Pension plans (Tables)

12 Months Ended

Dec. 31, 2012

Schedule of net periodic pension expense

The components of net periodic pension expense for each of the three years ending December 31, 2012 are as follows (in millions).

	2012			2011			2010
Service cost	$	247		$	191		$	165
Interest cost		583			568			543
Expected return on plan assets		(610	)		(579	)		(528	)
Other, primarily amortization of actuarial losses		220			102			69
Net pension expense	$	440		$	282		$	249

Schedule of changes in projected benefit obligations

A reconciliation of the changes in the PBOs for each of the years ending December 31, 2012 and 2011 is shown in the table that follows (in millions).

	2012			2011
Projected benefit obligation, beginning of year	$	12,992		$	10,598
Service cost		247			191
Interest cost		583			568
Benefits paid		(879	)		(579	)
Business acquisitions		8			1,017
Actuarial (gains) or losses and other		1,122			1,197
Projected benefit obligation, end of year	$	14,073		$	12,992

Changes in plan assets

A reconciliation of the changes in assets of all plans for each of the years ending December 31, 2012 and 2011 is presented in the table that follows (in millions).

	2012			2011
Plan assets at beginning of year	$	9,150		$	8,246
Employer contributions		649			523
Benefits paid		(879	)		(579	)
Actual return on plan assets		1,429			361
Business acquisitions		6			632
Other		81			(33	)
Plan assets at end of year	$	10,436		$	9,150

Schedule of fair value measurements by major categories of plan assets

Fair value measurements for pension assets as of December 31, 2012 and 2011 follow (in millions).

	Total Fair Value		Quoted Prices (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
December 31, 2012
Cash and equivalents	$	900	$	345	$	555	$	—
Government obligations		899		529		370		—
Investment funds		2,069		413		1,650		6
Corporate debt obligations		689		86		603		—
Equity securities		5,444		5,211		233		—
Other		435		12		97		326
	$	10,436	$	6,596	$	3,508	$	332
December 31, 2011
Cash and equivalents	$	830	$	797	$	33	$	—
Government obligations		915		534		380		1
Investment funds		1,872		402		1,465		5
Corporate debt obligations		1,180		95		1,085		—
Equity securities		3,618		3,432		186		—
Other		735		37		314		384
	$	9,150	$	5,297	$	3,463	$	390

Schedule of net funded status of pension plans

The net funded status of the defined benefit pension plans is summarized in the table that follows (in millions).

	December 31,
	2012			2011
Amounts recognized in the Consolidated Balance Sheets:
Accounts payable, accruals and other liabilities	$	3,441		$	3,686
Losses and loss adjustment expenses		256			214
Other assets		(60	)		(58	)
	$	3,637		$	3,842

Schedule of pension plan amounts recognized In accumulated other comprehensive income

A reconciliation of the pre-tax accumulated other comprehensive income (loss) related to defined benefit pension plans for each of the two years ending December 31, 2012 follows (in millions). We estimate that $221 million of the balance at December 31, 2012 will be included in pension expense in 2013.

	2012			2011
Balance at beginning of year	$	(2,521	)	$	(1,395	)
Amount included in net periodic pension expense		130			76
Gains (losses) current period and other		(125	)		(1,202	)
Balance at end of year	$	(2,516	)	$	(2,521	)

Weighted Average Interest Rate Assumptions

Weighted average interest rate assumptions used in determining projected benefit obligations and net periodic pension expense were as follows.

	2012			2011
Applicable to pension benefit obligations:
Discount rate		4.0	%		4.6	%
Expected long-term rate of return on plan assets		6.6			6.9
Rate of compensation increase		3.6			3.7
Discount rate applicable to pension expense		4.5			5.3