ZAVAROVALNICA MARIBOR D.D. ANNUAL REPORT

Transcription

ZAVAROVALNICA
MARIBOR D.D.
ANNUAL
2011
REPORT
Life goes on with ZM by your side
0
Maribor, 29 March 2012, revised
THE CONTENTS OF THE REVISED ANNUAL REPORT FOR
2011
The Conclusion of the Management Board on the Annual
Report
The Conclusion of the Supervisory Board on the Annual
Report
Business Report
Financial Report
2
66
Independent Auditor's Report on Financial Statements
161
Enclosure to the Business Report
(Financial Statements According to Schemes of the Supervisory
Organ)
162
ANNUAL REPORT OF ZAVAROVALNICA MARIBOR d.d. FOR 2011
At a meeting held on 30 March 2012 the Management Board discussed and adopted
the annual report of the company and was acquainted with the progress of the audit
process and the report of the certified auditor on company's account statements.
When adopting the annual report the Management Board followed the provisions of the
legislation (Companies Act – ZGD-1, Articles 64 and 230) and standpoints regarding the
formation of reserve funds as regulated by the Insurance Act and which are not defined as
income according to the IFRS. The revised financial statement of the company includes the
approved use of net profit of the current year as follows:
Company's net profit for 2011 amounts to 10,557,074.56 euros of which 615,263.00
euros will be used for forming of the loan insurance equalization provision. From the
remaining net profit 2,560,039.58 euros will be used for forming the statutory reserves,
whereas the sum of 7,381,771.98 euros remains unallocated.
The Management Board suggests to the Supervisory Board to leave the distributable
profit in the amount of 7,668,896.76 euros on 31 December 2011 unallocated due to
decreased risk of capital adequacy at the introduction of the EU Solvency II Directive.
The Management Board has adopted the annual report of Zavarovalnica Maribor for
2011 in the presented content and proposes the Supervisory Board to approve the
revised annual report and to pass a positive opinion of the audit report.
Maribor, 30 March 2012
Management Board:
Drago COTAR, Chairman of the
Management Board
Borut Celcer, M.Sc., Member of the
Management Board
Srečko ČARNI, Member of the
Management Board
David KASTELIC, M.Sc., Member of
the Management Board
Marko Planinšec, Member of the
Management Board
OPINION OF THE SUPERVISORY BOARD
ON THE COMPANY'S REVISED ANNUAL REPORT
AND ON THE REPORT OF THE CERTIFIED AUDITOR
FOR THE 2011 BUSINESS YEAR
On 24 April 2011, the Supervisory Board of the company discussed the revised Annual
Report of Zavarovalnica Maribor d.d. for 2011 and the Certified Auditor’s Report for the
annual statements of 2011 prepared by the selected audit firm Ernst & Young.
The opinion provided by the audit firm assures an honest presentation of the company’s
financial status with an appropriate amount of formed reserves that are entirely covered with
legally admissible investment forms and appropriate capital adequacy on 31 December
2011.
The supervisory board found that the company reached 10,557,074.56 euros of net profit
which exceeds the estimations and is also the result of favorable situation in the area of
property insurance. The market share of the insurance company lowered by 0.2 percent in
the property insurance group and increased by 0.9 percent in the life insurance group.
The supervisory board estimates, that the Management Board of Zavarovalnica Maribor d.d.
followed their planned business policy and efficiently executed the steps with which the
company improved their loss ratio. The company also did not expose itself with its
investment policy to such risks that have during the financial crisis influenced the investment
portfolios the most.
The supervisory board establishes that the company formed the equalization provision for
loan risk in the sum of 615,263.00 euros according to the Insurance Act and allocated
2,560,039.58 euros to legal reserves and thus reached the statutory defined limit of legal
reserves. The remaining net profit amounts to 7,381,771.98 euros.
On 31 December
7,668,896.76 euros.
2011,
the
distributable
profit
of
the
company
amounts
to
The supervisory board approves the revised annual report in the following form and
provides a positive opinion on the auditor’s report for 2011.
Maribor, 24 April 2012
Matjaž Kovačič,
Chairman of the Supervisory Board
BUSINESS REPORT
Company name:
Zavarovalnica Maribor, delniška zavarovalna družba
Short name:
Zavarovalnica Maribor d.d.
