Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations Off-Balance Sheet Arrangements In the course of selling business entities and assets to third parties, CNA has agreed to indemnify purchasers for losses arising out of breaches of representation and warranties with respect to the business entities or assets being sold, including, in certain cases, losses arising from undisclosed liabilities or certain named litigation.
Such indemnification provisions generally survive for periods ranging from nine months following the applicable closing date to the expiration of the relevant statutes of limitation.
As of December 31, 2007, the aggregate amount of quantifiable indemnification agreements in effect for sales of CNA business entities, assets, and third party loans was $873 million.
In addition, CNA has agreed to provide indemnification to third party purchasers for certain losses associated with sold business entities or assets that are not limited by a contractual monetary amount.
As of December 31, 2007, CNA had outstanding unlimited indemnifications in connection with the sales of certain of its business entities or assets that included tax liabilities arising prior to a purchaser’s ownership of an entity or asset, defects in title at the time of sale, employee claims arising prior to closing and in some cases, losses arising from certain litigation and undisclosed liabilities.
These indemnification agreements survive until the applicable statutes of limitation expire, or until the agreed upon contract terms expire.
As of December 31, 2007 and 2006, CNA has recorded approximately $27 million and $28 million of liabilities related to the CNA indemnification agreements.
At December 31, 2007 and 2006, we had no other off-balance sheet arrangements.
Contractual Obligations Our contractual payment obligations are as follows:
## Table 0 ##
(a) Includes estimated future interest payments, but does not include original issue discount.
(b) Claim and claim adjustment expense reserves are not discounted and represent CNA’s estimate of the amount and timing of the ultimate settlement and administration of claims based on its assessment of facts and circumstances known as of December 31, 2007.
See the Reserves – Estimates and Uncertainties section of this MD&A for further information.
Claim and claim adjustment expense reserves of $16 related to business which has been 100% ceded to unaffiliated parties in connection with the individual life sale are not included.
(c) Future policy benefits and policyholder funds reserves are not discounted and represent CNA’s estimate of the ultimate amount and timing of the settlement of benefits based on its assessment of facts and circumstances known as of December 31, 2007.
Future policy benefit reserves of $843 and policyholder fund reserves of $42 related to business which has been 100% ceded to unaffiliated parties in connection with the individual life sale are not included.
Additional information on future policy benefits and policyholder funds reserves is included in Note 1 of the Notes to Consolidated Financial Statements included under Item 8.
(d) Consists primarily of obligations aggregating $851 related to Boardwalk Pipeline’s expansion projects as previously discussed in Item 1.
– Business.
In addition, the table above includes approximately $200 relating to Diamond Offshore’s major upgrade of its Ocean Monarch rig and construction of two new jack-up rigs, the Ocean Scepter and Ocean Shield.
In addition, as previously discussed, Lorillard has entered into the State Settlement Agreements which impose a stream of future payment obligations on Lorillard and the other major U. S.  cigarette manufacturers.
Lorillard’s portion of ongoing adjusted settlement payments, including fees to settling plaintiffs’ attorneys, are based on a number of factors which are described under “Liquidity and Capital Resources – Lorillard,” above.
Lorillard’s cash payment in 2007 amounted to $945 million and Lorillard estimates its cash payments in 2008 will be approximately $1,050 million to
Notes to Consolidated Financial Statements Note 19.
Reinsurance – (Continued) contract inception which measure the present value of reinsurer losses as compared to the present value of the related premium.
In 2003, the Company discontinued purchases of such contracts.
The following table summarizes the amounts receivable from reinsurers at December 31, 2007 and 2006.
## Table 1 ##
CNA has established an allowance for uncollectible reinsurance receivables.
The provision for uncollectible reinsurance was $1 million, $23 million and $35 million for the years ended December 31, 2007, 2006 and 2005.
CNA attempts to mitigate its credit risk related to reinsurance by entering into reinsurance arrangements with reinsurers that have credit ratings above certain levels and by obtaining collateral.
The primary methods of obtaining collateral are through reinsurance trusts, letters of credit and funds withheld balances.
Such collateral was approximately $2.4 billion and $2.6 billion at December 31, 2007 and 2006.
On a more limited basis, CNA may enter into reinsurance agreements with reinsurers that are not rated.
