AIG 2010 Annual Report Download - page 27

American International Group, Inc., and Subsidiaries
The following table presents the gross liability (before discount), reinsurance recoverable and net liability
recorded for each calendar year, and the reestimation of these amounts as of December 31, 2010:
(in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Gross Liability, End of Year $39,222 $42,629 $48,173 $53,388 $63,430 $79,279 $82,263 $87,929 $91,832 $88,041 $94,368
Reinsurance Recoverable,
End of Year 12,251 15,201 17,327 15,644 14,624 19,693 17,369 16,212 16,803 17,487 19,644
Net Liability, End of Year 26,971 27,428 30,846 37,744 48,806 59,586 64,894 71,717 75,029 70,554 74,724
Reestimated Gross Liability 75,731 80,801 82,628 83,659 84,848 91,544 91,738 97,890 101,022 94,070
Reestimated Reinsurance
Recoverable 25,309 25,954 25,801 23,376 21,500 24,442 21,005 19,615 18,979 19,334
Reestimated Net Liability 50,422 54,847 56,827 60,283 63,348 67,102 70,733 78,275 82,043 74,736
Cumulative Gross
Redundancy/(Deficiency) (36,509) (38,172) (34,455) (30,271) (21,418) (12,265) (9,475) (9,961) (9,190) (6,029)
* During 2009, Transatlantic Holdings, Inc. (Transatlantic) was deconsolidated and 21st Century Insurance Group and Agency Auto Division
(excluding AIG Private Client Group) (21st Century) and HSB Group, Inc. (HSB) were sold. The sales and deconsolidation are reflected in
the table above as a reduction in December 31, 2009 net reserves of $9.7 billion and as an $8.6 billion increase in paid losses for the years
1999 through 2008 to remove the reserves for these divested entities from the ending balance.
Analysis of Consolidated Losses and Loss Expense Reserve Development Excluding Asbestos and Environmental
Losses and Loss Expense Reserve Development
The following table presents the losses and loss expense reserves and the development thereof excluding those for
asbestos and environmental claims for each calendar year.*
(in millions) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Net Reserves Held $24,829 $25,286 $28,651 $35,559 $45,742 $55,226 $60,451 $67,597 $71,062 $66,588 $69,157
Discount (in Reserves Held) 1,287 1,423 1,499 1,516 1,553 2,110 2,264 2,429 2,574 2,655 3,055
Net Reserves Held
(Undiscounted) 26,116 26,709 30,150 37,075 47,295 57,336 62,715 70,026 73,636 69,243 72,212
Paid (Cumulative) as of:
One year later 9,515 10,861 10,632 11,999 14,718 15,047 14,356 16,183 24,028 15,618
Two years later 16,808 17,801 18,283 21,419 23,906 24,367 23,535 31,204 35,613
Three years later 21,447 23,430 25,021 28,129 30,320 31,163 33,555 39,503
Four years later 25,445 28,080 29,987 32,686 35,481 39,009 39,044
Five years later 28,643 31,771 33,353 36,601 41,600 42,791
Six years later 31,315 34,238 36,159 41,198 44,456
Seven years later 33,051 36,353 39,637 43,178
Eight years later 34,543 39,055 41,163
Nine years later 36,752 40,299
Ten years later 37,671
AIG 2010 Form 10-K 11