Reinsurance recoverables on unpaid claims 1,443,869 1,250,770 207,660 255,716 (194) (194) 1,651,335 1,506,292
Reinsurance recoverables on other reserves 1,269 3,590 6,032 8,641 – – 7,301 12,231
Total investments and cash under own management 31,000,184 32,427,757 8,988,934 9,258,423 68,360 107,315 40,057,478 41,793,495
From insurance business with external third parties 10,710,944 9,204,554 7,079,562 7,149,068 – – 17,790,506 16,353,622 thereof
Change in fair value of financial instruments 2,069 2,452 36,500 23,702 – (88) 38,569 26,066
Total depreciation, impairments and appreciation of investments 70,905 75,997 44 31 – – 70,949 76,028
Commission and brokerage, change in deferred acquisition costs and other technical income / expenses 2,434,368 1,975,912 1,081,775 1,022,547 227 2 3,516,370 2,998,461
Income / expense on funds withheld and contract deposits 17,789 24,031 217,126 308,118 – – 234,915 332,149
Non-controlling interest in profit or loss 79,740 51,337 6,282 3,860 – – 86,022 55,197 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
6. Notes on the individual items of the balance sheet 6.1 Investments under own management
Maturities of the fixed-income and variable-yield securities N 18 in EUR thousand
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments N 19 classified as held to maturity as well as their fair value in EUR thousand
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments N 20 classified as held to maturity as well as their fair value in EUR thousand
Government debt securities of EU member states 60,967 1,147 1,195 4 62,158
Amortised cost, unrealised gains and losses and accrued interest on loans and receivables as well as their fair value N 22 in EUR thousand
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments N 23 classified as available for sale as well as their fair value in EUR thousand
Amortised cost, unrealised gains and losses and accrued interest on the portfolio of investments N 24 classified as available for sale as well as their fair value in EUR thousand
Government debt securities of EU member states 2,402,598 16,815 167,294 11,931 2,557,961
Fair value of financial assets at fair value through profit or loss before and after accrued interest N 25 as well as accrued interest on such financial assets in EUR thousand
Hannover Re recognised in this category as at the balance sheet date derivative financial instruments in an amount of EUR 88.8 million (EUR 57.7 million) that are originally allocable to this item as well as fixed-income securities amounting to EUR 212.0 million (EUR 239.9 million) designated in this category. The fixed-income securities included in this category decreased largely due to currency effects. The increase in the derivative financial instruments derives from a reinsurance treaty with a financing component written in the area of life and health reinsurance.
Fixed-income securities – loans and receivables 1,745,927 272,116 136,439 221,632 19,030 – – 60,020 2,455,164
Fixed-income securities – loans and receivables 1,729,470 454,311 175,440 176,365 25,213 – – 2,795 2,563,594
Fixed-income securities – available-for-sale 14,222,049 5,011,396 5,466,586 6,114,696 921,352 151,673 3,251 291,170 32,182,173
Fixed-income securities – held to maturity – 3,715 – 278,120 42,918 11,429 – – 336,182
Fixed-income securities – at fair value through profit or loss – – – 26,485 – 213,432 – – 239,917
Equity securities – available-for-sale – – – 474,201 58,519 372,587 – – 905,307
Other financial assets – at fair value through profit or loss – – – 6,198 5,520 45,804 143 – 57,665
Public price listings are not available for companies valued at equity. The net book value of associated companies includes goodwill in the amount of EUR 18.8 million (EUR 18.5 million). For further details please see section 4 “Consolidation”.
Gross book value at 31 December of the year under review 1,712,667 1,502,800
Cumulative depreciation at 31 December of the year under review 128,939 100,557
Net book value at 31 December of the previous year 1,402,243 1,302,703
The fair value of investment property amounted to EUR 1,743.6 million (EUR 1,541.1 million) as at the balance sheet date.
In terms of diversification across various real estate sectors the focus is on office properties (73%), followed by retail properties (15%). The allocation is complemented by investments in further sectors, including for example logistics and parking facilities. In geographical terms, exposures are spread across the United States (40%), Europe (excluding Germany; 33%) as well as Germany (20%) and Asia (7%).
Other invested assets The other invested assets consisted largely of participating interests in partnerships measured at fair value in an amount of EUR 1,507.6 million (EUR 1,463.1 million), the amortised cost of which amounted to EUR 1,124.5 million (EUR 1,042.2 million). The differences between the carrying amounts and the amortised costs were recognised as unrealised gains of EUR 398.0 million (EUR 427.8 million) and unrealised losses of EUR 14.8 million (EUR 6.9 million) under cumulative other comprehensive income.
In addition, acquired life insurance policies measured at fair value through profit or loss were recognised under the other invested assets in an amount of EUR 38.2 million (EUR 55.1 million).
• Level 2: Assets or liabilities which are measured using observable market data and are not allocable to level 1. Measurement is based, in particular, on prices for comparable assets and liabilities that are traded on active markets, prices on markets that are not considered active as well as inputs derived from such prices or market data.
Fair value hierarchy of financial assets and liabilities recognised at fair value N 35 in EUR thousand
Net book value at 31 December of the year under review 102 49,039 384,973 1,639,065 185,498
Net book value at 31 December of the year under review 10 – 390,676 1,653,902 168,943
The breakdown of income and expenses recognised in the statement of income in the financial year in connection with financial assets and liabilities assigned to level 3 is as follows: Income and expenses from level 3 financial assets and liabilities N 38 in EUR thousand
Income and expenses from level 3 financial assets and liabilities N 39 in EUR thousand
Realised gains and losses on investments – – – 23,192 –
Total depreciation, impairments and appreciation of investments – – (1,264) (11,665) –
Fair value hierarchy of financial assets and liabilities measured at amortised cost N 40 in EUR thousand
Fair value hierarchy of financial assets and liabilities measured at amortised cost N 41 in EUR thousand
The funds withheld totalling EUR 10,735.0 million (EUR 11,673.3 million) represent the cash and securities deposits furnished by our company to our cedants that do not trigger any cash flows and cannot be realised by cedants without our consent. The maturities of these deposits are matched to the corresponding provisions. In the event of default on such a deposit our reinsurance commitment is reduced to the same extent. The decrease in funds withheld was attributable principally to partial withdrawals for specific underwriting years in relation to our UK single premium business.
Development of deferred acquisition costs N 42 in EUR thousand 2017 2016 1
Net book value at 31 December of the year under review 2,228,246 2,264,034 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
For further explanatory remarks please see section 3.2 “Summary of major accounting policies”.
