Income Taxes (Tables)

12 Months Ended

Dec. 31, 2011

Income Taxes

Reconciliation of the change in the amount of unrecognized tax benefits

($ in millions)	2011		2010		2009
Balance – beginning of year	$	25	$	22	$	21
Increase for tax positions taken in a prior year		—		1		—
Decrease for tax positions taken in a prior year		—		—		—
Increase for tax positions taken in the current year		—		2		1
Decrease for tax positions taken in the current year		—		—		—
(Decrease) increase for settlements		—		—		—
Reductions due to lapse of statute of limitations		—		—		—
Balance – end of year	$	25	$	25	$	22

Components of the deferred income tax assets and liabilities

($ in millions)	2011			2010
Deferred assets
Unearned premium reserves	$	656		$	637
Difference in tax bases of invested assets		564			521
Discount on loss reserves		315			310
Pension		255			229
Alternative minimum tax credit carryforward		255			168
Accrued compensation		213			201
Net operating loss carryforwards		203			—
Other postretirement benefits		188			157
Life and annuity reserves		10			227
Other assets		84			70
Total deferred assets		2,743			2,520
Valuation allowance		(67	)		(6	)
Net deferred assets		2,676			2,514
Deferred liabilities
DAC		(897	)		(937	)
Unrealized net capital gains		(757	)		(511	)
Other intangible assets		(142	)		(6	)
Other liabilities		(158	)		(61	)
Total deferred liabilities		(1,954	)		(1,515	)
Net deferred asset	$	722		$	999

Components of income tax expense (benefit)

($ in millions)	2011		2010		2009
Current	$	14	$	133	$	(18	)
Deferred		158		56		430
Total income tax expense	$	172	$	189	$	412

Reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations

	2011			2010			2009
Statutory federal income tax rate		35.0	%		35.0	%		35.0	%
Tax-exempt income		(13.6	)		(16.1	)		(19.4	)
Tax credits		(2.1	)		(0.5	)		—
Dividends received deduction		(1.8	)		(1.5	)		(1.2	)
Adjustment to prior year tax liabilities		(0.8	)		(0.2	)		(2.6	)
Other		1.2			0.5			0.8
Valuation allowance		—			—			19.1
Effective income tax rate		17.9	%		17.2	%		31.7	%