Claims provision, gross The claims provision comprises provisions for anticipated future claims payments in respect of claims incurred, but not fully settled at the reporting date. These include both claims that have been reported (RBNS – reported but not settled) and those that have not yet been reported (IBNR – incurred but not reported). The provisions related to reported claims are assessed individually by the Claims Department, while the IBNR provisions are calculated based on empirical data for the time it takes from a loss or claim occurring (date of loss) until it is reported (date reported). Based on experience and the development of the portfolio, a statistical model is prepared to calculate the scope of post-reported claims. The appropriateness of the model is measured by calculating the deviation between earlier postreported claims and post-reported claims estimated by the model.
Reinsurers’ share of insurance-related liabilities in general insurance, gross Reinsurers’ share of insurance-related liabilities in general insurance, gross is classified as an asset in the balance sheet. Reinsurers’ share of provision for unearned premiums, gross and reinsurers’ share of claims provision, gross are included in reinsurers’ share of insurance-related liabilities in general -insurance, gross. The reinsurers’ share is less expected losses on claims based on objective evidence of impairment losses.
• the financial assets are included in a portfolio that is measured and evaluated regularly at fair value
Investments held to maturity are measured at amortised cost using the effective interest method, less any impairment losses.
The category loans and receivables comprise the classes bonds classified as loans and receivables, loans, receivables related to direct operations and reinsurance, receivables from group companies, other receivables and cash and cash equivalents.
The category financial derivatives comprise the class financial derivatives at fair value through profit or loss.
Gains and losses on curtailment or settlement of a defined benefit plan are recognised in the income statement at the time of the curtailment or settlement.
Share-based payment Gjensidige has a share saving program for employees and a share-based remuneration scheme for senior executives. The share savings program is an arrangement with settlement in shares, while the remuneration scheme is an arrangement with settlement in both shares and cash.
The cost of share-based transactions with employees is recognised as an expense over the average recovery period. For arrangements that are settled in shares, the value of the allocated shares in the period is recognised as a salary expense in the income statement with a corresponding increase in other paid-in equity. For arrangements settled in cash, which is only applicable for Gjensidige’s obligation to withold an amount for the employee’s tax liability and transfer this amount in cash to the tax authorities on behalf of the employee, the value of the options granted is recognised as a salary expense in the income statement with a corresponding increase in other paid-in equity. Employers' social security costs are calculated based on the fair value of the shares on each balance sheet date. The amount is recognised in the income statement over the expected vesting period and accrued according to IAS 37.
Share-based payment arrangements settled by one of the shareholders in the ultimate mother company is also recognised as a share-based payment transaction with settlement in equity.
Recognition Current tax and deferred tax are recognised as an expense or income in the income statement, with the exception of deferred tax on items that are recognised in other comprehensive income, where the tax is recognised in other comprehensive income, or in cases where deferred tax arises as a result of a business combination. For business combinations, deferred tax is
calculated on the difference between fair value of the acquired assets and liabilities and their carrying amount. Goodwill is recognised without provision for deferred tax.
The provider of intra-group services, that are not considered core activities, will as a main rule, allocate its incurred net costs (all costs included) based on a Cost Plus method, which includes direct and indirect costs, as well as a mark-up for profit.
Non-current assets held for sale and discontinued operations A discontinued operation is a part of Gjensidige that either has been disposed of or is classified as held for sale and: • represents a separate major line of business or geographical area of operations,
• is part of a single coordinated plan to dispose of a separate major line of business or geographical area of operations or
For long-tail lines, the risk is linked to the fact that the ultimate claim costs must be estimated based on experience and empirical data. For certain lines within accident and health insurances, it may take ten to 15 years before all the claims that occurred in a calendar year are reported to the company. In addition, there will be many instances where information reported in a claim is inadequate to calculate a correct provision. This may be due to ambiguity concerning the causal relationship and uncertainty about the injured party’s future work capacity etc. Many personal injury claims are tried in the court system, and over time the level of compensation for such claims has increased. This will also be of consequence to claims that occurred in prior years and have not yet been settled. The risk linked to provisions for lines related to insurances of the person is thus affected by external conditions. To reduce this risk, the company calculates its claims liability based on various methods and follows up that the registered provisions linked to ongoing claims cases are updated at all times based on the current calculation rules. See note 3 (in the consolidated group accounts) and note 16.
Premiums written Gross - direct business and accepted proportional reinsurance 1,220.2 1,423.3 1,053.9 2,890.4 5,292.8 334.4 9,787.5 962.0 998.8 1,481.5 1,589.3
Premiums earned Gross - direct business and accepted proportional reinsurance 1,198.4 1,405.3 1,025.1 2,854.1 5,079.1 330.2 9,548.3 930.6 1,068.7 1,453.0 1,557.0
Provision for unearned premiums, gross 351.2 517.2 273.0 1,222.1 2,675.4 44.0 4,256.1 318.1 413.0 354.7 368.1 Claims provision, gross 223.7 3,822.9 8,715.2 5,652.8 706.1 106.3 4,827.5 1,412.2 191.5 413.3 1,787.1
Försäkringshuset Amb & Rosèn AB Stockholm, Sweden 100% 7.4 4.4 7.4 4.4
¹ Operating income. For companies where financial income is operating income, financial income is included. For other companies, financial income is not included.
