The Hartford 2012 Annual Report Download - page 161




Other Policyholder Funds and Benefits Payable
Other policyholder funds and benefits payable consist of universal life-type contracts and investment contracts.
Universal life-type contracts consist of fixed and variable annuities, 401(k), certain governmental annuities, private placement life insurance (“PPLI”),
variable universal life insurance, universal life insurance and interest sensitive whole life insurance. The liability for universal life-type contracts is equal to
the balance that accrues to the benefit of the policyholders as of the financial statement date (commonly referred to as the account value), including credited
interest, amounts that have been assessed to compensate the Company for services to be performed over future periods, and any amounts previously assessed
against policyholders that are refundable on termination of the contract.
Investment contracts consist of institutional and governmental products, without life contingencies, including funding agreements, certain structured
settlements and guaranteed investment contracts. The liability for investment contracts is equal to the balance that accrues to the benefit of the contract holder
as of the financial statement date, which includes the accumulation of deposits plus credited interest, less withdrawals and amounts assessed through the
financial statement date. Contract holder funds include funding agreements held by Variable Interest Entities issuing medium-term notes.
Foreign Currency Translation
Foreign currency translation gains and losses are reflected in stockholders’ equity as a component of accumulated other comprehensive income (loss). The
Company’s foreign subsidiaries’ balance sheet accounts are translated at the exchange rates in effect at each year end and income statement accounts are
translated at the average rates of exchange prevailing during the year. The national currencies of the international operations are generally their functional
currencies.
F-20