Sun Life 2012 Annual Report Download - page 156

24.B Insurance Contracts and Investment Contracts for Account of Segregated Fund
Holders
Changes in insurance contracts and investment contracts for account of segregated fund holders are as follows:
Insurance Contracts Investment Contracts
For the years ended December 31, 2012 2011 2012 2011
Balance as at January 1, $ 82,650 $ 81,931 $ 5,533 $ 6,015
Additions to segregated funds:
Deposits 7,163 9,964 164 218
Net transfers (to) from general funds 189 617 ––
Net realized and unrealized gains (losses) 5,134 (3,645) 574 (323)
Other investment income 2,366 2,409 174 84
Total additions $ 14,852 $ 9,345 $ 912 $ (21)
Deductions from segregated funds:
Payments to policyholders and their beneficiaries 8,697 8,084 493 491
Management fees 1,130 1,149 62 75
Taxes and other expenses 266 159 12 7
Foreign exchange rate movements 716 (766) (84) (112)
Total deductions $ 10,809 $ 8,626 $ 483 $ 461
Net additions (deductions) $ 4,043 $ 719 $ 429 $ (482)
Less: Held for sale (Note 3) $ 27,668 $ –
Balance as at December 31 $ 59,025 $ 82,650 $ 5,962 $ 5,533
25. Commitments, Guarantees and Contingencies
25.A Lease Commitments
We lease offices and certain equipment. These are operating leases with rents charged to operations in the year to which they relate.
Total future rental payments for the remainder of these leases total $352. The future rental payments by year of payment are included
in Note 6.
25.B Contractual Commitments
In the normal course of business, various contractual commitments are outstanding, which are not reflected in our Consolidated
Financial Statements. In addition to loan commitments for debt securities and mortgages included in Note 6.A.i, we have equity,
investment property, and property and equipment commitments. As at December 31, 2012, we had a total of $1,203 of contractual
commitments outstanding. The expected maturities of these commitments are included in Note 6.
25.C Letters of Credit
We issue commercial letters of credit in the normal course of business. As at December 31, 2012, lines of credit from financial
institutions of $1,688 were in place ($1,739 as at December 31, 2011) of which a total of $640 in letters of credit were outstanding
($821 as at December 31, 2011) of which $377 relate to internal reinsurance ($612 as at December 31, 2011).
25.D Indemnities and Guarantees
In the normal course of our business, we have entered into agreements that include indemnities in favour of third parties, such as
purchase and sale agreements, confidentiality agreements, engagement letters with advisors and consultants, outsourcing
agreements, leasing contracts, trade-mark licensing agreements, underwriting and agency agreements, information technology
agreements, distribution agreements, financing agreements, the sale of equity interests, and service agreements. These agreements
may require us to compensate the counterparties for damages, losses, or costs incurred by the counterparties as a result of breaches
in representation, changes in regulations (including tax matters) or as a result of litigation claims or statutory sanctions that may be
suffered by the counterparty as a consequence of the transaction. We have also agreed to indemnify our directors and certain of our
officers and employees in accordance with our by-laws. These indemnification provisions will vary based upon the nature and terms of
the agreements. In many cases, these indemnification provisions do not contain limits on our liability, and the occurrence of contingent
events that will trigger payment under these indemnities is difficult to predict. As a result, we cannot estimate our potential liability under
these indemnities. We believe that the likelihood of conditions arising that would trigger these indemnities is remote and, historically,
we have not made any significant payment under such indemnification provisions.
In certain cases, we have recourse against third parties with respect to the aforesaid indemnities, and we also maintain insurance
policies that may provide coverage against certain of these claims.
Guarantees made by us that can be quantified are included in Note 6.A.i.
25.E Guarantees of Sun Life Assurance Preferred Shares and Subordinated
Debentures
SLF Inc. has provided a guarantee of the following subordinated debentures issued by Sun Life Assurance: the $150 of 6.30%
subordinated debentures due 2028, and the $800 of 6.15% subordinated debentures due 2022. Claims under this guarantee will rank
154 Sun Life Financial Inc. Annual Report 2012 Notes to Consolidated Financial Statements