Separate Accounts, Death Benefits and Other Insurance Benefit Features

Changes in the gross GMDB and UL secondary guarantee benefits are as follows:



	GMDB			UL Secondary Guarantees
Liability balance as of January 1, 2013	$	944		$	363
Incurred	150			240
Paid	(125		)	—
Unlock	(120		)	—
Impact of Reinsurance Transaction	—			1,143
Currency Translation Adjustment	(5		)	—
Liability balance as of September 30, 2013	$	844		$	1,746
Reinsurance recoverable asset, as of January 1, 2013	$	608		$	21
Incurred	79			240
Paid	(76		)	—
Unlock	(73		)	—
Impact of Reinsurance Transaction	—			1,485
Reinsurance recoverable asset, as of September 30, 2013	$	538		$	1,746



	GMDB			UL Secondary Guarantees
Liability balance as of January 1, 2012	$	1,158		$	228
Incurred	162			84
Paid	(196		)	—
Unlock	(165		)	21
Currency Translation Adjustment	(1		)	—
Liability balance as of September 30, 2012	$	958		$	333
Reinsurance recoverable asset, as of January 1, 2012	$	724		$	22
Incurred	90			(2		)
Paid	(90		)	—
Unlock	(108		)	—
Reinsurance recoverable asset, as of September 30, 2012	$	616		$	20

7. Separate Accounts, Death Benefits and Other Insurance Benefit Features (continued)

The following table presents details concerning GMDB and GMIB exposure as of September 30, 2013:



Individual Variable and Group Annuity Account Value by GMDB/GMIB Type
Maximum anniversary value (“MAV”) [1]	Account Value (“AV”) [8]		Net amount at Risk (“NAR”) [9]		Retained Net Amount at Risk (“RNAR”) [9]		Weighted Average Attained Age of Annuitant
MAV only	$	19,367	$	3,112	$	191	69
With 5% rollup [2]	1,579		271		18		69
With Earnings Protection Benefit Rider (“EPB”) [3]	4,828		582		18		67
With 5% rollup & EPB	573		117		5		70
Total MAV	26,347		4,082		232
Asset Protection Benefit (APB) [4]	18,669		383		77		67
Lifetime Income Benefit (LIB) – Death Benefit [5]	878		11		3		66
Reset [6] (5-7 years)	3,205		84		39		69
Return of Premium [7] /Other	20,733		108		23		67
Subtotal U.S. GMDB	69,832		4,668		374		68
Less: General Account Value with U.S. GMDB	7,412
Subtotal Separate Account Liabilities with GMDB	62,420
Separate Account Liabilities without U.S. GMDB	77,444
Total Separate Account Liabilities	$	139,864
Japan GMDB [10], [11]	$	14,161	$	575	$	—	69
Japan GMIB [10], [11]	$	13,951	$	448	$	—	69


[1]	MAV: the GMDB is the greatest of current AV, net premiums paid and the highest AV on any anniversary before age 80 (adjusted for withdrawals).


[2]	Rollup: the GMDB is the greatest of the MAV, current AV, net premium paid and premiums (adjusted for withdrawals) accumulated at generally 5% simple interest up to the earlier of age 80 or 100% of adjusted premiums.


[3]	EPB GMDB is the greatest of the MAV, current AV, or contract value plus a percentage of a contract’s growth. A contract’s growth is AV less premiums net of withdrawals, subject to a cap of 200% of premiums net of withdrawals.


[4]	APB GMDB is the greater of current AV or MAV, not to exceed current AV plus 25% times the greater of net premiums and MAV (each adjusted for premiums in the past 12 months).


[5]	LIB GMDB is the greatest of current AV, net premiums paid, or for certain contracts a benefit amount that ratchets over time, generally based on market performance.


[6]	Reset GMDB is the greatest of current AV, net premiums paid and the most recent five to seven year anniversary AV before age 80 (adjusted for withdrawals).


[7]	ROP: the GMDB is the greater of current AV and net premiums paid.


[8]	AV includes the contract holder’s investment in the separate account and the general account.


[9]	NAR is defined as the guaranteed benefit in excess of the current AV. RNAR is NAR reduced for reinsurances. NAR and RNAR are highly sensitive to equity market movements and increase when equity markets decline.

[10]

Assumed GMDB includes a ROP and MAV (before age 80) paid in a single lump sum. GMIB is a guarantee to return initial investment, adjusted for earnings liquidity, paid through a fixed annuity, after a minimum deferral period of 10, 15 or 20 years. The guaranteed remaining balance (“GRB”) related to the Japan GMIB was $13.8 billion and $17.8 billion as of September 30, 2013 and December 31, 2012, respectively. The GRB related to the Japan GMAB and GMWB was $361 and $470 as of September 30, 2013 and December 31, 2012, respectively. These liabilities are not included in the Separate Account as they are not legally insulated from the general account liabilities of the insurance enterprise. As of September 30, 2013, 100% of RNAR is reinsured to an affiliate. See Note 11 - Transactions with Affiliates of Notes to Condensed Consolidated Financial statements.


[11]	Policies with a guaranteed living benefit (a GMWB in the US or a GMIB in Japan) also have a guaranteed death benefit. The NAR for each benefit is shown, however these benefits are not additive. When a policy terminates due to death, any NAR related to GMWB or GMIB is released. Similarly, when a policy goes into benefit status on a GMWB or GMIB, its GMDB NAR is released.

For a description of the Company’s guaranteed living benefits that are accounted for at fair value, see Note 3 - Fair Value Measurements of Notes to Condensed Consolidated Financial Statements.

Account balances of contracts with death benefit guarantees were invested in variable separate accounts as follows:



Asset type	September 30, 2013		December 31, 2012
Equity securities (including mutual funds)	$	56,808	$	58,208
Cash and cash equivalents	5,612		6,940
Total	$	62,420	$	65,148

As of September 30, 2013 and December 31, 2012, approximately 15% and 16%, respectively, of the equity securities above were invested in fixed income securities through these funds and approximately 85% and 84%, respectively, were invested in equity securities through these funds.