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SEGMENT INFORMATION
 12 Months Ended
Dec. 31, 2015
SEGMENT INFORMATION  
SEGMENT INFORMATION

3. SEGMENT INFORMATION

We report our results of operations consistent with the manner in which our chief operating decision makers review the business to assess performance and allocate resources through two reportable segments: Commercial Insurance and Consumer Insurance as well as a Corporate and Other category. The Corporate and Other category consists of businesses and items not allocated to our reportable segments.

We evaluate performance based on revenues and pre-tax operating income (loss). Pre-tax operating income (loss) is derived by excluding certain items from net income (loss) attributable to AIG. See the table below for the items excluded from pre-tax operating income.

Investment income of the Non-Life Insurance Companies is allocated between the Property Casualty and Personal Insurance operating segments based on an internal investment income allocation model. The model estimates investable funds based primarily on loss reserves and allocated capital. Investment income of the Life Insurance Companies is attributed to the Retirement, Life and Institutional Markets operating segments based on invested assets in product line portfolios; income from invested assets in excess of liabilities is allocated to product lines based on internal capital estimates.

The Commercial and Consumer reportable segments are each presented as three operating segments:

Commercial Insurance

The Commercial Insurance segment is presented as three operating segments:

  • Property Casualty – consists of Casualty, Property, Specialty, and Financial product lines.
  • Mortgage Guaranty – Mortgage insurance protects mortgage lenders and investors against the increased risk of borrower default related to high loan-to-value mortgages.
  • Institutional Markets – consists of stable value wrap products, structured settlement and terminal funding annuities, high net worth products, corporate- and bank-owned life insurance and guaranteed investment contracts (GICs).

Property Casualty products are primarily distributed through a network of independent retail and wholesale brokers, and through an independent agency network. Mortgage Guaranty products and services are provided to mortgage lenders including mortgage banks, credit unions and finance agencies. Institutional Markets products are marketed primarily through specialized marketing and consulting firms and structured settlement brokers.

Consumer Insurance

The Consumer Insurance segment is presented as three operating segments:

  • Retirement – consists of Fixed Annuities, Retirement Income Solutions, Group Retirement, and Retail Mutual Funds product lines.
  • Life – primary products in the U.S. include term life and universal life insurance. International products include term and whole life insurance, supplemental health, cancer and critical illness insurance.
  • Personal Insurance – consists of Personal Lines and Accident & Health product lines.

Retirement products are distributed through affiliated career financial advisors and through non-affiliated channels, which include banks, wirehouses, regional and independent broker-dealers, independent marketing organizations and independent insurance agents. Life products in the U.S. are primarily distributed through independent marking organizations, independent insurance agents, financial advisors and direct marketing. International life products are sold through non-affiliated independent agents and direct marketing. Personal insurance products are distributed primarily through agents and brokers, as well as through direct marketing and partner organizations.

Corporate and Other

Our Corporate and Other consists of:

  • Income from assets held by AIG Parent and other corporate subsidiaries;
  • General operating expenses not attributable to specific reporting segments;
  • Interest expense; and
  • Run-off insurance lines.

Certain of our management activities, such as investment management, enterprise risk management, liquidity management and capital management, and our balance sheet reporting, are conducted on a legal entity basis. We group our insurance-related legal entities into two categories: Non-Life Insurance Companies, and Life Insurance Companies.

Non-Life Insurance Companies include the following major property casualty and mortgage guaranty companies: National Union Fire Insurance Company of Pittsburgh, Pa.(National Union); American Home Assurance Company (American Home); Lexington Insurance Company (Lexington); Fuji Fire and Marine Insurance Company Limited (Fuji Fire); American Home Assurance Company, Ltd. (American Home Japan); AIG Asia Pacific Insurance, Pte, Ltd.; AIG Europe Limited and United Guaranty Residential Insurance Company (UGRIC).

Life Insurance Companies include the following major operating companies: American General Life Insurance Company (American General Life); The Variable Annuity Life Insurance Company (VALIC); The United States Life Insurance Company in the City of New York (U.S. Life) and AIG Fuji Life Insurance Company Limited (Fuji Life).

