AIG 2012 Annual Report Download - page 318

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coverages, insurance and risk management programs for large corporate customers and other customized structured
insurance products, as well as excess and umbrella liability, directors and officers and products liability. Generally,
actual historical loss development factors are used to project future loss development. However, there can be no
assurance that future loss development patterns will be the same as in the past. Moreover, any deviation in loss cost
trends or in loss development factors might not be identified for an extended period of time subsequent to the
recording of the initial loss reserve estimates for any accident year. There is the potential for reserves with respect to
a number of years to be significantly affected by changes in loss cost trends or loss development factors that were
relied upon in setting the reserves. These changes in loss cost trends or loss development factors could be
attributable to changes in economic conditions in the United States and abroad, changes in the legal, regulatory,
judicial and social environment, changes in medical cost trends (inflation, intensity and utilization of medical services),
underlying policy pricing, terms and conditions, and claims handling practices.
Lease Commitments
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We occupy leased space in many locations under various long-term leases and have entered into various leases
covering the long-term use of data processing equipment.
The following table presents the future minimum lease payments under operating leases:
2013 $ 390
2014 282
2015 207
2016 171
2017 138
Remaining years after 2017 310
Total $ 1,498
Rent expense was $445 million, $482 million and $587 million for the years ended December 31, 2012, 2011
and 2010, respectively. These amounts include $16 million, $37 million and $129 million attributable to discontinued
operations for the years ended December 31, 2012, 2011 and 2010, respectively.
Flight Equipment Related to Business Held for Sale
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At December 31, 2012, ILFC had committed to purchase 229 new aircraft with aggregate estimated total remaining
payments of approximately $17.5 billion, including four aircraft through sale-leaseback transactions with airlines
deliverable from 2012 through 2019. ILFC had also committed to purchase five used aircraft and nine new spare
engines. ILFC also has the right to purchase an additional 50 Airbus A320neo family narrowbody aircraft. ILFC will
be required to find lessees for any aircraft acquired and to arrange financing for a substantial portion of the purchase
price. These commitments are related to discontinued operations and will not be retained by AIG upon closing of the
sale. See Note 4 herein, for a discussion of the ILFC transaction.
The following table presents the minimum future rental income on noncancelable operating leases of flight
equipment that has been delivered:
2013 $ 3,854
2014 3,344
2015 2,631
2016 2,001
2017 1,347
Remaining years after 2017 1,628
Total $ 14,805
Flight equipment is leased under operating leases with remaining terms ranging from one to fourteen years.
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AIG 2012 Form 10-K 301
(in millions)
(in millions)
ITEM 8 / NOTE 16. CONTINGENCIES, COMMITMENTS AND GUARANTEES