Age structure of overdue accounts receivable N 43 in EUR thousand
Within the scope of our management of receivables we expect to receive payment of accounts receivable within three months of the date of creation of the debit entry – a period for which we also make allowance in our risk analysis. Please see our comments on the credit risk within the risk report on page 97 et seq.
Gross book value of accounts receivable at 31 December of the year under review 3,838,515 3,718,498
The following capitalisation rates and growth rates were recognised for the individual cash-generating units: Capitalisation rates N 46
Of this, other assets of EUR 5.1 million (EUR 3.9 million) are attributable to affiliated companies.
The item “Other” includes receivables of EUR 286.8 million (EUR 209.0 million) which correspond to the present value of future premium payments in connection with derivative financial instruments arising from transactions in the life and health reinsurance business group. For further explanation please see section 8.1 “Derivative financial instruments and financial guarantees”.
Development of the present value of future profits (PVFP) on acquired life reinsurance portfolios N 48 in EUR thousand 2017 2016
Cumulative depreciation at 31 December of the year under review 58,574 59,461
Net book value at 31 December of the previous year 76,592 78,261
The period of amortisation amounts to altogether 30 years. For further information please refer to our explanatory notes on intangible assets in section 3.2 “Summary of major accounting policies”.
Fixtures, fittings and equipment N 49 in EUR thousand 2017 2016
Gross book value at 31 December of the previous year 155,812 147,459
Cumulative depreciation at 31 December of the previous year 128,578 118,752
Cumulative depreciation at 31 December of the year under review 127,858 128,578
Net book value at 31 December of the year under review 29,653 27,234
Development of other intangible assets N 50 in EUR thousand 2017 2016
Gross book value at 31 December of the previous year 265,220 247,773
Cumulative depreciation at 31 December of the year under review 231,166 213,132
Net book value at 31 December of the previous year 52,088 47,777
The item includes EUR 0.2 million (EUR 0.8 million) for self-created software and EUR 33.7 million (EUR 37.3 million) for purchased software as at the balance sheet date. Scheduled depreciation is taken over useful lives of three to ten years. Of the additions, an amount of EUR 3.6 million (EUR 10.1 million) is attributable to purchased software.
Loss and loss adjustment expense reserve 28,378,545 1,651,335 26,727,210 28,129,418 1,506,292 26,623,126 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
Net book value at 31 December of the previous year 28,129,418 1,506,292 26,623,126 26,556,388 1,395,281 25,161,107
Changes in the consolidated group 164,813 41,964 122,849 4,179 2,613 1,566
Specific value adjustment for retrocessions – 43,609 (43,609) – 1,250 (1,250)
Net book value at 31 December of the year under review 28,378,545 1,651,335 26,727,210 28,129,418 1,506,292 26,623,126 1 Including expenses recognised directly in equity
Net loss reserve and its run-off in the property and casualty reinsurance segment N 53 in Mio. EUR
As percentage of original loss reserve 2.8 0.5 0.5 0.7 0.7 0.2 0.6 0.4 2.0 (1.4)
Due after five through ten years 4,160,760 224,772 3,935,988 1,105,203 71,956 1,033,247
Due after ten through twenty years 2,726,059 128,750 2,597,309 552,594 4,983 547,611 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
The average maturity of the loss and loss adjustment expense reserves was 4.6 years (5.1 years), or 4.6 years (5.1 years) after allowance for the corresponding retrocession shares. The benefit reserve had an average maturity of 11.1 years (10.9 years) – or 13.6 years (12.3 years) on a net basis.
Net book value after currency translation 9,638,277 1,065,993 8,572,284 11,612,865 1,371,995 10,240,870
Development of the unearned premium reserve N 57 in EUR thousand gross retro net gross retro net
Net book value at 31 December of the previous year 3,382,498 134,927 3,247,571 3,192,841 164,023 3,028,818
Net book value at 31 December of the year under review 3,541,194 96,402 3,444,792 3,382,498 134,927 3,247,571 1 Restated pursuant to IAS 8 (cf. section 3.1 of the notes)
The contract deposits on the liabilities side decreased by EUR 349.1 million in the year under review from EUR 4,298.3 million to EUR 3,949.2 million. The contract deposits item on the liabilities side essentially encompasses balances deriving from non-traditional life insurance contracts that are to be carried as liabilities. The decrease was due principally to partial withdrawals from specific underwriting years in relation to UK single premium business.
As at 1 July 2000 the 2000 pension plan came into force for the entire Group. Under this plan, new employees included in the group of beneficiaries are granted an indirect commitment from HDI Unterstützungskasse e.V. This pension plan provides for retirement, disability and surviving dependants’ benefits.
Defined benefit obligation Fair value of plan assets Impact of minimum funding requirement / asset ceiling
Position at 1 January of the financial year 207,621 154,832 26,981 4,533 40 –
Actuarial gain (–) / loss (+) from change in financial assumptions (7,176) 21,998 – – – –
Experience gains (–) / losses (+) 3,145 17,755 – – – –
Return on plan assets, excluding amounts included in interest income – – 4,154 11,904 – –
Position at 31 December of the financial year 210,855 207,621 33,675 26,981 135 40
Fair value of plan assets at 31 December of the financial year 33,675 26,981
In the current financial year Hannover Re anticipates contribution payments of EUR 2.6 million under the plans set out above. The weighted average duration of the defined benefit obligation is 18.3 (17.9) years.
Furthermore, a change is possible with respect to the assumed mortality rates and lifespans. The underlying mortality tables were adjusted by reducing the mortalities by 10% in order to determine the longevity risk. Extending the lifespans in this way would have produced a EUR 6.6 million (EUR 6.9 million) higher pension commitment at the end of the financial year.
(EUR 0.9 million) was attributable to commitments to employees in key positions. Of the expense for defined contribution plans, an amount of EUR 10.8 million (EUR 10.7 million) relates to state pension schemes, thereof EUR 7.6 million (EUR 7.2 million ) to contributions to the statutory pension insurance scheme in Germany.
Of this, other liabilities of EUR 16.6 million (EUR 7.6 million) are attributable to affiliated companies.
Audits and costs of publishing the annual financial statements 7,574 (223) 7,351 – 150 7,752 6,170 101 (18) 8,964
On 14 September 2010 Hannover Rück SE placed a subordinated bond on the European capital market through its subsidiary Hannover Finance (Luxembourg) S.A. This subordinated debt of EUR 500.0 million has a maturity of 30 years with a first scheduled call option after ten years and may be redeemed at each coupon date thereafter. The bond carries a fixed coupon of 5.75% in the first ten years, after which the interest rate basis changes to a floating rate of 3-month EURIBOR +423.5 basis points.
Altogether three (three) subordinated bonds were recognised as at the balance sheet date with an amortised cost of EUR 1,492.0 million (EUR 1,490.8 million).
