2 Including assets for the account and at the risk of life insurance policyholders. 3 Calculation is based on the consolidated profit and equity before minority interests respectively. 4 2010 based on the proposal to the Annual General Meeting. 5 Of which latency calculation effects from other business segments: 31 December 2009 CHF 6.9 million / 31 December 2010 CHF – 10.4 million.
WhAT WE AChIEvEd In 2010: Profit of CHF 436.7 million (previous year: CHF 421.0 million), a plus of 3.7 % Return on equity of 10.4 % (previous year: 10.3 %) Excellent solvency of 224 % (previous year 230 %) Equity amounting to CHF 4,133.5 million (previous year: CHF 4,510.0 million) Business volume growth in local currencies of 1.7 % to a total of CHF 9,541.4 million Dividend per share of CHF 4.50 unchanged over the previous year, equating to a dividend return of 4.9 % on the price at year-end of CHF 91.00 Combined ratio (net) of 95.2 % (previous year: 94.4 %) Embedded value (MCEV) of CHF 2,573.5 million (previous year: CHF 2,625.8 million); new business margin of 11.8 % (previous year: 9.3 %) Baloise Bank SoBa: 6.6 % or CHF 280.1 million more in customer deposits; total portfolio of CHF 4,515.9 million
Belgium and Luxembourg: strong growth dynamics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Other units and Group business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Corporate Executive Committee and management structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56 Compensation Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Change of control and defensive action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Business volume, premiums and combined ratio . . . . . . . . . . . . . 88
Appropriation of retained earnings as proposed by the Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105
KEy dATES And ConTACTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cover
Ueli Steck, alpinist, Interlaken, Switzerland An extreme mountaineer who climbs the world’s mountains in record time. Thanks to his comprehensive and meticulous preparation, he safely achieves the seemingly impossible.
Mihovil Španja, competitive swimmer, Dubrovnik, Croatia A top athlete who became a professional swimmer due to an early illness.
They talk about the discipline they muster and the many important details they pay attention to. About the things that are necessary in the build-up in order to achieve excellence.
“ Fear is extremely important. If you lose your fear, you no longer have respect and you overestimate yourself.”
What do you think good preparation has to do with safety? Yes, the safety thing… Lots of people think that what I do is extreme, crazy, because the danger is clearly obvious. I will fall if I make a mistake while climbing without a rope. It is incomprehensible to many that someone would take the risk at all. But if you work on it, you will find solutions so that it is no longer dangerous. That allows you to push the limits so far in the end.
Have you ever dived into a project unprepared? No, I can’t do that. I don’t have the nerves for it. You could perhaps see that as a handicap, typically Swiss. Everything has to be prepared carefully. Otherwise I don’t risk it. You don’t just climb into a wall unsecured, at least I don’t. I know what can happen if something goes wrong. I never start a climb if I’m not 100% convinced that it will work and I’ll be back home in the evening. But to get to that point is extremely difficult. It takes time and calls for perfect preparation.
You get into a state of flow when you climb a mountain. Does that sometimes happen in the preparation phase as well?
Yes. When you’re fit and doing a fast training session, you see only the route at some point and it just flows. You notice how your legs push… That’s an awesome feeling. It is even more intense afterwards when you’re climbing, this flow state, because you have to concentrate even harder. Your thoughts don’t stray for even a second; there is nothing but the next hold. You see it and you’re sure, I won’t let it go, nothing will happen. That is beautiful.
You train nearly every day. Yes, in the climbing hall, jogging, cross-country skiing in winter – that’s somewhere between 1,000 and 1,200 hours of straight training time per year.
How do you prepare mentally? The real mental preparation, that only happens to me through the physical preparation. Your head’s straight only when you feel that you’re physically fit.
Yes. I try things that no one has done before, techniques that some might say won’t work out. You don’t really run wearing crampons. But when you do train like this, you notice that it does actually work very well. There are many things that I try to optimise, also regarding equipment.
Routine is important to you. What are your daily rituals? My two morning coffees are actually the most important ritual. And it’s important that the day always has some tranquil periods. My daily routine is pretty tight, so I have to create some free space otherwise I get bogged down.
Is that a feeling of freedom? Yes. I can do it. That’s it. There is a solution. That’s great.
Reflection is really preparation. Yes, for the next time. When you arrive at the foot of the mountain, look at it and say: Hey, it’s just not possible now – then it’s just not possible. Then you know that is the right decision for sure.
“ At first you think it’s impossible. Then you start to train and slowly a structure emerges, until you’re up to the challenge somewhere down the line.”
Speed record Matterhorn, Switzerland: 1 hour 56 minutes 2008 Speed record Grandes Jorasses, France: 2 hours 21 minutes
New Eiger speed record: 2 hours 47 minutes 2007 Speed ascent Eiger, Switzerland: 3 hours 54 minutes 2005 Solo ascent of the north face of the Cholatse (6,400 m) and the east face of the Tawoche (6,505 m), Nepal 2002 First ascent of Mount Dickey, Alaska vorabdruck
Bâloise-Holding Geschäftsbericht 2010 lorem ipsum into the operating theatre relatively quickly. There I can completely rely on my team that performs the anaesthesia. The disinfecting of the instruments is a job done by the theatre nurse. But I usually wash and cover the patient myself when I have the leading position. Then I know that everything is just as I want it to be. Good preparation is very important. After all, complications can occur even during straightforward operations – when a blood vessel bursts, for example. You need to be prepared for every eventuality. But that is also the fascinating thing about my job, that it is so complex and intricate.
Dubrovnik. Water everywhere. It has been raining for 20 days; the sea seems to have washed over the city. We meet Mihovil Španja in the Hotel Ivka. Together we drive to the Gradski Bazen, Dubrovnik’s municipal swimming pool and home to the water polo club Jug. Mihovil Španja trains here for several hours every day. They all train here. There are 30 water polo teams in the small coastal town alone.
Mihovil Španja was just six months old when he contracted polio. In the course of his rehabilitation, he finally began swimming and won seven medals directly at his first competition outside Croatia. And he took it from there. Later when we are sitting at the dining table at his home, he tells us he was a hyperactive child. After his swimming lesson, he used to stay in the pool for the water polo training and afterwards stood in the goal on the football pitch just to finally feel tired. Other people with polio are in wheelchairs. Mihovil Španja was spared this fate because he started swimming so early on.
Each day is planned in Mihovil Španja’s life, in sport as well as in his spare time. And he records it meticulously. His diary also says when he bought his boat with which he goes out fishing on the sea now and then.
His concentration is at its peak in the changing room shortly before the competition starts. Still he remains quite relaxed. He counts the stars while even the older swimmers seem nervous. It’s better for him this way. Polako. That means easy in Croatian. We will try to remember that and ask him what safety means to him.
“To be a professional athlete and not feel safe in every situation is very risky,” he replies with a meaningful expression. His trainer controls everything; he is in daily contact with him via e-mail or text. It’s all in his hands. He also decides on the resting phases. A kind of sport god? “Yes.” Mihovil Španja laughs – as he often does.
“ When you win an Olympic medal, you cry because you’re so happy and think: It was worth it – all the effort. It was just the preparation for this kick.”
Mihovil Španja is one of the most successful Croatian athletes. His achievements include breaking thirteen world records.
Double European champion in 200 m medley and 100 m breaststroke, as well as twice runner-up in 400 m freestyle and 100 m backstroke at the European championship, Reykjavik, Iceland 2008 Three A finals in 100 m backstroke, 200 m medley and 100 m breaststroke at the Paralympic Games, Beijing, China 2006 Bronze at the world championship in 100 m backstroke, Durban, South Africa 2004 Three-times bronze in 100 m backstroke, 200 m medley and 400 m freestyle at the Paralympic Games, Athens, Greece 2002 Runner-up in 100 m backstroke and bronze in 400 m freestyle at the world championship, Mar del Plata, Argentina 2001 European champion in 400 m freestyle, Stockholm, Sweden 2000 Three A finals at the Paralympic Games, Sydney, Australia 1999 Runner-up in the European championship in 400 m freestyle, Braunschweig, Germany vorabdruck
We thank our employees for their special dedication, their loyalty and their sense of responsibility. However, our sincere thanks also go to you, the owners of Baloise, and to our customers for their trust and loyalty.
Based on our almost 150 years of Swiss tradition, we stand for value-creating continuity. We are fully aware that, as such, we are not the most exciting company but probably one of the safest. For generations we have been successfully cultivating this core belief, and we are of the opinion that it will continue to be extremely viable in the future seen against the backdrop of the currently unstable environment.
In 2010, continuity was again our guiding principle. Two years ago we launched the programme “Baloise 2012” with the intention of enhancing growth and profitability at Baloise in the long term. Since then we have been working pain- stakingly to achieve this. We have improved the company’s efficiency with numerous measures. The contribution to earnings from this programme already amounted to CHF 92 million last year.
We want people to feel safe. In our view it is our most important task to contribute to this. Our promise to customers, employees and shareholders is therefore “Making you safer.”
With a combination of targeted prevention and classic insurance, we offer our customers additional value above and beyond that offered by the conventional insurance business. We delight in the many positive benefits: the significantly higher product density per client, the greater readiness to recommend Baloise to others, the above-average increase in new customers. Here again, we are providing continuity: we will continue to hone our safety profile in a rigorous manner.
Dr rolf Schäuble Dr Martin Strobel Chairman of the Board of Directors Group Chief Executive Officer
The Baloise share recorded strong growth of 20.5 % in the second half of the year and outperformed both the Swiss Market Index (+ 5.0 %) and the European Insurance Industry Index (+ 10.1 %).