Gjensidige's share of loan 2,365.6 2,401.4 Total receivables from joint ventures 2,365.6 2,401.4
Shares and similar interests Dividend income 7.8 6.7 Unrealised gains/(losses) from shares and similar interests (202.2) 656.5 Net realised gains/(losses) from shares and similar interests 649.5 284.0 Total net income and gains/(losses) from shares and similar interests 455.2 947.2
Derivatives Net interest income/(expenses) from derivatives 27.0 30.6 Unrealised gains/(losses) from derivatives 187.6 506.2 Net realised gains/(losses) from derivatives (597.6) (854.1) Total net income and gains/(losses) from derivatives (382.9) (317.2)
Net income and gains/(losses) from loans and receivables Net interest income/(expenses) from loans and receivables 574.6 606.3 Net gains/(losses) from loans and receivables 21.9 228.3 Net gains/(losses) from changes in exchange rates on loans and receivables 9.6 5.6 Total net income and gains/(losses) from loans and receivables 606.1 840.2
Net other financial income/(expenses) 1 (84.6) (81.1) Discounting of claims provision classified as interest expense (11.4) (33.2) Change in discount rate claims provision (161.0) (198.1)
Insurance-related administration expenses incl. commissions for received reinsurance and sales expenses Depreciation and value adjustments (note 11 and note 12), excl. depreciation properties 536.1 627.4 Employee benefit expenses (note 8) 2,963.7 2,751.1 ICT costs 712.5 607.4 Consultants’ and lawyers’ fees 78.6 129.9 Commissions 484.2 466.8 Other expenses 1 (1,026.8) (1,038.2) Total insurance-related operating expenses incl. commissions for received reinsurance and sales expenses 3,748.3 3,544.5
Of which sales expenses Employee benefit expenses 1,481.9 1,071.9 Commission 510.8 497.0 Other sales expenses 407.5 747.1 Total sales expenses 2,400.2 2,315.9
8. Salaries and remuneration The average number of employees in the Group was 2,842 (2,890).
On retirement after the age of 60, a corresponding agreed reduction applies from 100 per cent upon retirement to 70 per cent upon reaching the age of 67. From the age of 67, the pension is calculated on the basis of the Company’s ordinary entitlement earning period of 30 years and is 70 per cent of the fixed salary with a full earning period. Company car arrangements and other benefits are retained until the age of 67.
The CEO has a period of notice of six months and is not entitled to severance pay or termination benefits if he leaves the Company earlier.
Members of the senior group management have a period of notice of six months. No members of the senior group management today have agreements of severance pay or payment of pay after termination of employment.
In accordance with local practice in Denmark and the Baltic, there are certain individual agreements on severance pay in connection with resignation in Gjensidige Forsikring ASA in these countries.
Jørgen Inge Ringdal, Executive Vice President 2,912.8 430.6 156.4 935.7 433.6 2,666 2,666 5,116 28,263 2
Sigurd Austin, Executive Vice President (1.1.20-23.4.20) 1 1,501.3 25.4 50.8 213.9 6.2 2,868 3,004 5,608 3
Mats C. Gottschalk, Executive Vice President 5 4,679.1 666.8 459.8 452.8 698.1 3,072 3,090 5,875 20,331 3
Tor Erik Silset, Executive Vice President (1.6.20-31.12.20) 1 1,580.8 324.5 100.5 114.4 331.9 37 93 170 3,390
The senior group management Helge Leiro Baastad, CEO 5,332.4 1,355.2 171.3 1,638.1 1,364.0 7,797 8,257 14,903 60,231 2
Jørgen Inge Ringdal, Executive Vice President 2,804.4 557.7 166.1 732.4 566.5 2,561 2,719 5,116 26,310 2
Mats C. Gottschalk, Executive Vice President 5 4,589.0 921.5 423.5 478.8 643.4 2,739 3,372 5,893 18,117 3
Taxable temporary differences Property, plant and equipment and intangible assets 1,267.8 1,135.8 Shares, bonds and other securities 846.5 1,199.6 Profit and loss account 80.1 100.2 Account for deferred income from technical provisions including security provision 3,266.8 3,780.2 Total taxable temporary differences 5,461.3 6,215.7
Deductible temporary differences Loans and receivables (31.5) (14.1) Provisions for liabilities (288.9) (294.5) Net pension liabilities (332.8) (326.8) Total deductible temporary differences (653.3) (635.4)
Reconciliation of tax expense Profit before tax expense 5,840.4 8,613.9 Estimated tax of profit before tax expense (25%) (1,460.1) (2,153.5)
Tax recognised in other comprehensive income Deferred tax pensions 27.4 29.1 Tax payable on exchange rate differences (64.9) 17.1 Total tax recognised in other comprehensive income (37.5) 46.2
The main result from the tax relief decision mentioned above, is that an increase in taxable gain from sale of shares in Gjensidige held by Gjensidigestiftelsen, leads to an increase in the taxable basis for depreciation in Gjensidige, which in turn give a
Disability pension, spouse/cohabitant pension and child’s pension are also included in the plan subject to more detailed rules.
The sensitivity analysis is based on only one assumption being changed at a time, while all the others remain constant. This is seldom the case, since several of the assumptions co-vary.
Gjensidige is exposed to financial risk since the pension assets are managed in Gjensidige Pensjonskasse as an investment choice portfolio. The financial risk is related to investments in equities, interest-bearing securities and property. Most of the investments are in securities funds and bonds. The financial risk comprises stock market, interest rate, credit, currency and liquidity risk, whereas the greatest risk factor is interest rate risk. Financial risk in pension assets is estimated using defined stress parameters for each asset class and assumptions about how the development of the different asset classes will co-vary.
