AIG 2013 Annual Report Download - page 335

The following table summarizes the weighted average assumptions used to determine the benefit
obligations:
December 31, 2013
Discount rate
Rate of compensation increase
December 31, 2012
Discount rate 3.93% 2.62% 3.67% 3.45%
Rate of compensation increase 4.00% 2.86% N/A 3.55%
* The non-U.S. plans reflect those assumptions that were most appropriate for the local economic environments of each of the subsidiaries
providing such benefits.
The following table summarizes assumed health care cost trend rates for the U.S. plans:
Following year:
Medical (before age 65) 7.39%
Medical (age 65 and older) 6.82%
Ultimate rate to which cost increase is assumed to decline 4.50%
Year in which the ultimate trend rate is reached:
Medical (before age 65) 2027
Medical (age 65 and older) 2027
A one percent point change in the assumed healthcare cost trend rate would have the following effect on our
postretirement benefit obligations:
U.S. plans $5 $(4)
Non-U.S. plans $ 15 $ (11)
Our postretirement plans provide benefits primarily in the form of defined employer contributions rather than defined
employer benefits. Changes in the assumed healthcare cost trend rate have a minimal impact for U.S. plans because
for post-1992 retirees, benefits are fixed dollar amounts based on service at retirement. Our non-U.S. postretirement
plans are not subject to caps.
Assumptions
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AIG 2013 Form 10-K 317
ITEM 8 / NOTE 21. EMPLOYEE BENEFITS
Pension Postretirement
U.S. Plans Non-U.S. Plans*U.S. Plans Non-U.S. Plans*
4.83% 2.77% 4.59% 4.77%
3.50% 2.89% N/A 3.34%
At December 31, 2013 2012
7.21%
6.80%
4.50%
2027
2027
One Percent One Percent
Increase Decrease
At December 31,
(in millions) 2013 2012 2013 2012
$6 $(3)
$ 11 $ (7)
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