International Insurance Company of Hannover SE, Scandinavian Branch, Stockholm / Sweden 198,462 192,910 108 4,249
International Insurance Company of Hannover SE, UK Branch, London / United Kingdom 368,196 333,358 (200) 3,532 1 IFRS figures before consolidation 2 Branch was newly established in 2017. 3 Branch is in liquidation.
These are predominantly special purpose entities in the form of funds, which for their part transact certain types of equity and debt capital investments. These investments encompass private equity funds, fixed income funds, collateralised debt obligations, real estate funds, index funds and other public funds. The volume of these transactions is derived from the book values of the respective investments and amounted to EUR 3,016.9 million (EUR 3,239.4 million) as at the balance sheet date. The maximum risk of loss corresponds to the book values.
Hannover Re also uses further segregated accounts of Kaith Re Ltd. and other structured entities outside the Group for various retrocessions of both its traditional and ILS covers, which in each case are passed on to institutional investors in securitised form. The volume of these transactions is measured by the ceded exposure limit of the underlying retrocession agreements and amounted to altogether EUR 2,635.3 million (EUR 1,844.7 million) as at the balance sheet date. The structured entities are in all cases fully funded by contractually defined investments in the form of cash and equivalent liquid assets. Given that the entire exposure limit of the structured entities is therefore wholly collateralised in each case, there is no risk of loss for Hannover Re.
The book values of the assets and liabilities from the specified transactions with unconsolidated structured entities were as follows as at the balance sheet date: Book values from business relations with unconsolidated structured entities N 13 in EUR thousand
The business was included in the consolidated financial statement for the first time as at 1 July 2017. For the purposes of initial consolidation and in accordance with appropriate measurement methods, the fair values of the acquired assets and assumed liabilities were to some extent established on the basis of assumptions and estimations. The assumptions and estimates that had been made were put into concrete terms as at the balance sheet date, and initial consolidation was therefore finalised within the measurement period.
The gross written premium of the assumed business from the date of initial consolidation until the balance sheet date amounted to EUR 62.3 million. For the same period a positive result in a minimal amount was booked from the assumed business.
In the fourth quarter of 2017 all shares in the special purpose property companies 3541 PRG s.r.o. as well as Škodův palác s.r.o., both Prague, Czech Republic, were acquired via HR GLL Europe Holding S.à.r.l., Luxembourg, for the purpose of acquiring real estate. Škodův palác was subsequently merged into 3541 PRG with no effect on Group net income. In addition, HR GLL Europe Holding S.à.r.l., Luxembourg, and HR GLL Central Europe GmbH & Co. KG, Munich, acquired all shares in the special purpose property company 92601 BTS s.r.o., Bratislava, Slovakia, in December 2017, again for the purpose of acquiring real estate. Altogether, an amount of around EUR 135 million was invested in this connection.
Hannover Re | Annual Report 2017 4.4 Major disposals and retirements
Within the US subgroup Hannover Re Real Estate Holdings, Inc., the special purpose property company 11 Stanwix LLC, Wilmington, was liquidated after the property that it held had been sold. The special purpose property company 7660SAN LLC (formerly 300 California, LLC), Wilmington, was also liquidated in the course of the year.
Hannover Rück SE and E+S Rückversicherung AG, both Hannover, each sold their 50% interests in Hannover Euro Private
Equity Partners II GmbH & Co. KG and in Hannover Euro Private Equity Partners III GmbH & Co. KG, including the two subsidiaries HEPEP II Holding GmbH and HEPEP III Holding GmbH, all Cologne, effective 31 October 2017 as well as the shares in Hannover Euro Private Equity Partners IV GmbH & Co. KG, Cologne, effective 30 November 2017. Derecognition of the assets and liabilities gave rise to income of EUR 0.2 million, which was recognised in other comprehensive income.
In the previous year Hannover Re had acquired all the shares in the company The Congregational & General Insurance Public Limited Company (CGI), Bradford, UK, through its subsidiary International Insurance Company of Hannover SE, Hannover. Following delicensing by the national Financial Conduct Authority on 27 December 2017, CGI was transferred in its entirety to its parent company under a Part VII transfer and legally extinguished. In view of the fact that this involves an internal transaction within the Group, it does not give rise to any implications for Group net income.
All companies consolidated for the first time or deconsolidated in 2017 are allocated to the property and casualty reinsurance segment.
Fixed-income securities – held to maturity 259,284 342,793 71,898 134,045 5,000 8,117 336,182 484,955
Fixed-income securities – loans and receivables 2,417,894 2,539,270 37,270 24,324 – – 2,455,164 2,563,594
Equity securities – available for sale 37,520 905,307 – – – – 37,520 905,307
Reinsurance recoverables on benefit reserve – – 959,533 1,189,420 – – 959,533 1,189,420
Other assets in the segment 1,351,426 1,115,251 792,297 723,648 (671,162) (681,631) 1,472,561 1,157,268
Other liabil ities in the segment 1,948,148 2,150,083 1,705,864 1,659,712 (682,176) (696,723) 2,971,836 3,113,072 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
Assets held for sale – 15,086 – – – – – 15,086
Loss and loss adjustment expense reserve 24,130,443 24,010,367 4,248,296 4,119,245 (194) (194) 28,378,545 28,129,418
Segment statement of income Property and casualty reinsurance Life and health reinsurance Consolidation Total thereof
From insurance business with other segments – – – (45) – 45 – –
Interest on hybrid capital – – – – 71,736 71,693 71,736 71,693 thereof
Held to maturity due in one year 85,411 86,359 144,327 145,003 due after one through two years 28,055 29,586 87,517 90,601 due after two through three years 35,145 39,097 28,500 30,907 due after three through four years 138,465 156,064 35,083 40,284 due after four through five years – – 140,256 162,586 due after five through ten years 48,278 54,789 48,276 54,398 due after more than ten years 828 263 996 311
Available for sale due after one through two years 2,711,972 2,721,829 3,382,457 3,404,847 due after two through three years 3,310,919 3,364,264 2,820,187 2,866,629 due after three through four years 3,659,321 3,675,048 3,748,106 3,841,259 due after four through five years 2,748,835 2,814,657 3,134,627 3,190,102 due after five through ten years 9,992,925 10,218,549 11,351,605 11,588,659 due after more than ten years 4,601,225 4,935,094 4,234,143 4,498,831
Financial assets at fair value through profit or loss due in one year 177,634 177,634 11,698 11,698 due after one through two years 8,620 8,620 210,510 210,510 due after two through three years – – 7,881 7,881 due after three through four years – – 9,828 9,828 due after four through five years 7,075 7,075 – –
Debt securities issued by semi-governmental entities 85,877 1,247 3,915 – 89,792
Amortised cost, unrealised gains and losses and accrued interest on loans and receivables as well as their fair value N 21 in EUR thousand
Debt securities issued by semi-governmental entities 1,609,907 25,638 225,273 3,701 1,831,479
Analysis of the fair value changes in the portfolio of fixed-income securities at fair value through profit or loss indicated that, contrary to the previous year, no fair value changes were attributable to a changed credit risk. In the previous year fair value reductions of EUR 2.2 million were due to changes in credit risks.
