AIG 2014 Annual Report Download - page 73

ITEM 2 / EXECUTIVE OVERVIEW
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Executive Overview
This overview of the MD&A highlights selected information and may not contain all of the information that is important to
current or potential investors in AIG’s securities. You should read this Annual Report on Form 10-K in its entirety for a complete
description of events, trends, uncertainties, risks and critical accounting estimates affecting us.
In the fourth quarter of 2014, we completed our previously announced reorganization of our commercial and consumer
insurance businesses and modified the presentation of our results to reflect our new operating structure. The new operating
structure includes two reportable segments, Commercial Insurance and Consumer Insurance, and a Corporate and Other
category. The Corporate and Other category consists of businesses and items not allocated to our reportable segments. Prior
to the fourth quarter of 2014, we reported our results through two reportable segments – AIG Property Casualty and AIG Life
and Retirement.
In order to align financial reporting with the manner in which our chief operating decision makers review the businesses to
assess performance and make decisions about resources to be allocated, the Commercial Insurance and Consumer
Insurance reportable segments include the following operating segments:
• Commercial property casualty, mortgage guaranty and institutional markets businesses, which were previously reported
as components of AIG Property Casualty, Other operations and AIG Life and Retirement, respectively, are now reported
as components of the Commercial Insurance reportable segment.
• Consumer property casualty business and Japan life insurance business, which were previously reported as components
of AIG Property Casualty, and our retail life and retirement and institutional group retirement and group benefits
businesses, which were previously reported as components of AIG Life and Retirement, are now reported as
components of the Consumer Insurance reportable segment.
• Insurance run-off lines of business, which were previously reported in AIG Property Casualty's Other category, are now
reported as a component of the Corporate and Other category.
Prior periods have been revised to conform to the current period presentation for the above segment changes.
Presentation Changes
We reclassified our presentation for certain Policy fees, along with a related portion of Amortization of deferred policy
acquisition costs, from their respective captions to Net realized capital gains (losses) and Changes in benefit reserves and
DAC, VOBA and SIA related to net realized capital gains (losses), respectively. The reclassification of these policy fees, which
are related primarily to guaranteed minimum withdrawal benefits (GMWB) embedded derivatives in our variable annuity
products, to realized capital gains (losses), consolidates the fees from these embedded derivatives with the associated change
in fair value of such derivatives. The reclassifications reduced pre-tax operating income and after-tax operating income, but
had no effect on GAAP basis Total revenues, Income from continuing operations before income tax expense (benefit) or Net
income.
Also, revisions were made to change the classification of certain miscellaneous income from General operating and other
expenses to premiums, and of certain broker-dealer fees from General operating and other expenses to other income, to
conform with the current period presentation. There was no effect on pre-tax or after-tax operating income, income from
continuing operations or net income.