The Baloise share is included in the Swiss Leader Index (SLI) due to market capitalisation and its trading volume. This comprises the 30 largest and most solvent Swiss stocks.
DIVIDENDS PAID oUT To ShArEholDErS For the 2010 fiscal year, the Board of Directors will propose a cash dividend of CHF 4.50 to the Annual General Meeting on 29 April 2011. Measured against the year-end price, this represents a cash dividend yield of 4.9 %.
ShArEholDEr STrUCTUrE Bâloise Holding Ltd has a broad shareholder base. The free float of the Baloise share is still 100 %. The BlackRock Group, now with a 5.03 % stake in Baloise, exceeded the reportable 5 % threshold on 9 September 2010. This was the only significant change to the shareholder base in the 2010 fiscal year. Information on the sigificant shareholders as of 31 December 2010 is detailed in the table on page 103.
INDExED ShArE PrICE DEVEloPMENT 1 BâloISE holDING rEGISTErED ShArE 2005 – 2010
Consolidated profit per share basic in CHF 12.90 15.15 7.33 8.64 9.14
Dividends per share 3 in CHF 3.80 4.50 4.50 4.50 4.50 1 Calculation is based on the consolidated profit and equity before minority interests respectively. 2 Relevant for the earnings per share calculation (see Financial Report page 122). 3 2010 based on proposal to Annual General Meeting.
SWITZErlAND In its home market, Switzerland, Baloise operates under the brand names “Basler Versicherungen” and “Baloise Bank SoBa.” Baloise Switzerland is the largest business unit within the Group. As a financial services provider it focuses on comprehensive insurance and pension solutions. Its clients are private individuals, small and medium-sized enterprises as well as se- lected industrial companies. The company’s own sales force constitutes the core of its sales strategy. This is augmented by a network of selected sales partners for specific product and client segments, and by brokers and the Internet. Baloise Bank SoBa specifically complements the range of pension solutions with banking products that are sold by the insurance sales force and by the Bank itself. In north-west Switzerland its market positioning is also that of a full-service bank.
Baloise Our markets lUxEMBoUrG “Bâloise Assurances” provides a broad range of insurance, pension and asset formation products to private and corporate customers in the Grand Duchy. Outside of its home market, Bâloise Luxembourg also sells pension and asset formation solutions in various EU countries in partnership with banking partners that have strong market positioning.
CroATIA AND SErBIA In Croatia, Baloise operates as “Basler osiguranje Zagreb”. It offers a comprehensive range of insurance solutions for private and corporate customers, using its own insurance sales force and via agencies and banks. Since the end of 2007, Baloise has also been represented in Serbia, where it concentrates on selected target customer segments.
BrAND DElIVErABlES Safety Safety is our core achievement. Safety is behind every achievement, every service and every product. As a force which liberates energy, inspires and fosters.
Professionalism Baloise stands for professionalism. This allows us to produce top-quality performance. We are professional in our approach to our core business, our customers and our marketing. Because we know that professionalism brings inner peace.
To in sp ir e em plo yees, customers, partners and shareholders vorabdruck
The increase in profit to CHF 436.7 million and above-average growth in the classic insurance business in local currencies of 3.7 % are testimony to the sound condition of Baloise.
Baloise achieved impressive growth in the 2010 fiscal year. Total business volume, which includes investment-type life insurance products, reached CHF 9,541.4 million (previous year: CHF 9,765.4 million). This equates to a plus in local currencies of 1.7 % and a decline of 2.3 % in Swiss francs, attributable to the unfavourable euro exchange rate. Insurance premiums in accordance with IFRS accounting methods (“classic insurance business”) precisely equalled the previous year’s level of CHF 6,859.8 milllion. If, however, premium development is seen from a local currency perspective, thus reflecting market performance more exactly, significant growth of 3.7 % was achieved. The investment life insurance products of Baloise Life in Liechtenstein and Bâloise in Luxembourg enjoyed highly pleasing development once again. Striking growth impetus was recorded by the units in Switzerland, Belgium, Luxembourg and Austria. Baloise business volume remains well diversified across the whole Group.
lIFE INSUrANCE DIVISIoN: GooD GroWTh Thanks to the good financial result and successful implementation of the “Baloise 2012” measures, the life insurance division was able to achieve a profit before borrowing costs and taxes of CHF 182.7 million (previous year: CHF 151.0 million); this equates to a plus of 21.0 %. The lower interest rates dampened the technical result significantly. The necessary reduction of the life annuity dividends that resulted in Switzerland, as well as the improved investment result had a positive effect. Business volume – including investment-type life insurance – reached CHF 6,496.5 million (previous year: CHF 6,629.0 million), an increase of 1.5 % in local currencies and a fall of 2.0 % in Swiss franc terms. In the case of the high-volume investment-type life insurance products, Bâloise Luxembourg was able to achieve very strong growth. Baloise Life in Liechtenstein again generated good business volume even though – as expected – the exceptionally high level of the previous year driven by the Italian tax amnesty could not be repeated. The increase in classic life insurance income (IFRS premium volume) amounted to an excellent 2.5 % in Swiss francs and 5.0 % in local currencies.
EqUITY: SolID DEVEloPMENT Consolidated equity (after minority interests) of Baloise Group amounted to a total of CHF 4,133.5 million on 31 December 2010 (previous year: CHF 4,510.0 million). The 8.3 % decrease was due to the dividend for the 2009 fiscal year and the share buy-back and the deconsolidation of the OVB group in the course of the separation of companies in Germany as well as negative currency effects.
The share buy-backs as part of the share buy-back programme reduced equity by CHF 34.7 million. Return on equity increased to 10.4 % from 10.3 % in the previous year. Group solvency stood at the still excellent level of 224 % as compared with 230 % in the previous year.
Even in times of low interest rates, Baloise still adheres to its quality requirements for bond investments to ensure that the investment portfolio’s very high level of debtor quality is not put at risk. Gross impairment of only CHF 2.6 million (0.01 % of fixed-interest investments) is testimony to this quality. In the life business, investments consider existing obligations toward policyholders, while the nonlife business can exploit additional market opportunities. As from the end of April, more than 80 % of euro bonds held by the Swiss companies were currency hedged; this way, book losses due to the fall in the value of the euro were restricted to a significant extent. As at the end of the year, hedge ratios were even higher in some cases.
Total managed assets 66,254.4 1 Including CHF 90.5 million (previous year: CHF 47.2 million) other assets (precious metal stocks from investment-type life insurance policies).
BAloISE INSUrANCE: hIGh oPErATING ProFITABIlITY WITh STroNG GroWTh The excellent condition of the core business, notably in the nonlife sector, and significantly reduced costs were the main factors driving income. Profit before borrowing costs and taxes amounted to CHF 273.7 million (previous year: CHF 308.0 million). The decline of 11.1 % is attributable to low interest rates, the strong Swiss franc and major claims. With business volume totalling CHF 4,108.2 million (previous year: CHF 3,930.0 million), Baloise Group’s largest unit passed the four billion mark for the first time ever. The plus of 4.5 % is above the market average due above all to the convincing growth of the collective life insurance business. The innovative variable annuity products (life insurance with a capital guarantee) of Baloise Life in Liechtenstein, newly introduced into the Swiss market, attracted great interest among customers.
Business volume in the life insurance division grew by 6.5 % to CHF 2,822.9 million (previous year: CHF 2,649.8 million). The Group Life Business (occupational pension plans) grew particularly strongly at 11.5 % both in terms of annual and one-off premiums. This was attributable to the attractive products and to the good positioning of Baloise Insurance as a strong partner in the occupational pension sector. In the case of the classic individual life insurance business, demand was weak as expected due to the interest rate situation. There was a shift in favour of variable annuity products which proved to be very popular.
BAloISE BANK SoBA: GroWTh AND ProFIT ENhANCEMENT Baloise Bank SoBa had a successful financial year in 2010. At CHF 21.2 million, net profit was 2.2 % up on the previous year’s level despite the difficult environment. Customer deposits grew by CHF 280.1 million or 6.6 % while customer loans increased by CHF 301.0 million or 5.4 %. The result of the interest margin-based business declined slightly due to low market interest rates and competition-related pressure on margins. Income from commission and services recorded a fall of 14.0 %. The company was able to cut material expenses by 18.4 % due to further optimisation of the cost base. The cost-income ratio improved to 66.8 % (previous year: 68.4 %). Total assets improved by 4.4 % and amounted to CHF 6.4 billion as of 31 December 2010. The proven cooperation with Baloise Insurance made a key contribution to the positive result.
The segment Switzerland confirmed its outstanding profitability and growth strength in both the insurance and banking sectors.
The German unit comprising Basler and Deutscher Ring Leben and Sach reported a good result. The separation of Deutscher Ring is progressing according to plan.
CroATIA AND SErBIA: EFFICIENCY ENhANCEMENT IN A CoNTrACTING ENVIroNMENT Following the conclusion of the integration process in Croatia, the focus was on operational reorganisation and business pro- cess optimisation. As compared with the previous year, the business result improved significantly but continued to be in negative territory. In a contracting environment the business volume of both units declined to CHF 78.8 million (previous year: CHF 92.6 million), a fall in local currency of 7.6 %. The company was able to maintain its market share in the Croatian nonlife sector whereby the motor vehicle insurance business grew noticeably. Life insurance business volume declined sharply, due in part to the loss of a bank sales partner. The gross combined ratio improved to 110.2 % (previous year: 110.9 %) thanks to a fall in the expense ratio.
