XML 81 R26.htm IDEA: XBRL DOCUMENT v3.6.0.2
Other Expenses
 12 Months Ended
Dec. 31, 2016
Other Income and Expenses [Abstract]  
Other Expenses
17. Other Expenses
Information on other expenses was as follows:
 
 
Years Ended December 31,
 
 
2016
 
2015
 
2014
 
 
(In millions)
Compensation
 
$
4,785

 
$
4,938

 
$
4,894

Pension, postretirement and postemployment benefit costs
 
415

 
400

 
473

Commissions
 
4,311

 
4,517

 
5,153

Volume-related costs
 
934

 
1,002

 
859

Capitalization of DAC
 
(3,589
)
 
(3,837
)
 
(4,183
)
Amortization of DAC and VOBA
 
2,641

 
3,936

 
4,132

Amortization of negative VOBA
 
(269
)
 
(361
)
 
(442
)
Interest expense on debt
 
1,201

 
1,208

 
1,216

Premium taxes, licenses and fees
 
750

 
766

 
801

Professional services
 
1,550

 
1,511

 
1,457

Rent and related expenses, net of sublease income
 
364

 
328

 
361

Other (1)
 
1,976

 
2,361

 
2,370

Total other expenses (2)
 
$
15,069

 
$
16,769

 
$
17,091


__________________
(1)
See Note 19 for information on the charge related to income tax for the year ended December 31, 2015.
(2)
Includes $212 million of expenses, primarily in professional services, for the year ended December 31, 2016 in connection with the Separation. See Note 2 for further information on the Separation.
Capitalization of DAC and Amortization of DAC and VOBA
See Note 5 for additional information on DAC and VOBA including impacts of capitalization and amortization. See also Note 7 for a description of the DAC amortization impact associated with the closed block.
Interest Expense on Debt
See Notes 12, 13, and 14 for attribution of interest expense by debt issuance. Interest expense on debt includes interest expense related to CSEs. See Note 8.
Restructuring Charges
The Company announced in 2016 a unit cost improvement program related to the Company’s refreshed enterprise strategy. This global strategy focuses on transforming the Company to become more digital, driving efficiencies and innovation to achieve competitive advantage, and simplified, decreasing the costs and risks associated with the Company’s highly complex industry to customers and shareholders. For the year ended December 31, 2016, the Company recorded $35 million, primarily related to severance, in other expenses. As the expenses relate to an enterprise-wide initiative, they are reported in Corporate & Other. Management anticipates further restructuring charges through the year ending December 31, 2019. However, such restructuring plans were not sufficiently developed to enable management to make an estimate of such restructuring charges at December 31, 2016.
In 2016, the Company completed a previous enterprise-wide strategic initiative. These restructuring charges are included in other expenses. As the expenses relate to an enterprise-wide initiative, they are reported in Corporate & Other. Information regarding restructuring charges was as follows:
 
 
Years Ended December 31,
 
 
2016
 
2015
 
2014
 
 
Severance
 
Lease and
Asset
Impairment
 
Total
 
Severance
 
Lease and
Asset
Impairment
 
Total
 
Severance
 
Lease and
Asset
Impairment
 
Total

 
(In millions)
Balance at January 1,
 
$
18

 
$
4

 
$
22

 
$
31

 
$
6

 
$
37

 
$
40

 
$
6

 
$
46

Restructuring charges
 
—

 
1

 
1

 
60

 
4

 
64

 
83

 
8

 
91

Cash payments
 
(17
)
 
(4
)
 
(21
)
 
(73
)
 
(6
)
 
(79
)
 
(92
)
 
(8
)
 
(100
)
Balance at December 31,
 
$
1

 
$
1

 
$
2

 
$
18

 
$
4

 
$
22

 
$
31

 
$
6

 
$
37

Total restructuring charges incurred since inception of initiative
 
$
383

 
$
47

 
$
430

 
$
383

 
$
46

 
$
429

 
$
323

 
$
42

 
$
365