Other long-term liabilities – – 1 – – – 38 1 Excluding minority interests in partnerships, sundry non-technical provisions and derivative financial instruments; the maturities of the latter two items are broken down separately
Subordinated loans – – – – – 996,370 494,471 1 Excluding minority interests in partnerships, sundry non-technical provisions and derivative financial instruments; the maturities of the latter two items are broken down separately
Net gains and losses from debt and subordinated capital N 69 in EUR thousand
The ordinary expenses principally include interest expenses of nominally EUR 70.6 million (EUR 70.7 million) resulting from the issued subordinated debt.
Reconciliation of debt and subordinated capital N 70 in EUR thousand
Cash flow Non-cash-items Balance at 31 December 2017Currency translation Other changes
Conditional capital of up to EUR 60,299 thousand is available; it can be used to grant shares to holders of bonds and / or profit-sharing rights with conversion rights and warrants. Authorised capital is also available in an amount of up to EUR 60,299 thousand. Both have a time limit of 9 May 2021; the subscription right of shareholders may be excluded with the consent of the Supervisory Board under certain conditions. The Executive Board is authorised, with the consent of the Supervisory Board, to use an amount of up to EUR 1,000 thousand of the existing authorised capital to issue employee shares.
The disclosures on capital management arising out of IAS 1 “Presentation of Financial Statements” are provided in the “Financial position” section on page 51 of the management report, to which the reader is referred. This includes both a presentation of our capital management objectives and procedures and a description of our policyholders’ surplus, together with a summary of the diverse capital requirements to which we are subject. The Solvency II regulatory framework, in particular, gives rise to capital requirements and consequences for capital management, which we discuss more closely in the risk report on page 78 et seq.
Non-controlling interests in partnerships are reported in accordance with IAS 32 “Financial Instruments: Presentation ” under long-term liabilities. The non-controlling interest in profit or loss, which forms part of net income and is shown separately after net income as a “thereof” note, amounted to EUR 86.0 million (EUR 55.2 million) in the year under review.
Of the impairments totalling EUR 40.8 million (EUR 47.4 million), an amount of EUR 18.0 million (EUR 3.1 million) was recognised on real estate and real estate funds. Impairments of EUR 3.7 million (EUR 30.1 million) were attributable to equities or equity funds because their fair values had fallen either significantly (by at least 20%) or for a prolonged period (for at least nine months) below acquisition cost. Impairment losses of EUR 8.4 million (EUR 11.7 million) were taken on alternative investments. The impairments taken on fixed-income securities amounted to just EUR 0.3 million (EUR 0.7 million). In addition, impairment losses of EUR 10.4 million (EUR 1.9 million) were recognised on our investments in participating interests.
These write-downs contrasted with write-ups of EUR 0.9 million (EUR 0.3 million).
Financial assets – at fair value through profit or loss 11,515 3,188
Making allowance for the other investment expenses of EUR 110.8 million (EUR 109.1 million), net income from assets under own management of altogether EUR 1,539.0 million (EUR 1,218.3 million) was recognised in the year under review.
Net gains and losses on investments N 76 in EUR thousand
Other technical expenses (net) 3,781 3,997 7.4 Other income and expenses
Other income / expenses N 81 in EUR thousand 2017 2016
Expenses from contracts recognised in accordance with the deposit accounting method 5,951 35,246
An unchanged tax rate of 32.63% (rounded to 32.7%) was used to calculate the deferred taxes of the major domestic companies. It is arrived at from the corporate income tax rate of 15.0%, the German solidarity surcharge of 5.5% and a trade earnings tax rate of 16.8%. The Group tax rate consequently also amounts to 32.7% (32.7%). The deferred taxes at the companies abroad were calculated using the applicable country-specific tax rates.
Change in deferred taxes due to changes in tax rates (30,430) (2,676)
Domestic / foreign breakdown of recognised tax expenditure / income N 83 in EUR thousand 2017 2016
Present value of future profits on acquired life reinsurance portfolios (PVFP) 7,911 9,574
Reconciliation of the expected expense for income taxes with the actual expense N 86 in EUR thousand 2017 2016
The expense for income taxes in the financial year was EUR 143.2 million lower than in the previous year at EUR 248.0 million (EUR 391.2 million). In addition to the lower pre-tax profit compared to the previous year, this was due among other things to changes in future applicable local tax rates in the
United States and France and the associated remeasurement of deferred tax liabilities.
Availability of non-capitalised loss carry-forwards Unused tax loss carry-forwards, deductible temporary differences and tax credits of EUR 601.2 million (EUR 459.4 million) existed as at the balance sheet date. Making allowance for local tax rates, EUR 367.3 million (EUR 109.7 million) thereof was not capitalised since realisation is not sufficiently certain.
The write-down of deferred tax assets recognised in previous years resulted in a deferred tax expense of EUR 10.1 million (EUR 0.7 million) in the year under review. This is not opposed by any deferred tax income (EUR 18.1 million) from the reversal of earlier write-downs.
Excess deferred tax assets are recognised with respect to losses in the year under review or in the previous year only to the extent that, based on strong evidence, it is likely that the company concerned will generate sufficiently positive taxable results in the future. This evidence was provided for deferred tax assets of EUR 23.0 million (EUR 25.8 million).
Loss carry-forwards – – – 364,403 364,403 8. Other notes 8.1 Derivative financial instruments and financial guarantees
Hannover Re’s portfolio contained derivative financial instruments as at the balance sheet date in the form of forward exchange transactions taken out to hedge currency risks. These transactions gave rise to recognition of other liabilities in an amount of EUR 17.7 million (EUR 10.0 million) and other financial assets at fair value through profit or loss in an amount of EUR 2.0 million (EUR 16.8 million). The increase in equity from hedging instruments recognised directly in equity pursuant to IAS 39 in an amount of EUR 1.4 million (reduction in equity recognised directly in equity of EUR 4.9 million) derived solely from the forward exchange transactions taken out to hedge currency risks from long-term investments in foreign operations. These hedging instruments resulted in the recognition of other liabilities in an amount of EUR 2.4 million (EUR 2.3 million). Ineffective components of the hedge were recognised in profit or loss under other investment income in an amount of EUR 0.2 million (other investment expenses of EUR 0.6 million).
In order to hedge the risk of share price changes in connection with the stock appreciation rights granted under the share award plan, Hannover Re has taken out hedges since 2014 in the form of so-called equity swaps. The fair value of these instruments amounted to EUR 0.8 million as at the balance sheet date and was recognised under other liabilities (EUR 0.8 million recognised under other financial assets at fair value through profit or loss). The hedge gave rise to a decrease in equity from hedging instruments recognised directly in equity in an amount of EUR 1.5 million (EUR 0.9 million). Ineffective components of the hedge were recognised in a minimal amount under other investment expenses.