BAloISE lIFE, lIEChTENSTEIN: ATTrACTIVE, INNoVATIVE PENSIoN ProDUCTS The business volume of Baloise Life in Liechtenstein, which specialises in innovative life insurance products, amounted to CHF 1,119.0 million in the 2010 financial year (previous year: CHF 1,600.0 million). Thus the business with variable pension products (variable annuities) achieved strong growth generating CHF 103.4 million. Despite the expiry of the tax amnesty in Italy after April 2010, the company was able to maintain its business volume in investment-type life insurance policies at a high level.
GroUP BUSINESS The segment “Group business” comprises the units for intraGroup reinsurance and financing, as well as the holding companies and corporate IT. Profit before borrowing costs and taxes amounted to CHF 74.5 million (previous year: CHF 123.3 million). The decline was attributable to the reinsurance unit’s lower underwriting result and to negative currency development.
Basler Austria saw a continuation of its above-average growth and invested further in the expansion of its sales activities. Further efficiency enhancement occurred in Croatia following the conclusion of the integration process.
“ In line with our ‘Making you safer’ promise, we think particularly longterm, since our smart prevention solutions help ensure that damage does not occur in the first place.”
Every day we make an invaluable contribution to the economy and to society, for example by providing occupational pension solutions.
We create and maintain jobs that add value and thereby accept our social responsibility.
We generate earnings to invest in the future of Baloise and to help fund the public sector by paying taxes.
We apply capital resources efficiently, in the interests of shareholders and of the wider economy.
Performance, innovation and partnership are the core values of our corporate culture. The skills and the motivation of our employees are the foundation of our successes – today and tomorrow.
As of 31 December 2010, the Baloise Group had 8,797 (2009: 9,391) employees (FTE in 2010: 7,688).
In our main market, Switzerland, 58.8 % (2009: 61.9 %) of employees participated in our Employee Share Ownership Programmes.
Staff turnover as of 31 December 2010 was 10.4 % (2009: 7.8 %).
→→ By retaining and recruiting outstanding employees, we contribute to the company’s long-term success.
→→ Performance-driven, highly motivated and well-trained employees enable us to obtain competitive advantages.
Our Human Resources strategy lays the foundations to enable us to implement these principles. The elements of our Human Resources strategy are: →→ To be the preferred employer in our sector →→ To be performance and results-driven →→ To be a highly qualified, learning organisation →→ To have excellent leadership and management skills →→ To be highly adaptable and flexible →→ To have an employee-focused corporate culture
The employees form the basis of our success. We are preparing them for the future.
39Sustainable business management Human Resources them to fill suitable vacant positions. In addition, as far as recruitment is concerned, we also increasingly rely on innovative Web 2.0 technologies. This means less search processes via job advertisements in newspapers and via personnel consultants.
PErForMANCE AND rESUlTS ArE WhAT CoUNT We are performance- and results-driven and we remunerate our employees accordingly on this basis. The focus of our incentive systems lies on a long-term, share-based remuneration, in particular regarding executives. We also want to meet the interests of our shareholders in this manner.
INVESTMENT IN STrATEGY-ENhANCING ADVANCED TrAINING In 2009, Baloise created an innovative development programme for the top 70 executives and 80 talented employees – the Strategic Leadership Programme (SLP). In 2010 this programme was expanded to include a further 200 talents and managers. During this programme the participants acquire the skills necessary to successfully realise the corporate strategy. The SLP consists of 30 learning modules divided between four topics (growth, optimisation, new business areas, management ). The skills (e.g. customer focus, pricing, courage or credibility) are acquired in four steps: 1. Acquiring knowledge: Within each of the 30 learning and activity modules a group visits leading business schools and acquires up-to-date knowledge.
3. Derivation of action plans for Baloise. 4. Implementation: the participants communicate and implement this knowledge and these action plans within their organisations.
For many years Baloise has also actively given support in health issues. Basler Switzerland received the label “Friendly WorkSpace® – Registered” from the Swiss health promotion board in April 2010. This has been awarded since 2009 to companies that promote corporate health management beyond the mandatory guidelines.
Healthy companies require healthy employees – since their well-being contributes considerably to a company’s development. In a friendly workspace employees perform better, are more solution-oriented, motivated and innovative. The label shows that resources are available in a company to maintain and promote the health and performance of its employees. With this commitment to promoting health, Baloise is honouring its promise “Making you safer” internally as well. Basler is proud to be the first overall insurer in Switzerland to receive this award.
Employees from every international subsidiary are represented in the Baloise European Forum. We thus provide employee representatives with direct access to the Corporate Executive Committee, as well as promote communication locally. A two-day meeting of the European Forum and employee representatives was held in Vienna in May 2010. The emphasis was on corporate strategy and the implementation of the new Group IT and Group procurement system.
100 % of Baloise employees are represented by employee committees, staff associations, trade unions or other employee organisations.
www.baloise.com/careers Attractive employer Personnel development Our employees Direct hires and trainees Job openings vorabdruck
ENErGY EFFICIENCY IN CoMPUTEr CENTrES Basler’s computer centres are being brought together step by step. This means that existing infrastructures are used more efficiently, operating costs are optimised and the security of the data entrusted to Basler is improved.
Approximately 30 % of the process energy used in modern computer centres is used to maintain a comfortable indoor climate. The responsible managers at Basler have analysed the consumption data of our computer centres and defined measures to reduce the consumption figures that are good already today by 5 to 10 % over the next three years. Here too we wish to keep our promise to use resources carefully and reduce the operating costs on a long-term basis.
SAVING PAYS oFF In 2009, Basler Germany set itself the target to use of finite resources sparingly and increase employee awareness of environmental issues. To this purpose, Basler Germany started a project together with experts. Changing the lighting at one location, reducing the water flow quantities of the sanitary facilities and improved waste separation led to savings of 43,700 kWh electricity, 45,762 CO2 and 700 m3 of water and a costs reduction of over EUR 100,000 euros per year. These successfully implemented measures were rewarded with an environmental certificate. Further measures are planned for the year 2011 regarding the vehicle fleet, the outdoor lighting and the purchasing of consumables.
www.baloise.com/sustainability Ecology → Environmental mission statement Ecology → Ecology audit Risk Management Interview with Rolf Schäuble
ThE rISK MAP The risk map distinguishes between the different categories of risk to which Baloise is exposed: →→ Underwriting risks →→ Market risks →→ Financial structure risks →→ Business environment risks →→ Operational risks →→ Strategic / information risks
The risk map is embedded in the organisation and the responsibilities of the entire Group. Each risk is assigned to a risk owner (with overall responsibility) and to a separate risk controller (risk monitoring and control).
rISK GoVErNANCE AND rISK CUlTUrE Expansion of risk governance and risk culture has a long tradition at Baloise. We continuously work to improve this culture throughout the entire organisation. Appointed risk owners and risk controllers for specific risk issues is as much a part of this culture as membership of committees that meet regularly to deal with risk issues. At the same time, risk models and processes are continually improved. 2009 saw the completion of a project to upgrade the internal control system (ICS).
Baloise risk organisation includes the Group Risk Committee and local Risk Committees in all business units. These committees consist of members of the Corporate Executive Committee or members of the local management. They are responsible for taking risk strategy decisions.
Special boards also prepare decision documents relating to specific risk areas, such as asset / liability management, compliance, IT risks and allocation, for these committees.
→→ Risk governance and risk culture: this involves fostering and firmly embedding risk awareness, handling and perception throughout the entire organisation.
→→ Risk processes: risk organisation, and the standards that apply to it, are important aspects of Risk Management, in conjunction with management, reporting and evaluation processes.
Our Risk Management counts among the best 15 percent in Europe vorabdruck
This is rounded off by close cooperation between the Group’s Risk Management team and local risk experts. This comprehensive risk organisation is our platform for sharing and continuous further development of “best practices.” Group Risk Management is responsible for: →→ the development of consistent, mandatory risk models across the Group,
→→ the monitoring of standards across the Group, →→ reporting, →→ compliance with risk processes, →→ communication with external partners such as auditors, corporate supervisory bodies and rating agencies.
The business units are responsible for locally implementing Group specifications. Overall responsibility lies with the Group’s Chief Financial Officer, followed by the Head of Financial Management. Ultimate responsibility with regard risk tolerance, business objectives, Risk Management strategy and standards is in the hands of the Board of Directors of Bâloise Holding Ltd.
rISK MEASUrEMENT Our risk model standardises quantification of all business and financial market risks in all strategic business units. It is in line with the principles and calculation methods of the Swiss Solvency Test and the European Union’s Solvency II guidelines. As a pioneering Risk Management tool, it provides a firm foundation to enable management to make strategic and operational decisions.
This combination of an overall risk model on the one hand, and the specific risk approach on the other, ensures that Baloise has an appropriate risk overview at all times.
→→ We monitor market and financial structure risks in all investment units, using a wide range of reporting pro- cesses. There are, for example (in addition to maximum limits for equities exposure), clear mandatory guidelines for bond ratings. Credit risks are assessed using not only the “Basel II” approach, but also advanced statistical methods.
Risk reports covering half a year are discussed with decisionmakers in order to derive appropriate measures. We use our monthly risk analysis to review the overall solvency position, focusing on capital investment risks. Reports to regulatory authorities complete the picture.
STrATEGIC rISK MANAGEMENT Our internal risk model, which quantifies all business and financial market risks in a standard manner, also forms the basis of strategic discussions about Baloise readiness to take risks. The capital requirements derived from this model re- present minimum actual capital requirements in this regard.
There is a comprehensive view of primary strategic risks and how to manage them. Strategic Risk Management provides a clear perspective on developing new areas of business and optimising the risk-return ratio of our existing business.
→→ The Baloise Group’s investment strategy focuses on diversification and the principle of only investing in instruments that can be fully assessed.
