| BUSINESS SEGMENT INFORMATION |
BUSINESS SEGMENT INFORMATION
The Company consists of two reportable insurance business segments: Aflac Japan and Aflac U.S., both of which sell supplemental health and life insurance. Operating business segments that are not individually reportable and business activities not included in Aflac Japan or Aflac U.S. are included in the "Other business segments" category.
We do not allocate corporate overhead expenses to business segments. We evaluate and manage our business segments using a financial performance measure called pretax operating earnings. Our definition of operating earnings excludes the following items from net earnings on an after-tax basis: realized investment gains/losses (securities transactions, impairments, and the impact of derivative and hedging activities) and nonrecurring items. We then exclude income taxes related to operations to arrive at pretax operating earnings. Information regarding operations by segment follows:
| | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | (In millions) | 2012 | | 2011 | | 2012 | | 2011 | Revenues: | | | | | | | | Aflac Japan: | | | | | | | | Earned premiums | $ | 4,405 |
| | $ | 4,018 |
| | $ | 12,769 |
| | $ | 11,490 |
| Net investment income | 713 |
| | 695 |
| | 2,134 |
| | 1,980 |
| Other income | 22 |
| | 7 |
| | 38 |
| | 33 |
| Total Aflac Japan | 5,140 |
| | 4,720 |
| | 14,941 |
| | 13,503 |
| Aflac U.S.: | | | | | | | | Earned premiums | 1,254 |
| | 1,192 |
| | 3,736 |
| | 3,547 |
| Net investment income | 153 |
| | 147 |
| | 457 |
| | 439 |
| Other income | 5 |
| | 3 |
| | 10 |
| | 8 |
| Total Aflac U.S. | 1,412 |
| | 1,342 |
| | 4,203 |
| | 3,994 |
| Other business segments | 10 |
| | 13 |
| | 40 |
| | 40 |
| Total business segment revenues | 6,562 |
| | 6,075 |
| | 19,184 |
| | 17,537 |
| Realized investment gains (losses) | 286 |
| | (83 | ) | | (177 | ) | | (1,330 | ) | Corporate | 65 |
| | 62 |
| | 197 |
| | 183 |
| Intercompany eliminations | (66 | ) | | (67 | ) | | (215 | ) | | (198 | ) | Total revenues | $ | 6,847 |
| | $ | 5,987 |
| | $ | 18,989 |
| | $ | 16,192 |
|
| | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | (In millions) | 2012 | | 2011 | | 2012 | | 2011 | Pretax earnings: | | | | | | | | Aflac Japan | $ | 994 |
| | $ | 1,019 |
| | $ | 2,998 |
| | $ | 2,918 |
| Aflac U.S. | 260 |
| | 214 |
| | 789 |
| | 708 |
| Other business segments | 0 |
| | 0 |
| | 0 |
| | 2 |
| Total business segment pretax operating earnings | 1,254 |
| | 1,233 |
| | 3,787 |
| | 3,628 |
| Interest expense, noninsurance operations | (45 | ) | | (44 | ) | | (134 | ) | | (126 | ) | Corporate and eliminations | (15 | ) | | (14 | ) | | (53 | ) | | (43 | ) | Pretax operating earnings | 1,194 |
| | 1,175 |
| | 3,600 |
| | 3,459 |
| Realized investment gains (losses) | 286 |
| | (83 | ) | | (177 | ) | | (1,330 | ) | Total earnings before income taxes | $ | 1,480 |
| | $ | 1,092 |
| | $ | 3,423 |
| | $ | 2,129 |
| Income taxes applicable to pretax operating earnings | $ | 363 |
| | $ | 405 |
| | $ | 1,200 |
| | $ | 1,196 |
| Effect of foreign currency translation on operating earnings | 2 |
| | 45 |
| | 28 |
| | 144 |
|
Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2012 related to deferred policy acquisition costs.
Assets were as follows: | | | | | | | | | (In millions) | September 30,
2012 | | December 31,
2011 | Assets: | | | | Aflac Japan | $ | 120,712 |
| | $ | 101,692 |
| Aflac U.S. | 15,785 |
| | 13,942 |
| Other business segments | 144 |
| | 160 |
| Total business segment assets | 136,641 |
| | 115,794 |
| Corporate | 21,486 |
| | 16,182 |
| Intercompany eliminations | (20,287 | ) | | (15,739 | ) | Total assets | $ | 137,840 |
| | $ | 116,237 |
|
Prior-year amounts have been adjusted for the adoption of accounting guidance on January 1, 2012 related to deferred policy acquisition costs. |