The pension assets are higher than the calculated pension liabilities. However, it must be tested whether the use of pension assets has a limitation. It is expected that part of the overfunding will be used to finance new earnings or be returned to the sponsor. A reduction in the liabilities (for example due to a rise in interest rates) will be partially offset by an increase in potential overfunding. The risk factors below must therefore be seen in the light of the overfunding.
The pension liability will increase by approximately 12.6 per cent in the event of a parallel shift in the whole yield curve (fall in interest) of minus one percentage point. The value will fall by approximately 10.6 per cent in the event of an interest rate increase of one percentage point.
If wage growth is one percentage point higher, it will lead to approximately 3.7 per cent increase in the liability. If wage growth is one percentage point lower, it will lead to approximately 3.0 per cent decrease in the liability. If G is one percentage point higher it will lead to approximately 1.5 per cent decrease in the liability.
Gjensidige Pensjonskasse measures risk based on requirements set by the Financial Supervisory Authority in the form of stress tests. These tests should reflect 99.5 per cent value at risk. The pension fund has a solvency capital margin of 138 per cent without the use of transitional rules, which indicates that there is no requirement to provide pension funds to improve the pension fund’s solvency.
If the administrator of the AFP plan presents such allocation figures, this could result in the plan being recognised as a defined benefit plan. It is difficult, however, to arrive at an allocation key that is acceptable to the members. An allocation key based on the Gjensidige’s share of total annual pay will not be acceptable since such a key is too simple and will not adequately reflect the financial liabilities.
Interest cost 44.8 12.3 57.1 59.4 15.1 74.5 Actuarial gains and losses 238.9 119.1 358.0 145.0 62.8 207.8 Benefits paid (116.9) (34.5) (151.3) (112.7) (34.5) (147.3) Employers' national insurance contributions of benefits paid (17.1) (6.4) (23.5) (26.4) (6.3) (32.8)
Fair value of plan assets As at 1 January 2,324.7 2,324.7 2,198.8 2,198.8 Interest income 51.7 51.7 64.0 64.0 Return beyond interest income 174.7 174.7 40.5 40.5 Contributions by the employer 106.6 6.4 113.0 164.8 6.3 171.2 Benefits paid (116.9) (116.9) (112.7) (112.7) Employers' national insurance contributions of benefits paid (17.1) (6.4) (23.5) (26.4) (6.3) (32.8)
Business combinations (2.7) (2.7) (4.4) (4.4) As at 31 December 2,521.0 2,521.0 2,324.7 2,324.7
Pension expense recognised in profit or loss Current service cost 24.6 9.9 34.6 24.5 9.6 34.1 Interest cost 44.8 12.3 57.1 59.4 15.1 74.5 Interest income (51.7) (51.7) (64.0) (64.0) Employers' national insurance contributions 4.7 1.9 6.6 4.7 1.8 6.5 Pension cost 22.4 24.1 46.5 24.5 26.5 51.0
Cumulative amount as at 1 January (2,801.7) (2,685.3) Return on plan assets 174.7 40.5 Changes in demographic assumptions (135.8) (133.4) Changes in financial assumptions (222.2) (74.4) The effect of the asset ceiling 73.6 50.9 Exchange rate differences 0.6 (0.0) Cumulative amount as at 31 December (2,910.7) (2,801.7)
Disposals/reclassifications (26.6) (534.2) (57.1) (617.9) Exchange differences (20.3) (8.3) (6.0) (11.7) (46.3) As at 31 December 2019 3,050.1 1,205.7 1,003.6 611.3 5,870.8 Uncompleted projects 280.6 280.6 As at 31 December 2019, including uncompleted projects 3,050.1 1,205.7 1,284.3 611.3 6,151.4
Amortisation and impairment losses As at 1 January 2019 (100.0) (598.8) (791.4) (196.7) (1,686.9) Additions through merger (349.9) (4.3) (291.1) (645.4) Amortisation (127.5) (235.5) (70.8) (433.8) Disposals/reclassifications 26.6 493.1 57.1 576.9 Exchange differences 5.3 2.4 6.3 14.0 As at 31 December 2019 (100.0) (1,044.3) (535.7) (495.3) (2,175.3)
Cost As at 1 January 2020 3,050.1 1,205.7 1,003.6 611.3 5,870.8 Additions / change in cost
Exchange differences 180.9 85.2 27.3 50.4 343.8 As at 31 December 2020 3,231.1 791.2 635.3 661.7 5,319.2 Uncompleted projects 78.0 78.0 As at 31 December 2020, including uncompleted projects 3,231.1 791.2 713.3 661.7 5,397.3
Amortisation and impairment losses As at 1 January 2020 (100.0) (1,044.3) (535.7) (495.3) (2,175.3) Amortisation (56.8) (200.7) (67.8) (325.3) Disposals/reclassifications
Each of the units above is the smallest identifiable group of assets that generates cash inflows and considered as separate cash-generating units. Normally, each segment will be
considered as a cash-generating unit. Acquired portfolios are integrated into the operations in the various countries and have joint management follow-up and management. The annual assessment of impairment losses was carried out in the third quarter of 2020. There has also been carried out indication assessments during other quarters in order to assess whether there is new evidence that calls for a new impairment assessment. In the fourth quarter, an updated assessment was made of whether the termination of the agreement with Nykredit will have a significant effect on goodwill related to Gjensidige Forsikring, Danish branch. The updated assessment gives no indication of impairment losses.
