Segments Information

9 Months Ended

Sep. 30, 2013

Segment Reporting [Abstract]

Segments Information

4) Segments Information

The principal business of the Corporation is the sale of property and casualty insurance. The profitability of the property and casualty insurance business depends on the results of both underwriting operations and investments, which are viewed as two distinct operations. The underwriting operations are managed and evaluated separately from the investment function.

The property and casualty insurance subsidiaries underwrite most lines of property and casualty insurance. Underwriting operations consist of four separate business units: personal insurance, commercial insurance, specialty insurance and reinsurance assumed. The personal segment targets the personal insurance market. The personal classes include automobile, homeowners and other personal coverages. The commercial segment includes those classes of business that are generally available in broad markets and are of a more commodity nature. Commercial classes include multiple peril, casualty, workers’ compensation and property and marine. The specialty segment includes those classes of business that are available in more limited markets since they require specialized underwriting and claim settlement. Specialty classes include professional liability coverages and surety. The reinsurance assumed business is in runoff following the transfer of the ongoing business to a reinsurance company in 2005.

Corporate and other includes investment income earned on corporate invested assets, corporate expenses and the results of the Corporation’s non-insurance subsidiaries.

Revenues and income before income tax of each operating segment were as follows:

	Periods Ended September 30
	Third Quarter						Nine Months
	2013			2012			2013			2012
	(in millions)
Revenues
Property and casualty insurance
Premiums earned
Personal insurance	$	1,060		$	1,009		$	3,141		$	3,013
Commercial insurance		1,321			1,299			3,928			3,890
Specialty insurance		648			669			1,959			2,005
Total insurance		3,029			2,977			9,028			8,908
Reinsurance assumed		(2	)		—			(2	)		3
		3,027			2,977			9,026			8,911
Investment income		352			373			1,076			1,145
Total property and casualty insurance		3,379			3,350			10,102			10,056
Corporate and other		6			12			34			36
Realized investment gains, net		18			—			335			103
Total revenues	$	3,403		$	3,362		$	10,471		$	10,195
Income (loss) before income tax
Property and casualty insurance
Underwriting
Personal insurance	$	108		$	155		$	333		$	374
Commercial insurance		215			194			534			263
Specialty insurance		108			63			299			194
Total insurance		431			412			1,166			831
Reinsurance assumed		—			15			10			34
		431			427			1,176			865
Increase (decrease) in deferred policy acquisition costs		12			(9	)		69			15
Underwriting income		443			418			1,245			880
Investment income		342			364			1,042			1,117
Other income (charges)		(3	)		1			11			6
Total property and casualty insurance		782			783			2,298			2,003
Corporate and other loss		(61	)		(56	)		(182	)		(173	)
Realized investment gains, net		18			—			335			103
Total income before income tax	$	739		$	727		$	2,451		$	1,933