UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
R QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2015
OR
o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
for the transition period from to
Commission file number 1-08323
Cigna Corporation
(Exact name of registrant as specified in its charter)
Delaware |
|
06-1059331 |
(State or other jurisdiction of incorporation or organization) |
|
(I.R.S. Employer Identification No.) |
900 Cottage Grove Road Bloomfield, Connecticut |
|
06002 |
(Address of principal executive offices) |
|
(Zip Code) |
(860) 226-6000 | ||
Registrants telephone number, including area code | ||
(860) 226-6741 | ||
Registrants facsimile number, including area code | ||
Not Applicable | ||
(Former name, former address and former fiscal year, if changed since last report) |
Indicate by check mark |
|
YES |
|
NO | |||
· whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. |
|
R |
|
o | |||
· whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). |
|
R |
|
o | |||
· whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. | |||||||
Large accelerated filer R |
Accelerated filer o |
Non-accelerated filer o |
Smaller Reporting Company o | ||||
· whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). |
|
o |
|
R | |||
As of July 15, 2015, 257,495,372 shares of the issuers common stock were outstanding.
Cigna Corporation
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Page | ||
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1 | |
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2 | |
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3 | |
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4 | |
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6 | |
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7 | |
Managements Discussion and Analysis of Financial Condition and Results of Operations |
40 | |
61 | ||
62 | ||
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63 | ||
64 | ||
65 | ||
65 | ||
66 | ||
67 | ||
E-1 |
As used herein, Cigna or the Company refers to one or more of Cigna Corporation and its consolidated subsidiaries.
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Cigna Corporation
Consolidated Statements of Income
|
|
Unaudited Three Months Ended June 30, |
|
Unaudited Six Months Ended June 30, |
| ||||||||
|
|
|
| ||||||||||
|
|
|
| ||||||||||
(In millions, except per share amounts) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
| ||||
Revenues |
|
|
|
|
|
|
|
|
| ||||
Premiums |
|
$ |
7,432 |
|
$ |
6,800 |
|
$ |
14,834 |
|
$ |
13,476 |
|
Fees and other revenues |
|
1,117 |
|
1,027 |
|
2,255 |
|
2,033 |
| ||||
Net investment income |
|
297 |
|
294 |
|
573 |
|
571 |
| ||||
Mail order pharmacy revenues |
|
625 |
|
547 |
|
1,203 |
|
1,042 |
| ||||
Net realized investment gains |
|
21 |
|
65 |
|
94 |
|
107 |
| ||||
Total revenues |
|
9,492 |
|
8,733 |
|
18,959 |
|
17,229 |
| ||||
|
|
|
|
|
|
|
|
|
| ||||
Benefits and Expenses |
|
|
|
|
|
|
|
|
| ||||
Global Health Care medical costs |
|
4,577 |
|
4,219 |
|
9,181 |
|
8,250 |
| ||||
Other benefit expenses |
|
1,199 |
|
1,100 |
|
2,468 |
|
2,266 |
| ||||
Mail order pharmacy costs |
|
529 |
|
469 |
|
1,021 |
|
883 |
| ||||
Other operating expenses |
|
2,212 |
|
1,996 |
|
4,416 |
|
3,976 |
| ||||
Amortization of other acquired intangible assets |
|
39 |
|
48 |
|
83 |
|
100 |
| ||||
Total benefits and expenses |
|
8,556 |
|
7,832 |
|
17,169 |
|
15,475 |
| ||||
Income before Income Taxes |
|
936 |
|
901 |
|
1,790 |
|
1,754 |
| ||||
Income taxes: |
|
|
|
|
|
|
|
|
| ||||
Current |
|
375 |
|
329 |
|
683 |
|
639 |
| ||||
Deferred |
|
(23) |
|
- |
|
(8) |
|
14 |
| ||||
Total income taxes |
|
352 |
|
329 |
|
675 |
|
653 |
| ||||
Net Income |
|
584 |
|
572 |
|
1,115 |
|
1,101 |
| ||||
Less: Net Income (Loss) Attributable to Noncontrolling Interests |
|
(4) |
|
(1) |
|
(6) |
|
- |
| ||||
Shareholders Net Income |
|
$ |
588 |
|
$ |
573 |
|
$ |
1,121 |
|
$ |
1,101 |
|
Shareholders Net Income Per Share: |
|
|
|
|
|
|
|
|
| ||||
Basic |
|
$ |
2.30 |
|
$ |
2.16 |
|
$ |
4.38 |
|
$ |
4.11 |
|
Diluted |
|
$ |
2.26 |
|
$ |
2.12 |
|
$ |
4.30 |
|
$ |
4.05 |
|
Dividends Declared Per Share |
|
$ |
- |
|
$ |
- |
|
$ |
0.04 |
|
$ |
0.04 |
|
The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.
Cigna Corporation
Consolidated Statements of Comprehensive Income
|
|
Unaudited Three Months Ended June 30, |
|
Unaudited Six Months Ended June 30, |
| ||||||||||
|
|
|
| ||||||||||||
|
|
|
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(In millions) |
|
2015 |
|
|
2014 |
|
2015 |
|
|
2014 |
| ||||
Shareholders net income |
|
$ |
588 |
|
|
$ |
573 |
|
$ |
1,121 |
|
|
$ |
1,101 |
|
Shareholders other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
| ||||
Net unrealized appreciation (depreciation), securities |
|
(234) |
|
|
103 |
|
(146) |
|
|
189 |
| ||||
Net unrealized appreciation, derivatives |
|
5 |
|
|
- |
|
12 |
|
|
- |
| ||||
Net translation of foreign currencies |
|
18 |
|
|
46 |
|
(86) |
|
|
35 |
| ||||
Postretirement benefits liability adjustment |
|
20 |
|
|
11 |
|
31 |
|
|
23 |
| ||||
Shareholders other comprehensive income (loss) |
|
(191) |
|
|
160 |
|
(189) |
|
|
247 |
| ||||
Shareholders comprehensive income |
|
397 |
|
|
733 |
|
932 |
|
|
1,348 |
| ||||
Comprehensive income attributable to noncontrolling interests: |
|
|
|
|
|
|
|
|
|
|
| ||||
Net income (loss) attributable to redeemable noncontrolling interests |
|
(1) |
|
|
2 |
|
(1) |
|
|
5 |
| ||||
Net (loss) attributable to other noncontrolling interests |
|
(3) |
|
|
(3) |
|
(5) |
|
|
(5) |
| ||||
Other comprehensive income (loss) attributable to redeemable noncontrolling interests |
|
(3) |
|
|
3 |
|
(12) |
|
|
- |
| ||||
Other comprehensive income attributable to other noncontrolling interests |
|
- |
|
|
- |
|
- |
|
|
1 |
| ||||
Total comprehensive income |
|
$ |
390 |
|
|
$ |
735 |
|
$ |
914 |
|
|
$ |
1,349 |
|
The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.