The maturities of the fair values and notional values of the hedging instruments described above can be broken down as follows:
Maturity structure of derivative financial instruments N 88 in EUR thousand
The net changes in the fair value of these instruments resulted in a charge of EUR 3.8 million to the result of the financial year (EUR 6.6 million).
Within the scope of the accounting of “modified coinsurance” and “coinsurance funds withheld” (ModCo) reinsurance treaties, under which securities deposits are held by the ceding companies and payments rendered on the basis of the income from certain securities of the ceding company, the interest-rate risk elements are clearly and closely related to the underlying reinsurance arrangements. Embedded derivatives consequently result solely from the credit risk of the underlying securities portfolio.
Hannover Re calculates the fair values of the embedded derivatives in ModCo treaties using the market information available on the valuation date on the basis of a “credit spread” method. Under this method the derivative is valued at zero on the date when the contract commences and its value then fluctuates over time according to changes in the credit spreads of the securities. The derivative had a positive value of EUR 25.1 million (EUR 24.6 million) as at the balance sheet date and was recognised under other financial assets at fair value through profit or loss. In the course of the year the change in the fair value of the derivative gave rise to income of EUR 3.7 million before tax (EUR 0.5 million).
A number of transactions concluded in the life and health reinsurance business group in previous years, under which Hannover Re companies offer their contracting parties coverage for risks from possible future payment obligations arising out of hedging instruments, are also to be classified as derivative financial instruments. The payment obligations result from contractually defined events and relate to the development of an underlying group of primary insurance contracts with statutory reserving requirements. The contracts are to be categorised and recognised as stand-alone credit derivatives pursuant to IAS 39. These derivative financial instruments were carried in equity on initial recognition because receivables recognised under other assets were to be carried in the same amount. Please see section 6.6 “Other assets”. The fair value of these instruments was EUR 165.1 million (EUR 168.9 million) on the balance sheet date and was recognised under other liabilities. The change in value in subsequent periods is dependent upon the risk experience and led to an improvement of EUR 30.0 million (EUR 22.6 million) in investment income in the financial year.
A retrocession agreement exists in the area of life and health reinsurance under which the premiums were deposited with Hannover Re and invested in a structured bond. The retrocessionaire has furnished a guarantee for its fair value. In accordance with the requirements of IFRS 4 this guarantee was to be unbundled from the retrocession agreement and is carried as a derivative financial instrument at fair value. The derivative was recognised with a positive fair value of EUR 2.2 million
(EUR 10.6 million) as at the balance sheet date under other financial assets at fair value through profit or loss. In the course of the year the change in the fair value of the derivative resulted in a charge of EUR 7.4 million (income of EUR 10.1 million). Conversely, the performance of the structured bond, which is also measured at fair value, gave rise to income (expense) in the same amount.
In the area of life and health reinsurance a reinsurance treaty was also written with a financing component under which the amount and timing of the return flows are dependent on lapse rates within an underlying primary insurance portfolio. This treaty and a corresponding retrocession agreement, which were classified as financial instruments pursuant to IAS 39, resulted in the recognition of other liabilities of EUR 20.4 million and other financial assets at fair value through profit or loss in an amount of EUR 49.0 million. Altogether, these arrangements gave rise to an improvement in income of EUR 1.8 million in the year under review.
All in all, application of the standards governing the accounting for derivatives in connection with the technical account led to recognition of assets totalling EUR 86.3 million (EUR 40.6 million) as well as recognition of liabilities in an amount of EUR 244.7 million (EUR 174.3 million) from the derivatives resulting from technical items as at the balance sheet date. Improvements in investment income amounting to EUR 40.2 million (EUR 40.9 million) as well as charges to income of EUR 8.6 million (EUR 1.8 million) were recognised in the year under review from all separately measured derivatives in connection with the technical account.
Financial guarantees Structured transactions were entered into in the life and health reinsurance business group in order to finance statutory reserves (so-called Triple-X or AXXX reserves) of US ceding companies. In each case such structures necessitated the involvement of a special purpose entity. The special purpose entities carry extreme mortality risks securitised by the cedants above a contractually defined retention and transfer these risks by way of a fixed / floating swap to a member company of the Hannover Re Group. The total amount of the contractually agreed capacities of the transactions is equivalent to EUR 3,229.1 million (EUR 3,674.6 million); an amount equivalent to EUR 2,525.9 million (EUR 2,745.8 million) had been taken up as at the balance sheet date. The variable payments to the special purpose entities that are guaranteed by the Hannover Re Group cover their payment obligations. Under some of the transactions the payments resulting from the swaps in the event of a claim are reimbursed by the parent companies of the cedants by way of compensation agreements. In this case the reimbursement claims from the compensation agreements are to be capitalised separately from and up to the amount of the provision.
(HDI), Hannover, holds a stake of 79.0% in Talanx AG and therefore indirectly holds 39.7% (rounded) of the voting rights in Hannover Rück SE.
Talanx Reinsurance Broker AG grants Hannover Rück SE and E+S Rückversicherung AG a preferential position as reinsurers of cedants within the Talanx Group. In addition, Hannover Rück SE and E+S Rückversicherung AG are able to participate in the protection covers on the retention of Group cedants and share in the protection afforded by them. In certain circumstances
Hannover Rück SE and E+S Rückversicherung AG are obliged to assume unplaced shares of the reinsurance of Group cedants from Talanx Reinsurance Broker AG.
In the context of a bond issue by Talanx AG the Group companies Hannover Rück SE and E+S Rückversicherung AG invested in a nominal amount of EUR 47.0 million in the issued bearer debt, which has a coupon of 3.125%. The carrying amount of the instrument, which is recognised under fixed-income securities held to maturity, was EUR 48.3 million (EUR 48.3 million) including accrued interest of EUR 1.3 million (EUR 1.3 million).
Under long-term lease arrangements companies belonging to the Hannover Re Group rented out business premises in 2015 to Talanx Service AG, Hannover. In addition, lease agreements exist with Talanx Service AG for use of a portion of the space in our data centre.
Remuneration and shareholdings of the management boards of the parent company The remuneration of the active members of the Executive Board of Hannover Re amounted to altogether EUR 8.0 million (EUR 9.0 million). The total remuneration (excluding pension payments) of former members of the Executive Board and their surviving dependants stood at EUR 0.3 million (EUR 0.3 million ). The pension payments to previous members of the Executive Board and their surviving dependants, for whom 17 (16) pension commitments existed, totalled EUR 1.6 million (EUR 1.6 million) in the year under review; altogether, a provision of EUR 24.7 million (EUR 25.3 million) has been set aside for these commitments.