Cankarjeva ulica 3, 2507 Maribor
Registration date:
26 December 1990,
Registry number 1/03762/00
Maribor District Court
Tax number:
44814631
Registration number:
5063400
Classification by Activity:
62.120 - other insurances
CONTENTS OF BUSINESS REPORT
Introduction ..................................................................................................................................................... 3
Company Performance Highlights 2007 – 2011 ................................................................................................. 4
Management Board Report ................................................................................................................................ 5
Report on the Work of the Supervisory Board ................................................................................................... 7
Growth and development of the Company from 2007 TO 2011 ....................................................................... 9
COMPANY ASSETS FROM 2007 TO 2011 ............................................................................................................ 9
EQUITY AND LIABILITIES OF THE COMPANY FROM 2007 TO 2011 ................................................................... 10
COMPANY REVENUE ......................................................................................................................................... 11
COMPANY CHARGES ......................................................................................................................................... 12
EMPLOYEES ....................................................................................................................................................... 13
EVENTS, MARKING THE YEAR OF 2011 ............................................................................................................. 14
Company profile ...................................................................................................................................................... 9
Company's Identity Card................................................................................................................................... 15
Company's Development Strategy ................................................................................................................... 16
Main Activities and Insurance Forms ................................................................................................................ 17
History and Development ................................................................................................................................. 18
Ownership structure ......................................................................................................................................... 19
Organizational Structure................................................................................................................................... 20
The Sales Network ............................................................................................................................................ 21
Business Performance Report for 2011 .......................................................................................................... 23
Business Environment and Insurance Business ................................................................................................ 23
Company's Financial Position and Financial Results ......................................................................................... 27
Outline of the More Important Insurance Classes ........................................................................................... 38
Information Technology and its Development ................................................................................................. 44
Investments ...................................................................................................................................................... 46
Internal Audit Function ..................................................................................................................................... 47
Events Following the Balance Sheet Date ........................................................................................................ 48
Risk Management .......................................................................................................................................... 49
Sustainable Development Report................................................................................................................... 50
Employees......................................................................................................................................................... 50
Quality Management System ........................................................................................................................... 53
Responsibility Towards Social Environment ..................................................................................................... 53
Communication with Target Public .................................................................................................................. 54
Management Board and Supervisory Board ................................................................................................... 56
THE ASSEMBLY .................................................................................................................................................. 56
Supervisory Board............................................................................................................................................. 56
Management Board .......................................................................................................................................... 58
Sector and Department Directors..................................................................................................................... 60
Selected Indicators of Business Operations .................................................................................................... 61
0
INTRODUCTION
It has been another successful year for Zavarovalnica Maribor d.d. (hereinafter Company)
that the company concluded with a positive business result.
The equity of the company increased by
12.4 percent with regard to the previous
fiscal year.
The share capital was increased by 12.8
million euros.
Net profit and loss account contributed
10,557,000 euros to equity growth. At the
same time, the company paid out
dividends arising from distributable profit in
2010 in total amount of 8,718,000 euros
and the revaluation reserve was
decreased by 4,967,000 euros.
Relative to previous period the technical
account (technical result) was higher by
13.4 percent.
Zavarovalnica Maribor d.d. Business Report
3
COMPANY PERFORMANCE HIGHLIGHTS 2007 – 2011
Charged gross premium
Property insurance
Life insurance
- Standard life insurance
- Unit-linked life insurance
2011
263,244
187,839
75,405
31,882
43,523
2010
259,599
188,290
71,309
33,073
38,236
2009
2008
2007
266,041 251,845 234,348
199,016 185,868 170,673
67,025 65,977 63,675
35,060 36,883 39,346
31,965 29,094 24,329
Charged gross claims
Property insurance
Life insurance
- Standard life insurance
- Unit-linked life insurance
140,022
102,530
37,492
27,001
10,491
151,283
111,124
40,158
31,368
8,790
190,212 190,871 138,625
151,156 157,884 108,878
39,056 32,987 29,747
34,241 31,280 28,899
4,815
1,707
848
Total assets
760,989
734,042
680,833 634,940 603,814
87,540
77,867
Investments
618,187
575,443
514,927 463,943 471,407
Technical provisions
Technical provisions transferred to the co- and
reinsurers
622,228
590,434
559,361 511,314 492,916
60,428
62,863
66,023
68,525
54,612
14,639
10,557
14,226
10,595
-587
-555
6,032
2,792
6,312
4,155
7.03
0.931
7.62
1.037
6.59
-0.075
7.54
0.410
7.50
0.610
875
879
874
897
904
907
909
899
894
889
In EUR ,000
1
Equity
2
Profit and loss account prior to taxation
Net income
3
Book value per share in EUR
4
Net income per share in EUR
Number of employees on Dec 12
Average number of employees in year
67,314
51,378
51,123
1
equity as stated in the balance sheet prepared in accordance with IFRS requirements, additional explanation to
equity is in the financial report under item 12 of the Explanations of the Financial Statements chapter
2
through the assets of the insured with unit-linked life insurance, investments into real estate and investments
into affiliated companies
3
equity on 31.12. /total number of shares issued on 31.12.