Cigna Corporation
|
|
Unaudited |
| |||||
|
|
As of |
|
As of |
| |||
|
|
June 30, |
|
December 31, |
| |||
(In millions, except per share amounts) |
|
2015 |
|
2014 |
| |||
Assets |
|
|
|
|
|
| ||
Investments: |
|
|
|
|
|
| ||
Fixed maturities, at fair value (amortized cost, $17,307; $17,278) |
|
$ |
18,569 |
|
|
$ |
18,983 |
|
Equity securities, at fair value (cost, $196; $199) |
|
189 |
|
|
189 |
| ||
Commercial mortgage loans |
|
2,054 |
|
|
2,081 |
| ||
Policy loans |
|
1,439 |
|
|
1,438 |
| ||
Other long-term investments |
|
1,471 |
|
|
1,488 |
| ||
Short-term investments |
|
97 |
|
|
163 |
| ||
Total investments |
|
23,819 |
|
|
24,342 |
| ||
Cash and cash equivalents |
|
1,969 |
|
|
1,420 |
| ||
Premiums, accounts and notes receivable, net |
|
3,790 |
|
|
2,757 |
| ||
Reinsurance recoverables |
|
7,021 |
|
|
7,080 |
| ||
Deferred policy acquisition costs |
|
1,588 |
|
|
1,502 |
| ||
Property and equipment |
|
1,502 |
|
|
1,502 |
| ||
Deferred tax assets, net |
|
369 |
|
|
293 |
| ||
Goodwill |
|
6,041 |
|
|
5,989 |
| ||
Other assets, including other intangibles |
|
2,722 |
|
|
2,683 |
| ||
Separate account assets |
|
8,311 |
|
|
8,328 |
| ||
Total assets |
|
$ |
57,132 |
|
|
$ |
55,896 |
|
Liabilities |
|
|
|
|
|
| ||
Contractholder deposit funds |
|
$ |
8,433 |
|
|
$ |
8,430 |
|
Future policy benefits |
|
9,495 |
|
|
9,642 |
| ||
Unpaid claims and claim expenses |
|
4,573 |
|
|
4,400 |
| ||
Global Health Care medical costs payable |
|
2,432 |
|
|
2,180 |
| ||
Unearned premiums |
|
627 |
|
|
621 |
| ||
Total insurance and contractholder liabilities |
|
25,560 |
|
|
25,273 |
| ||
Accounts payable, accrued expenses and other liabilities |
|
6,686 |
|
|
6,264 |
| ||
Short-term debt |
|
150 |
|
|
147 |
| ||
Long-term debt |
|
5,046 |
|
|
5,005 |
| ||
Separate account liabilities |
|
8,311 |
|
|
8,328 |
| ||
Total liabilities |
|
45,753 |
|
|
45,017 |
| ||
Contingencies Note 16 |
|
|
|
|
|
| ||
Redeemable noncontrolling interests |
|
76 |
|
|
90 |
| ||
Shareholders Equity |
|
|
|
|
|
| ||
Common stock (par value per share, $0.25; shares issued, 296; authorized, 600) |
|
74 |
|
|
74 |
| ||
Additional paid-in capital |
|
2,835 |
|
|
2,769 |
| ||
Accumulated other comprehensive loss |
|
(1,125) |
|
|
(936) |
| ||
Retained earnings |
|
11,178 |
|
|
10,289 |
| ||
Less treasury stock, at cost |
|
(1,672) |
|
|
(1,422) |
| ||
Total shareholders equity |
|
11,290 |
|
|
10,774 |
| ||
Noncontrolling interests |
|
13 |
|
|
15 |
| ||
Total equity |
|
11,303 |
|
|
10,789 |
| ||
Total liabilities and equity |
|
$ |
57,132 |
|
|
$ |
55,896 |
|
Shareholders Equity Per Share |
|
$ |
43.85 |
|
|
$ |
41.55 |
|
The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.