→→ Our stable property portfolio, with its high-quality recurring revenues from capital employed, proved to be an important earnings pillar.
More information on the subject of risk management can be found in the 2010 Financial report, “5. Management of insurance and financial risks” pages 30 to 67.
Operating within the framework of the Swiss Code of Best Practice and the SIX Corporate Governance Guidelines, Baloise aspires in particular to foster a corporate culture with high ethical standards, which emphasises the integrity of the company and its employees. Baloise is convinced that highquality corporate governance has a positive impact on the long-term performance of the company.
It was announced at the Board of Directors meeting on 9 December 2010 that Dr Rolf Schäuble will resign from the Board of Directors at the Annual General Meeting on 29 April 2011. During 17 years of service that Dr Rolf Schäuble was active as Chairman of the Board of Directors and at times simultaneously as Chief Executive Officer for Baloise and contributed considerably to the company’s success during this time. The longstanding member of the Board of Directors Dr Andreas Burckhardt will be appointed Dr Rolf Schäuble’s successor. Prof. Dr Gertrud Höhler has been a member of the Board since 1998 and will resign at the Annual General Meeting 2011 as a result of having reached the regulatory age limit. The Annual General Meeting 2011 will propose the election of Dr med. Georges-Antoine de Boccard as the successor of Prof. Dr Höhler, and Dr iur. Andreas Beerli (both Swiss citizens) as a new member of the Board of Directors.
shareholder structure As of 31 December 2010, a total of 19,493 shareholders were registered in the Bâloise Holding share register. Compared to the previous year, the number of registered shareholders increased by 15.190 %. BlackRock Inc., New York, holds 5.03 % of the outstanding shares directly as well as through its subsidiaries according to the disclosure on 16 September 2010.
The “Significant shareholders” section on page 103 of the Annual Report provides further information on the composition of the shareholder base as of 31 December 2010.
→ Baloise share → Share buy-back programme dividends paid to shareholders Due to our shareholder-friendly dividend policy, CHF 1,766.1 million have been passed onto shareholders in the form of cash dividends and share buy-backs over the last five years.
Authorised and contingent capital, other financing instruments Authorised capital A resolution passed at the Annual General Meeting on 30 April 2009 authorised the Board of Directors to increase share capital until 30 April 2011 by CHF 500,000 at most, by issuing a maximum of 5,000,000 registered shares with a face value of CHF 0.10, which are to be subscribed and paid in full. Accordingly, § 3 section 4 of the Articles of Incorporation was rewritten in 2009.
→→ Hansjörg Frei for a two-year term of office as a result of having reached the regulatory age limit at the 2012 Annual General Meeting.
→→ Dr iur. Andreas Beerli (1951, CH) studied and completed his PhD at the University of Basel. He was employed at Baloise and Swiss Re where he held various management posts. Most recently he was the Chief Operating Officer and member of corporate management at Swiss Re. He has worked as an independent consultant since 2009.
52 Corporate�Governance Corporate�Governance�Report including�Compensation�Report rolf schäuble (1944, CH, Dr oec. HSG) obtained his doctorate (Dr oec. HSG) after reading economics at the University of St. Gallen. Between 1975 and 1993, he held various posts in the Zurich Insurance Group in Zurich, as of 1986 as a member of the management board. In 1993 Dr Rolf Schäuble joined the Board of Directors of Bâloise Holding Ltd and was appointed Chairman in 1994. From 1996 until 2002, he was also a delegate of the Board of Directors and Chief Executive Officer of the Baloise Group. Between 2002 and December 2007, he served only as Chairman of the Board of Directors. From 6 December 2007 until 31 December 2008 he again served simultaneously as Chief Executive Officer. This dual mandate ended on 31 December 2008.
georg f. Krayer (1943, CH, Dr iur.) has been a member of the Board of Directors since 1995 and its Vice-Chairman since 2004. From 6 December 2007 until 31 December 2008 he also fulfilled the role of Lead Director. He studied law, obtaining a doctorate (Dr iur.). Dr Georg F. Krayer is Honorary Chairman of the Board of Directors at Bank Sarasin & Cie AG, Basel and was the Chairman of the Swiss Bankers Association until 2003. He is an independent, non-executive director.
Andreas Burckhardt (1951, CH, Dr iur.) has been a member of the Board of Directors since 1999. He studied law at the Universities of Basel and Geneva and obtained his doctorate (Dr iur.). He worked for Fides Treuhandgesellschaft from 1982 until 1987 and served as General Secretary of the Baloise Group from 1988 until 1994. Since 1994 he has been Director of the Basel Area Chamber of Commerce. Dr Andreas Burckhardt is Vice-President of the Swiss Association of Chambers of Commerce and has been a member of the Great Council of the Canton of Basel City since 1997 (President in 2006/2007). He is an independent, non-executive director.
Board of directors from left ro right: rolf schäuble, georg f. Krayer, Michael Becker, Andreas Burckhardt vorabdruck
53Corporate�Governance Corporate�Governance�Report including�Compensation�Report gertrud höhler (1941, D, Prof. Dr phil.) joined the Board of Directors in 1998. She is a business and political consultant and was Professor of Literature and German at the University of Paderborn from 1976 to 1993. She studied literature and art history in Bonn, Berlin, Zurich and Mannheim. From 1987 to 1990 Prof. Dr Gertrud Höhler was PR consultant to the Chairman of Deutsche Bank AG, Alfred Herrhausen, and between 1992 and 1995 was a non-executive director at Grand Metropolitan PLC, London. She is a member of the Board of Directors of Georg Fischer AG, Schaffhausen, and was a member of the Board of Directors of Ciba AG, Basel, from 1998 until 2009. Prof. Dr Gertrud Höhler is an independent, non-executive director.
eveline saupper (1958, CH, Dr iur.) has been a member of the Board of Directors since 1999. She studied law at the University of St. Gallen and obtained her doctorate (Dr iur.). Today, she is an attorney-at-law and a certified tax expert. From 1983 to 1985, she was with Peat Marwick Mitchell (now KPMG Fides) in Zurich and from 1985 to 1992 with Baker & McKenzie in Zurich and Chicago. She joined Homburger AG, Zurich, in 1992, where she is a partner. Dr Eveline Saupper is a member of the boards of the Hess Holding SA, Luxembourg, of subsidiaries of the Hess group as well as of the Homburger AG, Zurich. She is an independent, non-executive director.
Secretary to the Board of Directors: Dr Thomas Sieber, Rheinfelden Head of Group Audit Committee: Rolf-Christian Andersen, Meilen More information on the members of the Board of Directors can be found on the Internet www.baloise.com → About us → Organisation → Board of Directors cross-ownerships No cross-ownerships exist.
election and terms of office At the end of 2010, the Board of Directors consisted of nine members. Each member is elected by the Annual General Meeting for a term of three years. Around one-third of the members step down annually unless they are re-elected (staggered replacement). Due to age restrictions, a Board of Directors mandate ends no later than the Annual General Meeting following a member’s 70th birthday. Currently the average age is about 64. Each member of the Board of Directors is elected individually, and if requested by the shareholders, also granted an individual discharge.
Internal organisation duties of the Board of directors Subject to the decision-making powers of the shareholders at the Annual General Meeting, the Board of Directors is the company’s supreme decision-making body. Essentially, decisions are made by the Board of Directors, unless authority has been delegated to the Chairman of the Board of Directors, to the Committees, the Corporate Executive Committee or to the CEO on grounds of organisational regulations.
As per Article 716a of the Swiss Code of Obligations and Section 1 II of the organisational regulations, the principal duties of the Board of Directors are general management, overall and financial supervision of the company and specifying the organisational structure.
www.baloise.com → Responsibility → Corporate Governance → Rules and regulations committees of the Board of directors The Board of Directors is supported by four committees. These committees report to the Board of Directors and submit proposals for their areas of responsibility. The Investment and Compensation Committees in particular have their own decision-making authority.
The Audit Committee supports the Board of Directors in those supervisory and financial duties that cannot be delegated (Article 716a Swiss Code of Obligations), by evaluating the organisational structure and the functioning of international and external auditing systems and the annual and consolidated financial statements. The Audit Committee also evaluates vorabdruck
Head of Corporate Audit, the Secretary of the Board of Directors and by representatives of the external auditors. Meetings of the Compensation Committee are primarily attended by the Chief Executive Officer, the Secretary of the Board of Directors and the Head of Group Human Resources.
www.baloise.com → Responsibility → Corporate Governance → Rules and regulations corporate executive committee information and control tools The Group Corporate Audit department reports directly to the Chairman of the Board of Directors. Effective risk management is of key importance to an insurance group. This is why there is a chapter on financial risk management in the Annual Report from page 44, and in the Financial Report from page 30 on.
the effectiveness of internal control systems, including risk management and the status of compliance. The Audit Committee has discussed the consolidated financial statement for the 2010 fiscal year both with management and with the external auditors. Based on these discussions, the Audit Committee has recommended that the audited Annual Financial Statement be incorporated in the Group’s Annual Report for the fiscal year ended on 31 December 2010 and submitted to the Annual General Meeting. The Board of Directors has endorsed this proposal.
In 2010, the full Board of Directors of Bâloise Holding convened ordinarily on six occasions. The table on page 51 shows the directors’ attendance at these full Board meetings. All members of each relevant committee attended all the additional twelve committee meetings. Board attendance by members of the Board of Directors was thus a very respectable 100.00 %. One meeting of the full Board of Directors dealt with the further training of the members, in particular, the topics Risk Report (including Swiss Solvency Test), reporting and accounting trends.