4
net profit and loss account/weighted average number of shares in the reporting period
4
MANAGEMENT BOARD REPORT
Dear company shareholders, business partners and coworkers …
The most important life motto of the present time is respect for others—employees,
customers, sponsored parties, local authority, children, educators—in one word, for all
participants that are (may be) within an organization. The responsibility starts with each
individual. When we look back, we can honestly say that in 2011 we invested all of our
energy and efforts into responsible relations with our owners and insured persons and of
course with employees who are an indispensable part of our company. Social responsibility
is our duty and at the same time privilege. Our basic mission—to help people in need—is
thus spread to other areas of our operations.
In twenty years of independent (again) insurance company we have proven that we are a
good team in different areas, which is supported by the third place among most desirable
employers according to the Hewitt method in 2004, participation at the Family friendly
certification gained as a pilot company in Slovenia in 2006 and upgraded with full certificate
last December, the Horus award for social responsibility – finalist in 2009, collaboration in the
research of the best employer 'Zlata nit' (the Golden Thread) in which we participate from the
beginning (for four years), and financial data: 187.8 million euros of collected gross premium
and 102.5 million euros of settlement compensations (8.6 million euros less than in 2010) in
the area of property insurance, and 75.4 million euros of collected premium (4.1 million euros
more than in 2010) and 37.5 million euros of settlement compensations in the area of life
insurance. The company produced net profit in the amount of 10,557,000 euros.
The year 2011 was interesting and diverse. We successfully concluded the capital increase
in the amount of 12.8 million euros, we improved our already excellent collection of
insurances and added numerous advantages and specialties and by that increased their
attractiveness in the eyes of the insured persons. We adopted the reorganization regulations
with some minor changes, and co-established the Network for Social Responsibility of
Slovenia of which mission is to promote social responsibility and to connect companies and
organizations striving for incorporation of social responsibility into all of their operation areas.
We launched a new platform for the only insurance blog in Slovenia written by our
employees. In our desire to enable better conditions and services of higher quality we
renovated business areas for the insured persons and aggrieved parties on the ground floor
of our business premises on Cankarjeva 3 in Maribor.
Regarding the difficult economic situation and more and more specific needs of the insured
persons we offered a new ZM PRIZMA Komfort life insurance package that covers also
insurance in case of employment loss of the insured person.
We are proud of our Primus award received last October by Mr. Drago Cotar, the Chairman
of the Management Board. The award proves his extreme excellence in communications and
contribution to the development of the communication profession. We are also very glad to
have received the Horus recognition award as finalists, awarded to social responsible
companies.
5
In 2011 we remained capitally strong and we ensured safety to our insured persons and of
course remained loyal to our basic mission: to assure economic safety and trust of our
business partners.
We care. We care about the society and its employees, the environment in which we live and
work, our insured persons in the times we live in. We would like to focus all of our attention
and knowledge to the development of quality services and excellent business relations and
most of all we want to give back to the environment everything it's been giving us year after
year.
Management Board:
Management Board
Management Board
Management Board
Management Board
6
REPORT ON THE WORK OF THE SUPERVISORY BOARD
In 2011, the supervisory board of the Company consisted of the following members:
Matjaž Kovačič, Chairman, Dušan Čeč, Deputy Chairman, Manja Skernišak, member, Janez
Komelj, member, Edi Kosi, member (representative of ZM d.d. employees – chairman of ZM
d.d. free trade union) and Robert Ciglarič, member (representative of ZM d.d. employees –
chairman of the workers’ council).
