Aetna 2009 Annual Report Download - page 68

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Net Investment Income
Sources of net investment income for 2009, 2008 and 2007 were as follows:
(Millions) 2009 2008 2007
Debt securities 907.8$ 877.4$ 860.4$
Mortgage loans 118.6 116.9 123.5
Other investments 38.6 (50.4) 205.4
Gross investment income 1,065.0 943.9 1,189.3
Less: Investment expenses (28.6) (33.9) (39.4)
Net investment income
(1)
1,036.4$ 910.0$ 1,149.9$
(1) Investment risks associated with our experience-rated and discontinued products generally do not impact our results of operations
(refer to Note 20 beginning on page 82 for additional information on our accounting for discontinued products). Net investment
income includes $347.8 million, $296.1 million and $446.4 million for 2009, 2008 and 2007, respectively, related to investments
supporting our experience-rated and discontinued products.
The decrease in Other investment income in 2008 compared to 2007 was primarily due to losses from alternative
investments, which did not recur in 2009.
9. Other Comprehensive Income (Loss)
Shareholders’ equity included the following activity in accumulated other comprehensive loss in 2009:
Foreign Accumulated
Currency Pension Other
Previously and and OPEB Comprehensive
(Millions) Impaired
(1)
All Other Derivatives Plans Income (Loss)
Balance at December 31, 2008 -$ (229.3)$ (8.7)$ (1,643.3)$ (1,881.3)$
Cumulative effect of adopting a new
accounting standard ($83.0 pretax)
(2)
(5.3) (48.4) - - (53.7)
Net unrealized gains (losses) ($1,004.6 pretax) 106.3 592.4 34.4 (80.1) 653.0
Reclassification to earnings ($110.5 pretax) (.7) (79.0) (.4) 139.1 59.0
Balance at December 31, 2009 100.3$ 235.7$ 25.3$ (1,584.3)$ (1,223.0)$
Net Unrealized Gains (Losses)
Securities
(1) Represents the non-credit-related component of OTTI on debt securities that we do not intend to sell as well as subsequent changes in fair
value related to previously impaired debt securities.
(2) Effective April 1, 2009, we adopted new accounting guidance for other-than-temporary impairments of debt securities. Refer to Note 2
beginning on page 48 for additional information on the cumulative effect adjustment required.
Shareholders’ equity included the following activity in accumulated other comprehensive loss in 2008 and 2007:
Accumulated
Foreign Pension Other
Currency and and OPEB Comprehensive
(Millions) Securities Derivatives Plans Income (Loss)
Balance at December 31, 2006 66.5$ 19.2$ (711.4)$ (625.7)$
Effect of changing measurement date of pension and OPEB
plans pursuant to new accounting guidance - - 113.9
(1)
113.9
Balance at January 1, 2007, as adjusted 66.5 19.2 (597.5) (511.8)
Net unrealized (losses) gains ($250.0 pretax) (64.3) - 226.8 162.5
Net foreign currency and derivative losses ($(13.7) pretax) - (8.9) - (8.9)
Reclassification to earnings ($107.4 pretax) 51.1 (3.3) 22.0 69.8
Balance at December 31, 2007 53.3 7.0 (348.7) (288.4)
Net unrealized losses ($3,158.9 pretax) (756.7) - (1,296.6) (2,053.3)
Net foreign currency and derivative losses ($25.5 pretax) - (16.6) - (16.6)
Reclassification to earnings ($647.7 pretax) 474.1 0.9 2.0 477.0
Balance at December 31, 2008 (229.3)$ (8.7)$ (1,643.3)$ (1,881.3)$
Net Unrealized Gains (Losses)
(1) We elected to adopt the measurement date provisions of new accounting guidance for defined benefit plans and other postretirement
benefits in 2007. The transition provisions of this accounting guidance required us to recognize the effects of this change as an
adjustment to the opening balance of accumulated other comprehensive loss on January 1, 2007.
Annual Report – Page 62