6. Separate Accounts, Death Benefits and Other Insurance Benefit Features

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


				UL Secondary
	GMDB			Guarantees
Liability balance as of January 1, 2011	$	1,115		$	113
Incurred		134			27
Paid		(122	)		—
Unlock		(64	)		—

Liability — gross, as of June 30, 2011		1,063			140


Reinsurance Recoverable— as of January 1, 2011	$	686		$	30
Incurred		65			5
Paid		(65	)		—
Unlock		(27	)		—

Reinsurance Recoverable — as of June 30, 2011		659			35


				UL Secondary
	GMDB			Guarantees
Liability balance as of January 1, 2010	$	1,304		$	76
Incurred		145			20
Paid		(182	)		—
Unlock		111			—

Liability — gross, as of June 30, 2010	$	1,378		$	96


Reinsurance Recoverable— as of January 1, 2010	$	802		$	22
Incurred		75			4
Paid		(93	)		—
Unlock		52			—

Reinsurance Recoverable — as of June 30, 2010	$	836		$	26

The following table provides details concerning GMDB and GMIB exposure as of June 30, 2011:


Breakdown of Variable Annuity Account Value by GMDB/GMIB Type
					Retained Net
	Account		Net amount		Amount		Weighted Average
	Value		at Risk		at Risk		Attained Age of
Maximum anniversary value (“MAV”) [1]	(“AV”) [8]		(“NAR”) [9]		(“RNAR”) [9]		Annuitant
MAV only	$	24,081	$	4,765		342		68
With 5% rollup [2]		1,648		416		29		68
With Earnings Protection Benefit Rider (“EPB”) [3]
Benefit Rider (“EPB”) [3]		6,228		747		20		65
With 5% rollup & EPB		685		142		6		68

Total MAV		32,642		6,070		397
Asset Protection Benefit (APB) [4]		26,268		1,820		353		65
Lifetime Income Benefit (LIB) — Death Benefit [5]		1,252		53		16		64
Reset [6] (5-7 years)		3,584		193		100		68
Return of Premium [7] /Other		23,557		462		131		65

Subtotal U.S. GMDB [8]		87,303	$	8,598		997		66
Less: General Account Value with U.S. GMBD		7,008

Subtotal Separate Account Liabilities with GMDB		80,295
Separate Account Liabilities without U.S. GMDB		77,178

Total Separate Account Liabilities	$	157,473

Japan GMDB [10], [11]	$	17,614	$	3,975	$	—		67
Japan GMIB [10], [11]	$	16,856	$	3,667	$	—		67


(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 the contract’s growth. The 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 $20.5 billion and $19.6 billion as of June 30, 2011 and 2010, respectively. The GRB related to the Japan GMAB and GMWB was $556 and $536 as of June 30, 2011 and 2010, 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 June 30, 2011, 100% of RNAR is reinsured to an affiliate. See Note 10 of the 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.

See Note 3 of the Notes to Condensed Consolidated Financial Statements for a description of the Company’s guaranteed living benefits that are accounted for at fair value.

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


Asset type	June 30, 2011		December 31, 2010
Equity securities (including mutual funds)	$	72,395	$	75,601
Cash and cash equivalents		7,900		8,365

Total	$	80,295	$	83,966

As of June 30, 2011 and December 31, 2010, approximately 16% and 15%, respectively, of the equity securities above were invested in fixed income securities through these funds and approximately 84% and 85%, respectively, were invested in equity securities.