Cigna Corporation
Consolidated Statements of Changes in Total Equity
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
|
Redeemable |
| |||||||||
Unaudited |
|
|
|
Additional |
|
Other |
|
|
|
|
|
|
|
Non- |
|
|
|
Non- |
| |||||||||
For the three months ended June 30, 2015 |
|
Common |
|
Paid-in |
|
Comprehensive |
|
Retained |
|
Treasury |
|
Shareholders |
|
controlling |
|
Total |
|
controlling |
| |||||||||
(In millions) |
|
Stock |
|
Capital |
|
Loss |
|
Earnings |
|
Stock |
|
Equity |
|
Interests |
|
Equity |
|
Interests |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Balance at April 1, 2015 |
|
$ |
74 |
|
$ |
2,823 |
|
$ |
(934) |
|
$ |
10,635 |
|
$ |
(1,656) |
|
$ |
10,942 |
|
$ |
16 |
|
$ |
10,958 |
|
$ |
83 |
|
Effect of issuing stock for employee benefit plans |
|
|
|
14 |
|
|
|
(45) |
|
84 |
|
53 |
|
|
|
53 |
|
|
| |||||||||
Other comprehensive (loss) |
|
|
|
|
|
(191) |
|
|
|
|
|
(191) |
|
|
|
(191) |
|
(3) |
| |||||||||
Net income (loss) |
|
|
|
|
|
|
|
588 |
|
|
|
588 |
|
(3) |
|
585 |
|
(1) |
| |||||||||
Repurchase of common stock |
|
|
|
|
|
|
|
|
|
(100) |
|
(100) |
|
|
|
(100) |
|
|
| |||||||||
Other transactions impacting noncontrolling interests |
|
|
|
(2) |
|
|
|
|
|
|
|
(2) |
|
- |
|
(2) |
|
(3) |
| |||||||||
Balance at June 30, 2015 |
|
$ |
74 |
|
$ |
2,835 |
|
$ |
(1,125) |
|
$ |
11,178 |
|
$ |
(1,672) |
|
$ |
11,290 |
|
$ |
13 |
|
$ |
11,303 |
|
$ |
76 |
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
|
Redeemable |
| |||||||||
|
|
|
|
Additional |
|
Other |
|
|
|
|
|
|
|
Non- |
|
|
|
Non- |
| |||||||||
For the three months ended June 30, 2014 |
|
Common |
|
Paid-in |
|
Comprehensive |
|
Retained |
|
Treasury |
|
Shareholders |
|
controlling |
|
Total |
|
controlling |
| |||||||||
(In millions) |
|
Stock |
|
Capital |
|
Loss |
|
Earnings |
|
Stock |
|
Equity |
|
Interests |
|
Equity |
|
Interests |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Balance at April 1, 2014 |
|
$ |
92 |
|
$ |
3,392 |
|
$ |
(433) |
|
$ |
14,136 |
|
$ |
(6,631) |
|
$ |
10,556 |
|
$ |
13 |
|
$ |
10,569 |
|
$ |
96 |
|
Effect of issuing stock for employee benefit plans |
|
|
|
13 |
|
|
|
(32) |
|
81 |
|
62 |
|
|
|
62 |
|
|
| |||||||||
Other comprehensive income |
|
|
|
|
|
160 |
|
|
|
|
|
160 |
|
|
|
160 |
|
3 |
| |||||||||
Net income (loss) |
|
|
|
|
|
|
|
573 |
|
|
|
573 |
|
(3) |
|
570 |
|
2 |
| |||||||||
Repurchase of common stock |
|
|
|
|
|
|
|
|
|
(414) |
|
(414) |
|
|
|
(414) |
|
|
| |||||||||
Capital contribution by noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
5 |
|
5 |
|
2 |
| |||||||||
Distribution to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) |
| |||||||||
Balance at June 30, 2014 |
|
$ |
92 |
|
$ |
3,405 |
|
$ |
(273) |
|
$ |
14,677 |
|
$ |
(6,964) |
|
$ |
10,937 |
|
$ |
15 |
|
$ |
10,952 |
|
$ |
99 |
|
The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.
Cigna Corporation
Consolidated Statements of Changes in Total Equity
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
|
Redeemable |
| |||||||||
Unaudited |
|
|
|
Additional |
|
Other |
|
|
|
|
|
|
|
Non- |
|
|
|
Non- |
| |||||||||
For the six months ended June 30, 2015 |
|
Common |
|
Paid-in |
|
Comprehensive |
|
Retained |
|
Treasury |
|
Shareholders |
|
controlling |
|
Total |
|
controlling |
| |||||||||
(In millions) |
|
Stock |
|
Capital |
|
Loss |
|
Earnings |
|
Stock |
|
Equity |
|
Interests |
|
Equity |
|
Interests |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Balance at January 1, 2015 |
|
$ |
74 |
|
$ |
2,769 |
|
$ |
(936) |
|
$ |
10,289 |
|
$ |
(1,422) |
|
$ |
10,774 |
|
$ |
15 |
|
$ |
10,789 |
|
$ |
90 |
|
Effect of issuing stock for employee benefit plans |
|
|
|
69 |
|
|
|
(222) |
|
268 |
|
115 |
|
|
|
115 |
|
|
| |||||||||
Other comprehensive income (loss) |
|
|
|
|
|
(189) |
|
|
|
|
|
(189) |
|
|
|
(189) |
|
(12) |
| |||||||||
Net income (loss) |
|
|
|
|
|
|
|
1,121 |
|
|
|
1,121 |
|
(5 |
) |
1,116 |
|
(1) |
| |||||||||
Common dividends declared (per share: $0.04) |
|
|
|
|
|
|
|
(10) |
|
|
|
(10) |
|
|
|
(10) |
|
|
| |||||||||
Repurchase of common stock |
|
|
|
|
|
|
|
|
|
(518) |
|
(518) |
|
|
|
(518) |
|
|
| |||||||||
Other transactions impacting noncontrolling interests |
|
|
|
(3) |
|
|
|
|
|
|
|
(3) |
|
3 |
|
- |
|
(1) |
| |||||||||
Balance at June 30, 2015 |
|
$ |
74 |
|
$ |
2,835 |
|
$ |
(1,125) |
|
$ |
11,178 |
|
$ |
(1,672) |
|
$ |
11,290 |
|
$ |
13 |
|
$ |
11,303 |
|
$ |
76 |
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
|
|
|
|
|
|
Redeemable |
| |||||||||
|
|
|
|
Additional |
|
Other |
|
|
|
|
|
|
|
Non- |
|
|
|
Non- |
| |||||||||
For the six months ended June 30, 2014 |
|
Common |
|
Paid-in |
|
Comprehensive |
|
Retained |
|
Treasury |
|
Shareholders |
|
controlling |
|
Total |
|
controlling |
| |||||||||
(In millions) |
|
Stock |
|
Capital |
|
Loss |
|
Earnings |
|
Stock |
|
Equity |
|
Interests |
|
Equity |
|
Interest |
| |||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||
Balance at January 1, 2014 |
|
$ |
92 |
|
$ |
3,356 |
|
$ |
(520) |
|
$ |
13,676 |
|
$ |
(6,037) |
|
$ |
10,567 |
|
$ |
14 |
|
$ |
10,581 |
|
$ |
96 |
|
Effect of issuing stock for employee benefit plans |
|
|
|
49 |
|
|
|
(89) |
|
130 |
|
90 |
|
|
|
90 |
|
|
| |||||||||
Other comprehensive income |
|
|
|
|
|
247 |
|
|
|
|
|
247 |
|
1 |
|
248 |
|
|
| |||||||||
Net income (loss) |
|
|
|
|
|
|
|
1,101 |
|
|
|
1,101 |
|
(5) |
|
1,096 |
|
5 |
| |||||||||
Common dividends declared (per share: $0.04) |
|
|
|
|
|
|
|
(11) |
|
|
|
(11) |
|
|
|
(11) |
|
|
| |||||||||
Repurchase of common stock |
|
|
|
|
|
|
|
|
|
(1,057) |
|
(1,057) |
|
|
|
(1,057) |
|
|
| |||||||||
Capital contribution by noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
5 |
|
5 |
|
2 |
| |||||||||
Distribution to redeemable noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4) |
| |||||||||
Balance at June 30, 2014 |
|
$ |
92 |
|
$ |
3,405 |
|
$ |
(273) |
|
$ |
14,677 |
|
$ |
(6,964) |
|
$ |
10,937 |
|
$ |
15 |
|
$ |
10,952 |
|
$ |
99 |
|
The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.
