AIG 2010 Annual Report Download - page 107

American International Group, Inc., and Subsidiaries
The following table presents the rollforward of net loss reserves:
Years Ended December 31,
(in millions) 2010 2009 2008
Net liability for unpaid claims and claims adjustment expense at beginning of year $67,899 $72,455 $69,288
Foreign exchange effect (126) 1,416 (2,113)
Acquisitions(a) 1,538 --
Dispositions(b) (87) (9,657) (269)
Losses and loss expenses incurred(c):
Current year 24,074 27,354 34,516
Prior years, other than accretion of discount 4,182 2,771 118
Prior years, accretion of discount (181) 313 317
Losses and loss expenses incurred 28,075 30,438 34,951
Losses and loss expenses paid(c):
Current year 9,873 11,079 13,204
Prior years 15,919 15,673 16,240
Losses and loss expenses paid 25,792 26,752 29,444
Activity of discontinued operations -(1) 42
Net liability for unpaid claims and claims adjustment expense at end of year $71,507 $67,899 $72,455
(a) Represents the acquisition of Fuji on March 31, 2010.
(b) Transatlantic was deconsolidated during the second quarter of 2009, 21st Century was sold in the third quarter of 2009, HSB was sold during
the first quarter of 2009 and Unibanco was sold in the fourth quarter of 2008.
(c) Includes amounts related to dispositions through the date of disposition.
The following tables summarize development, (favorable) or unfavorable, of incurred losses and loss expenses for
prior years (other than accretion of discount):
Years Ended December 31,
(in millions) 2010 2009 2008
Prior Accident Year Development by Reporting Unit:
Chartis segment:
Chartis U.S. $4,471 $2,749 $ 23
Chartis International 379 9 (62)
Total Chartis segment 4,850 2,758 (39)
Other businesses:
Mortgage Guaranty (668) 38 177
Other businesses*-(25) 17
Total Other businesses (668) 13 194
Asbestos settlements -- (37)
Prior years, other than accretion of discount $4,182 $2,771 $118
* Includes Transatlantic which was deconsolidated during the second quarter of 2009, 21st Century was sold in the third quarter of 2009 and
HSB was sold during the first quarter of 2009.
AIG 2010 Form 10-K 91