Bring on tomorrow - AIG.com

More documents

Recommendations

Info

ITEM 7 / RESULTS OF OPERATIONS.....................................................................................................................................................................................Change in Benefit Reserves and DAC, VOBA and SIA Related to Net Realized Capital Gains (Losses)In conjunction with a program to utilize capital loss tax carryforwards, we sold approximately $19.5 billion ofinvestments in 2012. These and other sales with subsequent reinvestment at lower yields triggered loss recognitionon certain long-term payout annuity contracts in the amount of $1.2 billion, which effectively transferred shadow lossrecognition from unrealized (AOCI) to actual loss recognition (benefit expense) and, to a much lesser extent,transferred shadow DAC (AOCI) to DAC amortization expense in 2012. Assumptions related to investment yields,mortality experience and expenses will be reviewed periodically and updated as appropriate, which may result inadditional loss recognition reserves. In addition, due to the reinvestment of the assets at lower yields, earningsrelated to this payout annuity block of business are expected to decline beginning in 2013.PremiumsPremiums represent amounts received on traditional life insurance policies, group benefit policies and deposits onlife-contingent payout annuities. Premiums, deposits and other considerations is a non-GAAP measure that includeslife insurance premiums and deposits on annuity contracts and mutual funds.The following table presents a reconciliation of premiums, deposits and other considerations to premiums:Years Ended December 31,(in millions) 2012 2011 2010Premiums, deposits and other considerations $ 20,994 $ 24,392 $ 19,505Deposits (17,934) (21,338) (16,405)Other (632) (541) (580)Premiums $ 2,428 $ 2,513 $ 2,520Sales and DepositsThe following tables summarize AIG Life and Retirement premiums, deposits and other considerations byproduct * :Years Ended December 31,Percentage Change(in millions) 2012 2011 2010 2012 vs. 2011 2011 vs. 2010Premiums, deposits and other considerationsIndividual fixed annuity deposits $ 1,495 $ 6,606 $ 4,410 (77)% 50%Group retirement product deposits 7,028 7,312 6,309 (4) 16Life insurance 5,129 5,267 5,529 (3) (5)Individual variable annuity deposits 4,561 3,212 2,072 42 55Retail mutual funds 2,723 1,925 1,101 41 75Individual annuities runoff 58 70 84 (17) (17)Total premiums, deposits and otherconsiderations $ 20,994 $ 24,392 $ 19,505 (14)% 25%Life Insurance SalesRetail – Independent $ 138 $ 144 $ 123 (4)% 17%Retail – Affiliated (Career and AIG Direct) 110 109 98 1 11Total Retail 248 253 221 (2) 14Institutional – Independent 26 25 32 4 (22)Total life insurance sales $ 274 $ 278 $ 253 (1)% 10%* Life insurance sales include periodic premiums from new business expected to be collected over a one-year period and 10 percent of singlepremiums and unscheduled deposits from new and existing policyholders. Annuity sales represent deposits from new and existing customers...................................................................................................................................................................................................................................AIG 2012 Form 10-K 105