Cigna Corporation
Consolidated Statements of Cash Flows
|
|
Unaudited |
| |||||
|
|
Six Months Ended June 30, |
| |||||
(In millions) |
|
2015 |
|
|
2014 |
| ||
Cash Flows from Operating Activities |
|
|
|
|
|
| ||
Net income |
|
$ |
1,115 |
|
|
$ |
1,101 |
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |
|
|
|
|
|
| ||
Depreciation and amortization |
|
302 |
|
|
289 |
| ||
Realized investment gains |
|
(94) |
|
|
(107) |
| ||
Deferred income taxes |
|
(8) |
|
|
14 |
| ||
Net changes in assets and liabilities, net of non-operating effects: |
|
|
|
|
|
| ||
Premiums, accounts and notes receivable |
|
(1,007) |
|
|
(660) |
| ||
Reinsurance recoverables |
|
(53) |
|
|
67 |
| ||
Deferred policy acquisition costs |
|
(112) |
|
|
(100) |
| ||
Other assets |
|
41 |
|
|
(98) |
| ||
Insurance liabilities |
|
542 |
|
|
359 |
| ||
Accounts payable, accrued expenses and other liabilities |
|
216 |
|
|
78 |
| ||
Current income taxes |
|
117 |
|
|
100 |
| ||
Loss on extinguishment of debt |
|
100 |
|
|
- |
| ||
Other, net |
|
(50) |
|
|
(41) |
| ||
Net cash provided by operating activities |
|
1,109 |
|
|
1,002 |
| ||
Cash Flows from Investing Activities |
|
|
|
|
|
| ||
Proceeds from investments sold: |
|
|
|
|
|
| ||
Fixed maturities and equity securities |
|
1,177 |
|
|
510 |
| ||
Investment maturities and repayments: |
|
|
|
|
|
| ||
Fixed maturities and equity securities |
|
691 |
|
|
898 |
| ||
Commercial mortgage loans |
|
341 |
|
|
214 |
| ||
Other sales, maturities and repayments (primarily short-term and other long-term investments) |
|
714 |
|
|
1,404 |
| ||
Investments purchased or originated: |
|
|
|
|
|
| ||
Fixed maturities and equity securities |
|
(1,813) |
|
|
(2,583) |
| ||
Commercial mortgage loans |
|
(312) |
|
|
(183) |
| ||
Other (primarily short-term and other long-term investments) |
|
(541) |
|
|
(868) |
| ||
Property and equipment purchases |
|
(246) |
|
|
(236) |
| ||
Acquisitions, net of cash acquired |
|
(107) |
|
|
- |
| ||
Other, net |
|
- |
|
|
12 |
| ||
Net cash used in investing activities |
|
(96) |
|
|
(832) |
| ||
Cash Flows from Financing Activities |
|
|
|
|
|
| ||
Deposits and interest credited to contractholder deposit funds |
|
769 |
|
|
790 |
| ||
Withdrawals and benefit payments from contractholder deposit funds |
|
(733) |
|
|
(758) |
| ||
Net change in short-term debt |
|
(10) |
|
|
(96) |
| ||
Net proceeds on issuance of long-term debt |
|
894 |
|
|
- |
| ||
Repayment of long-term debt |
|
(938) |
|
|
- |
| ||
Repurchase of common stock |
|
(536) |
|
|
(1,029) |
| ||
Issuance of common stock |
|
128 |
|
|
80 |
| ||
Other, net |
|
(20) |
|
|
6 |
| ||
Net cash used in financing activities |
|
(446) |
|
|
(1,007) |
| ||
Effect of foreign currency rate changes on cash and cash equivalents |
|
(18) |
|
|
9 |
| ||
Net increase / (decrease) in cash and cash equivalents |
|
549 |
|
|
(828) |
| ||
Cash and cash equivalents, January 1, |
|
1,420 |
|
|
2,795 |
| ||
Cash and cash equivalents, June 30, |
|
$ |
1,969 |
|
|
$ |
1,967 |
|
Supplemental Disclosure of Cash Information: |
|
|
|
|
|
| ||
Income taxes paid, net of refunds |
|
$ |
519 |
|
|
$ |
514 |
|
Interest paid |
|
$ |
122 |
|
|
$ |
132 |
|
The accompanying Notes to the Consolidated Financial Statements (unaudited) are an integral part of these statements.
CIGNA CORPORATION
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Note 1 Basis of Presentation
The Consolidated Financial Statements include the accounts of Cigna Corporation and its subsidiaries (either individually or collectively referred to as Cigna, the Company, we, our or us). Intercompany transactions and accounts have been eliminated in consolidation. These Consolidated Financial Statements were prepared in conformity with accounting principles generally accepted in the United States of America (GAAP). Amounts recorded in the Consolidated Financial Statements necessarily reflect managements estimates and assumptions about medical costs, investment valuation, interest rates and other factors. Significant estimates are discussed throughout these Notes; however, actual results could differ from those estimates. The impact of a change in estimate is generally included in earnings in the period of adjustment. Certain reclassifications have been made to prior year amounts to conform to the current presentation.