In the year just ended, the Chairman’s Committee met five times, including once for a two-day strategy meeting. The Investment Committee met once. The Audit Committee met four times and the Compensation Committee met on two occasions.
Members of the Corporate Executive Committee are regularly invited to attend full Board of Directors meetings. Meetings of the Audit Committee are primarily attended by the Chief Executive Officer, the Chief Financial Officer, the vorabdruck
Jan De meulder (1955, B) studied mathematics and insurance mathematics at the universities of Antwerp and Leuven, Belgium. From 1978 until 1992, he worked in Antwerp for the ING Group at De Vaderlandsche Insurance. He was responsible, amongst other things, for product development and production in the life sector. After two years as General Manager of the Life Association of Scotland, Jan De Meulder joined the Fortis Group, Brussels, in 1994 and there he held various senior management posts, most recently as CEO of Fortis Corporate Insurance. He joined the Baloise Group in 2004. Since then he has held the position of CEO of the Belgian subsidiary, Mercator Verzekeringen, in Antwerp. Since 1 January 2009, Jan De Meulder has been head of the International Corporate Division.
thomas Sieber (1965, CH, Dr iur., M.B.L., lawyer) studied law at the University of St Gallen. At the beginning of 1994, he qualified to practice law in the canton of Zurich. He then spent a year on a Swiss National Science Foundation scholarship at the University of California in Berkeley, working on his thesis, for which he received a “summa cum laude” distinction and the Walther Hug Prize. From 1999 to 2002, he lectured in corporate law at the University of St Gallen. After working for Landis & Gyr and Siemens, Dr Thomas Sieber joined the Baloise Group in 1997, initially as Deputy Head of Legal and Taxes, and he has headed this division since 2001 while also holding the post of Secretary to the Board of Directors of Bâloise Holding. Dr Thomas Sieber has managed vorabdruck
57Corporate�Governance Corporate�Governance�Report including�Compensation�Report several strategic projects within the Baloise Group. As part of the review of the Swiss Insurance Supervisory Act, he managed the “Financial Markets Supervisory Authority” task force of the Swiss Insurance Association (SIA). With effect from 6 December 2007, Dr Thomas Sieber was appointed Head of the Corporate Center division, with responsibility for Human Resources, Legal and Taxes, Compliance, Corporate Development and Run Off and, since 2009, likewise for the newly created Group Procurement division. Thomas Sieber is also a member of the board of directors of EuroAirport Basel Mulhouse.
www.baloise.com → About us → Organisation → Corporate Executive Committee vorabdruck
Olav Noack, Dr. oec. HSG * (until 21.3.2011) Michael Müller * (as of 22.3.2011)
Jan De Meulder * German Egloff * Martin Wenk * Thomas Sieber, Dr iur. *
product Management Commercial Clients Clemens Markstein product Management private Customers & Focused Financial Services Wolfgang Prasser
Belgium Gert De Winter luxembourg André Bredimus austria Otmar Bodner, Dr iur.
Baloise 2012 Roger Matthes appointed actuary Switzerland Marie-Thérèse Kohler, Dr sc. Math. ETH (until 31.12.2010) Thomas Müller, Dr sc. math. (as of 1.1.2011)
59Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5. coMPensAtIon rePort: coMPensAtIon, PArtIcIPAtIons And loAns to the BoArd of dIrectors And the corPorAte executIve coMMIttee The remuneration policy, guidelines and system of Baloise are described in this chapter. In addition, the remuneration and loans to the members of the Board of Directors and the Corporate Executive Committee, including the participations of this group of persons, are disclosed. Key to the content and scope of this disclosure are Articles 663b bis and 663c of the Swiss Code of Obligations, the standard relating to information on Corporate Governance of the SIX Swiss Exchange and the Swiss Code of Best Practice for Corporate Governance including the circular 10/1 of the Federal Financial Supervisory Authority (FINMA) on remuneration systems. These regulations stipulate that certain details are to be made in the notes to the financial statements and other information is to be given in the section on corporate governance. Baloise considers this chapter as integral to corporate reporting and has therefore decided to publish the complete Compensation Report in the Annual Report and the chapters regarded as necessary in the Financial Report.
→→ remuneration policy and compensation systems are long-term in nature and geared to corporate strategy; →→ the total compensation provided by the company is market and performance-focused and designed to attract and retain persons with the necessary skills and high performance-orientation; →→ compensation justifiably reflects the company’s long- term success and the individual’s contribution and does not create false incentives.
The duties of the Committee include determining the structure and the amount of compensation for the Chairman and the members of the Board as well as of the members of the Corporate Executive Committee. As part of the incentive plan, the Committee defines the Group’s higher-ranking goals and assesses target attainment. It approves the regulations on compensation applicable to Corporate Executive Committee members and monitors their correct application.
remuneration directive and regulations In March 2010 the Board of Directors adopted a remuneration directive proposed by the Compensation Committee, which defines the remuneration directives and philosophy valid for the Baloise Group. The remuneration directive applies to all employees of the whole Baloise Group. It reflects the policies and values of the company and is based on the following principles: →→ Be competitive in the market – Baloise aims to pay basic salaries that are in line with the market and to exceed the market regarding variable remuneration when individual and company performance are very good.
→→ To consider the company and individal performance – performance is the basis for further development and advancement.
→→ Fairness and transparency – external comparison on the market also regarding wages, no discrimination.
Based on this remuneration directive, the Board of Directors simultaneously issued a remuneration rule applying to all employees in Switzerland and correspondingly also to all employees of the Group.
All elements of the remuneration policy are thus centrally regulated by the remuneration directive and rules. This regulatory framework forms the basis for a remuneration system that also covers the requirements of the Federal Financial Supervisory Authority. This means that the variable remuneration is in future even more strongly tied to the value creation of the company.
By means of the so-called performance remuneration, the performance of the individual is directly considered, based on an individually target agreement and the corresponding achievement of the objectives. The target value depends on the basic salary and varies according to the management level of the individual.
→→ considers the value creation of the company. The establishment of the so-called Performance Pool is directly linked to the company’s success and is determined by the Compensation Committee ex-post. Here the Compensation Committee considers the following criteria in particular: Group result compared to the previous year and competitors, capital market view in comparison to the competitors and risks assumed, as well as implementation of the strategy.
The compensation disclosed in the report at hand are still measured by the former system used up to now. For this reason, the previous remuneration system is described in detail below.
Market comparisons Baloise regularly compares the salaries of its senior executive managers with those of relevant competitors (STOXX Europe 600 Insurance Index and local employment markets) and strives to pay basic salaries in line with the market.
The results of a compensation survey carried out in 2008 by Kienbaum AG show that on average Baloise pays the market mean as regards total remuneration, whilst the proportion of shares in the total remuneration package is higher than that of comparable competitors as intended. The variable part of the remuneration package can also vary strongly, which in turn confirms that linking it to performance goals really has an effect.
The function value system of Baloise comprises nine function levels (FL); levels 1 to 3 apply across the Group, the other levels 4 to 9 are only applicable in Switzerland: →→ FL 1: Member of the Corporate Executive Committee (including the Chief Executive Officer)
As a performance-driven company, Baloise establishes a clear and replicable correlation between the goals of the employees and business objectives, which can be derived from strategic priorities. Remuneration, target agreements and performance assessments are closely related. Compensation – consisting of basic salary and variable payments – shows a clear yet differentiated connection to and recognition of the performance of the individual and the success of the company and is meant to motivate employees to continue to achieve outstan- ding results. Actual performance forms the basis for further development, career planning and the fostering of our talents.
Incentives Incentives as a variable and performance-related remuneration component depend on the attainment of certain targets. Individual performance is measured as part of the “Individual Performance Management” process (IPM) introduced. To this end, and in cooperation with their employees, superiors annually define key individual targets and assess the full extent of attainment by March of the following year at the latest.
Basic salary: CHF 100,000 Target incentive: 22 % of basic salary Total extent of target attainment: 80 % OPM factor (operational performance management): 1.1
Incentives are paid with the salary for June of the following year. Basically, employees at function levels 4 and 5 have the choice which proportion they would like to have paid out in cash and which they would like to receive as shares. This option is restricted for function levels 1 to 3; here a graded obligation to draw share exists: Members of the Corporate Executive Committee must draw 50 % of their incentives in the form of shares. These obligatory salaries mean that as the individual’s responsiblitity and total remuneration increases a significant proportion of the remuneration is paid out with a deferred effect. They also promote risk awareness among employees and encourage them to work economically and sustainably.
There is also in future a choice of two share subscription plans: Share Subscription Scheme and Employee Ownership Plan (compare 5.7 “Share Subscription Scheme and Employee Ownership Plan”).
The remuneration directive issued by the Board of Directors in March 2010 contains clear guidelines on service entry and departure compensation: Such payments may only be made in substantiated cases. Service entry and departure compensation
5.5. overview of the participation programmes For some time now, the Baloise Group has offered employees and executive management personnel various plans where shares are granted as part of the total remuneration package.
5.6. employee Incentive Plan The Basler foundation for employee incentive plans, set up in 1989, offers employees from various Group companies in Switzerland the option of buying shares of the Bâloise Holding Ltd at a preferential price, as a rule once a year, according to stipulations laid down in the regulations established by the foundation board. This promotes long-term employee commitment to the company, also as shareholders. The subscription price is determined by the foundation board at the beginning of the subscription period and published on the intranet. It is equivalent to half of the average rate determined for the month of August in the subscription year and amounts to CHF 41.90 for the reporting period (2009: CHF 45.70). The subscribed shares are always transferred on 1 September and are subject to a blocking period of three years.