All other information on the remuneration of the governing bodies, directors’ dealings and shareholdings as well as the structure of the remuneration system for the Executive Board is contained in the remuneration report from page 111 onwards. This remuneration report is based on the recommendations of the German Corporate Governance Code and contains information which also forms part of the notes to the 2017 consolidated financial statement as required by IAS 24 “Related Party Disclosures”. In addition, we took into account the more specific provisions of DRS 17 “Reporting on the Remuneration of Members of Governing Bodies”. Under German commercial law, too, this information includes data specified as mandatory for the notes (§ 314 HGB) and the management report (§ 315 HGB). These details are discussed as a whole in the remuneration report. Consequently, we have not provided any further explanation in the notes.
All the members of the Group’s management are eligible for the award of stock appreciation rights. Exercise of the stock appreciation rights does not give rise to any entitlement to the delivery of shares of Hannover Rück SE, but merely to payment of a cash amount linked to the performance of the Hannover Rück SE share.
Fair value at 31 December 2017 (in EUR) 32.21 8.92 8.76 10.79
Provisions at 31 December 2017 (in EUR million) 2.05 0.84 0.20 –
Amounts paid out in the 2017 financial year (in EUR million) 1.50 2.70 0.17 0.09
The calculations were based on the price of the Hannover Re share of EUR 108.20 as at the reference date of 13 December 2017, expected volatility of 20.23% (historical volatility on a five-year basis), an expected dividend yield of 4.62% and risk-free interest rates of -0.75% for the 2009 allocation year, -0.64% for the 2010 allocation year and -0.48% for the 2011 allocation year.
In the 2017 financial year the waiting period expired for 100% of the stock appreciation rights awarded in 2007, 2009 and 2010 and for 80% of those awarded in 2011. 8,356 stock appreciation rights from the 2007 allocation year, 19,649 stock appreciation rights from the 2009 allocation year, 303,026 stock appreciation rights from the 2010 allocation year and 46,424 stock appreciation rights from the 2011 allocation year were exercised. The total amount paid out stood at EUR 4.5 million.
Any entitlement to the granting of share awards after leaving the company is excluded. This shall not apply with respect to claims to variable remuneration acquired (pro rata) in the last year of service of the eligible recipient in the event of exit from the company on account of non-reappointment, occurrence of the pensionable event or death.
Development of the provision for share awards of Hannover Rück SE N 95
Provision at 31 December of the previous year – 1,918 4,087 6,556 10,255 12,983 35,799
In the year under review the 16,452 share awards of the Executive Board finally allocated in 2012 with a value of EUR 107.15 each plus the dividend entitlement of EUR 15.00 were paid out to the eligible members of the Executive Board. The 97,144 share awards of the senior executives for the 2012 financial year were paid out in 2017 with a value of EUR 107.03 each plus the dividend entitlement of EUR 15.00. The allocation to the provision for the 2012 share awards results from the difference between the share price as at the last balance sheet date (EUR 102.80) and the price from March 2017 on which the payout of the share awards was based (EUR 107.15 and EUR 107.03 respectively).
Staff The average number of staff at the companies included in the consolidated financial statement of the Hannover Re Group during the reporting period was 3,089 (2,804). As at the balance sheet date altogether 3,251 (2,893) staff were employed by the Hannover Re Group, with 1,385 (1,349) employed in Germany and 1,866 (1,544) working for the consolidated Group companies abroad.
Expenditures on personnel The expenditures on insurance business, claims expenses (claims settlement) and expenditures on the administration of investments include the following personnel expenditures: Personnel expenditures N 97 in EUR thousand 2017 2016 a) Wages and salaries 274,375 258,111 b) Social security contributions and expenditure on provisions and assistance ba) Social security contributions 25,486 22,082 bb) Expenditures for pension provision 26,551 25,520 bc) Expenditures for assistance 4,716 5,016
Dividend per share A dividend of EUR 603.0 million (EUR 572.8 million) was paid in the year under review for the 2016 financial year.
It will be proposed to the Annual General Meeting on 7 May 2018 that a dividend of EUR 3.50 per share as well as a special dividend of EUR 1.50 per share should be paid for the 2017 financial year. This corresponds to a total distribution of EUR 603.0 million. The dividend proposal does not form part of this consolidated financial statement.
Hannover Re | Annual Report 2017 8.7 Contingent liabilities and commitments
The guarantees given by Hannover Rück SE for the subordinated debts attach if the issuer fails to render payments due under the bonds. The guarantees cover the relevant bond volumes as well as interest due until the repayment dates. Given the fact that interest on the bonds is partly dependent on the capital market rates applicable at the interest payment dates (floating rates), the maximum undiscounted amounts that can be called cannot be estimated with sufficient accuracy. Hannover Rück SE does not have any rights of recourse outside the Group with respect to the guarantee payments.
Letter of credit (LoC) facilities existed with a number of financial institutions as at the balance sheet date in a total volume equivalent to EUR 2,890.9 million (EUR 2,826.0 million) and with various terms maturing at the latest in 2022.
As security for our technical liabilities, various financial institutions have furnished sureties for our company in the form of letters of credit. The total amount as at the balance sheet date was EUR 1,216.9 million (EUR 1,343.7 million).
A number of LoC facilities include standard market contractual clauses that allow the banks rights of cancellation in the event of material changes in our shareholding structure or trigger a requirement on the part of Hannover Re to furnish collateral upon materialisation of major events, for example if our rating is significantly downgraded. Please see also our explanatory remarks in the “Financial position” section of the management report, page 58, on the information pursuant to § 315 Para. 4 German Commercial Code (HGB).
As security for liabilities in connection with participating interests in real estate companies and real estate transactions the usual collateral under such transactions has been furnished to various banks, the amount of which totalled EUR 508.2 million (EUR 594.4 million) as at the balance sheet date.
Outstanding capital commitments with respect to alternative investments exist on the part of the Group in an amount of EUR 1,201.9 million (EUR 1,096.4 million). These primarily involve as yet unfulfilled payment obligations from investment commitments given to private equity funds and venture capital firms.
Hannover Rück SE has provided an open-ended guarantee limited to EUR 11.3 million in favour of the pension fund “The Congregational & General Insurance Plc Pension and Life Assurance Scheme” of the now extinguished Congregational & General Insurance Plc., Bradford, United Kingdom, at usual market conditions.