These interim Consolidated Financial Statements are unaudited but include all adjustments (including normal recurring adjustments) necessary, in the opinion of management, for a fair statement of financial position and results of operations for the periods reported. The interim Consolidated Financial Statements and notes should be read in conjunction with the Consolidated Financial Statements and Notes included in the Companys 2014 Form 10-K (including the Description of Business on page 66). The preparation of interim Consolidated Financial Statements necessarily relies heavily on estimates. This and certain other factors, including the seasonal nature of portions of the health care and related benefits business as well as competitive and other market conditions, call for caution in estimating full year results based on interim results of operations.
Note 2 Recent Accounting Changes
The Companys 2014 Form 10-K includes discussion of significant recent accounting changes that either have impacted or may impact our financial statements in the future. The following issuances of, and changes in, accounting pronouncements have occurred since the Company filed its 2014 Form 10-K.
Disclosures about Short-Duration Insurance Contracts (Accounting Standards Update (ASU) 2015-09). In May 2015, the Financial Accounting Standards Board (FASB) issued final guidance to enhance disclosure requirements for short-duration insurance contracts. The disclosures are aimed at providing more transparent information about an insurance entitys initial claim estimates and subsequent adjustments to those estimates, methodologies and judgments in estimating claims, and the timing, frequency and severity of claims. The impact of adoption on the Company is limited to increased disclosures about short-duration insurance liabilities, primarily including most liabilities of the Global Health Care and Group Disability and Life segments. The Company plans to adopt the new disclosures, as required, in its 2016 annual financial statements.
Simplifying the Presentation of Debt Issuance Costs (ASU 2015-03). In April 2015, the FASB issued guidance to simplify the presentation of debt issuance costs in financial statements. The amendment requires debt issuance costs to be presented as a direct deduction from the associated debt liability, consistent with the presentation of a debt discount. In addition, amortization of discount or premium is reported as interest expense. This amendment is effective beginning January 1, 2016, with early adoption permitted, and shall be applied retrospectively. The Company will reclassify debt issuance costs from other assets, including other intangibles, to long-term debt in the fourth quarter of 2015. This reclassification is not expected to result in a material change to either of these balance sheet line items.
Revenue from Contracts with Customers (ASU 2014-09). In July 2015, the FASB deferred the effective date of this new guidance to January 1, 2018.
Note 3 Earnings Per Share (EPS)
Basic and diluted earnings per share were computed as follows:
|
|
|
|
Effect of |
|
|
| |||
(Shares in thousands, dollars in millions, except per share amounts) |
|
Basic |
|
Dilution |
|
Diluted |
| |||
Three Months Ended June 30, |
|
|
|
|
|
|
| |||
2015 |
|
|
|
|
|
|
| |||
Shareholders net income |
|
$ |
588 |
|
|
|
$ |
588 |
| |
Shares: |
|
|
|
|
|
|
| |||
Weighted average |
|
255,730 |
|
|
|
255,730 |
| |||
Common stock equivalents |
|
|
|
4,367 |
|
4,367 |
| |||
Total shares |
|
255,730 |
|
4,367 |
|
260,097 |
| |||
EPS |
|
$ |
2.30 |
|
$ |
(0.04) |
|
$ |
2.26 |
|
|
|
|
|
|
|
|
| |||
2014 |
|
|
|
|
|
|
| |||
Shareholders net income |
|
$ |
573 |
|
|
|
$ |
573 |
| |
Shares: |
|
|
|
|
|
|
| |||
Weighted average |
|
265,377 |
|
|
|
265,377 |
| |||
Common stock equivalents |
|
|
|
4,544 |
|
4,544 |
| |||
Total shares |
|
265,377 |
|
4,544 |
|
269,921 |
| |||
EPS |
|
$ |
2.16 |
|
$ |
(0.04) |
|
$ |
2.12 |
|
|
|
|
|
Effect of |
|
|
| |||
(Shares in thousands, dollars in millions, except per share amounts) |
|
Basic |
|
Dilution |
|
Diluted |
| |||
Six Months Ended June 30, |
|
|
|
|
|
|
| |||
2015 |
|
|
|
|
|
|
| |||
Shareholders net income |
|
$ |
1,121 |
|
|
|
$ |
1,121 |
| |
Shares: |
|
|
|
|
|
|
| |||
Weighted average |
|
256,215 |
|
|
|
256,215 |
| |||
Common stock equivalents |
|
|
|
4,453 |
|
4,453 |
| |||
Total shares |
|
256,215 |
|
4,453 |
|
260,668 |
| |||
EPS |
|
$ |
4.38 |
|
$ |
(0.08) |
|
$ |
4.30 |
|
|
|
|
|
|
|
|
| |||
2014 |
|
|
|
|
|
|
| |||
Shareholders net income |
|
$ |
1,101 |
|
|
|
$ |
1,101 |
| |
Shares: |
|
|
|
|
|
|
| |||
Weighted average |
|
267,665 |
|
|
|
267,665 |
| |||
Common stock equivalents |
|
|
|
4,516 |
|
4,516 |
| |||
Total shares |
|
267,665 |
|
4,516 |
|
272,181 |
| |||
EPS |
|
$ |
4.11 |
|
$ |
(0.06) |
|
$ |
4.05 |
|
The following outstanding employee stock options were not included in the computation of diluted earnings per share for the three months and six months ended June 30, 2015 and 2014 because their effect was anti-dilutive.
|
|
Three Months Ended |
|
Six Months Ended |
| ||||
|
|
June 30, |
|
June 30, |
| ||||
(In millions) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
|
Anti-dilutive options |
|
- |
|
2.0 |
|
0.7 |
|
2.0 |
|
The Company held 38,694,585 shares of common stock in Treasury as of June 30, 2015, and 101,424,330 shares as of June 30, 2014. In the fourth quarter of 2014, the Company retired 70 million shares of treasury stock.