Participating interests and other invested assets, real estate funds 2,167,994 21,342 2,170,696 15,342
Fixed-income securities – held-to-maturity 303,675 118,989 52,291 10,000 – – – – 484,955
Fixed-income securities – loans and receivables 22,805 – 33,813 1,983,946 39,755 374,777 – 68 2,455,164
Fixed-income securities – loans and receivables – – 15,191 2,006,831 41,254 500,318 – – 2,563,594
Group share of income and expense recognised directly in equity (936) (9,087)
The carrying amount of the investments in associated companies changed as follows in the year under review: Investments in associated companies N 32 in EUR thousand 2017 2016
Net book value at 31 December of the previous year 114,633 128,008
Net book value at 31 December of the year under review 121,075 114,633
Development of investment property N 33 in EUR thousand 2017 2016
Gross book value at 31 December of the previous year 1,502,800 1,374,305
Cumulative depreciation at 31 December of the previous year 100,557 71,602
Net book value at 1 January of the year under review 1,318,675 1,323,560
Net book value at 31 December of the year under review 1,583,728 1,402,243
The additions to this item are attributable to investment activities at the relevant real estate companies belonging to the Hannover Re Group, not only in Europe but also in Asia and the United States.
Fair value hierarchy of financial assets and liabilities recognised at fair value N 34 in EUR thousand
Net book value at 31 December of the previous year 10 – 390,676 1,653,902 168,943
Net book value at 31 December of the previous year 10 – 371,254 1,475,415 156,144
Net book value after currency translation 10 – 376,940 1,508,331 161,877
Income and expenses recognised in the statement of income – – (3,081) 14,666 (22,575)
Change in fair value of financial instruments – – – 2,924 22,575
Total depreciation, impairments and appreciation of investments – – (3,081) (11,664) –
If models are used to measure financial assets and liabilities included in level 3 under which the adoption of alternative inputs leads to a material change in fair value, IFRS 13 requires disclosure of the effects of these alternative assumptions. Of the financial assets included in level 3 with fair values of altogether EUR 2,073.2 million (EUR 2,044.6 million) as at the balance sheet date, Hannover Re measures financial assets with a volume of EUR 1,892.6 million (EUR 1,853.8 million) using the net asset value method, in respect of which alternative inputs within the meaning of the standard cannot reasonably be established. The remaining financial assets included in level 3 with a volume of EUR 180.6 million (EUR 190.8 million) relate to investments, the valuation of which is based inter alia on technical parameters. Derivative financial instruments in connection with the reinsurance business were recognised under the other liabilities included in level 3 in the year under review. Their performance is dependent upon the risk experience of an underlying group of primary insurance contracts with statutory reserving requirements. The application of alternative inputs and assumptions has no material effect on the consolidated financial statement.
Total financial liabilities – 1,977,801 – 1,977,801 6.2 Funds withheld (assets)
The contract deposits on the assets side decreased by EUR 2.6 million in the year under review from EUR 170.5 million to EUR 167.9 million.
The retrocessionaires’ portions of the technical provisions are based on the contractual agreements of the underlying reinsurance treaties. For further details please refer to our comments on the technical provisions in section 6.7 “Technical provisions” on page 211 et seq. as well as the remarks in the risk report on page 86 et seq.
Net book value at 31 December of the previous year 2,264,034 2,149,141
The value adjustments on accounts receivable that we recognise in adjustment accounts changed as follows in the year under review: Value adjustments on accounts receivable N 44 in EUR thousand 2017 2016
Cumulative value adjustments at 31 December of the year under review 17,391 40,468
Net book value of accounts receivable at 31 December of the year under review 3,821,124 3,678,030
In addition, we took specific value adjustments on reinsurance recoverables on unpaid claims in the year under review. We would refer the reader to the corresponding remarks on the loss and loss adjustment expense reserve in section 6.7 “Technical provisions”. With regard to the credit risks resulting from technical assets we would also refer the reader to our comments on page 97 et seq. of the risk report.
In accordance with IFRS 3 “Business Combinations” scheduled amortisation is not taken on goodwill. Goodwill was subject to an impairment test.
This item principally includes the goodwill from the acquisitions of E+S Rückversicherung AG as well as of the shares of Integra Insurance Solutions Limited and Glencar Underwriting Managers Inc. Goodwill equivalent to altogether EUR 28.8 million was added in the context of the acquisition of Argenta Holdings Limited.
The other receivables include unadjusted items of EUR 0.2 million (EUR 0.2 million) that were overdue by between three and twelve months as at the balance sheet date as well as unadjusted items of EUR 0.3 million (previous year: none) that were overdue by more than twelve months as at the balance sheet date.
Net book value at 31 December of the year under review 63,285 76,592
Benefits” they were carried as a separate asset at fair value as at the balance sheet date in an amount of EUR 90.8 million (EUR 87.3 million).
Gross book value at 31 December of the year under review 157,511 155,812
Net book value at 31 December of the previous year 27,234 28,707
Gross book value at 31 December of the year under review 364,879 265,220
Cumulative depreciation at 31 December of the previous year 213,132 199,996
Credit risks may result from other financial assets that were not overdue or adjusted as at the balance sheet date. In this regard, the reader is referred in general to our comments on the credit risk contained in the risk report on page 93 et seq.
Technical provisions N 51 in EUR thousand gross retro net gross retro net
Net book value after currency translation 26,211,667 1,385,757 24,825,910 26,939,816 1,432,935 25,506,881
Specific value adjustments established in the year under review on retrocessions, i. e. on the reinsurance recoverables on unpaid claims, were principally attributable to the insolvency of a retrocessionaire from the United States in the area of property and casualty reinsurance. On balance, cumulative specific value adjustments of EUR 44.5 million (EUR 1.4 million ) were recognised in these reinsurance recoverables as at the balance sheet date.