ITEM 7 / RESULTS OF OPERATIONS.....................................................................................................................................................................................TOTAL PREMIUMS, DEPOSITS AND OTHER CONSIDERATIONS BY PRODUCT LINE(in millions)6%13% 8%13%11%RETAIL MUTUAL FUNDS22%INDIVIDUAL VARIABLE ANNUITY22%28%DEPOSITS24%30%32%34%27%23%7%2012 2011 2010LIFE INSURANCEGROUP RETIREMENT PRODUCTDEPOSITSINDIVIDUAL FIXED ANNUITYDEPOSITS15FEB201317173483Total premiums, deposits and other considerations decreased in 2012 as substantial decreases in individual fixedannuities were only partially offset by significant increases in individual variable annuities and retail mutual funds.2012 and 2011 ComparisonIndividual fixed annuity deposits declined due to the low interest rate environment as consumers are reluctant topurchase these products at the relatively low crediting rates currently offered. Group retirement product deposits(which include deposits into mutual funds and fixed options within variable annuities sold in group retirementmarkets) decreased modestly due to slightly lower levels of individual rollover deposits and periodic deposits in 2012,partially offset by higher mutual fund deposits. The low interest rate environment has affected group retirementdeposits, resulting in lower levels of deposits into fixed options. Individual variable annuity deposits increased due toinnovative product enhancements and expanded distribution as well as a more favorable competitive environment.Premiums from life insurance products increased in 2012, but were more than offset by declines in deferred annuitiessold through life insurance distribution channels. Retail mutual fund sales growth was principally driven bySunAmerica Asset Management Corp.’s Focused Dividend Strategy product offering which continues to be a toplong-term performer within its respective peer group.AIG Life and Retirement’s total life sales decreased 1 percent during 2012 compared to 2011. Overall retail universallife sales decreased 1 percent with sales of indexed products growing while sales of universal life products sensitiveto low interest rates declined. Retail term insurance sales increased 1 percent in 2012 compared to 2011 becausewe continued our disciplined focus related to new business pricing and underwriting. Institutional life sales increased4 percent in 2012 compared to 2011 from growth in single premium private placement universal life deposits.2011 and 2010 ComparisonGroup retirement deposits increased primarily due to higher levels of individual rollover deposits in 2011. Individualfixed annuity deposits increased as certain bank distributors negotiated a lower commission in exchange for a higherrate offered to policyholders which made our individual fixed annuity products more attractive. However, fixed annuitydeposits declined in the latter part of 2011 from the first six months of 2011 due to significant declines in interestrates. Variable annuity sales increased due to reinstatements of relationships at a number of key broker-dealers, andincreased wholesaler productivity. Deposits from life insurance products increased in 2011, but were more than offsetby declines in deferred annuities sold through life insurance distribution channels and a large private placementvariable annuity sale in 2010. Retail mutual fund annual sales growth was driven by SunAmerica Asset