Future minimum lease payments receivable N 100 in EUR thousand Amounts receivable
The appointed auditor of the consolidated financial statement of Hannover Re as defined by § 318 German Commercial Code (HGB) is KPMG AG Wirtschaftsprüfungsgesellschaft (KPMG
The fee for services relating to auditing of the financial statements performed by KPMG AG Wirtschaftsprüfungsgesellschaft includes above all the fees for the auditing of the consolidated financial statement including legally required extensions of the mandate, the review report on the interim report as well as audits of annual financial statements and audits of the Solvency II balance sheets of the subsidiaries included in the consolidated financial statement. The fees for other assurance services relate to legally or contractually required audits. The fees for tax consultancy services include, in particular, fees for support services provided for the preparation of tax returns and tax consulting on specific matters. The fees for other services encompass consultancy services connected with the initial application of new accounting principles, training activities relating to current developments in accounting practice as well as quality-assuring support services and consultancy services in connection with IT.
The changes in tax legislation approved by the US administration at the end of 2017 entered into force on 1 January 2018. These provide for new tax regulations that have considerable financial implications for the subsidiaries operating in the United States. It is unlikely that any appreciable negative effects on income will be incurred as a result.
Statement on the audit of the consolidated financial statement and the combined management report
• the attached consolidated financial statement complies in all material respects with IFRS, as applicable in the EU, and with the additional requirements of German law applicable pursuant to § 315e Para. 1 Commercial Code (HGB) and gives a true and fair view of the net assets and financial position of the Group as at 31 December 2017 as well as its results of operations for the financial year from 1 January to 31 December 2017 in accordance with these requirements, and
• the attached combined management report provides an accurate view overall of the position of the Group. In all material respects this combined management report is consistent with the consolidated financial statement, complies with German legal requirements and suitably presents the opportunities and risks of future development. Our audit opinion on the combined management report does not extend to the contents of the aforementioned components of the non-financial information statement and of the declaration on corporate governance or to the disclosures of the combined management report identified as unaudited that are contained in the combined management report.
Measurement of financial instruments measured using valuation models With regard to the accounting policies please see the explanatory remarks in the notes to the consolidated financial statement on pages 159 to 162. In addition, further information on the items in the financial statement is provided on pages 188 to 204. Remarks on the risks deriving from financial instruments are provided in the combined management report on pages 94 to 96.
The risk for the consolidated financial statement The investments amount to EUR 50,960.3 million as at the balance sheet date. Of these investments, financial assets amounting to EUR 34,603.0 million – as shown on page 201 of the notes – are measured at fair value. In turn, of these financial instruments, fair values of EUR 33,574.8 million are determined using valuation models or values indicated by third parties.
Extensive disclosures in the notes are required regarding the valuation methods and scope for discretion in connection with the measurement of financial instruments.
• Based on the fair values determined by the company, we convinced ourselves that the subsequent balance sheet valuation and the implications for profit or loss are accurate. In this connection we assessed whether write-ups and write-downs were suitably taken and recognised.
• We assessed the plausibility of the material assumptions used – including loss ratios. We devoted particularly close attention to the calculation of the IBNR reserve.
• We performed independent reserve calculations for significant segments that we selected on the basis of risk considerations. In this regard, we established a point estimate (best estimate) as well as an appropriate range in each case using actuarial methods and compared them with the company’s calculations.
The risk for the consolidated financial statement The company reports a benefit reserve of EUR 8,978.0 million (roughly 14.7% of the balance sheet total) in its annual financial statement.
An annual liability adequacy test is performed on the level of portfolios managed as a unit in order to verify whether the benefit reserve is sufficient and whether the capitalised acquisition costs are impaired. The test is based on the expected future gross margins, calculated according to current realistic actuarial bases, and is therefore dependent on the same assumptions as the benefit reserve. If a shortfall is determined in the context of the impairment test, the first step is to write down the capitalised acquisition costs. If there is still a deficit above and beyond this, the benefit reserve is to be increased accordingly.
Uncertainties exist primarily with regard to the estimation of the measurement parameters, particularly in relation to the biometric actuarial bases that are to be considered realistic – such as probabilities for mortality, the mortality trend or disability as well as socioeconomic factors such as the assumed behaviour of policyholders, e. g. cancellation.
Our approach in the audit In our audit of the benefit reserve we deployed our own actuaries as part of the audit team. In particular, we performed the following principal audit procedures: • We surveyed the process used to calculate the benefit reserve, identified significant controls that are performed and tested them with an eye to their design and effectiveness. We devoted particularly close attention to controls that ensure that new products are correctly classified and changes in assumptions are correctly implemented in the systems.
Our conclusions The measurement assumptions used in the measurement of the benefit reserve are adequate and balanced overall. The explanatory remarks and disclosures provided in the notes to the consolidated financial statement are appropriate.
• We assessed the adequacy of the material assumptions by analysing the methods used to derive them; this was done especially with an eye to whether the assumptions reflect the current business development.
• We compared the premiums expected by the company in the previous year with the actual figures and thus drew conclusions about the quality of estimation.
In preparing the consolidated financial statement, the legal representatives are responsible for assessing the capacity of the Group to continue business operations. Furthermore, they are responsible for declaring facts and circumstances connected with the continuation of business operations, where relevant. In addition, they are responsible for financial reporting on the basis of the accounting principle of continuation of business operations, unless there is an intention to liquidate the Group or cease business operations or there is no other realistic alternative.
Moreover, the legal representatives are responsible for the preparation of the combined management report, which overall gives an accurate view of the position of the Group and in all material respects is consistent with the consolidated financial statement, complies with German legal requirements and suitably reflects the opportunities and risks of future development. The legal representatives are also responsible for the safeguards and measures (systems) that they considered necessary in order to facilitate the preparation of a Group management
Hannover Re | Annual Report 2017 report in conformity with applicable German legal requirements and in order to be able to provide sufficient appropriate evidence for the statements contained in the Group management report.
The Supervisory Board is responsible for monitoring the financial reporting process used by the Group for drawing up the consolidated financial statement and the combined management report.
• we identify and assess the risks of material – intended or unintended – misstatements in the consolidated financial statement and in the combined management report, plan and conduct audit procedures in response to these risks and obtain audit evidence that is sufficient and appropriate to serve as a basis for our audit opinions. The risk of material misstatements not being detected is greater with fraud than with error, because fraud may involve fraudulent collaboration, falsifications, wilful incompleteness, misleading representations or the bypassing of internal controls.
• we obtain an understanding of the internal control system relevant to the audit of the consolidated financial statement and the safeguards and measures relevant to the audit of the combined management report in order to plan audit procedures that are appropriate under the existing circumstances, albeit not with the aim of providing an audit opinion on the effectiveness of these systems.
