The Hartford 2013 Annual Report Download - page 206

F-70
The following table provides details concerning GMDB and GMIB exposure as of December 31, 2013:
Individual Variable Annuity Account Value by GMDB/GMIB Type
Maximum anniversary value (“MAV”) [1]
Account
Value
(“AV”) [8]
Net Amount
at Risk
(“NAR”) [10]
Retained Net
Amount
at Risk
(“RNAR”) [10]
Weighted Average
Attained Age of
Annuitant
MAV only $ 19,638 $ 2,914 $ 519 69
With 5% rollup [2] 1,610 232 64 69
With Earnings Protection Benefit Rider (“EPB”) [3] 4,862 629 86 67
With 5% rollup & EPB 588 119 26 70
Total MAV 26,698 3,894 695
Asset Protection Benefit (“APB”) [4] 18,579 277 186 68
Lifetime Income Benefit (“LIB”) – Death Benefit [5] 773 9 9 66
Reset [6] (5-7 years) 3,286 74 74 69
Return of Premium (“ROP”) [7]/Other 12,476 71 62 67
Subtotal U.S. GMDB 61,812 4,325 1,026 68
Less: General Account Value with U.S. GMDB 4,349
Subtotal Separate Account Liabilities with GMDB 57,463
Separate Account Liabilities without U.S. GMDB 83,423
Total Separate Account Liabilities $ 140,886
Japan GMDB [9], [11] $ 20,130 $ 779 $ 552 71
Japan GMIB [9], [11] $ 18,483 $ 128 $ 128 71
[1] MAV GMDB is the greatest of current AV, net premiums paid and the highest AV on any anniversary before age 80 years (adjusted for
withdrawals).
[2] Rollup GMDB is the greatest of the MAV, current AV, net premium paid and premiums (adjusted for withdrawals) accumulated at generally
5% simple interest up to the earlier of age 80 years or 100% of adjusted premiums.
[3] EPB GMDB is the greatest of the MAV, current AV, or contract value plus a percentage of the contract’s growth. The contract’s growth is AV
less premiums net of withdrawals, subject to a cap of 200% of premiums net of withdrawals.
[4] APB GMDB is the greater of current AV or MAV, not to exceed current AV plus 25% times the greater of net premiums and MAV (each
adjusted for premiums in the past 12 months).
[5] LIB GMDB is the greatest of current AV, net premiums paid, or for certain contracts a benefit amount that ratchets over time, generally based
on market performance.
[6] Reset GMDB is the greatest of current AV, net premiums paid and the most recent five to seven year anniversary AV before age 80 years
(adjusted for withdrawals).
[7] ROP GMDB is the greater of current AV or net premiums paid.
[8] AV includes the contract holder’s investment in the separate account and the general account.
[9] GMDB includes a ROP and MAV (before age 80 years) paid in a single lump sum. GMIB is a guarantee to return initial investment, adjusted
for earnings liquidity which allows for free withdrawal of earnings, paid through a fixed payout annuity, after a minimum deferral period of
10 years, 15 years or 20 years. The GRB related to the Japan GMIB was $16.8 billion as of December 31, 2013. The GRB related to the
Japan GMAB and GMWB was $365 as of December 31, 2013. These liabilities are not included in the Separate Account as they are not
legally insulated from the general account liabilities of the insurance enterprise. As of December 31, 2013, 30% of the GMDB RNAR and
80% of the GMIB NAR is reinsured to a Hartford affiliate; as a result, the effects of the reinsurance are not reflected in this disclosure.
[10] NAR is defined as the guaranteed benefit in excess of the current AV. RNAR represents NAR reduced for reinsurance. NAR and RNAR are
highly sensitive to equity markets movements and increase when equity markets decline. Additionally Japan’s NAR and RNAR are highly
sensitive to currency movements and increase when the Yen strengthens.
[11] Policies with a guaranteed living benefit (GMIB in Japan) also have a guaranteed death benefit. The NAR for each benefit is shown in the
table above, however these benefits are not additive. When a policy terminates due to death, any NAR related to GMWB or GMIB is released.
Similarly, when a policy goes into benefit status on a GMWB or GMIB, its GMDB NAR is released.
In the U.S., account balances of contracts with guarantees were invested in variable separate accounts as follows:
Asset type As of December 31, 2013 As of December 31, 2012
Equity securities (including mutual funds) $ 52,858 $ 58,208
Cash and cash equivalents 4,605 6,940
Total $ 57,463 $ 65,148
As of December 31, 2013 and December 31, 2012, approximately 17% and 16%, respectively, of the equity securities above were invested
in fixed income securities through these funds and approximately 83% and 84%, respectively, were invested in equity securities through
these funds.
For further information on guaranteed living benefits that are accounted for at fair value, such as GMWB, see Note 5 - Fair Value
Measurements of Notes to Consolidated Financial Statements.
Table of Contents THE HARTFORD FINANCIAL SERVICES GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
11. Separate Accounts, Death Benefits and Other Insurance Benefit Features (continued)