The stock of shares employed for this purpose was acquired by the board during earlier share capital increases by Bâloise Holding Ltd. It can regulate the stock of shares through additional purchases as required. The foundation will be able to continue this Employee Incentive Plan in the coming years due to existing stocks.
In�cash�in�CHF�million 1.2 1.4 coMPAnIes In stoxx 600 euroPe InsurAnce Index (As of 31 deceMBer 2010)
66 Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5.7. share subscription scheme and employee ownership Plan Employees in Switzerland can choose between two plans for the incentive portion drawn in shares: Share Subscription Scheme and Employee Ownership Plan.
share ownership Plan Since May 2001, the majority of senior staff in Switzerland can draw a proportion of their incentive, which is freely selectable within certain ranges, in shares instead of in cash. Upper limits exist for function levels 1 to 3, members of the Corporate Executive Committee, who are obliged to draw at least half of their incentive as shares, may not draw more than 50 % of their incentive entitlement in shares as part of the Employee Share Ownership Plan. As with the Share Subscription Scheme, the subscription date is always 1 June; on this day, ownership of the shares is transferred to the employee without further vesting conditions, however, they may not be sold during a blocking period of three years. The subscription price is determined by the Corporate Executive Committee each year and published in advance on the intranet. On 19 April 2010, the Corporate Executive Committee decided that the subscription price for the reporting period be based on the volume-weighted stock average from 4 to 18 May 2010 (previous year: decision dated 20 April 2009; stock average from 6 to 11 May 2009). The discounted dividend right is deducted from this stock average over the period of three years, so that the subscription price in the reporting period amounted to CHF 70.88 (2009: CHF 76.21). The shares required for the Share Ownership Plan are purchased on the market.
5.8. Performance quota and Performance share units (Psu) Since 2007, two plans exist for Group employees at function levels 1 to 3: →→ the performance quota as part of short-term variable remuneration focusing on the consolidated result and value creation,
→→ the performance share unit programme as part of long-term variable remuneration, to achieve long-term employee retention.
Once the fiscal year has ended, the Compensation Committee assesses the performance and the success of the management at its discretion. Based on this assessment, the Compensation Committee decides on a total sum to be made available as a performance quota. The performance quota can also be zero if a corresponding assessment is made.
The individual amounts – as part of the total sum provided by the Compensation Committee – are specified by each line manager or other senior staff member for each employee in April and paid together with the June salary. These sums depend on individual performance and the contribution to the company’s success made by the person and vary in their amount and as a proportion of total remuneration. Part of the amount awarded (for members of the Corporate Executive Board 50 %) must be drawn in shares; for the remainder there is the choice to subscribe for further shares or have this amount paid out in cash. The regulations of the Employee Share Ownership Plan are valid for the part drawn in shares. The corresponding amounts are detailed in the table on pages 73 and 74 under the heading “Share Subscription Scheme.”
Performance share units (Psu) With its performance share unit programme, Baloise has had an instrument to involve its employees in the success of the company on a long-term basis and retain key personnel since 2007. Thus participants can profit even further from the longterm value enhancement of the company as long as they remain with Baloise. This means that the PSU programme creates a commonality of interests between the shareholders and management. The programme was introduced in 2007 for employees at function levels 1 to 3 in Switzerland (including the Chairman of the Board of Directors). In 2008, this group of participants was expanded to include members of the Corporate Executive Committee of foreign business units.
The participant receives the corresponding number of shares at the end of the performance period (vesting), i. e. on 1 January 2013 for the PSU allocated in 2010. The PSU become void without compensation or substitution, should the employment contract be terminated (except in the case of retirement, invalidity or death) during the performance period. To emphasise the long-term character of the programme, 50 % of the allocated shares are subject to an additional three-year blocking period after the performance period has expired.
5.9. Pension schemes Baloise provides several pension solutions that are designed differently to suit country-specific circumstances. There are different pension schemes available in Switzerland for the employees of the insurance company and the bank.
Baloise Insurance offers its employees in Switzerland an attractive pension solution as part of the 2nd pillar, which fulfils the following objectives: →→ It meets the requirements of the insured in case of a risk event (old age, death or invalidity) and absorbs the resulting financial consequences with a solution based on social partnership.
→→ It permits an appropriate maintenance of a lifestyle enjoyed to date with a sufficiently high substitution rate (1st and 2nd pillar benefits combined) to replace discontinued earnings. The employer makes an above-average contribution to financing of occupational pensions.
No claim to receivables from active or former members of the Board of Directors was waived.
5.11. remuneration to the chairman of the Board of directors and the members of the corporate executive committee See tables on pages 73 and 74.
Even if the basic salaries remained unchanged compared to the previous year, the sum of the total remuneration cannot be immediately compared to the previous year. In the reporting period PSU were converted into shares for the first tiem. These PSU were allocated as prospective entitlements three years ago. Their definite value was only fixed with the effected conversion. For this reason the equivalent value of the shares as a remuneration element is presented in the table on page 74 and so increases the total amount of the remuneration paid out in 2010 in comparison.
The variable portions of total remuneration are determined in spring each year as part of the Individual Perfor- mance Management process (compare 5.3. “Baloise remuneration system; incentives”). Therefore, the table on page 74 details the basic salary and pension benefits for 2010 and the variable remuneration components for the previous year that were paid out during the reporting period. The variable remuneration for the 2009 fiscal year is higher than it was in 2008. This is because the degree of target attainment was higher than in the previous year both regarding the company targets and the individual targets. When considering the total amount it is important to note that the variable remuneration of two new members of the Corporate Executive Committee is included in the sum.
71Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5.10. remuneration to the members of the Board of directors (not including chairman)
reMunerAtIon to the MeMBers of the BoArd of dIrectors 2009 (PrevIous yeAr)
remuneration 2009 remuneration for additional functions remuneration 2009 total 2009 of which: in cash 2009 of which: in shares
explanatory notes to table: Dr�Christoph�J.�C.�Albrecht�and�Dr�Arend�Oetker�resigned�from�the�Board�of�Directors�at�the�Annual�General�Meeting�2009�as�a�result�of�� having�reached�the�regulatory�age�limit.�They�therefore�only�received�half�of�the�usual�remuneration�in�2009. remuneration to former members of the Board of directors and related individuals��No�remuneration�was�paid�to a)�former�members�of�the�Board�of�Directors�with�regard�to�previous�governing�body�activities�in�Baloise�or�that�is�not�market�standard� b)�individuals�or�companies�related�to�the�members�of�the�Board�of�Directors�and�that�is�not�market-standard�(related�individuals:�spouses,�� civil�partners,�children�under�18�years,�companies�belonging�to�or�controlled�by�members�of�the�Board�of�Directors,�or�legal�or�natural�� persons�who�act�as�a�fiduciary�for�them).� Furthermore,�receivables�from�this�group�of�persons�were�not�waived.
� in chf in chf in chf in chf in chf in chf number
remuneration to former members of the Board of directors and related individuals��Due�to�contractual�obligations,�a�one-off�payment�of� CHF�80,000�was�paid�to�a�former�member�of�the�Board�of�Directors�connnected�to�his�previous�governing�body�activities�of�the�company.�� No�remuneration�was�paid�to�individuals�or�companies�involving�the�members�of�the�Board�of�Directors�and�that�is�not�market-standard�� (related�individuals:�spouse,�civil�partner,�children�under�18�years,�companies�controlled�by�members�of�the�Board�of�Directors,�legal�or�� natural�persons�who�act�as�a�fiduciary�for�them).� Furthermore,�receivables�from�this�group�of�persons�were�not�waived.
73Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5.11. remuneration for the chairman of the Board of directors and members of the corporate executive committee reMunerAtIon to the chAIrMAn of the BoArd of dIrectors And the MeMBers of the corPorAte executIve coMMIttee 2009 (PrevIous yeAr) �
Psu chf chf chf in�CHF � � � � � � � � � �
CEO�Baloise�Group � � � � � � � � � �
chf number of shares chf number of shares number of Psu chf chf chf in�CHF � � � � � � � � � � � � � � � �
� � � � � � � � � � � � � � � � �
Head�of�Corporate�Division�Switzerland � � � � � � � � � � � � � � � �
� � � � � � � � � � � � � � � �
total corporate executive committee explanation to the table compare pages 73 and 74: The�tables�contain�the�basic�salary�and�pension�benefits�for�2009�(page�73)�and�2010�(page�74)�as�well�as�the�variable�remuneration�components�for�the�� previous�year�that�were�paid�out�during�the�reporting�period.�Although�these�variable�remuneration�components�were�paid�out�in�2009�(page�73)�and�� 2010�(page74),�they�involve�the�respective�previous�fiscal�year.�Dr�O.�Noack�was�the�highest�paid�member�of�the�Corporate�Executive�Committee�in�2009.�� Dr�O.�Noack�was�the�highest�paid�Corporate�Executive�Committee�member�in�2009.�This�is�due�to�the�fact�that�Baloise�compensated�him,�compliant�� with�common�practice,�for�certain�claims�against�his�former�employer�that�he�waived�and,�for�the�same�reason,�Baloise�also�assumed�a�non-recurrent�� deposit�to�the�pension�fund.�The�corresponding�amounts�are�contained�in�the�columns�“Non-cash�benefits”�and�“Pension�benefits”(page�73).� Dr�M.�Strobel�is�the�highest�paid�Corporate�Executive�Committee�member�in�2010.
remuneration to former members of the Board of directors and related individuals��No�remuneration�was�paid�to�individuals�or�companies�affiliated� with�the�Chairman�of�the�Board�of�Directors�or�members�of�the�Corporate�Executive�Board�or�that�is�not�market-standard�(related�individuals:�� spouse,�civil�partner,�children�under�18�years,�companies�controlled�by�members�of�the�Board�of�Directors,�legal�or�natural�persons�who�act�as�a� fiduciary�for�them).�Furthermore,�receivables�from�this�group�of�persons�were�not�waived.