Growth reduces by 1% i terminal value calculation compared to expected
As at 31 December 2020 28.5 1,123.4 293.5 14.4 1,459.7 Uncompleted projects 11.0 11.0 As at 31 December 2020, including uncompleted projects 28.5 1,123.4 304.4 14.4 1,470.7
Depreciation and impairment losses As at 1 January 2020 (143.1) (252.3) (6.2) (401.6) Depreciation (161.6) (42.9) (6.4) (210.9) Disposals 15.2 95.7 6.2 117.1 Exchange differences (2.4) (1.6) (0.2) (4.2) As at 31 December 2020 (291.8) (201.1) (6.7) (499.6)
Carrying amount As at 1 January 2019 28.5 966.7 179.5 10.3 1,184.9 As at 31 December 2019 28.5 831.6 103.4 7.7 971.1
Lease liability Undiscounted lease liability 1 January 1,167.2 1,352.1 Effect of discounting of the lease liability (106.7) (148.3) Discounted lease liability 1 January 1,060.5 1,203.8
Financial assets Financial derivatives Financial derivatives at fair value through profit or loss 1,294.3 1,294.3 934.1 934.1
Financial assets at fair value through profit or loss, designated upon initial recognition
Financial liabilities at amortised cost Subordinated debt 18 1,198.9 1,209.0 1,198.6 1,201.6 Other liabilities 19 2,615.4 2,615.4 2,650.7 2,650.7 Liabilities related to direct insurance and reinsurance 497.9 497.9 427.0 437.8 Liabilities within the group 20 85.4 85.4 56.7 45.8
Financial assets Financial derivatives Financial derivatives at fair value through profit or loss 1,294.3 1,294.3
Shares and similar interests 146.2 4,099.0 1,277.3 5,522.4 Bonds and other fixed income securities 11,893.0 16,074.9 277.9 28,245.9 Loans 1.9 1.9
Reconciliation of financial assets valued based on non-observable market data (level 3) 2020
Net realised/ unrealised gains recognised in profit or loss Purchases Sales Settle- ments
Shares and similar interests 1,306.1 (126.9) 164.1 (66.4) 0.4 1,277.3 (126.9) Bonds and other fixed income securities 708.6 (19.1) (469.2) 57.7 277.9 Loans 2.2 1.6 (1.9) 1.9 1.8 Total 2,016.9 (144.4) 164.1 (537.6) 58.1 1,557.1 (125.1)
Perpetual Tier 1 capital ¹ 1,002.3 1,002.2 Subordinated debt 1,198.6 0.3 1,198.9
Perpetual Tier 1 capital ¹ 1,000.5 1.8 1,002.3 Subordinated debt 1,198.3 0.3 1,198.6
Other shares SOS International A/S 126.5 Cloudberry Clean Energy AS 919 967 072 40.4 Sampo Oyj 34.0 Mimiro Holding AS 821 186 382 25.0 Entra ASA 999 296 432 23.5 Helgeland Invest AS 939 150 234 16.7 Sector Asset Management AS 887 139 342 14.3 Telenor ASA 982 463 718 12.2 Equinor ASA 923 609 016 9.3 Scalepoint Technologies Limited 7.6 Paydrive AB 6.8 Tryg A/S 5.4 Quantafuel AS 915 119 484 5.2 Yara International ASA 986 228 608 4.3 Aker ASA 886 581 432 4.0 Nordic Credit Rating AS 917 685 991 3.7 Tun Media AS 982 519 985 3.7 Bone Support AB 3.6 Norwegian Energy Company ASA 987 989 297 3.5 Svenska Handelsbanken AB 3.4 Other shares 25.5 Total other shares 378.7
Wells Fargo Lux Worldwide EM Equity Fund Equity fund 608.0 RBC Funds Lux - Global Equity Focus Fund Equity fund 571.4 Nordea Stabile Aksjer Global 989 851 020 Equity fund 234.2 JSS Sustainable Equity - Global Thematic Equity fund 213.7 AB SICAV I - Global Core Equity Portfolio Equity fund 212.8 Incentive Active Value Fund Cl. A EUR Unrestricted Hedge fund 169.2 Storebrand Norge I 981 672 747 Equity fund 113.6 Danske Invest Norske Aksjer Institusjon I 981 582 020 Equity fund 111.3 American Century Concentrated Global Growth Equity Fund Equity fund 103.6 HitecVision VI LP Private equity fund 90.1 Norvestor VII LP Private equity fund 87.5 Invesco Credit Partners LPA Hedge fund 65.9 HitecVision Private Equity V LP Private equity fund 64.7 Viking Venture III Private equity fund 62.5 HitecVision VII Private equity fund 54.9 Northzone VIII L.P. Private equity fund 53.8 Argentum Secondary III Private equity fund 47.4 HitecVision Private Equity IV LP Private equity fund 44.3 NPEP Erhvervsinvest IV IS Private equity fund 36.1 Procuritas Capital Investor V Private equity fund 35.8 Other funds 449.3 Total funds 5,110.9 1 Norwegian Private Equity funds organised as internal partnerships do not have organisation number.
