Sun Life 2010 Annual Report Download - page 42

Total Revenue
($ millions) 2010 2009 2008
Premiums
Annuities 2,836 4,795 3,592
Life insurance 6,255 6,380 5,928
Health insurance 4,407 4,335 4,067
Total premiums 13,498 15,510 13,587
Net investment income (loss) 7,999 9,392 (767)
Fee Income 3,143 2,670 2,743
Total 24,640 27,572 15,563
Our total revenue for the year ended December 31, 2010 decreased to $24.6 billion, down $2.9 billion from 2009. The strengthening of
the Canadian dollar relative to average exchange rates for the twelve months of 2009 reduced reported revenues by $1.4 billion. Other
impacts on revenue, which exclude the impact of currency, included:
(i) a decrease of $1.3 billion in premium revenue, primarily due to lower fixed annuity premiums in SLF U.S as a result of our
decision to de-emphasize this product, partially offset by higher life and health insurance premiums;
(ii) a decrease in net investment income of $970 million primarily from a reduction in net gains on the fair value of HFT assets;
partially offset by;
(iii) an increase in fee income of $725 million, due to higher average net asset levels at MFS and growth in fee based businesses
in SLF Canada and SLF U.S.
The following table presents the revenue of the Company based on our five business segments. We have also included a line item
below labelled “adjusted revenue”, which excludes the impact of changes in currency and mark-to-market impact on HFT assets and
derivative instruments, as we believe this provides a more meaningful view of our revenue.
Revenue by Segment
($ millions) 2010 2009
SLF Canada 11,449 11,407
SLF U.S. 8,104 11,714
MFS 1,449 1,251
SLF Asia 1,709 1,813
Corporate 1,929 1,387
Total as reported 24,640 27,572
Impact of currency changes and changes in the value of HFT assets and derivative instruments 2,333 4,963
Total adjusted revenue(1) 22,307 22,609
(1) Adjusted revenue is a non-GAAP Measure.
After adjusting for the impact of currency and fair value changes in HFT assets, 2010 adjusted revenue of $22.3 billion was
$302 million lower than in 2009. This decrease was primarily attributable to a reduction in premium income of $1.3 billion, partially
offset by increased fee income of $725 million, higher AFS gains of $124 million and a pre-tax gain of $130 million associated with the
sale of our life reinsurance business in the fourth quarter of 2010.
Policy Benefits
We have a diverse range of current and future benefit payment obligations that affect overall earnings, such as payments to
policyholders, beneficiaries and depositors, net transfers to segregated funds and the increase to actuarial liabilities.
Policy Benefits
($ millions) 2010 2009 2008
Payments to policyholders, beneficiaries and depositors 13,078 13,457 13,775
Net transfers to segregated funds 921 860 539
Increase (decrease) in actuarial liabilities 2,909 7,697 (4,429)
Total 16,908 22,014 9,885
Payments to policyholders, beneficiaries and depositors in 2010 were $13.1 billion, down $379 million from 2009, primarily due to lower
death and disability payments.
Changes in actuarial liabilities reflected an increase of $2.9 billion in 2010 compared to $7.7 billion in 2009. The change of $4.8 billion
included:
(i) a decrease of $2.4 billion related to a decrease in liabilities on in-force business;
(ii) a decrease of $1.4 billion from a lower level of liabilities arising from new policies; and
(iii) a decrease of $1.0 billion from a lower level of assumption changes relative to 2009
Additional information on changes to our actuarial liabilities can be found in Note 9 to our 2010 Consolidated Financial Statements.
38 Sun Life Financial Inc. Annual Report 2010 Management’s Discussion and Analysis