The Hartford 2009 Annual Report Download - page 175

THE HARTFORD FINANCIAL SERVICES GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
F-26
4. Fair Value Measurements – Financial Instruments Excluding Guaranteed Living Benefits (continued)
Financial Instruments Not Carried at Fair Value
The following presents carrying amounts and fair values of The Hartford’ s financial instruments not carried at fair value and not
included in the above fair value discussion as of December 31, 2009 and December 31, 2008.
December 31, 2009 December 31, 2008
Carrying
Amount
Fair
Value
Carrying
Amount
Fair
Value
Assets
Policy loans $2,174 $2,321 $2,208 $ 2,435
Mortgage loans 5,938 5,091 6,469 5,654
Liabilities
Other policyholder funds and benefits payable [1] $12,330 $12,513 $14,839 $ 14,576
Commercial paper [2] — — 374 374
Senior notes [3] 4,054 4,037 4,052 3,119
Junior subordinated debentures [3] 1,717 2,338 1,703 1,420
Consumer notes [4] 1,131 1,194 1,205 1,188
[1] Excludes guarantees on variable annuities, group accident and health and universal life insurance contracts, including corporate owned life
insurance.
[2] Included in short-term debt in the Consolidated Balance Sheets. As of December 31, 2009, The Hartford has no commercial paper outstanding.
[3] Included in long-term debt in the Consolidated Balance Sheets, except for current maturities, which are included in short-term debt.
[4] Excludes amounts carried at fair value and included in disclosures above.
As of December 31, 2009, included in other liabilities in the Consolidated Balance Sheet are carrying amounts of $273 and $78 for
deposits and Federal Home Loan Bank advances, respectively, related to Federal Trust Corporation. These carrying amounts
approximate fair value.
The Company has not made any changes in its valuation methodologies for the following assets and liabilities since December 31, 2008.
• Fair value for policy loans and consumer notes were estimated using discounted cash flow calculations using current interest rates.
• Fair values for mortgage loans were estimated using discounted cash flow calculations based on current lending rates for similar
type loans. Current lending rates reflect changes in credit spreads and the remaining terms of the loans.
• Other policyholder funds and benefits payable, not carried at fair value, is determined by estimating future cash flows, discounted at
the current market rate.
• Carrying amounts approximate fair value for commercial paper. As of December 31, 2009, the Company has no outstanding
commercial paper.
• Fair value for long-term debt is based primarily on market quotations from independent third-party pricing services.