The total amount of the net reserve before specific value adjustments, to which the following remarks apply, was EUR 26,682.7 million (EUR 26,621.7 million) as at the balance sheet date.
The following table shows the net loss reserve for the property and casualty reinsurance business group in the years 2007 to 2017 as well as the run-off of the reserve (so-called run-off triangle ). The figures reported for the 2007 balance sheet year also include the amounts for previous years that are no longer shown separately in the run-off triangle. The run-off results shown reflect the changes in the ultimate loss arising in the 2017 financial year for the individual run-off years.
The run-off profit of altogether EUR 1,058.0 million (EUR 804.1 million) in the 2017 financial year derives, as in the previous year, above all from positive run-offs of reserves in short-tail property business as well as in the areas of general liability and marine / aviation.
Maturities of the technical reserves IFRS 4 “Insurance Contracts” requires information which helps to clarify the amount and timing of cash flows expected from reinsurance contracts. In the following tables we have shown the future maturities of the technical provisions broken down by the expected remaining times to maturity. As part of our maturity analysis we have directly deducted the deposits put up as collateral for these reserves, since the cash inflows and outflows from these deposits are to be allocated directly to the ceding companies. For further explanation of the recognition and measurement of the reserves please see section 3.2 “Summary of major accounting policies”.
Due after one through five years 10,812,304 661,217 10,151,087 1,934,719 853,841 1,080,878
Development of the benefit reserve N 56 in EUR thousand gross retro net gross retro net
Net book value at 31 December of the previous year 10,313,952 1,189,420 9,124,532 12,227,691 1,367,173 10,860,518
The development in the year under review was influenced by portfolio withdrawals attributable principally to partial withdrawals from specific underwriting years in relation to UK single premium business as well as in quota share business with German primary insurers.
The calculation of the provisions for pensions is based upon the following assumptions: Measurement assumptions N 58 in %
The movements in the net pension liability for the Group’s various defined benefit plans were as follows: Movements in net liability from defined benefit pension plans N 59 in EUR thousand
Past service cost and plan curtailments 81 – – – – –
Actuarial gain (–) / loss (+) from change in biometric assumptions 3,407 – – – – –
Employee contributions and deferred compensation 24 27 – 382 – –
The reconciliation of the projected benefit obligations with the recognised provisions for pensions is as follows: Provisions for pensions N 60 in EUR thousand 2017 2016
Projected benefit obligations at 31 December of the financial year 210,855 207,621
Recognised pension obligations at 31 December of the financial year 177,315 180,680 thereof: Capitalised assets 471 –
With regard to the liabilities from derivatives in an amount of EUR 264.3 million (EUR 186.8 million), please see our explanatory remarks on derivative financial instruments in section 8.1 “Derivative financial instruments and financial guarantees”.
Partial retirement arrangements and early retirement obligations 1,933 (6) 1,927 – – 167 858 11 10 1,235
On 20 November 2012 Hannover Rück SE placed a EUR 500.0 million subordinated bond in the European capital market via its subsidiary Hannover Finance (Luxembourg) S.A. The bond has a maturity of approximately 30 years with a first scheduled call option on 30 June 2023 and may be redeemed at each coupon date thereafter. It carries a fixed coupon of 5.00% p. a. until this date, after which the interest rate basis changes to a floating rate of 3-month EURIBOR +430 basis points.
The following table shows the movements in debt, subordinated capital components and other long-term liabilities with respect to cash and non-cash changes.
Shareholders’ equity is shown as a separate component of the financial statement in accordance with IAS 1 “Presentation of Financial Statements” and subject to IAS 32 “Financial Instruments: Disclosure and Presentation” in conjunction with IAS 39 “Financial Instruments: Recognition and Measurement”. The change in shareholders’ equity comprises not only the net income deriving from the statement of income but also the changes in the value of asset and liability items not recognised in the statement of income.
The Annual General Meeting of Hannover Rück SE resolved on 10 May 2017 that a gross dividend of EUR 5.00 per share should be paid for the 2016 financial year. This corresponds to a total distribution of EUR 603.0 million (EUR 572.8 million). The distribution consists of a dividend of EUR 3.50 per share and a special dividend of EUR 1.50 per share.
Treasury shares IAS 1 requires separate disclosure of treasury shares in shareholders ’ equity. As part of this year’s employee share option plan Hannover Rück SE acquired altogether 18,805 (16,413) treasury shares during the second quarter of 2017 and delivered them to eligible employees at preferential conditions. These shares are blocked until 31 May 2021. This transaction resulted in an expense of EUR 0.4 million (EUR 0.4 million), which was recognised under personnel expenditure, as well as a negligible change in retained earnings recognised in equity. The company was no longer in possession of treasury shares as at the balance sheet date.
Non-controlling interests in the shareholders’ equity of subsidiaries are reported separately within Group shareholders’ equity in accordance with IAS 1 “Presentation of Financial Statements ”. They amounted to EUR 758.1 million (EUR 743.3 million ) as at the balance sheet date.
Net income 205,345 133,367 thereof attributable to non-controlling interests 72,299 46,956
Shareholders’ equity 1,995,032 1,978,546 thereof attributable to non-controlling interests 702,419 696,615
Dividends paid 125,000 110,000 thereof attributable to non-controlling interests 44,011 38,729
Net gains and losses on investments N 75 in EUR thousand
Other invested assets – 1,588 – 3,652 5,240 1 Including income from associated companies, for reconciliation with the consolidated statement of income 2 Excluding other investment expenses
Net technical result (488,505) 115,935 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
Commissions and brokerage, change in deferred acquisition costs N 79 in EUR thousand 2017 2016 1
Commissions and brokerage, change in deferred acquisition costs (net) 3,499,270 2,978,642 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
Income from contracts recognised in accordance with the deposit accounting method 198,088 105,858
Of the separate value adjustments, an amount of EUR 19.6 million (EUR 30.6 million) was attributable to accounts receivable and EUR 43.6 million (EUR 1.3 million) to retrocession recoverables.
Deferred tax assets and deferred tax liabilities of all Group companies N 84 in EUR thousand 2017 2016
Deferred tax liabilities 1,353,303 1,434,681 1 Thereof on tax loss carry-forwards: EUR -80,933 thousand (EUR -26,880 thousand)
Tax expense / income not attributable to the reporting period (42,861) 30,435
In the year under review the actual taxes on income were reduced by EUR 5.2 million (EUR 0.5 million) because loss carry-forwards were used for which no deferred tax assets were established.
