The Hartford 2010 Annual Report Download - page 152

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THE HARTFORD FINANCIAL SERVICES GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
F-24
4. Fair Value Measurements –Financial Instruments Excluding Guaranteed Living Benefits (continued)
Roll-forward of Financial Instruments Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs
(Level 3) for the twelve months from January 1, 2009 to December 31, 2009
Changes in unrealized
gains (losses)
Fair value Total realized/unrealized Purchases, included in net income
as of gains (losses) included in: issuances, Transfers in Fair value related to financial
January 1, Net income and and/or (out) as of instruments still held at
Asset (Liability) 2009 [1] OCI [2] settlements of Level 3 [3] December 31, 2009 December 31, 2009 [1]
Assets
Fixed maturities, AFS
ABS $ 536 $ (44) $ 176 $ (45) $ (43) $ 580 $ (34)
CDO 2,612 (491) 827 (65) (48) 2,835 (447)
CMBS 341 (308) 338 (93) 29 307 (94)
Corporate 6,396 (73) 1,192 915 (403) 8,027 (52)
Foreign govt./govt. agencies 100 2 — 11 (20) 93 2
Municipal 163 — 3 25 71 262 —
RMBS 1,662 (441) 214 (243) (39) 1,153 (264)
Total fixed maturities, AFS 11,810 (1,355) 2,750 505 (453) 13,257 (889)
Equity securities, AFS 541 2 6 (19) (472) 58 (1)
Freestanding derivatives [4] (281) 76 (4) 29 (9) (189) 131
Separate accounts [5] 786 (65) — 344 (103) 962 (38)
Liabilities
Other policyholder funds and
benefits payable
Institutional notes (41) 39 — — — (2) 39
Equity linked notes (8) (2) — — — (10) (2)
Total other policyholder funds and
benefits payable (49) 37
—
—
— (12) 37
Other derivative liabilities [6] (163) 70 — 93 — — —
Consumer notes (5) — — — — (5)
—
[1] All amounts in these columns are reported in net realized capital gains (losses) except for $3, which is reported in benefits, losses and loss
adjustment expenses. All amounts are before income taxes and amortization of DAC.
[2] All amounts are before income taxes and amortization of DAC.
[3] Transfers in and/or (out) of Level 3 are attributable to a change in the availability of market observable information and re-evaluation of the
observability of pricing inputs primarily for certain long-dated corporate bonds and preferred stocks.
[4] Derivative instruments are reported in this table on a net basis for asset/(liability) positions and reported in the Consolidated Balance Sheet in
other investments and other liabilities.
[5] The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account
liabilities, which results in a net zero impact on net income for the Company.
[6] On March 26, 2009, certain of the Allianz warrants were reclassified to equity, at their current fair value, as shareholder approval of the
conversion of these warrants to common shares was received. See Note 21 for further discussion.