Honeywell 2006 Annual Report Download - page 112

HONEYWELL INTERNATIONAL INC.
NOTES TO FINANCIAL STATEMENTS—(Continued)
(Dollars in millions, except per share amounts)
Insurance Recoveries for Asbestos Related Liabilities
Year Ended December 31, 2006 Year Ended December 31, 2005 Year Ended December 31, 2004
Bendix NARCO Total Bendix NARCO Total Bendix NARCO Total
Beginning of year $ 377 $ 1,096 $ 1,473 $ 336 $ 1,226 $ 1,562 $ 209 $ 1,238 $ 1,447
Probable insurance recoveries related to claims
filed 11 — 11 34 — 34 96 — 96
Probable insurance recoveries related to annual
update of expected resolution values for pending
claims 39 — 39 (15) — (15) 39 — 39
Insurance receipts for asbestos related liabilities (166) (100) (266) (33) (127) (160) (8) (59) (67)
Insurance receivables settlements and write-offs(1) 34 (41) (7) 41 — 41 — — —
Other(2) 7 — 7 14 (3) 11 — 47 47
End of year $ 302 $ 955 $ 1,257 $ 377 $ 1,096 $ 1,473 $ 336 $ 1,226 $ 1,562
(1) In 2006, $34 million reflects gains from settlements with two Bendix insurance carriers and $41 million represents the write-down
of the NARCO insurance receivable to reflect the reduction in the estimated cost of future claims. In 2005, consists of gains from
insurance settlements of $172 million principally related to a structured insurance settlement with a carrier which converted a
policy into a future, fixed, non-contingent payment stream, and charges of $131 million for write-offs of certain amounts due from
insurance carriers.
(2) In 2004, $47 million related to additional probable insurance recoveries identified in the second quarter of 2004 based on our
ongoing evaluation of the enforceability of our rights under the various insurance policies.
NARCO and Bendix asbestos related balances are included in the following balance sheet accounts:
December 31,
2006 2005
Other current assets $ 157 $ 171
Insurance recoveries for asbestos related liabilities 1,100 1,302
$1,257 $1,473
Accrued liabilities $ 557 $ 520
Asbestos related liabilities 1,262 1,549
$1,819 $2,069
Other Matters
Baton Rouge, LA—As previously reported, three incidents occurred during 2003 at Honeywell's Baton Rouge, Louisiana
chemical plant, including a release of chlorine, a release of antimony pentachloride (which resulted in an employee fatality), and an
employee exposure to hydrofluoric acid. The United States Environmental Protection Agency and the United States Department of
Justice have conducted investigations of these incidents, including a federal grand jury convened to investigate the employee fatality.
As a result of that investigation, we have signed a plea agreement with the U.S. Attorney under which Honeywell will plead guilty to a
misdemeanor charge and pay $12 million in combined restitution and fines. The plea agreement has been filed, but the plea and the
sentence still are subject to Court acceptance, which we expect to receive. Honeywell has been served with several civil lawsuits
regarding these incidents, for which we believe we have adequate insurance coverage to the extent that there is any liability. We are
also engaged in discussions with the Louisiana Department
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