No deferred taxes were established on liabilities-side taxable temporary differences amounting to EUR 50.6 million (EUR 40.2 million) in connection with interests in Group companies because the Hannover Re Group can control their reversal and will not reverse them in the foreseeable future.
Availability of loss carry-forwards that have not been capitalised: Expiry of non-capitalised loss carry-forwards and temporary differences N 87 in EUR thousand One to five years Six to ten years More than ten years
Hannover Re holds derivative financial instruments to hedge interest rate risks from loans connected with the financing of real estate; these gave rise to recognition of other liabilities in an amount of EUR 1.0 million (EUR 2.5 million) and other financial assets at fair value through profit or loss in an amount of EUR 0.5 million (EUR 0.2 million).
Maturity structure of derivative financial instruments N 89 in EUR thousand
Derivative financial instruments in connection with reinsurance A number of treaties in life and health reinsurance meet criteria which require application of the stipulations contained in IFRS 4 “Insurance Contracts” governing embedded derivatives. These accounting regulations require that certain derivatives embedded in reinsurance contracts be separated from the underlying insurance contract (“host contract”), reported separately at fair value in accordance with IAS 39 “Financial Instruments: Recognition and Measurement” and recognised under investments. Fluctuations in the fair value of the derivative components are to be recognised through profit and loss in subsequent periods.
A derivative financial instrument was also unbundled from another similarly structured transaction. This gave rise to recognition of other financial assets at fair value through profit or loss in an amount of EUR 7.4 million (EUR 4.1 million). The performance of this derivative improved the result by EUR 3.5 million in the financial year (EUR 7.5 million).
At the end of the year under review an index-linked cover was written for longevity risks. The resulting derivative was recognised as at the balance sheet date with a negative fair value of EUR 52.6 million under other liabilities. There were no effects on income owing to initial recognition close to the balance sheet date.
Talanx AG holds an unchanged majority interest of 50.22% in Hannover Rück SE. For its part, HDI Haftpflichtverband der Deutschen Industrie Versicherungsverein auf Gegenseitigkeit
Companies belonging to the Talanx Group granted the Hannover Re Group insurance protection inter alia in the areas of public liability, building, contractors all risks, group accident and business travel insurance. Divisions of Talanx AG also performed services for the Hannover Re Group in the areas of taxes and general administration.
For the year under review and the previous year these business relations can be broken down as follows: Business assumed and ceded in Germany and abroad N 92 in EUR thousand
Furthermore, IT and management services were performed for Talanx Reinsurance Broker AG, Hannover, under service contracts.
The members of the governing bodies did not receive any advances or loans in the year under review. Nor were there any other material reportable circumstances or contractual relationships as defined by IAS 24 between companies of the Hannover Re Group and the members of the governing bodies or their related parties in the year under review. Furthermore, above and beyond the aforementioned remuneration as Supervisory Board members at Group companies, the members of the Supervisory Board were not in receipt of any remuneration or benefits for personally rendered services as defined by section 5.4.6 Para. 3 of the German Corporate Governance Code.
Stock Appreciation Rights Plan With effect from 1 January 2000 the Executive Board of Hannover Rück SE, with the consent of the Supervisory Board, introduced a virtual stock option plan that provides for the granting of stock appreciation rights to certain managerial staff. The content of the stock option plan is based solely on the Conditions for the Granting of Stock Appreciation Rights.
The allocations for the years 2007 and 2009 to 2011 gave rise to commitments in the 2017 financial year shown in the following table. No allocations were made for the years 2005 or 2008.
Number of rights existing at 31 December 2017 63,533 94,542 22,510 –
Expense in the 2017 financial year (in EUR million) 0.30 0.01 – –
The existing stock appreciation rights are valued on the basis of the Black-Scholes option pricing model.
On this basis the aggregate provisions – included in the sundry non-technical provisions – amounted to EUR 3.1 million (EUR 7.3 million) for the 2017 financial year. The expense totalled altogether EUR 0.3 million (EUR 1.1 million).
The members of the Executive Board and management of Hannover Re who are eligible recipients under the Share Award Plan are those who have been allowed a contractual claim to the granting of share awards and whose service / employment relationship exists at the time when the share awards are granted and does not end through cancellation or a termination agreement on an effective date prior to expiry of the vesting period.
Share awards were granted separately for the first time for the 2011 financial year and then for each financial year (allocation year) thereafter. The first payout of share awards took place in the 2016 financial year for those share awards that had been allocated in the 2011 financial year to the eligible members of the Executive Board. In the 2017 financial year the first payout was also made to the participating senior executives.
In addition, upon payment of the value of the share awards, a sum shall be paid out in the amount of the dividend insofar as dividends were distributed to shareholders. The amount of the dividend is the sum total of all dividends per share paid out during the term of the share awards multiplied by the number of share awards due for disbursement to the eligible recipient at the disbursement date. In the event of early disbursement of the share awards, the value of the dividends shall only be paid out for the period until occurrence of the event that triggers early disbursement. No pro rata allowance shall be made for dividends that have not yet been distributed.
Provision at 31 December of the year under review 1,559 4,045 6,371 8,965 13,116 – 34,056
The aggregate provision – recognised under the sundry non-technical provisions – amounted to EUR 34.1 million (EUR 35.8 million) as at the balance sheet date.
The personnel expense for share awards in the case of members of the Executive Board is spread on an accrual basis across the relevant term of the share awards or the shorter term of the service contracts; in the case of senior executives the personnel expense is spread across the relevant term of the share awards. The allocation of the financial year recognised in the expenditures on personnel totalled altogether EUR 12.1 million (EUR 10.6 million). This consists of the expense for share awards of the 2017 financial year as well as the dividend claim and the additionally earned portion of the share awards granted in earlier financial years. The value of the share awards finally granted is also influenced by movements in the share price. The sum total of the dividends included in the expenditures on personnel for earlier financial years amounted to EUR 2.0 million (EUR 2.0 million). The distributed dividend is recognised, with no allowance made for expected dividend payments. Dividend claims are recognised in the discounted amounts.
Number of employees (excluding Board members) 3,045 3,035 3,220 3,251 3,089 2,893 2,804
Hannover Rück SE has secured by subordinated guarantee the subordinated debts issued by Hannover Finance (Luxembourg ) S.A. in the 2010 and 2012 financial years in amounts of EUR 500.0 million each.