Claims and claims handling costs Claims reported and claims handling costs 13,843.6 (554.5) 13,289.1 13,593.0 (473.6) 13,119.4 Claims incurred, but not reported 13,849.7 13,849.7 15,176.8 15,176.8 Total as at 1 January 27,693.3 (554.5) 27,138.8 28,769.8 (473.6) 28,296.2
NOK millions 2020 2019 Discounted claims provision, gross - annuities 6,335.7 5,904.9 Nominal claims provision, gross - annuities 6,419.7 6,203.7
NOK millions 2020 2019 As at 31 December NOK 7.40 kroner (7.25) based on profit for the year 1 3.700,0 3,625.0
ISIN NO0010720378 NO0010771546 Issuer Gjensidige Forsikring ASA Gjensidige Forsikring ASA Principal, NOK millions 1,200 1,000 Currency NOK NOK Issue date 2.10.2014 8.9.2016 Maturity date 3.10.2044 Perpetual First call date 2.10.2024 8.9.2021 Interest rate NIBOR 3M + 1.50% NIBOR 3M + 3.60%
Other provisions and liabilities Restructuring costs 1 65.5 71.6 Other provisions 2 223.4 222.9 Total other provisions and liabilities 288.9 294.5
Other liabilities Outstanding accounts Fire Mutuals 48.2 32.6 Accounts payable 116.7 211.5 Liabilities to public authorities 284.5 266.3 Motor insurance tax to Norwegian Motor Insurers’ Bureau (TFF) 1,651.9 1,616.5 Other liabilities 514.1 523.9 Total other liabilities 2,615.4 2,650.7
Guarantees and committed capital Committed capital, not paid 582.8 590.5 Credit facility Oslo Areal 1,634.4 1,598.6
As part of its ongoing financial management, Gjensidige has undertaken to invest up to NOK 582.8 million (590.5) in loan funds containing senior secured debt and various private equity and real estate investments, over and above amounts recognised in the balance sheet.
The timing of the outflow of capital is dependent on when the funds are making capital calls from their investors. Average remaining operating time for the funds, based on fair value, is slightly less than three years (four) and slightly less than four years (five) in average including option for extension.
Fair value measurement The fair value of the shares allocated through the share-based payment for executive personnel and the cash to cover the tax obligations is calculated on the basis of the share price at grant date. The amount is recognised immediately.
Share-based remuneration for key personnel 7.0 3.7 Share savings programme for employees 8.9 7.9 Total expenses (note 7) 16.0 11.6
Average remaining life of outstanding bonus shares 0.96 1.02 Weighted average fair value of bonus shares granted 175.94 135.53 Weighted average share price of bonus shares released during the period 192.65 163.02
The number of shares Outstanding 1 January 30,190 27,405 31,885 28,868 Granted during the period 16,249 15,065 14,084 12,869 Exercised during the period (15,512) (14,036) (17,097) (15,565) Modification dividend during the period 2,040 1,874 1,318 1,233 Outstanding 31 December 32,967 30,308 30,190 27,405 Exercisable 31 December 0 0 0 0
The Board of Directors and the CEO have today considered and approved the integrated annual report for Gjensidige Forsikring ASA, the Group and parent company, for the 2020 calendar year and as of 31 December 2020. The integrated annual report includes the annual accounts, the Directors’ report and statements on corporate governance and corporate social responsibility.
The consolidated accounts have been prepared in accordance with the EU-approved IFRS standards and pertaining interpretation statements applicable as of 31 December 2020, disclosure requirements that follow from the Norwegian Accounting Act as of 31 December 2020, and more detailed disclosure requirements that follow from the Regulations relating to annual accounts for general insurance companies (Regulations No 1775 of 18 December 2015) issued pursuant to the accounting Act.
Basis for Opinion We conducted our audit in accordance with laws, regulations, and auditing standards and practices generally accepted in Norway, including International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company and the Group as required by laws and regulations, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Gjensidige has established various control activities related to the measurement of claims provisions.
We assessed and tested the design of control activities related to data source, calculation models and determination of assumptions. For a sample of these controls, we tested if they operated effectively in the reporting period.
We used our own IT specialists to understand the overall governance model for IT systems and in the assessment and testing of control activities related to IT.
Other information Management is responsible for the other information. The other information comprises information in the Integrated annual report, except the financial statements and our auditor's report thereon.
Responsibilities of the Board of Directors and the Managing Director for the Financial Statements The Board of Directors and the Managing Director (Management) are responsible for the preparation in accordance with law and regulations, including a true and fair view of the financial statements of the Company in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway, and for the preparation and true and fair view of the financial statements of the Group in accordance accordance with International Financial Reporting Standards as adopted by the EU, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
• evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves a true and fair view.
• obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We also provide those charged with governance statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
Opinion on Registration and Documentation Based on our audit of the financial statements as described above, and control procedures we have considered necessary in accordance with the International Standard on Assurance Engagements (ISAE) 3000, Assurance Engagements Other than Audits or Reviews of Historical Financial Information, it is our opinion that management has fulfilled its duty to produce a proper and clearly set out registration and documentation of the Company’s accounting information in accordance with the law and bookkeeping standards and practices generally accepted in Norway.
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited (“DTTL”), its global network of member firms, and their related entities (collectively, the “Deloitte organization”). DTTL (also referred to as “Deloitte Global”) and each of its member firms and related entities are legally separate and independent entities, which cannot obligate or bind each other in respect of third parties. DTTL and each DTTL member firm and related entity is liable only for its own acts and omissions, and not those of each other. DTTL does not provide services to clients. Please see www.deloitte.no to learn more.