ManagementCorp.’s Specialty Series product offerings (Alternative Strategies and Global Trends) and the Focused DividendStrategy Portfolio.AIG Life and Retirement grew new sales of mortality-based life insurance products during 2011 by strengthening thecore retail independent distribution channel and continuing to focus on career agent and direct-to-consumerdistribution. Retail life sales increased 17 percent during 2011 as we continued to re-engage independent distributionchannels. Affiliated distribution channels grew 11 percent in 2011 as a result of an enhanced product suite appealing..................................................................................................................................................................................................................................106 AIG 2012 Form 10-K
Page 1 and 2:
American International Group, Inc.2
Page 3 and 4:
KEY FACTS & FIGURES52,000+ $65.7 bi
Page 5 and 6:
■We said we would return to profi
Page 7 and 8:
Financial HighlightsYears Ended Dec
Page 9 and 10:
~63,000AIG EMPLOYEES AROUND THE WOR
Page 11 and 12:
$115.1 millionAVERAGE CLAIMS PAID E
Page 13 and 14:
$10,000MAXIMUM DONATION MADE BY AIG
Page 15 and 16:
American International Group, Inc.F
Page 18 and 19:
AMERICAN INTERNATIONAL GROUP, INC.A
Page 20 and 21:
ITEM 1 / BUSINESS / AIG............
Page 22 and 23:
ITEM 1 / BUSINESS / AIG............
Page 24 and 25:
ITEM 1 / BUSINESS / AIG PROPERTY CA
Page 27 and 28:
ITEM 1 / BUSINESS / AIG PROPERTY CA
Page 29 and 30:
ITEM 1 / BUSINESS / AIG LIFE AND RE
Page 31 and 32:
Page 33 and 34:
Page 35 and 36:
ITEM 1 / BUSINESS / OTHER OPERATION
Page 37 and 38:
ITEM 1 / BUSINESS / OTHER OPERATION
Page 39 and 40:
ITEM 1 / BUSINESS..................
Page 41 and 42:
ITEM 1 / BUSINESS..................
Page 43 and 44:
ITEM 1 / BUSINESS..................
Page 45 and 46:
ITEM 1 / BUSINESS..................
Page 47 and 48:
ITEM 1 / BUSINESS..................
Page 49 and 50:
ITEM 1A / RISK FACTORS.............
Page 51 and 52:
Page 53 and 54:
Page 55 and 56:
Page 57 and 58:
Page 59 and 60:
Page 61 and 62:
ITEM 1B / UNRESOLVED STAFF COMMENTS
Page 63 and 64:
ITEM 5 / MARKET FOR REGISTRANT’S
Page 65 and 66:
ITEM 6 / SELECTED FINANCIAL DATA...
Page 67 and 68:
ITEM 6 / SELECTED FINANCIAL DATA...
Page 69 and 70:
ITEM 7 / MANAGEMENT’S DISCUSSION
Page 71 and 72: ITEM 7 / USE OF NON-GAAP MEASURES..
Page 73 and 74: ITEM 7 / EXECUTIVE SUMMARY.........
Page 85 and 86: ITEM 7 / RESULTS OF OPERATIONS.....
Page 121: ITEM 7 / RESULTS OF OPERATIONS.....
Page 137 and 138: ITEM 7 / LIQUIDITY AND CAPITAL RESO
Page 155 and 156: ITEM 7 / INVESTMENTS...............
Page 173 and 174:
ITEM 7 / ENTERPRISE RISK MANAGEMENT
Page 175 and 176:
Page 177 and 178:
Page 179 and 180:
Page 181 and 182:
Page 183 and 184:
Page 185 and 186:
Page 187 and 188:
Page 189 and 190:
ITEM 7 / CRITICAL ACCOUNTING ESTIMA
Page 191 and 192:
Page 193 and 194:
Page 195 and 196:
Page 197 and 198:
Page 199 and 200:
Page 201 and 202:
Page 203 and 204:
Page 205 and 206:
Page 207 and 208:
Page 209 and 210:
Page 211 and 212:
Page 213 and 214:
ITEM 7 / GLOSSARY..................
Page 215 and 216:
ITEM 7 / GLOSSARY..................
Page 217 and 218:
ITEM 7A / QUANTITATIVE AND QUALITAT
Page 219 and 220:
ITEM 8 / INDEX TO FINANCIAL STATEME
Page 221 and 222:
AMERICAN INTERNATIONAL GROUP, INC.C
Page 223 and 224:
Page 225 and 226:
Page 227 and 228:
ITEM 8 / NOTE 1. BASIS OF PRESENTAT
Page 229 and 230:
ITEM 8 / NOTE 2. SUMMARY OF SIGNIFI
Page 231 and 232:
Page 233 and 234:
Page 235 and 236:
Page 237 and 238:
Page 239 and 240:
Page 241 and 242:
ITEM 8 / NOTE 3. SEGMENT INFORMATIO
Page 243 and 244:
ITEM 8 / NOTE 3. SEGMENT INFORMATIO
Page 245 and 246:
ITEM 8 / NOTE 4. DIVESTED BUSINESSE
Page 247 and 248:
ITEM 8 / NOTE 4. DIVESTED BUSINESSE
Page 249 and 250:
ITEM 8 / NOTE 5. BUSINESS COMBINATI
Page 251 and 252:
ITEM 8 / NOTE 6. FAIR VALUE MEASURE
Page 253 and 254:
Page 255 and 256:
Page 257 and 258:
Page 259 and 260:
Page 261 and 262:
Page 263 and 264:
Page 265 and 266:
Page 267 and 268:
Page 269 and 270:
ITEM 8 / NOTE 7. INVESTMENTS.......
Page 271 and 272:
Page 273 and 274:
Page 275 and 276:
Page 277 and 278:
Page 279 and 280:
Page 281 and 282:
Page 283 and 284:
ITEM 8 / NOTE 8. LENDING ACTIVITIES
Page 285 and 286:
ITEM 8 / NOTE 9. REINSURANCE.......
Page 287 and 288:
ITEM 8 / NOTE 10. DEFERRED POLICY A
Page 289 and 290:
ITEM 8 / NOTE 10. DEFERRED POLICY A
Page 291 and 292:
ITEM 8 / NOTE 11. VARIABLE INTEREST
Page 293 and 294:
ITEM 8 / NOTE 11. VARIABLE INTEREST
Page 295 and 296:
ITEM 8 / NOTE 12. DERIVATIVES AND H
Page 297 and 298:
Page 299 and 300:
Page 301 and 302:
ITEM 8 / NOTE 13. LIABILITY FOR UNP
Page 303 and 304:
ITEM 8 / NOTE 14. VARIABLE LIFE AND
Page 305 and 306:
ITEM 8 / NOTE 15. DEBT OUTSTANDING.
Page 307 and 308:
ITEM 8 / NOTE 15. DEBT OUTSTANDING.
Page 309 and 310:
ITEM 8 / NOTE 16. CONTINGENCIES, CO
Page 311 and 312:
Page 313 and 314:
Page 315 and 316:
Page 317 and 318:
Page 319 and 320:
Page 321 and 322:
ITEM 8 / NOTE 17. TOTAL EQUITY.....
Page 323 and 324:
Page 325 and 326:
Page 327 and 328:
ITEM 8 / NOTE 18. NONCONTROLLING IN
Page 329 and 330:
ITEM 8 / NOTE 19. EARNINGS (LOSS) P
Page 331 and 332:
ITEM 8 / NOTE 20. STATUTORY FINANCI
Page 333 and 334:
ITEM 8 / NOTE 21. SHARE-BASED COMPE
Page 335 and 336:
ITEM 8 / NOTE 21. SHARE-BASED COMPE
Page 337 and 338:
ITEM 8 / NOTE 22. EMPLOYEE BENEFITS
Page 339 and 340:
Page 341 and 342:
Page 343 and 344:
Page 345 and 346:
Page 347 and 348:
ITEM 8 / NOTE 24. INCOME TAXES.....
Page 349 and 350:
Page 351 and 352:
Page 353 and 354:
ITEM 8 / NOTE 26. QUARTERLY FINANCI
Page 355 and 356:
ITEM 8 / NOTE 27. INFORMATION PROVI
Page 357 and 358:
Page 359 and 360:
Page 361 and 362:
PART II............................
Page 363 and 364:
PART IV............................
Page 365 and 366:
SignatureTitle/s/ ARTHUR C. MARTINE
Page 367 and 368:
ExhibitNumber Description Location(
Page 369 and 370:
Page 371 and 372:
Page 373 and 374:
Page 375 and 376:
Condensed Financial Information of
Page 377 and 378:
Condensed Financial Information of
Page 379 and 380:
Notes to Condensed Financial Inform
Page 381 and 382:
Supplementary Insurance Information
Page 383 and 384:
Valuation and Qualifying AccountsFo
Page 385 and 386:
Subsidiaries of RegistrantExhibit 2
Page 387 and 388:
Percentageof VotingSecuritiesJurisd
Page 389 and 390:
Percentageof VotingSecuritiesJurisd
Page 391 and 392:
CONSENT OF INDEPENDENT REGISTERED P
Page 393 and 394:
CERTIFICATIONSI, Robert H. Benmosch
Page 395 and 396:
CERTIFICATIONExhibit 32In connectio
Page 397 and 398:
SECURITIES REGISTERED PURSUANT TO S
Page 399:
American International Group, Inc.1
show all

Bring on tomorrow - AIG.com

Create successful ePaper yourself

Delete template?

Save as template?