Deferred Policy Acquisition and Sales Inducement Costs

12 Months Ended

Dec. 31, 2015

Deferred Policy Acquisition and Sales Inducement Costs

Deferred Policy Acquisition and Sales Inducement Costs

Deferred Policy Acquisition and Sales Inducement Costs

Deferred policy acquisition costs for the years ended December 31 are as follows:

($ in millions)	2015			2014			2013
Balance, beginning of year	$	1,271		$	1,331		$	1,834
Classified as held for sale, beginning balance	—			743			—
Total, including those classified as held for sale	1,271			2,074			1,834
Acquisition costs deferred	124			163			254
Amortization charged to income	(151		)	(162		)	(240		)
Effect of unrealized gains and losses	99			(97		)	226
Reinsurance ceded (1)	(29		)	—			—
Sold in LBL disposition	—			(707		)	—
Classified as held for sale, ending balance	—			—			(743		)
Balance, end of year	$	1,314		$	1,271		$	1,331

______________________

⁽¹⁾  In 2015, DAC decreased as a result of a reinsurance agreement with AAC.

DSI activity, which primarily relates to fixed annuities and interest-sensitive life contracts, for the years ended December 31 was as follows:

($ in millions)	2015			2014			2013
Balance, beginning of year	$	44		$	42		$	41
Classified as held for sale, beginning balance	—			28			—
Total, including those classified as held for sale	44			70			41
Sales inducements deferred	3			4			24
Amortization charged to income	(4		)	(4		)	(7		)
Effect of unrealized gains and losses	2			(3		)	12
Sold in LBL disposition	—			(23		)	—
Classified as held for sale, ending balance	—			—			(28		)
Balance, end of year	$	45		$	44		$	42