Segments Information

3 Months Ended

Mar. 31, 2014

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 has been in runoff since the transfer of the ongoing reinsurance assumed 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:

	Three Months Ended March 31
	2014			2013
	(in millions)
Revenues
Property and casualty insurance
Premiums earned
Personal insurance	$	1,076		$	1,031
Commercial insurance		1,300			1,308
Specialty insurance		653			666
Total insurance		3,029			3,005
Reinsurance assumed		—			(1	)
		3,029			3,004
Investment income		351			363
Total property and casualty insurance		3,380			3,367
Corporate and other		10			12
Realized investment gains, net		116			138
Total revenues	$	3,506		$	3,517
Income (loss) before income tax
Property and casualty insurance
Underwriting
Personal insurance	$	2		$	150
Commercial insurance		111			195
Specialty insurance		82			95
Total insurance		195			440
Reinsurance assumed		—			4
		195			444
Increase in deferred policy acquisition costs		13			41
Underwriting income		208			485
Investment income		341			351
Other income (charges)		(2	)		5
Total property and casualty insurance		547			841
Corporate and other		(60	)		(63	)
Realized investment gains, net		116			138
Total income before income tax	$	603		$	916