As part of our business activities we hold collateral available outside the United States in various blocked custody accounts and trust accounts, the total amount of which in relation to the Group’s major companies was EUR 3,173.0 million (EUR 2,954.6 million) as at the balance sheet date.
We put up own investments with a book value of EUR 17.2 million (EUR 49.8 million) as collateral for existing derivative transactions. We received collateral with a fair value of EUR 3.0 million (EUR 17.7 million) for existing derivative transactions.
In the year under review expenses from operating leases of EUR 13.7 million (EUR 11.3 million) were included in the result for the period. As part of the detailed analysis conducted in connection with the implementation of IFRS 16, two long-term land leases were identified that led to the increased non-cancellable future minimum lease payments payable.
Hannover Re | Annual Report 2017 8.9 Fee paid to the auditor
AG). The expense recognised for the fees paid to KPMG AG and worldwide member firms of KPMG International (KPMG) in the year under review can be broken down as follows: Fee paid to the auditor N 101 in EUR thousand
Services relating to auditing of the financial statements 8,953 3,328 8,540 2,445
The auditor responsible for performance of the audit engagement as defined by § 38 Para. 2 of the Professional Charter for Accountants / Certified Auditors (Berufssatzung WP / vBP) as amended on 21 June 2016 is Mr. Florian Möller. He served as the engagement partner responsible for the audit of the annual and consolidated financial statements for the first time as at 31 December 2015.
In this regard we would refer to our remarks in the “Opportunity and risk report” on page 80.
We have audited the consolidated financial statement of Hannover Rück SE, Hannover, and its subsidiaries (the Group) – comprising the consolidated balance sheet as at 31 December 2017, the consolidated statement of income, the consolidated statement of comprehensive income, the consolidated statement of changes in shareholders’ equity and the consolidated cash flow statement for the financial year from 1 January to 31 December 2017 as well as the notes to the consolidated financial statement, including a summary of major accounting policies. In addition, we audited the combined management report of Hannover Rück SE for the financial year from 1 January 2017 to 31 December 2017. In accordance with German statutory requirements, we did not audit the contents of the non-financial information statement and the declaration on corporate governance, which are contained in the section “Non-financial information statement” and in the section “Enterprise management” within the combined management report, or the disclosures identified as unaudited that are contained in the combined management report.
• Pursuant to § 322 Para. 3 Sentence 1 Commercial Code (HGB), we confirm that our audit did not give rise to any reservations concerning the accuracy of the consolidated financial statement and the combined management report.
We conducted our audit of the consolidated financial statement and the combined management report in conformity with § 317 Commercial Code (HGB) and the EU Audit Regulation (No. 537 / 2014) with due regard to German generally accepted standards for the auditing of financial statements promulgated by the Institute of Public Auditors in Germany (IDW). Our responsibility according to these requirements and principles is described more extensively in the section of our audit report entitled “Responsibility of the auditor for the auditing of the consolidated financial statement and the combined management report”. We are independent of the Group companies in conformity with the requirements of European law as well as German commercial law and professional standards and we fulfilled our other German professional duties in conformity with these requirements. Furthermore, we confirm pursuant to Article 10 (2) letter f) EU Audit Regulation that we did not provide any prohibited non-audit services as defined by Article 5 (1) EU Audit Regulation. We are of the opinion that the audit evidence obtained is sufficient and appropriate to serve as a basis for our audit opinions on the consolidated financial statement and the combined management report.
Audit matters of particular importance in the auditing of the consolidated financial statement
Audit matters of particular importance are those matters that, in our professional judgement, are of the greatest significance to our audit of the consolidated financial statement for the financial year from 1 January 2017 to 31 December 2017. These matters were considered in the context of our audit of the consolidated financial statement as a whole and in forming our audit opinion thereon; we do not provide a separate audit opinion on these matters. The presentation below follows the breakdown of the balance sheet items in the consolidated financial statement.
The measurement of financial instruments, the fair values of which have to be determined using valuation models or values indicated by third parties, is subject to uncertainty.
Our approach in the audit Our audit of the financial instruments was conducted with the support of valuation specialists on a risk-oriented basis. In particular, it included the following principal activities: • We audited the process used to enter the portfolio data and measurement parameters (interest rate curves, spreads) in the portfolio management system, including the controls set up in this regard. We convinced ourselves of the effectiveness of the installed controls by means of functional checks.
• In the case of financial instruments measured using a valuation model, we assessed IFRS conformity and the adequacy of the respective models as well as of the determination of the assumptions and parameters incorporated into the valuation for a selection based on risk considerations.
• On the basis of risk considerations, we verified the calculated fair values of selected items according to our own calculations or made a comparison with external information. The checks for financial instruments were made with the support of our valuation specialists. In this regard, we derived parameters incorporated into the calculation from market data, calculated our own fair values and compared them with the company’s results.
• We reviewed the disclosures in the notes to verify whether they comply with the accounting standards and, in so doing, we paid particular attention to the suitable presentation of the valuation methods.
Our conclusions The measurement models used are consistent with IFRS and appropriate overall. The input factors used by the company are appropriate overall. The explanatory remarks and disclosures contained in the notes to the consolidated financial statement are in conformity with the accounting standards.
Measurement of the loss and loss adjustment expense reserve in property and casualty reinsurance With regard to the accounting policies please see the explanatory remarks in the company’s notes on page 163 as well as pages 211 to 215 for further breakdowns of the loss and loss adjustment expense reserve. Risk information is provided in the Group’s combined management report on pages 88 to 91.
The risk for the consolidated financial statement The gross loss and loss adjustment expense reserve amounts to EUR 28,378.5 million (roughly 46.4% of the balance sheet total). A major part of the loss and loss adjustment expense reserve is attributable to property and casualty reinsurance.
The loss and loss adjustment expense reserve in property and casualty reinsurance is arrived at from the information provided by the prior insurers and by following actuarial procedures using statistical methods that necessitate a sufficiently long data history and stability of the observed data. This includes assumptions regarding premiums, ultimate loss ratios, run-off periods, factors and speed that are built upon past experience. Taking into account the results of the actuarial procedures and further information in relation to the uncertainties associated with the calculations, management finally determines the amount of the loss and loss adjustment expense reserve. Large losses are considered separately in the measurement of the reserve.