We have been engaged by the Board of Directors of Gjensidige Forsikring ASA to provide limited assurance in respect of the sustainability information presented in Gjensidige – Integrated annual report 2020. The assurance covers information in Chapter 2 – Creating added value in Gjensidige, subsection Creating value for our stakeholders, and information presented in Chapter 3 – Value created in 2020, up to the section Financial result, hereinafter referred to as “the Report”. Our responsibility is to provide a limited level of assurance on the subject matters concluded on below.
RReessppoonnssiibbiilliittiieess ooff tthhee BBooaarrdd ooff DDiirreeccttoorrss The Board of Directors are responsible for the preparation and presentation of the Report prepared in accordance with GRI Standards, level Core, and other reporting criteria described in the Report. They are also responsible for establishing such internal controls that they determine are necessary to ensure that the information is free from material misstatement, whether due to fraud or error.
Deloitte AS is subject to International Standard on Quality Control 1 and, accordingly, applies a comprehensive quality control system, including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements.
(GRI) Standards reporting principles and the reporting fulfils level Core according to the GRI Standards. Gjensidige’s GRI Content Index presented in Appendix 1 in the Report, appropriately reflects where information on each of the disclosures of the GRI Standards can be found in the Gjensidige – Integrated Annual Report 2020.
AAaassee AAaa.. LLuunnddggaaaarrdd FFrraannkk DDaahhll State Authorised Public Accountant Sustainability Expert
Appendix 1 – GRI Content Index and Board of Directors Report
Abbreviations applied: Rskl = the Norwegian Accounting Act (Regnskapsloven), NRS = Norwegian Accounting Standards Board (Norsk Regnskapsstiftelse), Vphl = the Norwegian Securities Trading Act (Verdipapirhandelloven), Vpf = the Norwegian Securities Regulation (Verdipapirforskriften)
Rskl§ 3-3a 102-1 Name of the organisation Gjensidige Forsikring ASA 42 102-2 NRS 16 2-4 Activities, brands, products, and services Gjensidige’s business model Our insurance segments Sustainable products and services 102-3 NRS 16 2-4 Location of headquarters Schweigaardsgate 21, Oslo, Norge 102-4 NRS 16 2-4 Location of operations Note 5 Gjensidige Forsikring ASA 212 102-5 Ownership and legal form Corporate governance, and Our commitment to our owners and creditors 102-6 Markets served Our insurance segments 42-47 102-7 Scale of the organization Our insurance segments 42-47 102-8 Information on employees and other workers
Included in Sustainability policy, and by the suppliers’ requirements, following the self-declaration on corporate social responsibility 102-12 External initiatives See appendix 3 102-13 Membership of associations See appendix 3
Strategy 102-14 NRS 16 2 Statement from senior decision-maker Statement from senior decision-maker Gjensidige’s strategy 102-15 NRS 16 2.7 Key impacts, risks, and opportunities Gjensidige’s strategy Risk strategy and risk management
Our core values Our mission and vision “Code-of-conduct” Value created 2020- Good management and control
Governance structure Responsible risk management and control Corporate governance 102-38,39 Annual total compensation ratio Value created – engaged employees 144-145
Engaged employees: ILO and cooperation with union representatives. All employees have full freedom of association. Norway: 58.8 % union members. Denmark: 87.97 % encompassed by collective agreements. Sweden: 97 % union members.
102-42 Identifying and selecting stakeholders Creating values for our stakeholders 49-51 102-43 Approach to stakeholder engagement Creating values for our stakeholders 49-51 102-44 Key topics and concerns raised Creating values for our stakeholders 49-51
Introduction. Reporting according to the Core level 102-55 GRI content index See appendix 1 102-56 External assurance Attestation statement from Deloitte 288
Strategy Climate-related financial disclosures (TCFD) Responsible investments 201-3 Defined benefit plan obligations and other retirement plans 202 Market presence 202-2 Proportion of senior management hired from the local community
Ethical operations, Anti-corruption 112 205-3 NRS 16 2.2 Confirmed incidents of corruption and actions taken
206 Anti-competitive behavior 206-3 NRS 16 2.2 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices
207-4 Country-by-country reporting Value created – A safer society – Direct and indirect taxes paid locally. Note 9.
Key figures and alternative performance measures Value crated 2020 – Climate and the environment Appendix 6 – Climate account
Key figures and alternative performance measures Climate-related financial disclosures (TCFD) Value crated 2020 – Climate and the environment 305-2 Rskl §3-3a, c Energy indirect (Scope 2) GHG emissions
Key figures and alternative performance measures Climate-related financial disclosures (TCFD) Value crated 2020 – Climate and the environment 305-3 Rskl §3-3a, c Other indirect (Scope 3) GHG emissions
Key figures and alternative performance measures Value created 2020 – engaged employees 401-3 Rskl §3-3c Parentel leave Value created 2020 – engaged employees 139-145 402 Labour / Management Relations 402-1 Minimum notice periods regarding operational changes
Value created 2020 – engaged employees Mechanism implemented to involve and prepare employees’ representatives for eventual downsizing, including duly prenotice.
Description of the GRI Standards Comment Page 404 Training and Education 404-1 Average hours of training per year per employee
Key figures and alternative performance measures Value created 2020 – engaged employees 405 Diversity and Equal Opportunity 405-1 Rskl §3-3c Diversity of governance bodies and employees
Value created in 2020 – Results of our commitment to management and control Appendix 4 Statement on equality: No deviations reported through the notification channel, nor through the mailbox for ethical operations.
