Management expenses and other outgo, depreciation, fluctuations In stock exchange and foreign currency rates, taxes Profit applicable to minority shareholders
Capital market Investments, real estate A. Saxer, Manager RRHügle, Deputy Manager F. Bolliger, Deputy Manager LGenoud, Deputy Manager J,-R. MIchot, Assistant Manager B. Rerrln, Assistant Manager J.-R. Rreyer, Assistant Manager F. E. Rotiner, Assistant Manager LWüger, Assistant Manager
Personnel service, training E. E.Arpagaus, Manager R. Oberle, Assistant Manager J. Niederer, Assistant Manager H.Sporri, Assistant Manager
The financial result of the 1981 business year is somewhat below our expectations, although current investment income strikingly exceeds that of the previous year. The strict application of the method by which investments are valued according to the lower of cost or market called for substantial write-offs as a result of the pronounced drop in stock exchange rates. Realized capital gains on capital market investments also turned out to be more modest than in the previous year. Wherever write-offs concern fixed-interest investments it is not possible to speak of outgo In the true sense as these securities are paid back at nominal value when they mature.
We can take it that our great efforts throughout the company will have a positive effect on the future business result and we look towards the coming, no doubt difficult, years well prepared and with confidence.
Accident 310 192 Sickness 81 80 General Third Party Liability 294 302
The net amount of new business for 1981 totalled Sw. frs. The actuarial auditor, Mr. Marc-Henri Amsler, has con10, 506 million, which Is 6.5 % higher than In the previous year. The net amount of business in force rose by 1.6 % to Sw. frs. 41,757 million, if exchange rates had remained stable, new business would have risen by 25 % and busi­ ness in force by 18%.
As in previous years, the year under report was character­ ized worldwide by high rates of inflation and an un­ changed tight monetary policy by most western central banks. At the same time, a considerable increase of financing requirement by the public sector was felt in many places. The consequence was majorfluctuations in interest rates and further drastic increases, particularly in the United States. During the last months of the reporting year interest rates again dropped somewhat; consumer and investment demand, however, remained subdued and led in many countries to a strong rise in unemploy­ ment.
In the Swiss Re Group, the total number of employees rose by 1.2 % to 13,492 (of. table comparing the business years 1974/75-1981 on pages 46 and 47).
At the Swiss insurance Training Centre, Zurich, over 1,000 Insurance experts, mostly from developing coun­ tries, have been trained since 1961. In the year under report three courses with over 100 participants were held. The Institute Is borne by a foundation set up and financed by the Swiss Re.
Real estate is valued at acquisition or construction cost, less the depreciation permitted by the tax authorities.
The commissions and profit commissions accounted for assumed business totalled Sw. frs. 999.0 million. Of this amount, Sw. frs. 262.2 million was further debited to retro­ cessionaires, so that for own account Sw. frs. 736.8 mil­ lion remained.
In the year under report the management expenses rose by Sw. frs. 6.9 million, or 6.5 %, to Sw. frs. 113.2 million. As a result of the further growth in the number of staff and salary adjustments the personnel oosts rose by approx. 7%. There was a 2% Increase in non-personnel costs caused mainly by the continued expansion of foreign rep­ resentations and by the introduction of modern word processing systems.
Of the total amount of current-account balances of Sw. frs. 904.8 million, Sw. frs. 700.4 million was for reinsurance assumed and Sw. frs. 175.0 million for reinsurance ceded; Sw. frs. 29.4 million concerned other credits, the most sig­ nificant part of which comprised reclaimed taxes. The overall increase over the previous year was Sw. frs. 57.3 million.
Contingent liabilities (sureties and contingent obliga­ tions to liberate not fully paid up shares) amounted to Sw. frs. 101,379,816 million per 31st December, 1981.
The consolidated gross premiums of the Magdeburger Versioherungsgruppe, Hanover, fell by 7.2 %to DM 111.2 miiiion (previous year, DM 837.4 miiiion). This decrease is due to the sale of the Magdeburger RückversicherungsAG. The gross premiums of the Magdeburger Feuerversicherungs -AG rose by 10.1 % (previous year, 6.2 %) to DM 458.5 miiiion. The claims rose by 9.0%. Thanks to ratio­ nalization measures it was possible to reduce the cost ratio. The underwriting loss increased. The result of capi­ tal investments was higher than that of the previous year. A dividend in the amount of the annual profit of DM 2.3 miiiion was paid (previous year, no dividend). - The Union und Rhein Versioherungs-AG merged on 1st January, 1982, with the Magdeburger Feuerversicherungs-AG. The insurance in force of the Magdeburger Allgemeine Lebens- und Rentenversicherungs-AG rose by 10.1 % to DM 4,500 miiiion. The more favourable risk and cost ex­ perience together with the clearly increased investment income as a result of the higher average interest led to an improvement of the result. The annual profit of DM 0.3 mii­ iion (as in the previous year) remaining after allocation to the reserve for bonuses was used to strengthen the capi­ tal funds and to pay an unchanged dividend of DM 0.2 miiiion.
The capital structure of the company was unchanged. The loan granted by the parent company rose by Sw. frs. 34.1 million to Sw. frs. 469.1 million. The increase was used mainly to finance the purchase of shares and capital increases in Group companies and minority holdings.
United States SwissRe Holding (North America) Inc. 100 East 46th Street, New York, N.Y. 10017
Fluctuations in stock exchange rates: Changes in the value of capital Investments which, in contrast to the fluctuations in foreign currency rates, stem principally from interest rate and stock exchange price changes and are in original currency.
General third party liability: Insurance of industrial, commercial, employers, products, professional or private liability.