Voya 2014 Annual Report Download - page 344

Voya Financial, Inc.
Notes to the Consolidated Financial Statements
(Dollar amounts in millions, unless otherwise stated)
In addition, on May 8, 2013, the Principal Insurance Subsidiaries domiciled in Colorado, Iowa and Minnesota
each reset, on a one-time basis, their respective negative unassigned funds account as of December 31, 2012 (as
reported in their respective 2012 statutory annual statements) to zero (with an offsetting reduction in gross paid-
in capital and contributed surplus). These resets were made pursuant to permitted practices in accordance with
statutory accounting practices granted by their respective domiciliary insurance regulators. These permitted
practices have no impact on total capital and surplus of these insurance subsidiaries and were recorded in each of
their respective second quarter 2013 statutory financial statements. See Management’s Discussion and Analysis
of Financial Condition and Results of Operations Restrictions-Liquidity and Capital Resources-Dividends and
Returns of Capital from Subsidiaries in Part II, Item 7. of this Annual Report on Form 10-K.
Captive Reinsurance Subsidiaries
Voya Financial, Inc.’s special purpose life reinsurance captive insurance company subsidiaries domiciled in
Missouri (collectively referred to as the “captive reinsurance subsidiaries”) provide reinsurance to the
Company’s insurance subsidiaries in order to facilitate the financing of statutory reserves including those
associated with Regulation XXX or AG38 and to fund certain statutory annuity reserve requirements. Each of the
captive reinsurance subsidiaries in operation as of December 31, 2014 is a wholly owned direct or indirect
subsidiary of one of the Principal Insurance Subsidiaries or Voya Holdings Inc. Each of the captive reinsurance
subsidiaries is subject to specific minimum capital requirements set forth in the insurance statutes of Missouri,
the state of domicile and is required to prepare statutory financial statements in accordance with statutory
accounting practices prescribed in the Missouri insurance statutes or permitted by the Missouri insurance
department. There are no prescribed practices material to the captive reinsurance subsidiaries, except that certain
of these subsidiaries have included the value of letters of credit and trust notes as admitted assets supporting the
statutory reserves ceded to such subsidiaries. The effect of these prescribed practices was to increase statutory
capital and surplus by $1,185.0 and $1,612.0 as of December 31, 2014 and 2013, respectively. The aggregate
statutory capital and surplus, including the aforementioned prescribed practices, was $552.5 and $616.6 as of
December 31, 2014 and 2013, respectively.
The Company’s Arizona captive, SLDI, provides reinsurance to the Company’s insurance subsidiaries in order to
facilitate the financing of statutory reserves including those associated with Regulation XXX or AG38 and to
fund certain statutory annuity reserve requirements. On December 20, 2013, SLDI re-domesticated from the
Cayman Islands to the State of Arizona. Arizona state insurance statutes and regulations require SLDI to file
financial statements with the Arizona Department of Insurance (“ADOI”) and allow the filing of such financial
statements on a U.S. GAAP basis modified for certain prescribed practices outlined in the Arizona insurance
statutes that are applicable to U.S. GAAP filers. These prescribed practices had no impact on SLDI’s
Shareholder’s equity as of as of December 31, 2014 and 2013. In addition, SLDI has obtained approval from the
ADOI for certain permitted practices, including taking reinsurance credit for certain ceded reserves where the
assets backing the liabilities are held by a wholly owned Principal Insurance Subsidiary of Voya Financial, Inc.
SLDI has recorded a receivable for these assets. The effect of the permitted practice was to increase SLDI’s
Shareholder’s equity by $482.0 and $490.6 as of December 31, 2014 and 2013, respectively, but has no effect on
the Company’s consolidated Total shareholders’ equity.
The captive reinsurance subsidiaries may not declare or pay any dividends other than in accordance with their
respective insurance reserve financing transaction agreements and their respective governing licensing orders.
Likewise, SLDI may not declare or pay dividends other than in accordance with its annual capital and dividend
plan as approved by the ADOI, which includes a minimum capital requirement. SLDI does not expect to make
any dividend payments during calendar year 2015.
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