• we draw conclusions regarding the adequacy of the accounting principle of continuation of business operations applied by the legal representatives as well as, on the basis of the audit evidence obtained, regarding whether material uncertainty exists in connection with events or circumstances that can raise significant doubts about the capacity of the Group to continue business operations. If we conclude that material uncertainty exists, we are required in the audit report to draw attention to the associated disclosures in the consolidated financial statement and in the combined management report or, if these disclosures are inadequate, to modify our audit opinion. We arrive at our conclusions on the basis of the audit evidence obtained until the date of our audit report. Future events or circumstances may, however, result in the Group no longer being able to continue its business operations.
• we assess the overall presentation, the structure and the content of the consolidated financial statement including the disclosures as well as whether the consolidated financial statement presents the underlying business transactions and events in such a way that the consolidated financial statement in compliance with IFRS, as applicable in the EU, and with the additional requirements of German law applicable pursuant to § 315e Para. 1 Commercial Code (HGB) gives a true and fair view of the net assets, financial position and results of operations of the Group.
• we assess the consistency of the combined management report with the consolidated financial statement, its conformity with the law and the view of the position of the Group that it conveys.
In our function as the Supervisory Board we considered at length during the 2017 financial year the position and development of the company and its major subsidiaries. We advised the Executive Board on the direction of the company and monitored the management of business on the basis of written and verbal reports from the Executive Board. The Supervisory Board of Hannover Rück SE held four regular meetings in order to adopt the necessary resolutions after appropriate discussion. With the exception of one meeting that one member of the Supervisory Board did not attend, all nine Supervisory Board members took part in each of the Supervisory Board meetings held in 2017. Two representatives of the Federal Financial Supervisory Authority participated in one meeting on a routine basis. In addition, we were informed by the Executive Board in writing on the basis of the quarterly statements and orally about the course of business and the position of the company and the Group. The quarterly reports with the components of the financial statements and key figures for the Hannover Re Group constituted an important source of information for the Supervisory Board.
We received an analysis of the 2016 results in property & casualty and life & health reinsurance as well as a presentation from the Executive Board covering the profit expectations for the 2017 financial year and the operational planning for the 2018 financial year. In addition, the Chairman of the Supervisory Board was constantly advised by the Chairman of the Executive Board of major developments and impending decisions as well as of the risk situation within the company and the Group. All in all, we were involved in decisions taken by the Executive Board and assured ourselves of the lawfulness, regularity and efficiency of the company’s management as required by our statutory responsibilities and those placed upon us by the company’s Articles of Association.
No audit measures pursuant to § 111 Para. 2 Sentence 1 Stock Corporation Act (AktG) were required in the 2017 financial year.
The Nomination Committee began its deliberations over suitable candidates for the upcoming by-election of two shareholder representatives to the Supervisory Board in the coming year. When recommending candidates for nomination, the Committee takes into account the legal and supervisory stipulations, the goals set by the Supervisory Board itself for the composition of the body as well as the guidelines regarding the specialist and personal requirements for the members of the Supervisory Board, which the latter had approved in updated form in the year under review.
Corporate Governance The Government Commission on the German Corporate Governance Code (DCKG) made changes to the German Corporate Governance Code in 2017. The Supervisory Board consequently examined the revised version of the German Corporate Governance Code as amended 7 February 2017 and in this connection approved corresponding changes to the Corporate Governance Principles of Hannover Rück SE. Among other things, a reference was inserted to the regularly performed efficiency review of the Supervisory Board’s work. In addition, the Supervisory Board implemented various requirements arising out of Section 5.4.1 of the Code regarding the composition of the Supervisory Board and approved a diversity concept. It was possible to omit the reporting on shareholdings of members of the Executive Board and Supervisory Board from the Corporate Governance Principles because legal standards now exist for reporting on the shareholdings of members of these bodies.
We have examined a) the annual financial statements of the company, the financial statements of the Hannover Re Group and the combined management report prepared by the Executive Board for the company and the Group, and b) the report of the Executive Board pursuant to § 312 Stock Corporation Act (AktG) (Report on relations with affiliated companies)
Word of thanks to the Executive Board and members of staff The good result generated by Hannover Rück SE for the 2017 financial year was made possible by the exceptional performance of the Executive Board and the members of staff working for the company and the Group. The Supervisory Board would like to express its recognition and special appreciation to the Executive Board and all the employees for their efforts.
Hannover ReTakaful B.S.C. (c) Al Zamil Tower 17th Floor Government Avenue Manama Center 305 Manama
Victoria Place, 2nd Floor, 31 Victoria Street Hamilton, HM 10 P.O. Box 2373 Hamilton, HM JX
Compass Insurance Company Limited KPMG Wanooka Place Ground Floor St. Andrews Road Parktown Johannesburg 2193 P.O. Box 37226 Birnam Park 2015 www.compass.co.za Managing Director: Paul Carragher
Fax Property & Casualty + 46 8 617-5593 Managing Director: Thomas Barenthein
Aggregate excess of loss treaty: a form of excess of loss treaty reinsurance under which the reinsurer responds when a ceding insurer incurs losses on a particular line of business during a specific period (usually twelve months) in excess of a stated amount.
Capital asset pricing model (CAPM): the CAPM is used to explain the materialisation of prices / returns on the capital market based on investor expectations regarding the future probability distribution of returns. Under this method, the opportunity cost rate for the shareholders’ equity consists of three components – a risk-averse interest rate, a market- specific risk loading and an enterprise-specific risk assessment, the beta coefficient. The cost of shareholders’ equity is therefore defined as follows: risk-averse interest rate + beta * enterprise-specific risk assessment.
Frequency losses: Losses that occur frequently in a foreseeable amount, i. e. where the underlying risks are associated with relatively high probabilities of occurrence and usually low loss amounts.
Funds held by ceding companies / funds held under reinsurance treaties: cf. deposits with ceding companies / deposits received from retrocessionaires
Insurance pool: a risk-sharing partnership under civil law formed by legally and economically independent insurers and reinsurers in order to create a broader underwriting base for particularly large or unbalanced risks. The members undertake to write certain risks only within the scope of the insurance pool. They include such risks – while maintaining their commercial independence – in the insurance pool against a commission fee. Each insurer participates in the profit or loss of the insurance pool according to its proportionate interest. Reinsurance is often ceded or accepted in order to further diversify the risk. Pools can be divided into two types: coinsurance pools, in which all members take the role of primary insurers according to their interests, and reinsurance pools, in which a primary insurer writes the risks and then spreads them among the participating insurers by way of reinsurance.
