MetLife 2002 Annual Report Download - page 57

METLIFE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
Information regarding VOBA and deferred policy acquisition costs for the year ended December 31, 2002 is as follows:
Value of Deferred
Business Policy Acquisition
Acquired Costs Total
(Dollars in millions)
Balance at January 1, 2002 ***************************************************** $1,678 $ 9,489 $11,167
Capitalizations ***************************************************************** — 2,340 2,340
Acquisitions******************************************************************* 369 — 369
Total ***************************************************************** 2,047 11,829 13,876
Amortization allocated to:
Net investment gains (losses) ************************************************** 16 (11) 5
Unrealized investment gains *************************************************** 154 384 538
Other expenses ************************************************************* 132 1,507 1,639
Total amortization ****************************************************** 302 1,880 2,182
Dispositions and other ********************************************************** (6) 39 33
Balance at December 31, 2002************************************************** $1,739 $ 9,988 $11,727
Information regarding VOBA and deferred policy acquisition costs for the year ended December 31, 2001 is as follows:
Value of Deferred
Business Policy
Acquired Acquisition Costs Total
(Dollars in millions)
Balance at January 1, 2001 ***************************************************** $1,674 $ 8,944 $10,618
Capitalizations ***************************************************************** — 2,039 2,039
Acquisitions******************************************************************* 124 — 124
Total ***************************************************************** 1,798 10,983 12,781
Amortization allocated to:
Net investment (losses) gains ************************************************** (15) 40 25
Unrealized investment gains *************************************************** 8 132 140
Other expenses ************************************************************* 126 1,287 1,413
Total amortization ****************************************************** 119 1,459 1,578
Dispositions and other ********************************************************** (1) (35) (36)
Balance at December 31, 2001************************************************** $1,678 $ 9,489 $11,167
Information regarding VOBA and deferred policy acquisition costs for the year ended December 31, 2000 is as follows:
Value of Deferred
Business Policy
Acquired Acquisition Costs Total
(Dollars in millions)
Balance at January 1, 2000 ***************************************************** $ 632 $ 8,438 $ 9,070
Capitalizations ***************************************************************** — 1,863 1,863
Acquisitions******************************************************************* 1,480 201 1,681
Total ***************************************************************** 2,112 10,502 12,614
Amortization allocated to:
Net investment gains (losses) ************************************************** 28 (123) (95)
Unrealized investment gains *************************************************** 93 497 590
Other expenses ************************************************************* 310 1,168 1,478
Total amortization ****************************************************** 431 1,542 1,973
Dispositions and other ********************************************************** (7) (16) (23)
Balance at December 31, 2000************************************************** $1,674 $ 8,944 $10,618
The estimated future amortization expense allocated to other expenses for VOBA is $147 million in 2003, $141 million in 2004, $137 million in 2005,
$135 million in 2006 and $128 million in 2007.
Amortization of VOBA and deferred policy acquisition costs is allocated to (i) investment gains and losses to provide consolidated statement of
income information regarding the impact of such gains and losses on the amount of the amortization, (ii) unrealized investment gains and losses to
provide information regarding the amount that would have been amortized if such gains and losses had been recognized, and (iii) other expenses to
provide amounts related to the gross margins or profits originating from transactions other than investment gains and losses.
Investment gains and losses related to certain products have a direct impact on the amortization of VOBA and deferred policy acquisition costs.
Presenting investment gains and losses net of related amortization of VOBA and deferred policy acquisition costs provides information useful in evaluating
the operating performance of the Company. This presentation may not be comparable to presentations made by other insurers.
MetLife, Inc. F-13