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Business Acquisitions and Dispositions Level 1 (Notes) | 9 Months Ended
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Sep. 30, 2016
Business Combinations [Abstract] |
Mergers, Acquisitions and Dispositions Disclosures [Text Block] | Business Acquisitions Maxum On July 29, 2016, the Company acquired 100% of the outstanding shares of Northern Homelands Company, the holding company of Maxum Specialty Insurance Group headquartered in Alpharetta, Georgia in a cash transaction for approximately $169, subject to post closing adjustments. The acquisition adds excess and surplus lines capability to the Company's Small Commercial line of business. Maxum will maintain its brand and limited wholesale distribution model. Maxum's revenues and earnings since the acquisition date are included in the Company's Condensed Consolidated Statements of Operations and are not material to the Company's consolidated results of operations for the three and nine months ended September 30, 2016. The following table summarizes the fair value of assets acquired and liabilities assumed at the acquisition date.
| As of July 29, 2016
Assets |
Cash and investments (including cash of $12) | $ | 274 |
Reinsurance recoverables | 113 |
Intangible assets [1] | 11 |
Other assets | 80 |
Total assets acquired | 478 |
Liabilities |
Unpaid losses | 235 |
Unearned premiums | 77 |
Other liabilities | 34 |
Total liabilities assumed | 346 |
Net identifiable assets acquired | 132 |
Goodwill [2] | 37 |
Net assets acquired | $ | 169 |
[1] | Comprised of indefinite lived intangibles of $5 related to state insurance licenses acquired and other intangibles of $6 related to agency distribution relationships of Maxum which will amortize over 10 years.
[2] | Non-deductible for income tax purposes.
The goodwill recognized is attributable to expected growth from the opportunity to sell both existing products and excess and surplus lines coverage to a broader customer base and will be allocated to the Small Commercial reporting unit within the Commercial Lines reporting segment. The Company recognized $1 of acquisition related costs in the three months ended September 30, 2016. These costs are included in insurance operating costs and other expenses in the Condensed Consolidated Statement of Operations. Lattice On July 29, 2016, an indirect wholly-owned subsidiary of the Company acquired 100% of the membership interests outstanding of Lattice Strategies LLC, an investment management firm and provider of strategic beta exchange-traded funds ("ETF") with approximately $200 of assets under management ("AUM") at the acquisition date. The following table summarizes the fair value of the consideration transferred at the acquisition date.
Fair value of consideration transferred |
Cash | $ | 19 |
Contingent consideration | 23 |
Total | $ | 42 |
The following table summarizes the fair value of assets acquired and liabilities assumed at the acquisition date.
| As of July 29, 2016
Assets |
Intangible assets [1] | $ | 11 |
Other assets (including cash of $1) | 2 |
Total assets acquired | 13 |
Liabilities |
Total liabilities assumed | 1 |
Net identifiable assets acquired | 12 |
Goodwill [2] | 30 |
Net assets acquired | $ | 42 |
[1] | Comprised of an indefinite lived intangible asset of $10 related to customer relationships and $1 of other intangibles, which are amortizable over 5 to 8 years.
[2] | Deductible for federal income tax purposes.
Lattice's revenues and earnings since the acquisition date are included in the Company's Condensed Consolidated Statements of Operations in the Mutual Funds reporting segment and are not material to the Company's consolidated results of operations for the three and nine months ended September 30, 2016. In addition to the initial cash consideration, the Company is required to make future payments to the former owners of Lattice of up to $60 based upon growth in ETF AUM over a four-year period beginning on the date of acquisition. The contingent consideration was measured at fair value at the acquisition date by projecting future ETF AUM and discounting expected payments back to the valuation date. The projected ETF AUM and risk-adjusted discount rate are significant unobservable inputs to fair value. The goodwill recognized is attributable to the fact that the acquisition of Lattice enables the Company to offer ETFs which are expected to be a significant source of future revenue and earnings growth. Goodwill will be allocated to the Mutual Funds reporting segment. The Company recognized $1 of acquisition related costs in the three months ended September 30, 2016. These costs are included in insurance operating costs and other expenses in the Condensed Consolidated Statement of Operations. Business Disposition Sale of U.K. businesses On July 26, 2016, the Company announced it had entered into an agreement to sell its U.K. property and casualty run-off subsidiaries, Hartford Financial Products International Limited and Downlands Liability Management Limited, in a cash transaction to Catalina Holdings UK Limited ("buyer"), for approximately $268, net of transaction costs. The Company's U.K. property and casualty run-off subsidiaries are included in the P&C Other Operations reporting segment. Revenues and earnings are not material to the Company's consolidated results of operations for the three and nine months ended September 30, 2016 and 2015. The Company recognized an estimated capital loss of $59, before tax, and related income tax benefit of $65, for an estimated after-tax net gain of $6 on the sale for the three and nine months ended September 30, 2016. The accrual for the estimated before tax loss is included as a reduction of the carrying value of assets held for sale in the Company's Condensed Consolidated Balance Sheets as of September 30, 2016. The transaction is expected to close in the fourth quarter of 2016, subject to regulatory approvals and other customary closing conditions. The carrying values of the assets and liabilities to be transferred by the Company to the buyer in connection with the sale are as follows:
| As of September 30, 2016
Assets |
Cash and investments | $ | 695 |
Reinsurance recoverables [1] | 226 |
Total assets held for sale | 921 |
Liabilities |  |
Reserve for future policy benefits and unpaid loss and loss adjustment expenses | 638 |
Other liabilities | 15 |
Total liabilities held for sale | $ | 653 |
[1] | Includes intercompany reinsurance recoverables of $58 to be settled in cash or securities prior to closing.

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- Definition The entire disclosure for business combinations, including leverage buyout transactions (as applicable), and divestitures. This may include a description of a business combination or divestiture (or series of individually immaterial business combinations or divestitures) completed during the period, including background, timing, and assets and liabilities recognized and reclassified or sold. This element does not include fixed asset sales and plant closings. + References No definition available. + Details
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