EMPLOYEE BENEFITS

6 Months Ended

Jun. 30, 2012

EMPLOYEE BENEFITS

EMPLOYEE BENEFITS

11. EMPLOYEE BENEFITS

The following table presents the components of net periodic benefit cost with respect to pensions and other postretirement benefits:

	Pension									Postretirement
(in millions)	Non-U.S. Plans			U.S. Plans			Total			Non-U.S. Plans		U.S. Plans			Total
Three Months Ended June 30, 2012
Components of net periodic benefit cost:
Service cost	$	13		$	39		$	52		$	-	$	2		$	2
Interest cost		9			50			59			1		2			3
Expected return on assets		(5	)		(60	)		(65	)		-		-			-
Amortization of prior service (credit) cost		(1	)		(9	)		(10	)		-		(2	)		(2	)
Amortization of net (gain) loss		3			29			32			-		-			-
Net periodic benefit cost	$	19		$	49		$	68		$	1	$	2		$	3
Three Months Ended June 30, 2011
Components of net periodic benefit cost:
Service cost	$	16		$	37		$	53		$	1	$	2		$	3
Interest cost		8			52			60			-		3			3
Expected return on assets		(6	)		(63	)		(69	)		-		-			-
Amortization of prior service (credit) cost		-			1			1			-		1			1
Amortization of net (gain) loss		3			10			13			-		-			-
Net periodic benefit cost	$	21		$	37		$	58		$	1	$	6		$	7
Amount associated with discontinued operations	$	1		$	-		$	1		$	-	$	-		$	-
Six Months Ended June 30, 2012
Components of net periodic benefit cost:
Service cost	$	26		$	76		$	102		$	1	$	3		$	4
Interest cost		17			100			117			1		5			6
Expected return on assets		(10	)		(120	)		(130	)		-		-			-
Amortization of prior service (credit) cost		(2	)		(17	)		(19	)		-		(5	)		(5	)
Amortization of net (gain) loss		7			58			65			-		-			-
Net periodic benefit cost	$	38		$	97		$	135		$	2	$	3		$	5
Six Months Ended June 30, 2011
Components of net periodic benefit cost:
Service cost	$	38		$	74		$	112		$	2	$	4		$	6
Interest cost		19			104			123			1		7			8
Expected return on assets		(13	)		(126	)		(139	)		-		-			-
Amortization of prior service (credit) cost		(2	)		1			(1	)		-		1			1
Amortization of net (gain) loss		9			21			30			-		-			-
Net periodic benefit cost	$	51		$	74		$	125		$	3	$	12		$	15
Amount associated with discontinued operations	$	11		$	-		$	11		$	1	$	-		$	1

    For the six-month period ended June 30, 2012, AIG contributed $47 million to its U.S. and non-U.S. pension plans and estimates it will contribute an additional $44 million for the remainder of 2012. These estimates are subject to change since contribution decisions are affected by various factors, including AIG's liquidity, market performance and management discretion.