AIG 2007 Annual Report Download - page 120

American International Group, Inc. and Subsidiaries
Management’s Discussion and Analysis of
Financial Condition and Results of Operations Continued
Japan and Other Results
Japan and Other results on a sub-product basis for 2007, 2006 and 2005 were as follows:
Premiums and Net Net Realized
Other Investment Capital Gains Total Operating
(in millions) Considerations Income (Losses) Revenues Income
2007
Life insurance $ 4,999 $2,113 $ (92) $ 7,020 $1,193
Personal accident 4,225 204 (1) 4,428 1,071
Group products 2,318 626 1 2,945 250
Individual fixed annuities 386 2,160 (181) 2,365 500
Individual variable annuities 459 980 (21) 1,418 30
Total $12,387 $6,083 $(294) $18,176 $3,044
2006
Life insurance (a) $ 4,783 $1,749 $ 316 $ 6,848 $1,731
Personal accident 3,957 162 49 4,168 1,122
Group products 1,740 541 13 2,294 272
Individual fixed annuities 337 1,930 28 2,295 553
Individual variable annuities 289 857 — 1,146 143
Total $11,106 $5,239 $ 406 $16,751 $3,821
2005
Life insurance $ 4,864 $1,828 $ (52) $ 6,640 $1,288
Personal accident 3,788 137 (15) 3,910 1,051
Group products 1,473 535 (34) 1,974 191
Individual fixed annuities 292 1,672 29 1,993 390
Individual variable annuities 186 1,234 — 1,420 100
Total $10,603 $5,406 $ (72) $15,937 $3,020
Percentage Increase/(Decrease) 2007 vs. 2006:
Life insurance 5% 21% —% 3% (31)%
Personal accident 7 26 — 6 (5)
Group products 33 16 (92) 28 (8)
Individual fixed annuities 15 12 — 3 (10)
Individual variable annuities 59 14 — 24 (79)
Total 12% 16% —% 9% (20)%
Percentage Increase/(Decrease) 2006 vs. 2005:
Life insurance (2)% (4)% —% 3% 34%
Personal accident 4 18 — 7 7
Group products 18 1 — 16 42
Individual fixed annuities 15 15 (3) 15 42
Individual variable annuities 55 (31) — (19) 43
Total 5% (3)% —% 5% 27%
(a) Includes the effect of an out of period UCITS adjustment in 2006, which increased both net investment income and operating income by $29 million.
2007 and 2006 Comparison estimates, trading account losses of $150 million in the U.K.
associated with certain investment-linked products, $67 million of
Total revenues for Japan and Other in 2007 increased compared additional claim expense related to the industry wide regulatory
to 2006, primarily due to higher premiums and other considera- review of claims in Japan and increased incurred policyholder
tions and net investment income partially offset by net realized benefits of $36 million related to a closed block of Japanese
capital losses. Net investment income increased in 2007 com- business with guaranteed benefits. These decreases were partially
pared to 2006 due to higher levels of assets under management offset by the positive effect of foreign exchange rates.
and higher policyholder trading gains partially offset by lower Life insurance premiums and other considerations increased
partnership and mutual fund income. Operating income decreased moderately in 2007 compared to 2006. In Japan, single premium
in 2007 compared to 2006 due principally to net realized capital sales of U.S. dollar denominated interest sensitive whole life
losses, a $187 million charge related to changes in actuarial
66 AIG 2007 Form 10-K