CNA’s largest recoverables from a single reinsurer at December 31, 2007, including prepaid reinsurance premiums, were approximately $1.5 billion from subsidiaries of Swiss Re Group, $886 million from subsidiaries of Munich Re Group, $834 million from subsidiaries of Hartford Insurance Group, $357 million from Allstate Insurance Group, and $333 million from Associated Accident & Health Reinsurance Underwriters.
The effects of reinsurance on earned premiums for the years ended December 31, 2007, 2006 and 2005 are shown in the following table:
## Table 2 ##
Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations Overview – (Continued) x exploration, production and marketing of natural gas, natural gas liquids and, to a lesser extent, oil (HighMount Exploration & Production LLC (“HighMount”), a wholly owned subsidiary); x operation of interstate natural gas transmission pipeline systems (Boardwalk Pipeline Partners, LP (“Boardwalk Pipeline”), a 70% owned subsidiary); and x operation of hotels (Loews Hotels Holding Corporation (“Loews Hotels”), a wholly owned subsidiary).
Unless the context otherwise requires, references in this report to “the Company,” “we,” “our,” “us” or like terms refer to the business of Loews Corporation excluding its subsidiaries.
The following discussion should be read in conjunction with Item 1A, Risk Factors, and Item 8, Financial Statements and Supplementary Data of this Form 10-K.  Consolidated Financial Results Net income and earnings per share information attributable to Loews common stock and Carolina Group stock is summarized in the table below.
## Table 3 ##
Consolidated net income (including both the Loews Group and Carolina Group) for the year ended December 31, 2007 was $2,489 million, compared to $2,491 million in the prior year.
Net income attributable to Loews common stock in 2007 amounted to $1,956 million, or $3.65 per share, compared to $2,075 million, or $3.75 per share, in the prior year.
The decrease in net income reflects reduced investment income, reduced results at CNA and a decrease in the share of Carolina Group earnings attributable to Loews common stock, due to the sale of Carolina Group stock in August and May of 2006, partially offset by higher results from Lorillard, Inc.  Net income attributable to Loews common stock includes net investment losses of $67 million (after tax and minority interest) in 2007 compared to net investment gains of $69 million (after tax and minority interest) in the prior year.
The net investment losses in 2007 were primarily driven by $428 million (after tax and minority interest) of other-thantemporary impairment losses at CNA which were partially offset by a gain of $93 million (after tax) related to a reduction in the Company’s ownership interest in Diamond Offshore from the conversion of Diamond Offshore’s 1.5% convertible debt into Diamond Offshore common stock.
Net income per share of Carolina Group stock for 2007 was $4.91 per share, compared to $4.46 per share in the prior year.
The increase in net income is primarily due to higher effective unit prices resulting from price increases in December 2006 and September 2007, lower sales promotion expenses and a lower effective tax rate, partially offset by an increase in expenses for the State Settlement Agreements and a charge related to litigation.
Packaging Corporation of America Notes to Consolidated Financial Statements (Continued) December 31, 2009 Purchase Commitments The Company has entered into various purchase agreements for minimum amounts of pulpwood processing and energy over periods ranging from one to twenty years at fixed prices.
