Unrealized in other comprehensive income

[Table of Contents](#i210a9c6b74ef4ff89c48a86e24b71d45_7)  
  
Humana Inc.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS—(Continued)(Unaudited)Our Level 3 assets had a fair value of $100 million at September 30, 2022 , or 0.4% of our total invested assets. During the year ended September 30, 2022, the changes in the fair value of the assets measured using significant unobservable inputs (Level 3) were comprised of the following:

|  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |
|  | For the nine months ended September 30, 2022 |
|  | Private Placements |  |  |  |  |
|  | (in millions) |
| Beginning balance at January 1 | $ | 68  |  |  |  |  |  |
| Total gains or losses: |  |  |  |  |  |
| Realized in earnings | —  |  |  |  |  |  |
| Unrealized in other comprehensive income | (12) |  |  |  |  |  |
| Purchases | 44  |  |  |  |  |  |
| Sales | —  |  |  |  |  |  |
| Settlements | —  |  |  |  |  |  |
| Balance at September 30 | $ | 100  |  |  |  |  |  |

There were no Level 3 assets for the nine months ended September 30, 2021.Financial LiabilitiesOur debt is recorded at carrying value in our consolidated balance sheets. The carrying value of our senior notes debt outstanding, net of unamortized debt issuance costs, was $9.8 billion at September 30, 2022 and $9.0 billion at December 31, 2021. The fair value of our senior notes debt was $9.0 billion at September 30, 2022 and $10.0 billion at December 31, 2021. The fair value of our senior notes debt is determined based on Level 2 inputs, including quoted market prices for the same or similar debt, or if no quoted market prices are available, on the current prices estimated to be available to us for debt with similar terms and remaining maturities. Carrying value approximates fair value for our term loans and commercial paper borrowings. The term loans and commercial paper borrowings were $803 million at September 30, 2022 and $3.5 billion at December 31, 2021.Put and Call Options Measured at Fair ValueOur put and call options associated with our equity method investments are measured at fair value each period using a Monte Carlo simulation. The put and call options fair values associated with our Primary Care Organization strategic partnership with WCAS, which are exercisable at a fixed revenue exit multiple and provide a minimum return on WCAS' investment if exercised, are measured at fair value each reporting period. The put and call options fair values were $190 million and $17 million, respectively, at September 30, 2022. The put and call options fair values, derived from the Monte Carlo simulation, were $202 million and $13 million, respectively, at December 31, 2021.The significant unobservable inputs utilized in these Level 3 fair value measurements (and selected values) include the enterprise value, annualized volatility and credit spread. Enterprise value was derived from a discounted cash flow model, which utilized significant unobservable inputs for long-term revenue, to measure underlying cash flows, weighted average cost of capital and long term growth rate. The table below presents the assumptions used for each reporting period.17
