U-Haul 2009 Annual Report Download - page 40

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Disclosures about Contractual Obligations and Commercial Commitments
The following table provides contractual commitments and contingencies as of March 31, 2009:
Contractual Obligations Total
Prior to
03/31/10
04/01/10
03/31/12
04/01/12
03/31/14
April 1, 2014
and Thereafter
Notes, loans and leases payable - Principal $ 1,339,210 $ 95,985 $ 267,642 $ 286,135 $ 689,448
Notes, loans and leases payable - Interest 261,888 53,354 88,847 73,799 45,888
Revolving credit agreements - Principal 207,280 37,280 - - 170,000
Revolving credit agreements - Interest 37,593 4,190 7,990 7,990 17,423
AMERCO's operating leases 625,206 147,258 236,762 174,209 66,977
Property and casualty obligations (a) 114,403 17,634 20,872 14,020 61,877
Life, health and annuity obligations (b) 1,747,006 139,581 246,372 216,908 1,144,145
Self insurance accruals (c ) 358,280 115,080 146,687 67,567 28,946
Post retirement benefit liability 9,749 595 1,494 1,898 5,762
Total contractual obligations $ 4,700,615 $ 610,957 $ 1,016,666 $ 842,526 $ 2,230,466
Payment due by Period (as of March 31, 2009)
(In thousands)
(a) these estimated obligations for unpaid losses and loss adjustment expenses include case reserves for reported claims
and incurred but not reported (“IBNR”) and are net of expected reinsurance recoveries. The ultimate amount to settle
both the case reserves and IBNR is an estimate based upon historical experience and current trends and could
materially differ from actual results. The assumptions do not include future premiums. Due to the significant
assumption employed in this model, the amounts shown could materially differ from actual results.
(b) these estimated obligations are based on mortality, morbidity, withdrawal and lapse assumptions drawn from our
historical experience and adjusted for any known trends. These obligations are derived from the current balance sheet
amount and include expected interest crediting but no amounts for future annuity deposits or premiums for life and
Medicare supplement policies. The cash flows shown are undiscounted for interest and as a result total outflows for all
years shown significantly exceed the corresponding liabilities of $435.9 million included in our consolidated balance
sheet as of March 31, 2009. Oxford expects to fully fund these obligations from their invested asset portfolio. Due to
the significant assumptions employed in this model, the amounts shown could materially differ from actual results.
(c) these estimated obligation are primarily the Company’s self insurance accruals for portions of the liability coverage
for our rental equipment. The estimates for future settlement are based upon historical experience and current trends.
Due to the significant assumption employed in this model, the amounts shown could materially differ from actual
results.
As presented above, contractual obligations on debt and guarantees represent principal payments while contractual
obligations for operating leases represent the notional payments under the lease arrangements. Interest on variable
rate debt is based on the applicable rate at March 31, 2009 without regard to associated interest rate swaps.
FASB Interpretation No. 48, Accounting for Uncertainties in Income Taxes - an interpretation of FASB statement
No. 109 (“FIN 48”) liabilities and interest of $10.9 million is not included above due to uncertainty surrounding
ultimate settlements, if any.
Off Balance Sheet Arrangements
The Company uses off-balance sheet arrangements in situations where management believes that the economics
and sound business principles warrant their use.
AMERCO utilizes operating leases for certain rental equipment and facilities with terms expiring substantially
through 2016, with the exception of one land lease expiring in 2034. In the event of a shortfall in proceeds from the
sales of the underlying rental equipment assets, AMERCO has guaranteed approximately $183.4 million of residual
values at March 31, 2009 for these assets at the end of their respective lease terms. AMERCO has been leasing
rental equipment since 1987. To date, we have not experienced residual value shortfalls related to these leasing
arrangements. Using the average cost of fleet related debt as the discount rate, the present value of AMERCO’s
minimum lease payments and residual value guarantees was $679.7 million at March 31, 2009.
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