Employee Benefits

9 Months Ended

Sep. 30, 2020

Retirement Benefits [Abstract]

Employee Benefits

Employee Benefits

The following table provides the components of the net periodic (benefit) cost recognized in the Condensed Consolidated Statements of Income for Aon’s significant U.K., U.S., and other major pension plans, which are located in the Netherlands and Canada. Service cost is reported in Compensation and benefits and all other components are reported in Other income (expense) as follows (in millions):

	Three Months Ended September 30,
	U.K.				U.S.				Other
	2020		2019		2020		2019		2020		2019
Service cost	$	—	$	—	$	—	$	—	$	—	$	—
Interest cost	22		26		22		27		5		6
Expected return on plan assets, net of administration expenses	(40)		(46)		(34)		(34)		(8)		(9)
Amortization of prior-service cost	—		—		—		1		—		—
Amortization of net actuarial loss	8		7		17		13		3		3
Total net periodic (benefit) cost	$	(10)	$	(13)	$	5	$	7	$	—	$	—
	Nine Months Ended September 30,
	U.K.				U.S.				Other
	2020		2019		2020		2019		2020		2019
Service cost	$	—	$	—	$	—	$	—	$	—	$	—
Interest cost	65		81		64		81		14		20
Expected return on plan assets, net of administration expenses	(118)		(143)		(100)		(102)		(25)		(29)
Amortization of prior-service cost	1		1		—		2		—		—
Amortization of net actuarial loss	23		22		51		40		9		9
Net periodic (benefit) cost	(29)		(39)		15		21		(2)		—
Loss on pension settlement	2		—		—		—		—		—
Total net periodic (benefit) cost	$	(27)	$	(39)	$	15	$	21	$	(2)	$	—

In the second quarter of 2020, settlements from a certain U.K. pension plan exceeded the plan’s service and interest cost. This triggered settlement accounting which required the immediate recognition of a portion of the accumulated losses associated with the plan. Consequently, the Company recognized a non-cash settlement charge of approximately £2 million ($2 million using June 30, 2020 exchange rates).

Contributions

Assuming no additional contributions are agreed to with, or required by, the pension plan trustees, the Company expects to make total cash contributions of approximately $5 million, $99 million, and $19 million, (at December 31, 2019 exchange rates) to its significant U.K., U.S., and other major pension plans, respectively, during 2020. The following table summarizes contributions made to the Company’s significant pension plans (in millions):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Contributions to U.K. pension plans	$	2	$	19	$	6	$	65
Contributions to U.S. pension plans	44		7		82		30
Contributions to other major pension plans	3		3		14		13
Total contributions	$	49	$	29	$	102	$	108