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Assumed life reinsurance programs involving minimum benefit guarantees under annuity contracts | 6 Months Ended
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Jun. 30, 2015
Reinsurance Disclosures [Abstract] |
Assumed life reinsurance programs involving minimum benefit guarantees under annuity contracts | Assumed life reinsurance programs involving minimum benefit guarantees under variable annuity contracts The following table presents income and expenses relating to GMDB and GLB reinsurance. GLBs include GMIBs as well as some GMABs originating in Japan.
| Three Months Ended |  |  | Six Months Ended |
| June 30 |  |  | June 30 |
(in millions of U.S. dollars) | 2015 |  |  | 2014 |  |  | 2015 |  |  | 2014 |
GMDB |  |  |  |  |  |  |
Net premiums earned | $ | 16 |  |  | $ | 18 |  |  | $ | 32 |  |  | $ | 37 |
Policy benefits and other reserve adjustments | $ | 11 |  |  | $ | 13 |  |  | $ | 20 |  |  | $ | 28 |
GLB |  |  |  |  |  |  |
Net premiums earned | $ | 30 |  |  | $ | 34 |  |  | $ | 62 |  |  | $ | 70 |
Policy benefits and other reserve adjustments | 7 |  |  | 10 |  |  | 19 |  |  | 19 |
Net realized gains (losses) | 104 |  |  | 2 |  |  | 59 |  |  | (48 | )
Gain recognized in Net income | $ | 127 |  |  | $ | 26 |  |  | $ | 102 |  |  | $ | 3 |
Less: Net cash received | 26 |  |  | 29 |  |  | 54 |  |  | 62 |
Net (increase) decrease in liability | $ | 101 |  |  | $ | (3 | ) |  | $ | 48 |  |  | $ | (59 | )
Net realized gains (losses) in the table above include gains (losses) related to foreign exchange and fair value adjustments on insurance derivatives and exclude gains (losses) on S&P put options and futures held to partially offset the risk in the GLB reinsurance portfolio. Refer to Note 7 for additional information. At June 30, 2015 and December 31, 2014, the reported liability for GMDB reinsurance was $114 million and $111 million, respectively. At June 30, 2015 and December 31, 2014, the reported liability for GLB reinsurance was $615 million and $663 million, respectively, which includes a fair value derivative adjustment of $347 million and $406 million, respectively. Reported liabilities for both GMDB and GLB reinsurance are determined using internal valuation models. Such valuations require considerable judgment and are subject to significant uncertainty. The valuation of these products is subject to fluctuations arising from, among other factors, changes in interest rates, changes in equity markets, changes in credit markets, changes in the allocation of the investments underlying annuitants’ account values, and assumptions regarding future policyholder behavior. These models and the related assumptions are regularly reviewed by management and enhanced, as appropriate, based upon improvements in modeling assumptions and availability of updated information, such as market conditions and demographics of in-force annuities.

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- Definition The entire disclosure pertaining to the existence, magnitude and information about insurance that has been ceded to or assumed from another insurance company, including the methodologies and assumptions used in determining recorded amounts. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 20 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6480758&loc=d3e6816-158387 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 605 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6486672&loc=d3e27374-158547 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 210 -Section S99 -Paragraph 1 -Subparagraph (SX 210.7-03.6,13) -URI http://asc.fasb.org/extlink&oid=6879938&loc=d3e572229-122910 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 20 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6480758&loc=d3e6811-158387 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 605 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6486672&loc=d3e27261-158547 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 605 -Section 55 -Paragraph 13 -URI http://asc.fasb.org/extlink&oid=34714010&loc=d3e27795-158548 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 605 -Section 55 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=34714010&loc=d3e27703-158548 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 944 -SubTopic 310 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6485557&loc=d3e21549-158491 + Details
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