The measurement of the loss and loss adjustment expense reserve is subject to uncertainties and is highly discretionary. Particularly in the case of large losses such as those caused by hurricane events, it may take a sizeable period of time until all loss advices have been received from ceding companies. Insofar as sufficient loss advices have not yet been received, the reserves for these large losses are estimated on the basis of internal analyses of the market loss and the impact on the company itself based on the existing covers.
Our approach in the audit In auditing the loss and loss adjustment expense reserve in property and casualty reinsurance, we used our own actuaries as part of the audit team and performed the following major audit procedures: • We surveyed the process for calculating the reserves, identified material controls and tested them for adequacy and effectiveness. The controls encompass both the completeness and correctness of the data used and the qualitative and quantitative elements of the valuation.
• With regard to the losses from the hurricane events “Harvey ”, “Irma” and “Maria”, we assessed the assumptions in relation to the loss amount based on interviews and inspection of documentation.
Our conclusions The methods used and the underlying assumptions for the measurement of the loss and loss adjustment expense reserve in property and casualty reinsurance are appropriate.
Measurement of the benefit reserve With regard to the accounting policies please see the explanatory remarks in the notes on page 163 as well as page 215 for further breakdowns of the benefit reserve. Risk information is provided in the company’s combined management report on pages 92 and 93.
The measurement of the benefit reserve is derived in accordance with actuarial methods from the present value of future benefits payable to ceding companies less the present value of future premiums still to be paid by ceding companies. Hannover Rück SE carries over the values from the statements of account of ceding companies or performs its own measurement. In cases where Hannover Rück SE arrives at the assessment that the reported technical provisions are not adequate, additional reserves are constituted on the basis of its own assumptions.
• We analysed the development of the benefit reserve compared to the previous year, especially with an eye to whether the assumptions reflect the current business development as well as our expectations based on market observations.
• We evaluated the liability adequacy test as to whether the actuarial bases and methods used were applied in conformity with IFRS and appropriately. If market interest rates were used for measurement purposes, we reviewed the adequacy of the discount rates used through comparison with parameters that could be observed on the market. In this context, we devoted particularly close attention to the adequacy test for US mortality solutions business.
Calculation of the estimated gross premium With regard to the accounting policies please see the explanatory remarks in the notes on pages 166 to 167 as well as page 226 for further breakdowns of the item.
Premiums for reinsurance assumed are recognised according to the terms and conditions of the reinsurance treaties. Where statements of account from ceding companies are missing, the company has made supplementary or complete estimates of the premiums. The estimation is based on assumptions and is subject to considerable uncertainty and therefore highly discretionary.
Our approach in the audit We conducted the following principal audit procedures, in particular: • We surveyed the process for calculating premiums. In this context, we devoted particularly close attention to the subprocess “calculation of estimated premiums”, identified the material controls performed and tested them with an eye to their design and effectiveness.
Our conclusions The methods used and the underlying assumptions for estimating the premiums are adequate and on the whole balanced.
The legal representatives are responsible for the other information. The other information encompasses: • the non-financial information statement,
• the disclosures identified as unaudited that are contained in the combined management report and
Responsibility of the legal representatives and of the Supervisory Board for the consolidated financial statement and the combined management report
Responsibility of the auditor for the auditing of the consolidated financial statement and the combined management report
Our objective is to obtain reasonable assurance as to whether the consolidated financial statement as a whole is free of material – intended or unintended – misstatements and whether overall the combined management report gives an accurate view of the Group’s position and in all material respects is consistent with the consolidated financial statement as well as with the insights gained from the audit, is in conformity with German legal requirements and suitably presents the opportunities and risks of future development; it is also our goal to provide an audit report that contains our audit opinions on the consolidated financial statement and on the combined management report.
During the audit we exercise our due discretion and maintain a fundamentally critical attitude. In addition,
• we assess the adequacy of the accounting policies applied by the legal representatives as well as the reasonableness of the estimated values presented by the legal representatives and associated disclosures.
We discuss with those charged with governance, among other things, the planned scope and the timetable of the audit as well as significant audit findings, including any deficiencies in the internal control system that we identify during our audit.
We provide to those charged with governance a declaration to the effect that we complied with the relevant independence requirements, and we discuss with them all relationships and other matters that can reasonably be assumed to affect our independence as well as the safeguards implemented in this respect.
We determine from among the matters that we discussed with those charged with governance those matters that were most relevant to the current reporting period in the audit of the consolidated financial statement and therefore constitute the particularly important audit matters. We describe these matters in the audit report, unless laws or other legal provisions prevent public disclosure of the matter.
We were selected as the auditor of the consolidated financial statement by the Supervisory Board on 8 March 2017. We received the audit mandate from the Chairman of the Supervisory Board on 12 May 2017. We have served as the auditor of the consolidated financial statement of Hannover Rück SE without interruption for more than 25 years.
We declare that the audit opinions contained in this audit report are consistent with the additional report to the Audit Committee in accordance with Article 11 EU Audit Regulation (“Additional report to the audit committee”).
The lead engagement partner for the audit is Mr. Florian Möller.
Key points of deliberation As in every year, we were regularly updated on the work of the Supervisory Board committees and given a description of the major pending legal proceedings. A further key point of deliberation was the examination of the various reports in accordance with Solvency II such as the Own Risk and Solvency Assessment (ORSA), the regulatory reporting and especially the capitalisation under Solvency II. In the context of the annual review of the Investment Guidelines, these were expanded to include, inter alia, infrastructure investments (debt and equity) on the assumption that the underlying “New Product Process” is approved by the Executive Board. A peer comparison report on the return on investment was also received. Extensive consideration was given to the EU audit reform and the review of the transition phase between auditors. The approval of the revised strategy of the Hannover Re Group was another major area of the Supervisory Board’s work. In addition, the Supervisory Board decided on the specialist and personal requirements for the Executive Board and Supervisory Board and compared them with the self-assessment of the Supervisory Board’s expertise that had been carried out. The Supervisory Board also examined the need for further training both for the Supervisory Board as a whole and for individual members of the Supervisory Board. As in every year, the full Supervisory Board considered the adequacy of the remuneration system for the members of the Executive Board. The variable remuneration of the members of the Executive Board was defined on the basis of the findings with respect to attainment of the respective targets for the 2016 financial year.
Committees of the Supervisory Board Of the committees formed by the Supervisory Board within the meaning of § 107 Para. 3 Stock Corporation Act (AktG), the Finance and Audit Committee met on four occasions, the Standing Committee met twice and the Nomination Committee met twice. The Chairman of the Supervisory Board updated the full Supervisory Board on the major deliberations of the committee meetings at its next meeting and provided an opportunity for further questions.