Note 4 Global Health Care Medical Costs Payable
Medical costs payable for the Global Health Care segment reflects estimates of the ultimate cost of claims that have been incurred but not yet reported, those that have been reported but not yet paid (reported claims in process), and other medical care expenses and services payable that are primarily comprised of accruals for incentives and other amounts payable to health care professionals and facilities, as follows:
|
|
June 30, |
|
December 31, |
| ||
(In millions) |
|
2015 |
|
2014 |
| ||
Incurred but not yet reported |
|
$ |
1,862 |
|
$ |
1,777 |
|
Reported claims in process |
|
431 |
|
288 |
| ||
Physician incentives and other medical care expenses and services payable |
|
139 |
|
115 |
| ||
Medical costs payable |
|
$ |
2,432 |
|
$ |
2,180 |
|
Activity in medical costs payable was as follows:
|
|
For the period ended | |||||
|
|
June 30, |
|
December 31, |
| ||
(In millions) |
|
2015 |
|
2014 |
| ||
Balance at January 1, |
|
$ |
2,180 |
|
$ |
2,050 |
|
Less: Reinsurance and other amounts recoverable |
|
252 |
|
194 |
| ||
Balance at January 1, net |
|
1,928 |
|
1,856 |
| ||
Incurred costs related to: |
|
|
|
|
| ||
Current year |
|
9,363 |
|
16,853 |
| ||
Prior years |
|
(182) |
|
(159) |
| ||
Total incurred |
|
9,181 |
|
16,694 |
| ||
Paid costs related to: |
|
|
|
|
| ||
Current year |
|
7,394 |
|
14,966 |
| ||
Prior years |
|
1,513 |
|
1,656 |
| ||
Total paid |
|
8,907 |
|
16,622 |
| ||
Ending Balance, net |
|
2,202 |
|
1,928 |
| ||
Add: Reinsurance and other amounts recoverable |
|
230 |
|
252 |
| ||
Ending Balance |
|
$ |
2,432 |
|
$ |
2,180 |
|
Reinsurance and other amounts recoverable includes amounts due from reinsurers and policyholders to cover incurred but not reported and pending claims for minimum premium products and certain administrative services only business where the right of offset does not exist. See Note 5 for additional information on reinsurance. For the six months ended June 30, 2015, actual experience differed from the Companys key assumptions resulting in favorable incurred costs related to prior years medical costs payable of $182 million, or 1.1% of the current year incurred costs as reported for the year ended December 31, 2014. Actual completion factors accounted for $49 million, or 0.3% of the favorability, actual medical cost trend resulted in $100 million, or 0.6%, and the remaining $33 million, or 0.2%, was primarily related to a change in 2014 reinsurance reimbursements under Health Care Reform.
For the year ended December 31, 2014, actual experience differed from the Companys key assumptions, resulting in favorable incurred costs related to prior years medical costs payable of $159 million, or 1.0% of the current year incurred costs as reported for the year ended December 31, 2013. Actual completion factors accounted for $61 million, or 0.4% of favorability, while actual medical cost trend resulted in the remaining $98 million, or 0.6%.
The impact of prior year development on shareholders net income was $44 million for the six months ended June 30, 2015 compared with $46 million for the six months ended June 30, 2014. The favorable effect of prior year development for both years primarily reflects low utilization of medical services. The change in the amount of the incurred costs related to prior years in the medical costs payable liability does not directly correspond to an increase or decrease in the Companys shareholders net income recognized for the following reasons:
First, the Company consistently recognizes the actuarial best estimate of the ultimate liability within a level of confidence, as required by actuarial standards of practice that require the liabilities be adequate under moderately adverse conditions. As the Company establishes the liability for each incurral year, the Company ensures that its assumptions appropriately consider moderately adverse conditions. When a portion of the development relates to a release of the prior years provision for moderately adverse conditions, the Company does not consider that amount as impacting shareholders net income to the extent that it is offset by an increase determined appropriate to address moderately adverse conditions for the current year incurred claims.
Second, as a result of the medical loss ratio (MLR) and risk mitigation provisions of Health Care Reform, changes in medical cost estimates due to prior year development may be offset by a change in accruals related to Health Care Reform.
Third, changes in reserves for the Companys retrospectively experience-rated business for accounts in surplus are generally offset by a change in the payment due to the policyholder (see page 3 of the Companys 2014 Form 10-K).
The determination of liabilities for the Global Health Care medical costs payable requires the Company to make critical accounting estimates. See Note 2(N) to the Consolidated Financial Statements in the Companys 2014 Form 10-K.
Note 5 Reinsurance
The Companys insurance subsidiaries enter into agreements with other insurance companies to assume and cede reinsurance. Reinsurance is ceded primarily to limit losses from large exposures and to permit recovery of a portion of direct or assumed losses. Reinsurance is also used in acquisition and disposition transactions when the underwriting company is not being acquired. Reinsurance does not relieve the originating insurer of liability. The Company regularly evaluates the financial condition of its reinsurers and monitors its concentrations of credit risk.
Effective Exit of GMDB and GMIB Business
In 2013, the Company entered into an agreement with Berkshire Hathaway Life Insurance Company of Nebraska (Berkshire) to effectively exit the guaranteed minimum death benefit (GMDB) and guaranteed minimum income benefit (GMIB) businesses via a reinsurance transaction. Berkshire reinsured 100% of the Companys future claim payments in these businesses, net of other reinsurance arrangements existing at that time. The Berkshire reinsurance agreement is subject to an overall limit with approximately $3.6 billion remaining.
Because this effective exit was accomplished via a reinsurance contract, the amounts related to the reinsured GMDB and GMIB contracts cannot be netted, so the gross assets and liabilities must continue to be measured and reported. The following disclosures provide further context to the methods and assumptions used to determine GMDB assets and liabilities.
GMDB
The Company estimates this liability with an internal model based on the Companys experience and future expectations over an extended period, consistent with the long-term nature of this product. Because the product is premium deficient, the Company records increases to the reserve if it is inadequate based on the model. As a result of the reinsurance transaction, reserve increases have a corresponding increase in the recorded reinsurance recoverable, provided the increased recoverable remains within the overall Berkshire limit (including the GMIB assets).
