Non-Insurance Revenues from Contracts with Customers

12 Months Ended

Dec. 31, 2018

Revenue from Contract with Customer [Abstract]

Non-Insurance Revenues from Contracts with Customers

Non-Insurance Revenues from Contracts with Customers

Non-Insurance revenue is recognized when obligations under the terms of a contract with a customer are satisfied; generally this occurs over time as obligations are fulfilled. Revenue is measured as the amount of consideration the Company expects to receive in exchange for providing services.

Deferred Non-Insurance Warranty Revenue

The Company had deferred non-insurance warranty revenue balances of $2.9 billion and $3.4 billion reported in Deferred non-insurance warranty revenue as of January 1, 2018 and December 31, 2018. The increase in the deferred revenue balance for the year ended December 31, 2018 was primarily driven by deferrals outpacing revenue recognized in the period due to growth in the business. For the year ended December 31, 2018, the Company recognized $834 million of revenues that were included in the deferred revenue balance as of January 1, 2018. For the year ended December 31, 2018, Non-insurance warranty revenue recognized from performance obligations related to prior periods due to a change in estimate was not material. The Company expects to recognize approximately $963 million of the deferred revenue in 2019, $791 million in 2020, $613 million in 2021 and $1.0 billion thereafter.

Cost to Obtain and Fulfill Non-Insurance Warranty Contracts with Customers

As of December 31, 2018, capitalized commission costs were $2.5 billion and capitalized administrator service costs were $24 million. For the year ended December 31, 2018, the amount of amortization of capitalized costs was $673 million and there was no impairment loss related to the costs capitalized. There were no adjustments to deferred costs recorded for the year ended December 31, 2018.