76 Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5.12. Amounts of the total remuneration and the variable payments totAl And vArIABle reMunerAtIon BAloIse grouP
debits / credits from remuneration for previous fiscal years recognised in profit and loss
total severance payments made explanatory notes to table: total remuneration��All�cash-value�benefits�which�the�financial�institute�pays�directly�or�indirectly�to�a�person�in�connection�with�his�employment� or�role�related�to�his�work;�e.�g.�cash�payments,�non-cash�benefits,�expenses�that�justify�or�increase�claims�to�pension�benefits,�pensions,�allocation� of�participation,�conversion�and�option�rights�as�well�as�waiving�any�claims.� variable compensation��Portion�of�the�total�remuneration�whose�adjustment�or�amount�is�at�the�discretion�of�the�financial�instituts�or�depends�on�the� occurrence�of�agreed�conditions,�including�performance�or�success-related�compensation�such�as�kickbacks�and�commissions.�Service�entry�and� departure�compensation�are�likewise�contained�under�the�item�variable�remuneration.
77Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5.13. loans to key personnel credIts And loAns to MeMBers of the BoArd of dIrectors And the corPorAte executIve coMMIttee (31 deceMBer)
Werner Kummer dr eveline saupper corporate executive committee member with the highest outstanding loan dr thomas sieber
78 Corporate�Governance Corporate�Governance�Report including�Compensation�Report 5.14. Participations and options shAres held By MeMBers of the BoArd of dIrectors excludIng chAIrMAn (31 deceMBer)
dr georg f. Krayer dr Michael Becker dr Andreas Burckhardt dr hansjörg frei
Werner Kummer dr eveline saupper total Board of directors (excluding chairman) 54,765 57,008 18,001 21,686 72,766 78,694 0.146 % 0.157 %
Percentage�of�issued�share�capital 0.110�% 0.114 % 0.036�% 0.043 % 0.146�% 0.157 % �
shAres held By the chAIrMAn of the BoArd of dIrectors And MeMBers of the corPorAte executIve coMMIttee (31 deceMBer)
Head�of�� Corporate�Division�� Asset�Management total chairman of the Board of directors and members of the corporate executive committee
Percentage�of�� issued�share�capital explanatory notes to table: shareholdings��Including�shares�held�by�related�individuals�(spouse,�civil�partner,�children�under�18�years,�companies�belonging� to�or�controlled�by�Board�members,�or�legal�or�natural�persons�that�act�as�fiduciaries�for�them). freely available shares��Shares�held�in�personal�custody�accounts. Blocked shares��Including�shares�financed�by�loans�stemming�from�ESOP.�Shares�subscribed�for�through�share-based�remuneration� schemes�are�subject�to�a�three-year�blocking�period.�According�to�§�20�of�the�Articles�of�Incorporation,�each�member�of�the�Board�� of�Directors�must�deposit�1,000�shares�with�the�company�for�the�term�of�his�/�her�office�(qualifying�shares). options�Options�held�in�relation�to�ESOP�are�not�listed�here,�as�they�do�not�originate�from�an�independent�option�plan,�but�have�been� written�to�secure�the�loan.�In�addition,�each�put�option�has�a�call�option�as�counterpart. Prospective entitlements (Psu)��Number�of�performance�share�units�allocated�(allocation�as�of�1�January�2008,�1�January�2009�and� 1�January�2010).
80 Corporate�Governance Corporate�Governance�Report including�Compensation�Report 6. shAreholder PArtIcIPAtIon rIghts voting rights Baloise’s share capital consists solely of registered shares. Each share grants the right to one vote. There are no shares with preferential voting rights. In order to maintain a broad shareholder base and protect minority shareholders, no shareholder is registered with voting rights of more than 2 %, irrespective of the number of shares held. The Board of Directors may approve exceptions to this rule with a two-thirds majority of all members (§ 5 of the Articles of Incorporation). There are currently no exceptions. Each shareholder may authorise another shareholder to exercise his / her voting rights in writing. In exercising voting rights, no shareholder may directly or indirectly aggregate his / her own and proxy votes to secure more than a fifth of all voting rights at the Annual General Meeting (§ 16 of the Articles of Incorporation).
Extraordinary General Meetings may be convened by resolution of the Annual General Meeting, the Board of Directors or the auditors. Furthermore, an Extraordinary General Meeting must be convened by the Board of Directors at the request of shareholders in compliance with legal stipulations (§ 11 of the Articles of Incorporation). For such a request to be granted, the shareholders must represent at least 10 % of the share capital, in compliance with article 699 section 3 of the Swiss Code of Obligations.
All six members of the Corporate Executive Committee have a twelve-month notice period. In addition, they are – as are seven other members of the executive management – entitled to a severance payment amounting to one annual salary (including incentive), in the event that their employment contract is terminated within twelve months after a change of control due to a takeover or merger or a merger of employers (under certain circumstances also of employees). The notice period for the Chairman of the Board of Directors is six months. No change of control clause exists.
Bâloise Holding has an Audit Committee made up of in- dependent members with finance and accounting quali- fications (compare table on page 51 of the Annual Report). The Audit Committee met four times during the fiscal year and on each occasion also met with the external auditors. The Audit Committee received detailed documentation on the findings of the external auditors, in particular as to the Annual and Half-Year Financial Statements at these meetings.
It proposes to the Board of Directors that external auditors be elected by the Annual General Meeting and makes recommendations regarding the auditors’ fees. Prior to the start of the annual audit, the Audit Committee reviews its scope and proposes areas requiring special consideration. The Audit vorabdruck
Committee reviews the external auditors’ fees annually. The criteria for assessing the auditors are
Information events Baloise provides comprehensive information on its operating activities: →→ Business results are presented and objectives, strategies and business activities are explained at press conferences (Annual and Half-Year Report media conferences).
→→ At financial analysts’ meetings, teleconferences take place to present Annual and Half-Year Financial Statements. These events are available afterwards as podcasts.
→→ The Annual General Meeting provides shareholders with a review of the business year.
Information on the Baloise share You can find information on the Baloise share in the Annual Report from page 24 onwards.
Information on Baloise bonds Information on outstanding Baloise bonds can be found in the Financial Report from page 111 onwards.
www.baloise.com → Investor relations → Bonds financial calendar At www.baloise.com, important dates for investors can be found. Here you can find the publication dates of the Annual and Half-Year Financial Statements. The General Annual Meeting, the date and invitation to the Annual General Meeting, the share register cut-off date and the ex-dividend date, if applicable, are also published here.
Premiums earned and policy fees (gross) 1 6,706.6 6,880.2 6,945.2 6,841.5 6,854.3
Interest expenses on insurance liabilities – 67.0 – 76.1 – 73.8 – 69.4 – 61.2
86 Financial Information Consolidated income statement additional inFormation in CHF million
Assets for the account and at the risk of life insurance policyholders 2,976.6 4,366.9 3,340.1 6,818.1 7,821.7
Funding ratio nonlife in percent 194.8 195.6 183.0 187.7 180.5 1 In line with the accounting principles applied by the Baloise Group, investment-type insurance premiums are not included in the premiums earned and policy fees.
2 Including financial liabilities held for trading purposes (derivative financial instruments).
ComBined ratio gross and net Gross Net as a percentage of premiums earned
Claims and benefits paid (gross) – 1,867.4 – 1,818.4 – 3,516.0 – 3,394.5
Expenses for policyholders’ dividends – 19.1 – 17.5 – 239.7 – 352.8 total technical result (gross) 231.5 198.3 – 1,256.0 – 1,371.1
Reinsurance share of claims incurred – 4.2 – 23.1 1.3 – 0.3
Expenses for policyholders’ dividends 0.0 0.2 1.2 1.2 total technical result of ceded business – 109.2 – 97.0 – 5.2 – 8.5
Claims and benefits paid – 1,813.4 – 1,754.0 – 3,510.2 – 3,389.2
Change in loss reserve / actuarial reserves 1 12.4 – 79.3 – 724.8 – 967.2
Realised gains and losses on investments 2 – 3.5 8.4 448.1 499.0
Other financial expenses and income – 28.7 1.7 – 373.7 – 206.4 result from investment income 260.3 279.0 1,412.2 1,562.3 annual result before borrowing costs and taxes 382.6 380.3 151.0 182.7
annual result (segment result) 331.5 315.0 121.8 150.2 1 Including change in provisions for loss adjustment expenses.
2 Including financial liabilities held for trading purposes (derivative financial instruments). 3 Of which latency calculation effects from other business segments: 31 December 2009 CHF 6.9 million / 31 December 2010 CHF – 10.4 million vorabdruck
Gross premiums by sectors gross Premiums By seCtor nonliFe in CHF million gross premiums written, nonlife 3,136.4 3,044.9 – 2.9 gross Premiums By seCtor liFe in CHF million
Investment-type premiums – 2,905.6 – 2,681.6 – 7.7 gross premiums written, life 3,723.4 3,814.9 2.5
Depreciation of intangible assets and property, plant and equipment – 4.9 – 9.6 annual result before taxes 61.0 67.9
Income taxes – 9.5 – 12.8 annual result (segment result) 51.5 55.1 additional inFormation in CHF million
Fixed-income securities shares investment properties mortgage assets, policy and other loans alternative financial assets, derivatives, cash and cash equivalents total in CHF million
total capital gains and losses – 3.5 – 138.6 – 142.1 8.4 184.8 193.2 asset alloCation, insuranCe 1 2009 2010 nonlife life total nonlife life total in CHF million 1 Excluding assets for the account and at the risk of life insurance policyholders.