Activity in the future policy benefit reserve for the GMDB business was as follows:
|
|
For the period ended |
| ||||
|
|
June 30, |
|
December 31, |
| ||
(In millions) |
|
2015 |
|
2014 |
| ||
Balance at January 1 |
|
$ |
1,270 |
|
$ |
1,396 |
|
Add: Unpaid claims |
|
16 |
|
18 |
| ||
Less: Reinsurance and other amounts recoverable |
|
1,186 |
|
1,317 |
| ||
Balance at January 1, net |
|
100 |
|
97 |
| ||
Add: Incurred benefits |
|
1 |
|
3 |
| ||
Less: Paid benefits |
|
(1) |
|
- |
| ||
Ending balance, net |
|
102 |
|
100 |
| ||
Less: Unpaid claims |
|
16 |
|
16 |
| ||
Add: Reinsurance and other amounts recoverable |
|
1,143 |
|
1,186 |
| ||
Ending balance |
|
$ |
1,229 |
|
$ |
1,270 |
|
Benefits paid and incurred are net of ceded amounts. The ending net retained reserve is to cover ongoing administrative expenses, as well as the few claims retained by the Company.
The death benefit coverage in force for GMDB contracts assumed by the Company was $2.7 billion as of June 30, 2015 and $2.8 billion as of December 31, 2014 assuming no reinsurance. The death benefit coverage in force is the amount the Company would have to pay if all contract holders (approximately 338,000 as of June 30, 2015 and 354,000 as of December 31, 2014) died as of the specified date. The Company should be reimbursed in full for these payments unless the Berkshire reinsurance limit is exceeded. The aggregate value of the underlying mutual fund investments for these GMDB contracts was $12.4 billion as of June 30, 2015 and $13.1 billion as of December 31, 2014.
Effects of Reinsurance
In the Companys Consolidated Statements of Income, premiums were reported net of amounts ceded to reinsurers and Global Health Care medical costs and other benefit expenses were reported net of reinsurance recoveries in the following amounts:
|
|
Three Months Ended |
|
Six Months Ended |
| ||||||||
(In millions) |
|
2015 |
|
2014 |
|
2015 |
|
2014 |
| ||||
Ceded premiums |
|
|
|
|
|
|
|
|
| ||||
Individual life insurance and annuity business sold |
|
$ |
42 |
|
$ |
44 |
|
$ |
83 |
|
$ |
89 |
|
Other |
|
104 |
|
84 |
|
193 |
|
180 |
| ||||
Total |
|
$ |
146 |
|
$ |
128 |
|
$ |
276 |
|
$ |
269 |
|
Reinsurance recoveries |
|
|
|
|
|
|
|
|
| ||||
Individual life insurance and annuity business sold |
|
$ |
61 |
|
$ |
69 |
|
$ |
147 |
|
$ |
168 |
|
Other |
|
127 |
|
88 |
|
200 |
|
170 |
| ||||
Total |
|
$ |
188 |
|
$ |
157 |
|
$ |
347 |
|
$ |
338 |
|
Reinsurance Recoverables
Components of the Companys reinsurance recoverables are presented below:
(In millions)
Line of Business |
|
Reinsurer(s) |
|
June 30, |
|
December 31, |
|
Collateral and Other Terms |
| ||
|
|
|
|
|
|
|
|
|
| ||
GMDB |
|
Berkshire |
|
$ |
1,105 |
|
$ |
1,147 |
|
100% secured by assets in a trust. |
|
|
|
|
|
|
|
|
|
|
| ||
|
|
Other |
|
38 |
|
39 |
|
99% secured by assets in a trust or letter of credit. |
| ||
|
|
|
|
|
|
|
|
|
| ||
Individual Life and Annuity (sold in 1998) |
|
Lincoln National Life and Lincoln Life &Annuity of New York |
|
3,748 |
|
3,817 |
|
Both companies ratings are sufficient to avoid triggering a contractual obligation to fully secure the outstanding balance. |
| ||
|
|
|
|
|
|
|
|
|
| ||
Retirement Benefits Business (sold in 2004) |
|
Prudential Retirement Insurance and Annuity |
|
1,050 |
|
1,092 |
|
100% secured by assets in a trust. |
| ||
|
|
|
|
|
|
|
|
|
| ||
Supplemental Benefits Business (2012 acquisition) |
|
Great American Life |
|
326 |
|
336 |
|
100% secured by assets in a trust. |
| ||
|
|
|
|
|
|
|
|
|
| ||
Global Health Care, Global Supplemental Benefits, Group Disability and Life |
|
Various |
|
667 |
|
561 |
|
Recoverables from approximately 80 reinsurers, including the U.S. Government, used in the ordinary course of business. Balances range from less than $1 million up to $277 million, with 9% secured by assets in trusts or letters of credit. |
| ||
|
|
|
|
|
|
|
|
|
| ||
Other run-off reinsurance |
|
Various |
|
87 |
|
88 |
|
99% of this balance is secured by assets in trusts. |
| ||
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
| ||
Total reinsurance recoverables |
|
|
|
$ |
7,021 |
|
$ |
7,080 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Over 90% of the Companys reinsurance recoverables were from companies that are rated A or higher by Standard & Poors at June 30, 2015. The Company reviews its reinsurance arrangements and establishes reserves against the recoverables if recovery is not considered probable. As of June 30, 2015, the Companys recoverables were net of a reserve of $4 million. The Company bears the risk of loss if its reinsurers and retrocessionaires do not meet or are unable to meet their reinsurance obligations to the Company.
Note 6 Organizational Efficiency Plan
The Company is regularly evaluating ways to deliver its products and services more efficiently and at a lower cost. During the fourth quarter of 2013, the Company committed to a plan to increase its organizational efficiency and reduce costs through a series of actions that includes employee headcount reductions. As a result, the Company recognized charges in other operating expenses of $60 million pre-tax ($40 million after-tax) in the fourth quarter of 2013, primarily for severance costs. As of June 30, 2015, the remaining balance is $15 million.
