Long-Term Commitments

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Long-Term Commitments

Long-term Commitments

The Company leases office facilities, equipment and automobiles under non-cancelable operating leases. These leases expire on varying dates, in some instances contain renewal and expansion options, do not restrict the payment of dividends or the incurrence of debt or additional lease obligations, and contain no significant purchase options. In addition to the base rental costs, occupancy lease agreements generally provide for rent escalations resulting from increased assessments for real estate taxes and other charges. Approximately 98% of the Company’s lease obligations are for the use of office space.

The consolidated statements of income include net rental costs of $383 million, $354 million and $367 million for 2018, 2017 and 2016, respectively, after deducting rentals from subleases ($8 million in 2018, $8 million in 2017 and $9 million in 2016). These net rental costs exclude rental costs and sublease income for previously accrued restructuring charges related to vacated space.

At December 31, 2018, the aggregate future minimum rental commitments under all non-cancelable operating lease agreements are as follows:

For the Years Ended December 31,	Gross Rental Commitments		Rentals from Subleases		Net Rental Commitments
(In millions of dollars)
2019	$	361	$	32	$	329
2020	$	340	$	31	$	309
2021	$	277	$	12	$	265
2022	$	252	$	10	$	242
2023	$	214	$	9	$	205
Subsequent years	$	753	$	32	$	721

The Company has entered into agreements, primarily with various service companies, to outsource certain information systems activities and responsibilities and processing activities. Under these agreements, the Company is required to pay minimum annual service charges. Additional fees may be payable depending upon the volume of transactions processed, with all future payments subject to increases for inflation. At December 31, 2018, the aggregate fixed future minimum commitments under these agreements are as follows:

For the Years Ended December 31,	Future Minimum Commitments
(In millions of dollars)
2019	$	189
2020	37
2021	14
Subsequent years	19
	$	259