The pace of consolidation in the insurance industry continued unabated. In many markets, this was strongly reflected in the scope and type of reinsurance cover sought. Following a phase of important structural changes, developments in the reinsurance industry have slowed somewhat. In these times of change, a reinsurance provider’s financial strength has become even more important.
Investment result 4. Allocated investment return 5. Interest charges 6. Other income, including other valuation readjustments 7. Other charges, including other valuation adjustments
Additional information on the Group accounts Gross premiums by country 37 Premiums by line 37 Net technical account by line 38 Technical provisions 39 Technical provisions by line 39 Technical provisions by currency 39 Investments 40 Investment result 40 Investments by currency 41 Capital funds 42
The Swiss Re Group’s obligations for claims payments and claims settlement charges also include obligations for long latent injury claims occurring mainly in the fields of US asbestos and environmental liability. These obligations comprise reported claims as well as claims incurred but not yet reported, and generally arise out of policies dating back ten years or more. The following table shows the payments made by the Swiss Re Group as well as the estimated, non-discounted obligations for own account as a result of these claims: Claims paid: USD millions
Return on equity * refer to glossary for definition 1 not including Mercantile & General Re 2 not including Swiss Re Italia 3 before offset of goodwill from acquisitions since 1 January 1996 48 Swiss Re Group
The financial year was marked once again by a favourable trend on the capital markets. The investment result rose by 47% to CHF 1.507 billion. Realised gains on the sale of investments climbed to CHF 1.8 billion and were accompanied by valuation adjustments of the same amount. To a large extent these include legally permitted, precautionary valuation adjustments to the securities portfolio as well as the write-off of goodwill resulting from acquisitions in recent years.
This item consists mainly of provisions for currency fluctuations and a provision relating to a guarantee provided in connection with the minority holding in Credit Suisse Financial Products, London.
As statutory auditors, we have audited the accounting records and the financial statements of Swiss Reinsurance Company on pages 51 to 58 for the year ended 31 December 1997.
The financial statements are the responsibility of the Board of Directors. Our responsibility is to express an opinion on these financial statements based on our audit. We confirm that we meet the legal requirements concerning professional qualification and independence.
In our opinion, the accounting records and the financial statements and the proposed appropriation of retained earnings comply with the law and the company’s Articles of Association.
Audatex Holding AG 4 d 100 f – – – Seestrasse 315 8038 Zurich
SR-Beratungsdienst GmbH d 100 – – – – Karl-Wiechert-Allee 20 30625 Hannover
Württembergische AG Versiche- d 31.92 e DEM 63.0 741.9 rungs-Beteiligungsgesellschaft 2, 3
European Finance Reinsurance d 100 f USD 0.3 5.5 Company Ltd.
Neither will the insurance industry emerge unscathed from this unpleasant situation; compensation claims are likely in liability and property insurance. Yet it is impossible to predict the actual extent of the impact, especially since the legislation, judicial framework and insurance covers in the individual countries can vary widely.
In some countries, public authorities assume the preventative duties. For example, Australia’s stock exchange regulators require all exchange -listed companies to provide an appropriate report on the measures taken. Failure to comply can lead to a halt in the trading of the company’s shares. In Singapore, insurance regulators are reminding the insurance industry of their task in a similar way. The British insurance association, in a joint effort with the Department of Trade and Industry, sets the standard for the affected companies.
At head office in Zurich, a team of experts has analysed the 5000 computer programs running on the mainframe computer.
Surety insurance: Sureties and guarantees issued to third parties for the fulfillment of contractual liabilities.
Amounts booked in return for insurance cover in the financial year.