Note 7 Fair Value Measurements
The Company carries certain financial instruments at fair value in the financial statements including fixed maturities, equity securities, short-term investments and derivatives. Other financial instruments are measured at fair value under certain conditions, such as when impaired.
Fair value is defined as the price at which an asset could be exchanged in an orderly transaction between market participants at the balance sheet date. A liabilitys fair value is defined as the amount that would be paid to transfer the liability to a market participant, not the amount that would be paid to settle the liability with the creditor.
The Companys financial assets and liabilities carried at fair value have been classified based upon a hierarchy defined by GAAP. The hierarchy gives the highest ranking to fair values determined using unadjusted quoted prices in active markets for identical assets and liabilities (Level 1) and the lowest ranking to fair values determined using methodologies and models with unobservable inputs (Level 3). An assets or a liabilitys classification is based on the lowest level of input that is significant to its measurement. For example, a financial asset or liability carried at fair value would be classified in Level 3 if unobservable inputs were significant to the instruments fair value, even though the measurement may be derived using inputs that are both observable (Levels 1 and 2) and unobservable (Level 3).
The Company estimates fair values using prices from third parties or internal pricing methods. Fair value estimates received from third-party pricing services are based on reported trade activity and quoted market prices when available, and other market information that a market participant may use to estimate fair value. The internal pricing methods are performed by the Companys investment professionals and generally involve using discounted cash flow analyses, incorporating current market inputs for similar financial instruments with comparable terms and credit quality, as well as other qualitative factors. In instances where there is little or no market activity for the same or similar instruments, fair value is estimated using methods, models and assumptions that the Company believes a hypothetical market participant would use to determine a current transaction price. These valuation techniques involve some level of estimation and judgment that becomes significant with increasingly complex instruments or pricing models.
The Company is responsible for determining fair value, as well as the appropriate level within the fair value hierarchy, based on the significance of unobservable inputs. The Company reviews methodologies, processes and controls of third-party pricing services and compares prices on a test basis to those obtained from other external pricing sources or internal estimates. The Company performs ongoing analyses of both prices received from third-party pricing services and those developed internally to determine that they represent appropriate estimates of fair value. The controls completed by the Company and third-party pricing services include reviewing to ensure that prices do not become stale and whether changes from prior valuations are reasonable or require additional review. The Company also performs sample testing of sales values to confirm the accuracy of prior fair value estimates. Exceptions identified during these processes indicate that adjustments to prices are infrequent and do not significantly impact valuations.
Financial Assets and Financial Liabilities Carried at Fair Value
The following tables provide information as of June 30, 2015 and December 31, 2014 about the Companys financial assets and liabilities carried at fair value. Separate account assets that are also recorded at fair value on the Companys Consolidated Balance Sheets are reported separately under the heading Separate account assets as gains and losses related to these assets generally accrue directly to policyholders.
June 30, 2015 |
|
Quoted Prices in |
|
Significant Other |
|
Significant |
|
Total | ||||
Financial assets at fair value: |
|
|
|
|
|
|
|
| ||||
Fixed maturities: |
|
|
|
|
|
|
|
| ||||
Federal government and agency |
|
$ |
249 |
|
$ |
580 |
|
$ |
- |
|
$ |
829 |
State and local government |
|
- |
|
1,771 |
|
- |
|
1,771 | ||||
Foreign government |
|
- |
|
1,953 |
|
4 |
|
1,957 | ||||
Corporate |
|
- |
|
13,144 |
|
292 |
|
13,436 | ||||
Mortgage-backed |
|
- |
|
56 |
|
1 |
|
57 | ||||
Other asset-backed |
|
- |
|
204 |
|
315 |
|
519 | ||||
Total fixed maturities (1) |
|
249 |
|
17,708 |
|
612 |
|
18,569 | ||||
Equity securities |
|
33 |
|
102 |
|
54 |
|
189 | ||||
Subtotal |
|
282 |
|
17,810 |
|
666 |
|
18,758 | ||||
Short-term investments |
|
- |
|
97 |
|
- |
|
97 | ||||
GMIB assets (2) |
|
- |
|
- |
|
867 |
|
867 | ||||
Other derivative assets (3) |
|
- |
|
12 |
|
- |
|
12 | ||||
Total financial assets at fair value, excluding separate accounts |
|
$ |
282 |
|
$ |
17,919 |
|
$ |
1,533 |
|
$ |
19,734 |
Financial liabilities at fair value: |
|
|
|
|
|
|
|
| ||||
GMIB liabilities |
|
$ |
- |
|
$ |
- |
|
$ |
841 |
|
$ |
841 |
Total financial liabilities at fair value |
|
$ |
- |
|
$ |
- |
|
$ |
841 |
|
$ |
841 |
(1) |
Fixed maturities included $558 million of net appreciation required to adjust future policy benefits for the run-off settlement annuity business including $32 million of appreciation for securities classified in Level 3. See Note 8 for additional information. |
(2) |
The GMIB assets represent retrocessional contracts in place from three external reinsurers that cover the exposures on these contracts. |
(3) |
Other derivative assets included $12 million of interest rate and foreign currency swaps qualifying as cash flow hedges. See Note 9 for additional information. |
December 31, 2014 |
|
Quoted Prices in |
|
Significant Other |
|
Significant |
|
Total | ||||
Financial assets at fair value: |
|
|
|
|
|
|
|
| ||||
Fixed maturities: |
|
|
|
|
|
|
|
| ||||
Federal government and agency |
|
$ |
290 |
|
$ |
664 |
|
$ |
- |
|
$ |
954 |
State and local government |
|
- |
|
1,856 |
|
- |
|
1,856 | ||||
Foreign government |
|
- |
|
1,936 |
|
4 |
|
1,940 | ||||
Corporate |
|
- |
|
13,105 |
|
393 |
|
13,498 | ||||
Mortgage-backed |
|
- |
|
84 |
|
1 |
|
85 | ||||
Other asset-back |