MetLife 2006 Annual Report Download - page 127

Download and view the complete annual report

Please find page 127 of the 2006 MetLife annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 166

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166

the estimated maximum future earnings from the closed block expected to result from operations attributed to the closed block after
income taxes. Earnings of the closed block are recognized in income over the period the policies and contracts in the closed block remain
in-force. Management believes that over time the actual cumulative earnings of the closed block will approximately equal the expected
cumulative earnings due to the effect of dividend changes. If, over the period the closed block remains in existence, the actual cumulative
earnings of the closed block is greater than the expected cumulative earnings of the closed block, the Company will pay the excess of the
actual cumulative earnings of the closed block over the expected cumulative earnings to closed block policyholders as additional
policyholder dividends unless offset by future unfavorable experience of the closed block and, accordingly, will recognize only the
expected cumulative earnings in income with the excess recorded as a policyholder dividend obligation. If over such period, the actual
cumulative earnings of the closed block is less than the expected cumulative earnings of the closed block, the Company will recognize only
the actual earnings in income. However, the Company may change policyholder dividend scales in the future, which would be intended to
increase future actual earnings until the actual cumulative earnings equal the expected cumulative earnings.
Information regarding the closed block liabilities and assets designated to the closed block is as follows:
2006 2005
December 31,
(In millions)
Closed Block Liabilities
Futurepolicybenefits............................................................. $43,089 $42,759
Otherpolicyholderfunds........................................................... 282 257
Policyholderdividendspayable....................................................... 701 693
Policyholderdividendobligation ...................................................... 1,063 1,607
Payablesforcollateralundersecuritiesloanedandothertransactions.............................. 6,483 4,289
Otherliabilities ................................................................. 192 200
Totalclosedblockliabilities........................................................ 51,810 49,805
Assets Designated to the Closed Block
Investments:
Fixed maturity securities available-for-sale, at estimated fair value (amortized cost: $30,286 and $27,892,
respectively)................................................................ 31,255 29,270
Tradingsecurities,atfairvalue(cost:$0and$3,respectively)................................. — 3
Equity securities available-for-sale, at estimated fair value (cost: $1,184 and $1,180, respectively) . . . . . . . . . 1,484 1,341
Mortgageloansonrealestate...................................................... 7,848 7,790
Policyloans.................................................................. 4,212 4,148
Realestateandrealestatejointventuresheld-for-investment.................................. 242 227
Short-terminvestments .......................................................... 62 41
Otherinvestedassets ........................................................... 644 250
Totalinvestments............................................................. 45,747 43,070
Cashandcashequivalents ......................................................... 255 512
Accruedinvestmentincome......................................................... 517 506
Deferredincometaxassets......................................................... 754 902
Premiumsandotherreceivables...................................................... 156 270
Totalassetsdesignatedtotheclosedblock............................................. 47,429 45,260
Excessofclosedblockliabilitiesoverassetsdesignatedtotheclosedblock......................... 4,381 4,545
Amounts included in accumulated other comprehensive income:
Unrealized investment gains (losses), net of income tax of $457 and $554, respectively . . . . . . . . . . . . . . . . 812 985
Unrealized gains (losses) on derivative instruments, net of income tax of ($18) and ($17), respectively . . . . . . . (32) (31)
Allocated to policyholder dividend obligation, net of income tax of ($381) and ($538), respectively . . . . . . . . . . (681) (954)
Totalamountsincludedinaccumulatedothercomprehensiveincome(loss)......................... 99 —
Maximumfutureearningstoberecognizedfromclosedblockassetsandliabilities ..................... $ 4,480 $ 4,545
Information regarding the closed block policyholder dividend obligation is as follows:
2006 2005 2004
Years Ended December 31,
(In millions)
BalanceatJanuary1,.................................................. $1,607 $2,243 $2,130
Impactonrevenues,netofexpensesandincometax ............................. (114) (9) 124
Changeinunrealizedinvestmentandderivativegains(losses)........................ (430) (627) (11)
BalanceatDecember31, ............................................... $1,063 $1,607 $2,243
F-44 MetLife, Inc.
METLIFE, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)