407 Freedom of Association and Collective Bargaining 407-1 NRS 16 2.10 Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk
Significant investment agreements and contracts that include human rights clauses or that underwent human rights screening
Value created in Gjensidige – Ethical operations – Complaints handling, Values created 2020 – Results of our commitment to management and control 417-3 Incidents of non-compliance concerning marketing communications
NRS 3 Events after the balance sheet day Statement concerning the annual account 177
NRS 16 2.5 Research and development Statement concerning the annual account 160
Specific security requirements for a selection of employees(s. a. HR, Group Procurement, Technology and Infrastructure, Sales and Claims services, Investor Relations, M&A, Capital Management)
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Proportion of women by job level Level 1 – Senior group management 30.0% 30.0% Level 2 30.3% 36.8% Level 3 41.0% 42.0% Level 4 38.6% 34.6% Level 5 – Only two persons at this level in 2020 66.7% 100.0% Other employees 48.7% 47.8% Proportion of women on the Board of Directors 50.0% 40.0%
Average pay (all employees) Women 638,764 681,013 Men 755,071 793,948 Women’s pay as a proportion of men’s (by job level)
A pay review will be carried out for the first time for the 2021 financial year
At Gjensidige, all employees are normally hired in full-time positions. An exception can be made if an employee applies for a temporary or a permanent reduction in working hours for social, health-related or other weighty welfare reasons. Some of our employees work less than 100 per cent of a full-time position, but they are positions of a temporary nature, such as student internships. On this basis, we believe we can say for certain that none of our employees work part-time involuntarily.
At Gjensidige, we work to make sure that we have a good, inclusive corporate culture where everyone is treated equally and with respect. We wish to develop an organisation in which diversity characterises our activities and generates new ideas and perspectives. It should be possible for all our employees to balance their work and personal life, and we make arrangements to help them achieve this. We expect all employees to be respectful and considerate and to display common courtesy in relation to colleagues, competitors, customers and others. We believe that we make each other better by being inclusive and engaged.
We have zero tolerance for discrimination and harassment, and anyone who feels that they are being discriminated or harassed/bullied shall be taken seriously. In 2018, we adopted new and updated guidelines to prevent unwanted sexual attention.
Our principles and procedures for equality and anti-discrimination are aligned with the company’s HR strategy and the pertaining guidelines, personnel policy and ethical rules (Code of Conduct).
Gjensidige has good processes in place to ensure employee representatives are involved in recruitment, pay reviews, health and safety work, reorganisation and staff reductions.
In cooperation with the HR department, the employee representatives on the Diversity and Inclusion Committee are involved in the work of fulfilling the company’s activity and reporting obligation through a four-stage method. We have looked at factors in our organisation that can contribute to discrimination and be an obstacle to equality in connection with recruitment, pay and working conditions, promotion, opportunities for development, adaptation and possibilities of combining work and family life, in addition to other relevant factors.
Gjensidige makes continuous efforts to ensure equality and prevent discrimination. We have a Diversity and Inclusion Committee consisting of trade union and HR representatives. The committee usually meets every quarter or as needed, but at least once a year. The committee has been involved in our work to fulfil the activity and reporting obligation.
The new engagement survey ‘My Voice’ was introduced in November 2019. We have thereby gone from annual measurements to continuous development and learning through monthly engagement surveys. Throughout 2020, the claim ‘People from all backgrounds are treated fairly at Gjensidige’ has returned a stable high score. In November 2020, the score was 9.1, up from 8.8 in November 2019, on a scale from 1 to 10. The proportion of negative scores (0–6) went down from 7 per cent to 4 per cent during the same period. We also ask the following question: ‘If I were to experience gross misconduct or violations, I am certain that Gjensidige will take steps to resolve the situation’. The score in November 2020 was 8.7, up from 8.2 in November 2019. The proportion of negative scores (0–6) went down from 16 per cent to 7 per cent during the same period. We keep a close eye on the proportion of negative responses to these questions, as we work to ensure that all our employees are treated fairly regardless of their background. We also have zero tolerance of discrimination, ***violations and misconduct.
We identified the following risks of discrimination and obstacles to equality
Through our work to identify risks of discrimination and obstacles to equality, we found that there was a risk of our job advertisements being more appealing to one of the genders. We hired more men than women in 2019, and the gender balance among managers does not tally with our ambition. We also found a risk that our hiring processes do not help to ensure a sufficient degree of diversity.
The action plan (see appendix) shows that we have worked on our job advertisements in 2020. The primary purpose has been to help to ensure a good gender balance among the applicants and to be able to attract applicants from different backgrounds and with different expertise and experience. We are working on several measures to ensure that we maintain focus on diversity and equality through the screening process and the first interview round. We endeavour to maintain the gender balance in the final round of interviews, especially for managerial positions.
We are making efforts to shift the development and follow-up of employees towards an even more continuous process, where employees themselves have a large say in their own development.
As part of our effort to create an inclusive corporate culture, we carried out various culture-building activities in 2020, including a webinar on prejudice and attitudes that was also available as a podcast, and best-practice interviews.