The Finance and Audit Committee considered inter alia the consolidated financial statement and the quarterly reports drawn up in accordance with IFRS and the individual financial statement of Hannover Rück SE drawn up in accordance with the German Commercial Code (HGB) and discussed with the independent auditors their reports on these financial statements. As in the previous year, an expert opinion on the adequacy of the loss reserves in property and casualty reinsurance
Hannover Re | Annual Report 2017 was noted, the retrocession structure of the Hannover Re Group and the accumulated prefinancing volume in life reinsurance including a comparison of the expected return flows with the repayments actually made, the risk reports, the compliance report and the report on adherence to Corporate Governance principles were discussed and reports on the major subsidiaries were received and considered. In addition, the Committee examined the investment structure and investment income – including the stress tests with regard to the investments and their implications for net income and the equity base – and defined the audit concentrations for the 2017 financial year. The Committee was provided with detailed reports on the recognition and measurement of the risk-oriented book of US life reinsurance business acquired in 2009 from Scottish Re. The Committee also considered various M&A projects. Furthermore, the Committee prepared various resolutions to be adopted by the Supervisory Board, including a resolution on the next steps to be taken in connection with the EU audit reform.
Consideration of the EU audit reform was a major point of emphasis in the work of the Finance and Audit Committee. In this connection the Finance and Audit Committee validated the report on the conclusions drawn by the company in the selection process for choosing a new auditing firm and made an appropriate recommendation regarding the future auditing firm. Furthermore, a primary concern was the review of the transition phase between the existing and future auditing firm. The Finance and Audit Committee subsequently assured itself – including through direct dialogue with the auditors in the context of a meeting – that the change of auditing firm will take place in an orderly fashion. It is envisaged that the new auditing firm will audit the individual and consolidated financial statements of the company for the 2018 financial year.
The Standing Committee dealt among other things with the adequacy of the system of remuneration for the members of the Executive Board, the determination of the variable remuneration of the members of the Executive Board for the 2016 financial year on the basis of the findings with respect to attainment of their respective targets and the examination of the remuneration for the Board members who were due for review. In all these matters the Committee drew up corresponding recommendations for the full Supervisory Board. The Committee deliberated at length on the medium- and long-time succession arrangements for the Executive Board and recommended to the full Supervisory Board the reappointment of Dr. Michael Pickel and Dr. Klaus Miller.
We considered the report by the Executive Board on non-financial matters (cf. page 64 et seq. of the combined management report) and examined it with the support of a knowledgeable external consultant with an eye to lawfulness, regularity and expediency.
In addition, the Supervisory Board received a report on the design of the remuneration schemes as well as the compliance, internal audit and risk reports.
Audit of the annual financial statements and consolidated financial statements The accounting, annual financial statements, consolidated financial statements and the combined management report were audited by KPMG AG Wirtschaftsprüfungsgesellschaft. The Supervisory Board chose the auditor and the Chairman of the Supervisory Board awarded the audit mandate. The auditor’s independence declaration was received. Along with the audit concentrations of the German Financial Reporting Enforcement Panel (DPR), the additional audit concentrations defined by the European Securities and Markets Authority (ESMA) also formed part of the scope of the audit. The mandate for the review report by the independent auditors on the Halfyearly Financial Report as at 30 June 2017 was also awarded again. The special challenges associated with the international aspects of the audits were met without reservation. Since the audits did not give rise to any objections KPMG AG Wirtschaftsprüfungsgesellschaft issued unqualified audit certificates. The Finance and Audit Committee discussed the annual financial statements and the combined management report with the participation of the auditors and in light of the audit reports, and it informed the Supervisory Board of the outcome of its examination. The audit reports were distributed to all members of the Supervisory Board and scrutinised in detail – with the participation of the auditors – at the Supervisory Board meeting held to consider the annual results. The auditors will also be present at the Annual General Meeting.
– in each case drawn up as at 31 December 2017 – and have no objections. Nor do we have any objections to the statement reproduced in the dependent company report.
Changes on the Supervisory Board and the Executive Board The composition of the Supervisory Board and its committees as well as of the Executive Board did not change in the year under review. Dr. Michael Pickel and Mr. Klaus Miller were reappointed as members of the Executive Board.
Details of memberships of legally required supervisory boards and comparable control boards at other domestic and foreign business enterprises are contained in the individual report of Hannover Rück SE.
Hannover Life Re of Australasia Ltd Tower 1, Level 33 100 Barangaroo Avenue Sydney NSW 2000
International Insurance Company of Hannover SE (Australian Branch) – Underwriting Office Tower 1, Level 33 100 Barangaroo Avenue Sydney NSW 2000
Hannover Rueck SE Bahrain Branch Al Zamil Tower 17th Floor Government Avenue Manama Center 305 Manama
Hannover Rück SE Escritório de Representação no Brasil Ltda. Praça Floriano, 19 salas 1701 / 02
Hannover Re (Ireland) DAC Canadian Life Branch 220 Bay Street, Suite 400 Toronto, Ontario M5J 2W4
International Insurance Company of Hannover SE (Canadian Branch) 220 Bay Street, Suite 400 Toronto, Ontario M5J 2W4
Hannover Re Consulting Services India Private Limited Unit 604, 6th Floor B Wing, Fulcrum Sahar Road Andheri (East)
Hannover Rück SE - India Branch Unit 604, 6th Floor B Wing, Fulcrum Sahar Road
Hannover Rück SE Korea Branch Room 414, 4th Floor Gwanghwamun Officia Building 92, Saemunan-ro, Jongno-gu Seoul 03186
Hannover Services (México) S.A. de C.V. German Centre Oficina 4-4-28 Av. Santa Fé No. 170 Col. Lomas de Santa Fé C.P. 01210 México, D.F.
Office Glendale 4500 Cherry Creek Drive South, Suite 1100 Glendale, Colorado 80246
Accumulation loss: sum of several individual losses incurred by various policyholders as a result of the same loss event (e. g. windstorm, earthquake). This may lead to a higher loss for the direct insurer or reinsurer if several affected policyholders are insured by the said company.
American Depositary Receipt (ADR): share certificates written by US banks on foreign shares deposited there. The ADRs are traded instead of the foreign shares. In the United States Hannover Re has enabled trading on the OTC (over-the-counter) market through an ADR Level 1 program. New capital cannot be raised and the ADR is not listed on a US exchange under a Level 1 program. The main advantage of an ADR Level 1 program compared to higher-level programs is that there is no requirement for accounting or financial reporting in accordance with US GAAP.
