AIG 2005 Annual Report Download - page 143

AMERICAN INTERNATIONAL GROUP, INC. AND SUBSIDIARIES
2. Segment Information
Continued
(b) The following table summarizes AIG’s General Insurance operations by major internal reporting unit for the years ended
December 31, 2005, 2004 and 2003:
General Insurance
Domestic Total Reclassifications Total
Brokerage Personal Mortgage Foreign Reportable and General
(in millions) Group Transatlantic Lines Guaranty General Segment Eliminations Insurance
2005
Revenues(a) $ 25,206 $ 3,766 $ 4,848 $ 655 $ 10,684 $ 45,159 $ 15 $ 45,174
Losses & loss expenses incurred 21,328 2,877 3,566 139 5,181 33,091 – 33,091
Underwriting expenses 4,524 928 1,087 153 3,076 9,768 – 9,768
Underwriting profit (loss)(b)(c)(d)(e) (3,250)(f)(g) (420) (19) 241 1,398(h) (2,050) – (2,050)
Operating income (loss)(c) (646)(f)(g) (39) 195 363 2,427 2,300 15 2,315
Depreciation expense 114 2 48 4 105 273 – 273
Capital expenditures 119 2 94 6 196 417 – 417
Identifiable assets 95,829 12,365 5,245 3,165 39,044 155,648 (4,981) 150,667
2004
Revenues(a) $23,332 $ 3,990 $4,488 $ 660 $ 9,473 $ 41,943 $ 18 $ 41,961
Losses & loss expenses incurred 18,808 2,755 3,211 142 5,441 30,357 – 30,357
Underwriting expenses 3,747 953 920 119 2,688 8,427 – 8,427
Underwriting profit (loss)(b)(c)(d) (1,340) (47) 160 278 702(h) (247) – (247)
Operating income(c) 777 282 357 399 1,344 3,159 18 3,177
Depreciation expense 122 3 29 3 94 251 – 251
Capital expenditures 115 2 92 7 134 350 – 350
Identifiable assets 81,754 10,605 5,159 2,826 36,055 136,399 (4,741) 131,658
2003
Revenues(a) $18,091 $ 3,452 $3,850 $ 683 $ 7,787 $ 33,863 $ (30) $ 33,833
Losses & loss expenses incurred 13,711 2,233 2,789 110 4,029 22,872 – 22,872
Underwriting expenses 2,606 829 706 122 2,196 6,459 – 6,459
Underwriting profit(b)(c)(d) 387 109 183 264 1,032(h) 1,975 – 1,975
Operating income(c) 1,774 390 355 451 1,562 4,532 (30) 4,502
Depreciation expense 97 3 19 3 82 204 – 204
Capital expenditures 83 2 45 3 151 284 – 284
Identifiable assets 73,516 8,708 4,958 2,879 31,615 121,676 (4,165) 117,511
(a) Represents the sum of General Insurance net premiums earned, net investment income and realized capital gains (losses).
(b) Underwriting profit (loss) is a GAAP measure that represents statutory underwriting profit or loss adjusted primarily for changes in deferred policy
acquisition costs.
(c) Catastrophe related losses for 2005, 2004 and 2003 by reporting unit were:
(in millions) 2005 2004 2003
Net
Insurance Reinstatement Insurance Insurance
Related Premium Related Related
Reporting Unit Losses Cost Losses Losses
DBG $1,747 $122 $ 582 $48
Transatlantic 463 45 215 4
Personal Lines 112 2 25 5
Mortgage Guaranty 10 – ––
Foreign General 293 94 232 26
Total $2,625 $263 $1,054 $83
(d) For Foreign General, includes the results of wholly owned AIU agencies.
(e) Includes the fourth quarter 2005 increase in net reserves of approximately $1.8 billion.
(f) Includes $197 million of additional losses incurred resulting from increased labor and material costs related to the 2004 Florida hurricanes.
(g) Includes $291 million of expenses related to changes in estimates for uncollectible reinsurance and other premium balances, and $100 million of accrued
expenses in connection with certain workers compensation insurance policies written between 1985 and 1996.
(h) Income statement accounts expressed in non-functional currencies are translated into U.S. dollars using average exchange rates.
AIG m Form 10-K 91