SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Jun. 30, 2020

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Rollforward of allowance for credit losses related to the adoption of the Financial Instruments Credit Losses Standard

Three Months Ended June 30, 2020		Balance,		Cumulative Effect		Purchased Credit		Incremental Increase		Write-offs and		Balance,
		Beginning		Adjustment as of		Deteriorated Initial		(Decrease) Recognized		Other Changes		End of
(in millions)		of Period		January 1, 2020		Allowance		in Income		in the Allowance(h)		Period
Securities available for sale(a)	$	211	$	-	$	20	$	29	$	(62)	$	198
Mortgage and other loan receivables(b)		787		-		-		19		(12)		794
Reinsurance recoverables (inclusive of
deposit accounted assets)(c)		362		-		-		7		(5)		364
Premiums and other receivables(d)		210		-		-		2		-		212
Contractual deductible recoverables(e)		14		-		-		-		-		14
Commercial mortgage loan commitments(f)		58		-		-		-		-		58
Total	$	1,642	$	-	$	20	$	57	$	(79)	$	1,640
Six Months Ended June 30, 2020
Securities available for sale(a)	$	-	$	-	$	33	$	227	$	(62)	$	198
Mortgage and other loan receivables(b)		438		318		-		50		(12)		794
Reinsurance recoverables (inclusive of
deposit accounted assets)(c)		151		224		-		5		(16)		364
Premiums and other receivables(d)		178		34		-		2		(2)		212
Contractual deductible recoverables(e)		-		14		-		-		-		14
Commercial mortgage loan commitments(f)		-		51		-		7		-		58
Total	$	767	$	641	$	33	$	291	$	(92)	$	1,640
Secondary impacts to certain long-duration
insurance contracts(g)				(27)
Tax impact				(127)
Total cumulative effect adjustment			$	487

(a)The allowance for credit losses is reported in Bonds available for sale in the Condensed Consolidated Balance Sheets. Changes in the allowance for credit losses are reported in Net realized capital gains (losses) in the Condensed Consolidated Statements of Income. Refer to Note 5 for additional information.

(b)The allowance for credit losses is reported in Mortgage and other loans receivable in the Condensed Consolidated Balance Sheets. Changes in the allowance for credit losses are reported in Net realized capital gains (losses) in the Condensed Consolidated Statements of Income. Refer to Note 6 for additional information.

(c)The allowance for credit losses is reported in Reinsurance assets – other and Reinsurance assets – Fortitude Re for reinsurance contracts that contain sufficient insurance risk, and reported in Other assets for insurance and reinsurance contracts that do not contain sufficient insurance risk in the Condensed Consolidated Balance Sheets. Changes in the allowance for credit losses are reported in Policyholder benefits and losses incurred for reinsurance contracts that do contain sufficient insurance risk and premiums for contracts that do not contain sufficient insurance risk in the Condensed Consolidated Statements of Income. Refer to Note 7 for additional information.

(d)The allowance for credit losses is reported in Premiums and other receivables in the Condensed Consolidated Balance Sheets. Changes in the allowance for credit losses are reported in General operating and other expenses in the Condensed Consolidated Statements of Income. Refer to Note 2 for additional information.

(e)The allowance for credit losses is reported in Liability for unpaid losses and loss adjustment expenses in the Condensed Consolidated Balance Sheets. Changes in the allowance for credit losses are reported in Policyholder benefits and losses incurred in the Condensed Consolidated Statements of Income. Refer to Note 10 for additional information.

(f)The allowance for credit losses is reported in Other liabilities in the Condensed Consolidated Balance Sheets. Changes in the allowance for credit losses are reported in Net realized capital gains (losses) in the Condensed Consolidated Statements of Income. Refer to Note 6 for additional information.

(g)This reflects adjustments to the amortization of DAC, unearned revenue reserve and sales inducement assets as well as impacts on the future policy benefits for certain universal life and variable annuity contracts.

(h) A write-off does not generally result in an incremental loss to AIG. Prior to a write-off occurring, the allowance for the credit loss is increased or decreased to reflect AIG’s expectation of the credit loss to be incurred. Accordingly, when a write-off occurs, the allowance is reversed for the same amount, resulting in no incremental loss to AIG.