Allstate 2012 Annual Report Download - page 230

A liability of $637 million and $41 million is included in the reserve for life-contingent contract benefits with respect to
this deficiency as of December 31, 2011 and 2010, respectively. The offset to this liability is recorded as a reduction of the
unrealized net capital gains included in accumulated other comprehensive income.
As of December 31, contractholder funds consist of the following:
($ in millions) 2011 2010
Interest-sensitive life insurance $ 10,826 $ 10,675
Investment contracts:
Fixed annuities 29,049 33,166
Funding agreements backing medium-term notes 1,929 2,749
Other investment contracts 528 514
Allstate Bank deposits — 1,091
Total contractholder funds $ 42,332 $ 48,195
The following table highlights the key contract provisions relating to contractholder funds:
Product Interest rate Withdrawal/surrender charges
Interest-sensitive life insurance Interest rates credited range from 0% to Either a percentage of account balance
11.0% for equity-indexed life (whose or dollar amount grading off generally
returns are indexed to the S&P 500) over 20 years
and 1.5% to 6.0% for all other products
Fixed annuities Interest rates credited range from 0% to Either a declining or a level percentage
9.9% for immediate annuities; (8.0)% to charge generally over ten years or less.
11.0% for equity-indexed annuities Additionally, approximately 25.3% of
(whose returns are indexed to the fixed annuities are subject to market
S&P 500); and 0.2% to 6.6% for all value adjustment for discretionary
other products withdrawals
Funding agreements backing Interest rates credited range from 0.9% Not applicable
medium-term notes to 5.8% (excluding currency-swapped
medium-term notes)
Other investment contracts:
Guaranteed minimum Interest rates used in establishing Withdrawal and surrender charges are
income, accumulation and reserves range from 1.8% to 10.3% based on the terms of the related
withdrawal benefits on interest-sensitive life insurance or fixed
variable and fixed annuity contract
annuities (1) and
secondary guarantees on
interest-sensitive life
insurance and fixed
annuities
(1) In 2006, the Company disposed of substantially all of its variable annuity business through reinsurance agreements with Prudential.
Contractholder funds include funding agreements held by VIEs issuing medium-term notes. The VIEs are Allstate
Life Funding, LLC, Allstate Financial Global Funding, LLC, Allstate Life Global Funding and Allstate Life Global Funding II,
and their primary assets are funding agreements used exclusively to back medium-term note programs.
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