Allstate 2008 Annual Report Download - page 310

Summarized financial performance data for each of the Company’s reportable segments for the years ended
December 31 are as follows:
2008 2007 2006
($ in millions)
Net Income
Property-Liability
Underwriting income
Allstate Protection $ 189 $ 2,838 $ 4,636
Discontinued Lines and Coverages (25) (54) (139)
Total underwriting income 164 2,784 4,497
Net investment income 1,674 1,972 1,854
Income tax expense on operations (401) (1,413) (1,963)
Realized capital gains and losses, after-tax (1,209) 915 227
Loss on disposition of operations, after-tax — — (1)
Property—Liability net income 228 4,258 4,614
Allstate Financial
Life and annuity premiums and contract charges 1,895 1,866 1,964
Net investment income 3,811 4,297 4,173
Periodic settlements and accruals on non-hedge derivative financial instruments 20 46 56
Contract benefits and interest credited to contractholder funds (4,029) (4,271) (4,184)
Operating costs and expenses and amortization of deferred policy acquisition costs (1,051) (1,042) (1,117)
Restructuring and related charges (1) (2) (24)
Income tax expense on operations (207) (279) (274)
Operating income 438 615 594
Realized capital gains and losses, after-tax (2,034) (125) (50)
DAC and DSI accretion relating to realized capital gains and losses, after-tax 385 12 36
DAC and DSI unlocking in fourth quarter 2008 related to realized capital and losses, after-tax (274) — —
Non—recurring items, after-tax(1) (219) — (18)
Reclassification of periodic settlements and accruals on non-hedge derivative instruments,
after-tax (13) (29) (36)
Loss on disposition of operations, after-tax (4) (8) (62)
Allstate Financial net (loss) income (1,721) 465 464
Corporate and Other
Service fees(2) 10 10 10
Net investment income 137 166 150
Operating costs and expenses(2) (372) (371) (366)
Income tax benefit on operations 107 100 112
Operating loss (118) (95) (94)
Realized capital gains and losses, after-tax (68) 8 9
Corporate and Other net loss (186) (87) (85)
Consolidated net (loss) income $(1,679) $ 4,636 $ 4,993
(1) During the fourth quarter of 2008, for traditional life insurance and immediate annuities with life contingencies, an aggregate premium
deficiency of $336 million, pre-tax ($219 million, after-tax) resulted primarily from an experience study indicating that the annuitants on
certain life-contingent contracts are projected to live longer than we anticipated when the contracts were issued, and, to a lesser degree,
a reduction in the related investment portfolio yield. The deficiency was recorded through a reduction in deferred acquisition costs.
During 2006, there was a write-off of present value of future profits related to a block of corporate owned life insurance policies that
terminated due to bankruptcy of the policyholder.
(2) For presentation in the Consolidated Statements of Operations, service fees of the Corporate and Other segment are reclassified to
operating costs and expenses.
200
Notes