Major loss: loss which has special significance for the direct insurer or reinsurer due to the amount involved; it is defined as a major loss in accordance with a fixed loss amount or other criteria (in the case of Hannover Re more than EUR 10 million gross).
Surplus relief treaty: A reinsurance contract under which an admitted reinsurer assumes (part of) a ceding company’s portfolio to relieve stress on the cedant’s policyholders’ surplus.
M 15 Property & Casualty reinsurance: Breakdown of gross written premium in Continental Europe by line of business 35
M 16 Property & Casualty reinsurance: Breakdown of gross written premium in worldwide specialty lines 36
M 18 Property & Casualty reinsurance: Breakdown of gross written premium in global reinsurance 39
M 19 Property & Casualty reinsurance: Breakdown of gross written premium in worldwide treaty reinsurance 39
M 20 Breakdown of gross premium by markets 43 M 21 Value of New Business (VNB) growth 43 M 22 Breakdown of gross written premium by reporting categories 43 M 23 EBIT-margin per reporting category vs. target margins 2017 43 M 24 Key figures for Life & Health reinsurance 44 M 25 Investment income 50 M 26 Development of investment income 51 M 27 Investment portfolio 52 M 28 Breakdown of investments under own management 52 M 29 Rating of fixed-income securities 53 M 30 Capital structure as at 31 December 2017 53 M 31 Development of policyholders’ surplus 54 M 32 Development of Group shareholders’ equity 55 M 33 Amortised cost of our subordinated bonds 56 M 34 Consolidated cash flow statement 56 M 35 Cash flow from operating activities 57 M 36 Financial strength ratings of the Hannover Re Group 57 M 37 Financial strength ratings of subsidiaries 57 M 38 Issue ratings of issued debt 58 M 39 Condensed profit and loss account of
M 47 Goal to be achieved by 2017: Development and expansion of “sustainable” products 70
shareholders’ equity) 87 M 61 Required risk capital 88 M 62 Required risk capital for underwriting risks property and casualty reinsurance 88 M 63 Required risk capital for the four largest natural hazards scenarios 88 M 64 Survival ratio in years and reserves for asbestosrelated claims and pollution damage 89 M 65 Stress tests for natural catastrophes after retrocessions 89 M 66 Limit and threshold for the 200-year aggregate annual loss as well as utilisation thereof 90 M 67 Catastrophe losses and major claims in 2017 90 M 68 Ensuring the quality of our portfolios 91 M 69 Combined and catastrophe loss ratio 91 M 70 Required risk capital for underwriting risks life and health reinsurance 92
N 01 Consolidated balance sheet as at 31 December 2017 146 N 02 Consolidated statement of income 2017 148 N 03 Consolidated statement of comprehensive
N 04 Consolidated statement of changes in shareholders’ equity 2017 150 N 05 Consolidated cash flow statement 2017 152 N 06 Further IFRS Amendments and Interpretations 158 N 07 Restatements pursuant to IAS 8 159 N 08 Valuation models 160 N 09 Key exchange rates 166 N 10 Scope of consolidation 169 N 11 List of shareholdings 170 N 12 Material branches of the Group 177 N 13 Book values from business relations with unconsolidated structured entities 2017 180 N 14 Book values from business relations with unconsolidated structured entities 2016 181 N 15 Assets and liabilities of the acquired business 182 N 16 Consolidated segment report 184
N 18 Maturities of the fixed-income and variable-yield securities 189 N 19 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 2017 190
N 21 Amortised cost, unrealised gains and losses and accrued interest on loans and receivables as well as their fair value 2017 191
N 23 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 2017 192
N 26 Carrying amounts before impairment 194 N 27 Rating structure of fixed-income securities 2017 195 N 28 Rating structure of fixed-income securities 2016 195 N 29 Breakdown of investments by currencies 2017 196 N 30 Breakdown of investments by currencies 2016 197
N 32 Investments in associated companies 198 N 33 Development of investment property 199 N 34 Fair value hierarchy of financial assets and liabilities recognised at fair value 2017 201 N 35 Fair value hierarchy of financial assets and liabilities recognised at fair value 2016 201 N 36 Movements in level 3 financial assets and
(PVFP) on acquired life reinsurance portfolios 208 N 49 Fixtures, fittings and equipment 209 N 50 Development of other intangible assets 210 N 51 Technical provisions 211 N 52 Loss and loss adjustment expense reserve 211 N 53 Net loss reserve and its run-off in the property and casualty reinsurance segment 213 N 54 Maturities of the technical reserves 2017 214 N 55 Maturities of the technical reserves 2016 214 N 56 Development of the benefit reserve 215 N 57 Development of the unearned premium reserve 216 N 58 Measurement assumptions 217 N 59 Movements in net liability from defined benefit pension plans 218 N 60 Provisions for pensions 219 N 61 Effect on the defined benefit obligation 219 N 62 Other liabilities 220 N 63 Development of sundry non-technical provisions 220 N 64 Maturities of the sundry non-technical provisions 220 N 65 Debt and subordinated capital 2017 222 N 66 Debt and subordinated capital 2016 222 N 67 Maturities of financial liabilities 2017 223 N 68 Maturities of financial liabilities 2016 223 N 69 Net gains and losses from debt and subordinated capital 223 N 70 Reconciliation of debt and subordinated capital 224
N 71 Subsidiaries with material non-controlling interests 225 N 72 Gross written premium 226 N 73 Investment income 227 N 74 Interest income on investments 227 N 75 Net gains and losses on investments 2017 228 N 76 Net gains and losses on investments 2016 228 N 77 Reinsurance result 229 N 78 Other technical income 229 N 79 Commissions and brokerage, change in deferred acquisition costs 230 N 80 Other technical expenses 230 N 81 Other income / expenses 230 N 82 Income tax 231 N 83 Domestic / foreign breakdown of recognised tax expenditure / income 231 N 84 Deferred tax assets and deferred tax liabilities of all Group companies 232 N 85 Netting of deferred tax assets and deferred tax liabilities 232 N 86 Reconciliation of the expected expense for income taxes with the actual expense 233 N 87 Expiry of non-capitalised loss carry-forwards and temporary differences 234 N 88 Maturity structure of derivative financial
We would also be pleased to send you copies of the Annual Reports of the Hannover Re Group and Hannover Rück SE in English or German. If you wish to receive paper copies of any of these versions please contact Corporate Communications on: Fax + 49 511 5604-1648 or order them online at www.hannover-re.com under “Investors / Results and reports”
Annual financial statements 2017 Annual Results Press Conference, Hannover Analysts’ Meeting, Frankfurt
Quarterly Statement as at 31 March 2018 Annual General Meeting Hannover Congress Centrum Theodor-Heuss-Platz 1 – 3 30175 Hannover