The Hartford 2014 Annual Report Download - page 121

Property & Casualty Operations
Property & Casualty Operations holds fixed maturity securities including a significant short-term investment position (securities with maturities of one year
or less at the time of purchase) to meet liquidity needs.
As of December 31, 2014, Property & Casualty Operations’ fixed maturities, short-term investments, and cash are summarized as follows:
Fixed maturities $ 25,610
Short-term investments 1,038
Cash 119
Less: Derivative collateral 125
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Liquidity requirements that are unable to be funded by Property & Casualty Operation’s short-term investments would be satisfied with current operating
funds, including premiums received or through the sale of invested assets. A sale of invested assets could result in realized losses.
Life Operations
Life Operations’ total general account contractholder obligations are supported by $44 billion of cash and total general account invested assets, which
includes a significant short-term investment position to meet liquidity needs.
As of December 31, 2014, Life Operations’ fixed maturities, short-term investments, and cash are summarized as follows:
Fixed maturities $ 33,166
Short-term investments 2,853
Cash 280
Less: Derivative collateral 1,282
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Capital resources available to fund liquidity, upon contractholder surrender, are a function of the legal entity in which the liquidity requirement resides.
Generally, obligations of Group Benefits will be funded by Hartford Life and Accident Insurance Company. Obligations of Talcott Resolution will generally
be funded by Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company.
Contractholder obligations of the former Retirement Plans business were funded by Hartford Life Insurance Company and of the former Individual Life
business were funded by both Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company. See Note 2 - Business Dispositions of
Notes to the Consolidated Financial Statements as to the sale of the Retirement Plans and Individual Life businesses and related transfer of invested assets in
2013.
HLIC, an indirect wholly owned subsidiary, became a member of the Federal Home Loan Bank of Boston (“FHLBB”) in May 2011. Membership allows HLIC
access to collateralized advances, which may be used to support various spread-based businesses and enhance liquidity management. The Connecticut
Department of Insurance (“CTDOI”) will permit HLIC to pledge up to $1.39 billion in qualifying assets to secure FHLBB advances for 2015. The amount of
advances that can be taken are dependent on the asset types pledged to secure the advances. The pledge limit is recalculated annually based on statutory
admitted assets and capital and surplus. HLIC would need to seek the prior approval of the CTDOI if there were a desire to exceed these limits. As of
December 31, 2014, HLIC had no advances outstanding under the FHLBB facility.
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