Interest and securities income 2 9.6 11.9 total income 329.5 345.2 total expenses – 99.9 – 111.6 tax expenses – 0.2 – 0.2
Other financial assets 0.2 0.2 non-current assets 1,668.8 1,791.0 total assets 2,162.7 2,140.2 equity and liabilities
treasury shares Treasury shares are posted at cost or at the lower fair value.
accruals Accruals considers both expenses paid in advance for the new fiscal year, as well as income from the current fiscal year that will only be received at a later date. Included under the same heading are dividends decided on the balance sheet date by the Annual General Meeting of the subsidiaries. Bâloise Holding reports these as dividend claims.
Participations Participations are recognised at cost net of requisite de- preciation.
Bonds Bonds are recognised at face value. The emission costs, reduced in the amount of the premium, are charged in full to the income statement upon issue of the bond.
Provisions Provisions are created to cover any risks according to the principles of prudent management.
accruals Accruals include income already received in respect of the new fiscal year and expenses for the current fiscal year which will only be paid at a later date.
Other interest expenses – 1.2 – 0.1 total interest expenses – 43.8 – 47.1 vorabdruck
100 Bâloise Holding Notes Bâloise Holding 6. dePreCiation in CHF million
Other expenses – 4.5 – 11.7 total other expenses – 6.0 – 13.1 notes to the BalanCe sheet 8. aCCruals Due to resolutions of the Annual General Meeting on 17 February 2011 of Baloise Asset Management Schweiz AG, Basel, and of Baloise Asset Management International AG, Basel, and on 1 March 2011 of Haakon AG, Basel, the accrued dividend claims (income from investments in associates) for the 2010 fiscal year were regarded as deferred expenses.
Share / corporate capital as of 31.12.2010 in % 1 in %1 Currency in million
Allocation (carry forward from Other reserves) 1 71.7 38.1 total reserve for treasury shares 118.3 156.4 total statutory reserves 130.0 168.1 other reserves
Withdrawal (carry forward to Reserve for treasury shares) – 71.7 – 38.1 total other reserves 298.6 264.9 retained earnings
Profit for the period 229.4 233.4 total retained earnings 230.2 234.2 total equity 663.8 672.2 1 Baloise Group companies purchased during the reporting period (not including the share buy-back via the secondary trading line) a total of 840,085 shares at an average price of CHF 83. During the reporting period they sold 379,736 shares at an average price of CHF 82 and together held a total of 1,708,136 Bâloise Holding shares as of 31 December 2010. The balance of Bâloise Holding shares acquired via the secondary trading line amounted to 223,565 shares, as in the previous year. These shares are stated in the balance sheet item “Treasury shares.”
103Bâloise Holding Notes Bâloise Holding 13. signiFiCant shareholders Two shareholder groups hold more than 5 % of outstanding Baloise shares as of 31 December 2010. The following table provides information on the current shareholder structure as of 31 December 2010 (figures rounded).
total holding as of share of voting rights as of total holding as of share of voting rights as of in percent shareholders
A purchase price retention of EUR 5 million to cover any guarantee claims was agreed in the purchase agreement concluded in 2007 regarding Osiguranje Zagreb. The sum is deposited in escrow at a bank. Furthermore, possible supplementary purchase price payments (earn-outs) were agreed. The amounts depend on the premium growth and net profits of Osiguranje Zagreb in the years 2007, 2008 and 2009. However, these additional payments amount to a maximum of EUR 20 million. No guarantee claims were made after the guarantee period had lapsed in the reporting period and the bank deposit in escrow was paid back to Bâloise Holding.
Bâloise Holding issues the following letter of comfort: As the owner of Baloise Life (Liechtenstein) AG, Bâloise Holding, Basel, warrants that its subsidiary, Baloise Life (Liechtenstein) AG is able to meet its financial obligations to its customers, arising from RentaSafe, BelRenta Safe, RentaProtect and RentaSafe Time contracts, in particular guarantee pledges, in full at any time. The maximum liability corresponds to the actuarial reserve entered in the balance sheet of Baloise Life (Liechtenstein) for these products as of 31 December 2010.
Bâloise Holding is jointly liable for value-added tax due with all companies which, under the leadership of the Baloise Insurance Ltd, are subject to group taxation.
16. details aBout the PerFormanCe oF a risK assessment Details about the performance of a risk assessment can be found in Chapter 5, “Management of insurance and financial risks,” in the Baloise Group’s Consolidated Annual Financial Statements.
The Board of Directors proposes to the Annual General Meeting the appropriation of retained earnings in accordance with the table below.
Appropriation to unappropriated reserves – 4,400,000.00 – 8,400,000.00 retained earnings to be carried forward 761,739.92 797,616.90
The distribution of profits complies with the provisions of § 30 of the Articles of Incorporation. Distribution per share equals CHF 4.50 gross or CHF 2.92 net of withholding tax.
Baloise “Baloise” stands for “Baloise Group”, “Bâloise Holding” for “Bâloise Holding Ltd”. By Baloise share we mean the share of Bâloise Holding Ltd.
Business volume Business volume includes premium income from the nonlife and life insurance business and from unit-linked life insurance policies during the reporting period. Due to the underlying accounting principles of the Baloise Group, the latter may not be disclosed as income in the consolidated financial statements.
Combined ratio Ratio of nonlife insurance business, expressing the sum of claims incurred (loss ratio), costs (expense ratio) and profit-sharing (profit-sharing ratio) in relation to pre- miums. This ratio is used to assess the profitability of the nonlife insurance business.
expense ratio The ratio of the cost of nonlife insurance business to premiums, expressed in percent.
iFrs Since 2000, the Baloise Group has prepared its consolidated annual financial statements in accordance with IFRS International Financial Reporting Standards (formerly IAS International Accounting Standards).
impairment (impairment loss) Impairment of an asset recognised in profit and loss. Whether the carrying value of an asset is greater than its recoverable amount is determined using an impairment test. If necessary, the asset is impaired down to the recoverable amount and recognised through profit and loss.
insurance benefits The benefits provided by the insurer in connection with the occurrence of an insured event.
investments Included in investments are properties, shares and alternative financial investments (stocks of an equity nature), fixed-interest securities, mortgage-backed investments, policies and other loans, derivatives as well as cash and cash equivalents. Precious metals from the investmenttype insurance business are presented under the item “Other assets”.
investment performance The performance measures the business success of investments. Gains, losses, income, expenses, as well as changes to as yet unrealised gains and losses, as set out in the income statement related to the average balance of the investments.
legal quota Fixed statutory or contractual percentage requiring life insurance companies to pass on a certain percentage of earnings to the policyholders.
loss reserve Provisions for claims that have not been settled at yearend.
reinsurance If the insurance company does not want to carry the full risk from an insurance policy or an entire portfolio of policies, it passes on part of the risk to a reinsurance company or another direct insurer. However, the primary insurer still has to indemnify the policyholder for the full risk.
return on equity Calculated return on the equity of a company during the fiscal year. Return on equity is calculated by taking the profit generated during the fiscal year and dividing it by average equity.
run off business Policy portfolio that has ceased to accept new policies, with existing policies expiring successively.
minimum interest rate Minimum required interest rate for the respective savings balance of company pension plans.
new business margin Value of new business divided by the annual premium equivalent (APE).
solvency Required minimum capital for insurance companies specified by the regulatory authorities, to cover business risks (investments, claims). As a rule, this requirement is specified at a national level and may differ from country to country.
technical reserves On the balance sheet, insurers disclose the value of future benefits they expect from the existing insurance policies, calculated at the present time. The value is computed using recognised principles.
technical result The technical result includes a comparison of all expenses and income from the insurance business. Expenses and income unrelated to the insurance business and revenue from investments are not included in the technical result.
unearned premium reserves Accrued portions of the written premiums that have been charged for periods after the balance sheet date.
value of new business The value of new business transacted during the report- ing period, valued at the time the policy is issued.
Baloise Bank soBa Amthausplatz 4 CH-4502 Solothurn bank@baloise.ch www.baloise.ch germany Basler versicherungen Basler Strasse 4 P.O. Box 1145 D-61345 Bad Homburg www.basler.de deutscher ring sachversicherungs-ag deutscher ring lebensversicherungs-ag Ludwig-Erhard-Strasse 22 D-20459 Hamburg www.deutscherring.de austria Basler versicherungen Brigittenauer Lände 50 – 54 A-1203 Vienna www.basler.at luXemBourg Bâloise assurances Atrium Business Park 23, rue du Puits Romain Bourmicht L-8070 Bertrange
Corporate publications can be ordered via the Internet or from the Baloise Group, Corporate Communications, Aeschengraben 21, CH-4002 Basel.
inFormation For media rePresentatives At www.baloise.com/media you will find the latest media releases, presentations, reports, pictures and podcast files of various Baloise events as well as media contact details.
Baloise Baloise key figures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cover shareholder inFormation review oF Business year sustainaBle Business management
Business volume, premiums and combined ratio . . . . 88 inFormation on the Baloise grouP . . . . . . . . . . . . . . . . . . . . . 111 Key dates and ContaCts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Cover
Corporate governance Dr Thomas Sieber Aeschengraben 21 CH-4002 Basel thomas.sieber@baloise.com investor relations Marc Kaiser Aeschengraben 21 CH-4002 Basel investor.relations@baloise.com media relations Dominik Müller Aeschengraben 21 CH-4002 Basel media.relations@baloise.com www.baloise.com vorabdruck