Voya 2014 Annual Report Download - page 106

or legal proceedings involving us or our affiliates, possibly including ING Group, could also have a negative
impact on our reputation and on the morale and performance of employees, and on business retention and new
sales, which could adversely affect our businesses and results of operations.
Litigation may adversely affect our profitability and financial condition.
We are, and may be in the future, subject to legal actions in the ordinary course of insurance, investment
management and other business operations. Some of these legal proceedings may be brought on behalf of a class.
Plaintiffs may seek large or indeterminate amounts of damage, including compensatory, liquidated, treble and/or
punitive damages. Our reserves for litigation may prove to be inadequate and insurance coverage may not be
available or may be declined for certain matters. It is possible that our results of operations or cash flows in a
particular interim or annual period could be materially affected by an ultimate unfavorable resolution of pending
litigation depending, in part, upon the results of operations or cash flows for such period. Given the large or
indeterminate amounts sometimes sought, and the inherent unpredictability of litigation, it is also possible that in
certain cases an ultimate unfavorable resolution of one or more pending litigation matters could have a material
adverse effect on our financial condition.
A loss of, or significant change in, key product distribution relationships could materially affect sales.
We distribute certain products under agreements with affiliated distributors and other members of the
financial services industry that are not affiliated with us. We compete with other financial institutions to attract
and retain commercial relationships in each of these channels, and our success in competing for sales through
these distribution intermediaries depends upon factors such as the amount of sales commissions and fees we pay,
the breadth of our product offerings, the strength of our brand, our perceived stability and financial strength
ratings, and the marketing and services we provide to, and the strength of the relationships we maintain with,
individual distributors. An interruption or significant change in certain key relationships could materially affect
our ability to market our products and could have a material adverse effect on our business, operating results and
financial condition. Distributors may elect to alter, reduce or terminate their distribution relationships with us,
including for such reasons as changes in our distribution strategy, adverse developments in our business, adverse
rating agency actions or concerns about market-related risks. Alternatively, we may terminate one or more
distribution agreements due to, for example, a loss of confidence in, or a change in control of, one of the
distributors, which could reduce sales.
We are also at risk that key distribution partners may merge or change their business models in ways that
affect how our products are sold, either in response to changing business priorities or as a result of shifts in
regulatory supervision or potential changes in state and federal laws and regulations regarding standards of
conduct applicable to distributors when providing investment advice to retail and other customers.
The occurrence of natural or man-made disasters may adversely affect our results of operations and financial
condition.
We are exposed to various risks arising from natural disasters, including hurricanes, climate change, floods,
earthquakes, tornadoes and pandemic disease, as well as man-made disasters and core infrastructure failures,
including acts of terrorism, military actions, power grid and telephone/internet infrastructure failures, which may
adversely affect AUM, results of operations and financial condition by causing, among other things:
• losses in our investment portfolio due to significant volatility in global financial markets or the failure
of counterparties to perform;
• changes in the rate of mortality, claims, withdrawals, lapses and surrenders of existing policies and
contracts, as well as sales of new policies and contracts; and
• disruption of our normal business operations due to catastrophic property damage, loss of life, or
disruption of public and private infrastructure, including communications and financial services.
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