The following table presents AIG’s continuing operations by reportable segment:

NetDepreciationPre-Tax
TotalInvestmentInterestandOperating
(in millions) RevenuesIncomeExpenseAmortizationIncome (Loss)
2015
Commercial Insurance
Property Casualty$23,625$3,596$12$2,255$593
Mortgage Guaranty1,051139-64644
Institutional Markets3,5181,73911(177)415
Total Commercial Insurance28,1945,474232,1421,652
Consumer Insurance
Retirement9,2986,00239(98)2,839
Life6,3932,10014205465
Personal Insurance11,37822011,94474
Total Consumer Insurance27,0698,322542,0513,378
Corporate and Other2,9016171,313426(883)
AIG Consolidation and elimination(573)(317)(109)10(92)
Total AIG Consolidated pre-tax operating income$57,591$14,096$1,281$4,629$4,055
Reconciling Items from pre-tax operating income to pre-tax income:
Changes in fair value of securities used to hedge guaranteed
living benefits(43)(43)--(43)
Changes in benefit reserves and DAC, VOBA and SIA related to
net realized capital gains----(15)
Other income (expense) - net----(233)
Loss on extinguishment of debt----(756)
Net realized capital gains776---776
Income from divested businesses(48)---(59)
Non-operating litigation reserves and settlements94---82
Reserve development related to non-operating run-off insurance
business----(30)
Restructuring and other costs----(496)
Other(43)----
Pre-tax income$58,327$14,053$1,281$4,629$3,281
2014
Commercial Insurance
Property Casualty$25,183$4,298$-$2,445$4,248
Mortgage Guaranty1,042138-56592
Institutional Markets2,5761,9577(215)670
Total Commercial Insurance28,8016,39372,2865,510
Consumer Insurance
Retirement9,7846,48923(231)3,495
Life6,3212,1997130580
Personal Insurance12,36439422,067399
Total Consumer Insurance28,4699,082321,9664,474
Corporate and Other4,2067001,805346(379)
AIG Consolidation and elimination(475)(356)(126)(181)(31)
Total AIG Consolidated pre-tax operating income$61,001$15,819$1,718$4,417$9,574
Reconciling Items from pre-tax operating income to pre-tax income:
Changes in fair value of securities used to hedge guaranteed
living benefits260260--260
Changes in benefit reserves and DAC, VOBA and SIA related to
net realized capital gains----(217)
Other income (expense) - net-----
Loss on extinguishment of debt----(2,282)
Net realized capital gains739---739
Loss from divested businesses1,602--312,169
Non-operating litigation reserves and settlements804---258
Reserve development related to non-operating run-off insurance
business-----
Restructuring and other costs-----
Other-----
Pre-tax income$64,406$16,079$1,718$4,448$10,501
2013
Commercial Insurance
Property Casualty$25,108$4,431$8$2,393$4,095
Mortgage Guaranty941132-50205
Institutional Markets2,8132,0901(160)680
Total Commercial Insurance28,8626,65392,2834,980
Consumer Insurance
Retirement9,4316,6283(165)3,490
Life6,3972,2694214806
Personal Insurance12,83245532,110268
Total Consumer Insurance28,6609,352102,1594,564
Corporate and Other4,0733092,451221(265)
AIG Consolidation and elimination(71)(343)(328)(26)111
Total AIG Consolidated pre-tax operating income$61,524$15,971$2,142$4,637$9,390
Reconciling Items from pre-tax operating income to pre-tax income:
Changes in fair value of securities used to hedge guaranteed
living benefits(161)(161)--(161)
Changes in benefit reserves and DAC, VOBA and SIA related to
net realized capital gains----(1,608)
Other income (expense) - net----(72)
Loss on extinguishment of debt----(651)
Net realized capital gains1,939---1,939
Loss from divested businesses4,420--76(177)
Non-operating litigation reserves and settlements1,152---708
Reserve development related to non-operating run-off insurance
business-----
Restructuring and other costs-----
Other-----
Pre-tax income$68,874$15,810$2,142$4,713$9,368

The following table presents AIG’s year-end identifiable assets and capital expenditures by legal entity category:

Year-End Identifiable AssetsCapital Expenditures
(in millions)2015201420152014
Total Non-Life Insurance Companies$150,368$164,299$991$697
Total Life Insurance Companies297,499301,295102114
Total Corporate and Other141,648159,3946291,021
AIG Consolidation and Elimination(92,572)(109,407)--
Total Assets$496,943$515,581$1,722$1,832

The following table presents AIG’s consolidated total revenues and real estate and other fixed assets, net of accumulated depreciation, by major geographic area:

Real Estate and Other Fixed Assets,
Total Revenues*Net of Accumulated Depreciation
(in millions)201520142013201520142013
U.S.$42,366$44,274$46,078$2,213$1,886$1,606
Asia Pacific5,9427,5238,804602521448
Other Foreign10,01912,60913,992320293261
Consolidated$58,327$64,406$68,874$3,135$2,700$2,315

* Revenues are generally reported according to the geographic location of the reporting unit.