We acquired HCC Global Financial Products (HCC Global), which underwrites our U.S. and International directors' and officers' liability business, in 2002. The purchase agreement, as amended, includes a contingency for future earnout payments. The earnout is based on HCC Global's pretax earnings from the acquisition date through September 30, 2007, with no maximum amount due to the former owners. When conditions specified under the purchase agreement are met, we record a net amount owed to or due from the former owners based on our estimate, at that point in time, of how claims will ultimately be settled. This net amount will fluctuate in the future, and the ultimate total net earnout payments cannot be finally determined until all claims are settled or paid.

Based on our estimate of ultimate claims settlements as of December 31, 2010, we recorded a projected net amount due from the owners of $20.0 million at year-end 2010. This net amount included approximately $22.7 million that was contractually due to the former owners in 2011. In March 2011, certain amendments were made to the purchase agreement, which resulted in an adjustment to our estimate of the ultimate amounts to be settled under the agreement. As a result, we increased goodwill by $20.0 million. Based on our estimate of ultimate claims settlements as of December 31, 2011, we recorded a projected amount due to the former owners of $31.3 million at year-end 2011, which is payable in 2012. All adjustments to the ultimate purchase price have been, or will be, recorded as an increase or decrease to goodwill. The total HCC Global earnout and related goodwill recognized from the acquisition date through December 31, 2011 was $255.6 million.

In 2010, we sold an inactive subsidiary, HCC Insurance Company, for $14.7 million cash and realized a $0.5 million gain.

In 2009, we sold the assets and licensed the intangibles related to our commercial marine agency business. We entered into a five-year managing general underwriter agreement that allows the purchaser to write that same business utilizing policies issued by one of our insurance companies. We reduced goodwill by $18.0 million, the amount assigned to this former reporting unit, and recognized an immaterial gain on the transaction.

In 2009, we executed a contract to sell 100% of the stock of our reinsurance broker, Rattner Mackenzie Limited (RML), to an affiliate of Marsh & McLennan Companies, Inc. (MMC) for $42.5 million of MMC common stock. We also executed an agreement with MMC and its affiliates whereby our insurance companies and agencies will continue to utilize MMC and its affiliates to place certain of our reinsurance programs. We sold assets of $142.2 million and liabilities of $165.6 million. We reduced goodwill by $41.9 million, the amount assigned to this former reporting unit, and recognized a loss of $4.7 million, which was included in other operating income in our consolidated statements of earnings. We sold the MMC stock at a gain shortly after the RML transaction closed.

In connection with the changes to our segment reporting structure in the third quarter of 2010, we allocated our consolidated goodwill to five reporting units, which are the same as our insurance underwriting segments. We allocated the goodwill based on the relative fair value of each reporting unit to the sum of the reporting units' total fair value at September 30, 2010. The goodwill balances by reportable segment and the changes in goodwill after our resegmentation are shown in the table below.

	U.S. Property		Professional		Accident		U.S. Surety
	& Casualty		Liability		& Health		& Credit		International		Total

Balance at September 30, 2010	$	223,000	$	250,000	$	144,000	$	79,700	$	125,000	$	821,700
Earnout and other		0		(180)		128		0		0		(52)
Balance at December 31, 2010		223,000		249,820		144,128		79,700		125,000		821,648
Earnout and other		0		51,727		4		0		(565)		51,166
Balance at December 31, 2011	$	223,000	$	301,547	$	144,132	$	79,700	$	124,435	$	872,814