In order to prevent employees who take out parental leave from lagging behind in terms of pay, we decided, starting from 1 May 2018, to give all employees an extra pay grade (or a 1.3 per cent pay increase for employees who are not in the grade system) if they have been on parental leave for five months or more. In the annual pay assessment, we are also concerned with ensuring good processes that do not favour some groups of employees based on assessment criteria etc. In this context, we also see that good training of managers help to ensure transparent, orderly processes.
In 2021, we will continue the work we have started, particularly relating to the recruitment processes, where we must both ensure implementation in the rest of the organisation and look at new measures. The diversity instructions must be implemented, and we believe the work will be of great importance to us as a company and to our employees. In that connection, there will be a need for training of managers and employees to raise awareness of both competence, maturity and management regarding diversity. We will continue working on creating an inclusive corporate culture, through e.g. webinars and by disseminating good examples throughout the organisation. We will also resume the work of reducing turnover among employees wo have been on parental leave during the past two years, which came to a halt because of the coronavirus situation.
When it comes to pay differences, women at management level 1 earn 82 per cent of what men earn, and at level 2, they earn 92 per cent. Women at management level 3 earn 96 per cent of what men earn, while at level 4 they earn 101 per cent. For all other positions, women earn 88 per cent of what men earn.
We do not register the gender of applicants for vacant positions and cannot therefore refer to any specific gender balance figures. We are nonetheless of the view that our gender balance has improved, and more women have been recruited for positions dominated by men this year. By focusing more on the job and the role to be filled than on desired qualifications, we attract
Classified: General Business applicants from other backgrounds than has traditionally been the case. In 2020, we hired more men than women in total, but, at the same time, the proportion of female managers has increased from 38.3 per cent in Q3 2019 to 39.3 per cent in the corresponding period in 2020.
Work on the big initiative to promote inclusion has been challenging seen in light of how very many employees in our biggest locations have worked from home. As more people start coming back to the office, it will be easier to facilitate work placements / work training. Despite the coronavirus situation, we have recruited employees with gaps in their CVs and had work placement/work training candidates, but our efforts could be intensified further.
Seminars/meetings/c ourses are scheduled for evenings or weekends or in locations that require travel
Create awareness of how the choice of time and place for seminars/meetings/course s unintentionally can lead to discrimination and be an obstacle to equality.
Establish network (support group) for employees on parental leave. Establish interview template for managers to be used before, during and after leaves of absence.
Help to ensure that all employees are treated with respect and feel free be themselves in the workplace.
Attitudes and prejudice among the staff influence our dealings with colleagues, customers and partners. Risk of prejudice and attitudes giving rise to discrimination and creating obstacles to equality
Contribute to an inclusive environment in which we acknowledge, develop and capitalise on employees’ diversity competence.
Initiated Through best-practice interviews on the intranet and Gjensidige TV, we have helped to raise awareness of the importance of workplace inclusion, and that people with slightly different CVs also have a lot to contribute.
Give all employees equal opportunities and help to raise the proportion of female managers
By raising awareness of the importance of a good gender balance, we see that we have helped to achieve a good gender balance in the different processes that were carried out in 2020.
All employees shall have their own development plan, and vacancies shall be advertised internally
According to the HR dashboard for Q4 2020, 72.9% of our employees have active development goals, compared with 69.9% in Q4 2019
Give more people who are excluded from the labour market a chance with us, and create an understanding of the importance of each person’s diversity competence.
At the end of Q4 2020 (Q4 2019), women earned on average x per cent of what men earn NO: 87.4% (86.0%) DK: 84.1% (116.7%) SE: 96.8% (96.8%)
Help to establish a clear direction in the diversity and inclusion work.
Certify diversity managers Increasingly acknowledge, develop and capitalise on employees' diversity competence
Initiated In 2020, we have certified two diversity managers under the auspices of the centre for diversity management (Seema) and Standards Norway.
Have at least one applicant from each gender in the final round of interviews for managerial positions.
In 2020, the proportion of female managers increased to 39.3% in Q3, compared with 38.3% the same period the year before.
Use other methods for screening and first-time interviews to ensure it is not the manager’s task alone.
Initiated By involving more people, we ensure that the process is more objective and thereby help to reduce the possibility of discrimination.
Non-alcoholic beverages must be easily accessible. The same applies to food alternatives.
All employees shall feel that social events are ‘open’ to everyone.
All employees shall feel that they are treated with respect, consideration and courtesy
Company Gjensidige Forsikring ASA Offsets cover Climate compensation for own emissions 2020, scope 1, district heating scope 2, and flights scope 3. Volume (tonnes CO2e) 3000 Type VER (Verified Emission Reduction) Issuing body Gold Standard Foundation Project name GS 1385 - Energy Efficiency and Improved Clean
PPRROOJJEECCTT TTYYPPEE Improved efficiency from reduced consumption of wood as fuel
The primary objective of the project is to significantly reduce wood fuel consumption of low income Ganesh households by providing them with affordable improved cookstoves in the Ashanti region in Ghana. The improved cookstoves can replace traditional stoves which expose people to toxic smoke and gas from burning wood while cooking.
CEMAsys’ Climate Certificate™ is hereby issued as a proof of purchase of carbon credits for voluntary offsets of own greenhouse gas emissions. The carbon credits have been issued in accordance to the relevant standard’s protocols and tracked in the registry using unique serial numbers to prevent double counting or double selling.
Offsets cover Climate compensation for «Innbo Ung og Reise Ung» in Q3 and Q4 2020
The carbon credits have been retired from the registry permanently, so that no one else can hold or retire them. For more information, see the project description.