Total purchase commitments are as follows:

<table><tr><td></td><td colspan="5">Payments Due by Period</td></tr><tr><td>December 31, 2007</td><td>Total</td><td>Less than 1 year</td><td>1-3 years</td><td>4-5 years</td><td>More than 5 years</td></tr><tr><td>(In millions)</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Debt (a)</td><td>$10,661</td><td>$784</td><td>$890</td><td>$3,244</td><td>$5,743</td></tr><tr><td>Operating leases</td><td>475</td><td>103</td><td>152</td><td>99</td><td>121</td></tr><tr><td>Claim and claim expense reserves(b)</td><td>30,259</td><td>6,733</td><td>9,194</td><td>4,767</td><td>9,565</td></tr><tr><td>Future policy benefits reserves(c)</td><td>11,388</td><td>180</td><td>346</td><td>332</td><td>10,530</td></tr><tr><td>Policyholder funds reserves(c)</td><td>882</td><td>436</td><td>342</td><td>3</td><td>101</td></tr><tr><td>Purchase obligations(d)</td><td>1,345</td><td>1,106</td><td>191</td><td>48</td><td></td></tr><tr><td>Total</td><td>$55,010</td><td>$9,342</td><td>$11,115</td><td>$8,493</td><td>$26,060</td></tr></table>
<table><tr><td>December 31</td><td>2007</td><td>2006</td></tr><tr><td>(In millions)</td><td></td><td></td></tr><tr><td>Reinsurance receivables related to insurance reserves:</td><td></td><td></td></tr><tr><td>Ceded claim and claim adjustment expense</td><td>$7,056</td><td>$8,191</td></tr><tr><td>Ceded future policy benefits</td><td>987</td><td>1,050</td></tr><tr><td>Ceded policyholders’ funds</td><td>43</td><td>48</td></tr><tr><td>Reinsurance receivables related to paid losses</td><td>603</td><td>658</td></tr><tr><td>Reinsurance receivables</td><td>8,689</td><td>9,947</td></tr><tr><td>Allowance for uncollectible reinsurance</td><td>-461</td><td>-469</td></tr><tr><td>Reinsurance receivables, net of allowance for uncollectiblereinsurance</td><td>$8,228</td><td>$9,478</td></tr></table>
<table><tr><td></td><td>Direct</td><td>Assumed</td><td>Ceded</td><td>Net</td><td>Assumed/ Net %</td></tr><tr><td>(In millions)</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Year Ended December 31, 2007</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Property and casualty</td><td>$9,097</td><td>$118</td><td>$2,349</td><td>$6,866</td><td>1.7%</td></tr><tr><td>Accident and health</td><td>660</td><td>76</td><td>119</td><td>617</td><td>12.3</td></tr><tr><td>Life</td><td>76</td><td></td><td>75</td><td>1</td><td></td></tr><tr><td>Earned premiums</td><td>$9,833</td><td>$194</td><td>$2,543</td><td>$7,484</td><td>2.6%</td></tr><tr><td>Year Ended December 31, 2006</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Property and casualty</td><td>$9,125</td><td>$120</td><td>$2,283</td><td>$6,962</td><td>1.7%</td></tr><tr><td>Accident and health</td><td>718</td><td>59</td><td>138</td><td>639</td><td>9.2</td></tr><tr><td>Life</td><td>100</td><td></td><td>98</td><td>2</td><td></td></tr><tr><td>Earned premiums</td><td>$9,943</td><td>$179</td><td>$2,519</td><td>$7,603</td><td>2.4%</td></tr><tr><td>Year Ended December 31, 2005</td><td></td><td></td><td></td><td></td><td></td></tr><tr><td>Property and casualty</td><td>$10,354</td><td>$186</td><td>$3,675</td><td>$6,865</td><td>2.7%</td></tr><tr><td>Accident and health</td><td>1,040</td><td>60</td><td>400</td><td>700</td><td>8.6</td></tr><tr><td>Life</td><td>140</td><td></td><td>136</td><td>4</td><td></td></tr><tr><td>Earned premiums</td><td>$11,534</td><td>$246</td><td>$4,211</td><td>$7,569</td><td>3.3%</td></tr></table>
<table><tr><td>Year Ended December 31</td><td>2007</td><td>2006</td></tr><tr><td>(In millions, except per share data)</td><td></td><td></td></tr><tr><td>Net income attributable to Loews common stock:</td><td></td><td></td></tr><tr><td>Income from continuing operations</td><td>$1,948</td><td>$2,086</td></tr><tr><td>Discontinued operations, net</td><td>8</td><td>-11</td></tr><tr><td>Net income attributable to Loews common stock</td><td>1,956</td><td>2,075</td></tr><tr><td>Net income attributable to Carolina Group stock</td><td>533</td><td>416</td></tr><tr><td>Consolidated net income</td><td>$2,489</td><td>$2,491</td></tr><tr><td>Net income per share:</td><td></td><td></td></tr><tr><td>Loews common stock</td><td></td><td></td></tr><tr><td>Income from continuing operations</td><td>$3.64</td><td>$3.77</td></tr><tr><td>Discontinued operations, net</td><td>0.01</td><td>-0.02</td></tr><tr><td>Loews common stock</td><td>$3.65</td><td>$3.75</td></tr><tr><td>Carolina Group stock</td><td>$4.91</td><td>$4.46</td></tr></table>

Question: In the year with lowest amount of Accident and health of ceded, what's the increasing rate of life? (in %)