Coinsurance Funds Withheld (CFW) Treaty: type of coinsurance contract where the ceding company retains a portion of the original premium at least equal to the ceded reserves. Similar to a ModCo contract the interest payment to the reinsurer reflects the investment return on an underlying asset portfolio.
Excess return on capital allocated (xRoCA): describes the IVC in relation to the allocated capital and shows the relative excess return generated above and beyond the weighted cost of capital.
Expense ratio: administrative expenses (gross or net) in relation to the (gross or net) premium earned.
Surplus reinsurance: form of proportional reinsurance under which the risk is not spread between the insurer and reinsurer on the basis of a previously agreed, set quota share. Instead, the insurer determines a maximum sum insured per risk up to which it is prepared to be liable. Risks that exceed the ceding company’s retention (surpluses) are borne by the reinsurer. The reinsurer’s lines thus vary according to the level of the retention and the sum insured of the reinsured contract. The reinsurer’s liability is generally limited to a multiple of the ceding company’s retention.
I 09 Highs and lows of the Hannover Re share 8 I 10 Relative performance of the Hannover Re share 9 I 11 Shareholding structure as at 31 December 2017 11 I 12 Geographical breakdown of the shares held by institutional investors 11 I 13 Basic information 12 I 14 Key figures 12
M 01 Target attainment 16 M 02 System of value-based management: Performance Excellence (PE) combines the strategic and operational levels 17 M 03 Intrinsic Value Creation and excess return on capital allocated 18 M 04 Gross premium by business group 26 M 05 Business development in the year under review 27 M 06 Gross written premium in P & C reinsurance 30 M 07 Geographical breakdown of gross written premium
M 08 Breakdown of gross premium by treaty types: proportional and non-proportional treaties by volume 30 M 09 Breakdown of gross premium by distribution channel: through brokers / direct 30 M 10 Key figures for Property & Casualty reinsurance 32 M 11 Property & Casualty reinsurance: Major loss trend 33 M 12 Property & Casualty reinsurance: Key figures for individual markets and lines in 2017 33 M 13 Property & Casualty reinsurance: Breakdown of gross written premium in target markets 34 M 14 Property & Casualty reinsurance: Breakdown of gross written premium in North America by line of business 34
M 17 Property & Casualty reinsurance: Breakdown of gross written premium in facultative reinsurance 38
Hannover Rück SE 59 M 40 Hannover Rück SE: Breakdown of gross premium by individual lines of business 60 M 41 Balance sheet structure of Hannover Rück SE 62 M 42 Matrix of material sustainability issues and reportable non-financial aspects 66 M 43 Goal to be achieved by 2017: Value creation for our shareholders 67 M 44 Goal to be achieved by 2017: Attractive investment for sustainability-minded investor groups 67
M 46 Goal to be achieved by 2017: Purposeful stakeholder dialogue 69
M 48 Goal to be achieved by 2017: Extension of ESG guidelines for asset management 71
M 49 Goal to be achieved by 2017: Customer orientation and satisfaction 72
M 50 Breakdown of employees by country 72 M 51 Goal to be achieved by 2017: Expansion of further training measures for specialist and executive staff 73 M 52 Goal to be achieved by 2017: Preserve and restore the performance capability of our staff 74 M 53 Goal to be achieved by 2017: Expansion of further training measures for specialist and executive staff 75 M 54 Goal to be achieved by 2017: Promoting diversity and a work / life balance 75 M 55 Risk management through multiple levels of limits 78 M 56 Strategic targets for risk position 79 M 57 Available capital and required risk capital 81 M 58 Central functions of risk monitoring and steering 82 M 59 Risk landscape of Hannover Re 86 M 60 Reconciliation (economic capital /
M 71 Required risk capital for market risks 93 M 72 Utilisation of the trigger system 94 M 73 Value at Risk for the investment portfolio of the
Hannover Re Group 94 M 74 Scenarios for changes in the fair value of material asset classes 95 M 75 Rating structure of our fixed-income securities 96 M 76 Required risk capital counterparty default risk 97 M 77 Gross written premium retained 97 M 78 Reinsurance recoverables as at the balance sheet date 98 M 79 Required risk capital for operational risks 98 M 80 Opportunity management process 104 M 81 Measurement basis and payment procedures for fixed remuneration 112 M 82 Overview of the composition of variable remuneration 113 M 83 Measurement bases / conditions of payment for variable remuneration 114 M 84 Payment procedures for the total variable remuneration 116 M 85 Total remuneration of the active members of the
M 86 Total expense for share-based remuneration of the Executive Board 120
M 87 German Corporate Governance Code, Item 4.2.5 Para. 3 – Table 1 (target / minimum / maximum remuneration as nominal amounts) 122
M 89 Pension commitments 127 M 90 Individual remuneration received by the members of the Supervisory Board 128 M 91 Securities transactions 129 M 92 Group of participants and total number of eligible participants in variable remuneration systems 130 M 93 Growth in gross domestic product (GDP) 134 M 94 Property & Casualty reinsurance: Forecast development for 2018 138 M 95 Life & Health reinsurance: Forecast development for 2018 141
N 20 Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments classified as held to maturity as well as their fair value 2016 190
N 24 Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments classified as available for sale as well as their fair value 2016 193
N 38 Income and expenses from level 3 financial assets and liabilities 2017 203 N 39 Income and expenses from level 3 financial assets and liabilities 2016 203 N 40 Fair value hierarchy of financial assets and liabilities measured at amortised cost 2017 204 N 41 Fair value hierarchy of financial assets and liabilities measured at amortised cost 2016 204 N 42 Development of deferred acquisition costs 205 N 43 Age structure of overdue accounts receivable 205 N 44 Value adjustments on accounts receivable 206 N 45 Development of goodwill 206 N 46 Capitalisation rates 207 N 47 Other assets 208 N 48 Development of the present value of future profits
N 92 Business assumed and ceded in Germany and abroad 238 N 93 Stock appreciation rights of Hannover Rück SE 240 N 94 Share awards of Hannover Rück SE 242 N 95 Development of the provision for share awards of Hannover Rück SE 242 N 96 Personnel information 243 N 97 Personnel expenditures 243 N 98 Calculation of the earnings per share 244 N 99 Future minimum lease payments payable 246 N 100 Future minimum lease payments receivable 246 N 101 Fee paid to the auditor 247