Within the frame of legal and statutory power for supervision of company business
management and concern of its legal compliance and efficiency the Supervisory Board held
six regular meetings and three correspondence sessions during the reporting period.
In the area of supervision on management and legal compliance of the company and after
preliminary discussions and statements adopted at the meetings of the Supervisory Board
Audit Committee the Supervisory Board among others:
o Adopted the business plan and approved the financial plan for 2011 within which it
defined the assurance of the obligatory capital adequacy as one of the key goals. At
the same time the Supervisory Board instructed the Management Board to operate
rationally at the execution of plans contained in the above mentioned documents by
decreasing business operation costs and number of employees.
o Monitored regularly the planned company operations through monthly reports and in
form of comparative data for the same period of the previous financial year. Monthly
reporting comprises insurance gross premium, annual premium of newly underwritten
life insurances, number of underwritten insurances, gross claims and number of
claims of each insurance class.
o Discussed quarterly reports on company operations with quarterly financial
statements and calculations of company's capital adequacy.
o Instructed the Management Board to take proper measures in accordance with
comparative analysis by insurance classes with negative technical result to limit the
insurance underwriting in those classes on the basis of a selective approach by
strictly regarding the technical results of individual policyholders.
o Discussed and confirmed a revised annual report and adopted the annual report of
the Management Board for the financial year 2010 of the company as a whole and a
consolidated annual report of the ZM Group. It expressed its opinion on both annual
reports;
o Was acquainted, at the last meeting in 2011, with the professional services
information on the effects of adopted measures for improving the technical results
and it instructed its audit committee to discuss the Business Policy and Financial Plan
propositions of the company for the year 2012 and to mediate them with the
suggested possible changes and completions to the Supervisory Board at the first
meeting in the new business year.
In the area of company's internal audit, the Supervisory Board adopted the report on the
audits performed in 2010 and confirmed the operations program of the Internal Audit
Services for 2011, as well as promptly discussed and adopted reports on quarterly internal
audits in 2011 and the report on self-assessment of Internal Audit Services.
7
In the area of corporate legislation, the Supervisory Board:
o
o
o
confirmed or defined the final contents of the suggestions of both assembly meetings,
above all in regard of capital increase (General Meeting of ZM d.d. on 23 May 2011)
and of dividend distribution (General meeting of ZM d.d. on 19 Sept. 2011);
adopted the declaratory decision on capital increase realization in the amount of
12,800,199.06 EUR;
based on the decision from the previous item it accepted the modifications and
completions of the Statute of the ZM d.d. according to the authorization of General
Meeting of ZM d.d. and confirmed its consolidated text.
In the area of human resources, the Supervisory Board:
o monitored the company’s employment policy, adopted the employment report for
2010, approved the guidelines of human resources plan for 2011. set the requirement
for verification of working processes and based on the findings execution of their
rationalization in the sense of optimal position occupation;
o named two members into the Management Board:
o Borut Celcer, M.Sc. was named a Management Board member for the area of
insurance technologies and information science with a 5-year mandate (1st
mandate) since 12 Jan 2011, when acquiring consensus of Insurance
Supervision Agency for carrying out functions, and David Kastelic, M.Sc. was
named a Management Board member for the area of marketing activities and
insurance acquisition with a 5-year mandate (2nd mandate) since 12 Oct.
2011;
o adopted the decisions on employee structure and human resources modifications in
the Audit Committee of the Supervisory Board.
Chairman of Supervisory Board of ZM d.d.
Matjaž Kovačič, B.Sc.
8
GROWTH AND DEVELOPMENT OF THE COMPANY FROM
2007 TO 2011
Growth and development of the company according to the selected business indicators1
2011
In percent
2010
2009
2008
2007
Gross loss ratio
53.2
58.3
71.5
75.8
59.2
Gross incurred loss ratio
61.0
63.3
78.7
85.0
68.5
Net loss ratio
50.9
56.3
63.1
55.9
52.3
Net incurred loss ratio
61.8
63.8
73.6
64.4
65.1
Return on average assets prior to taxation
1.96
2.01
-0.09
0.97
1.05
Return on average assets after taxation
1.41
1.50
-0.08
0.45
0.69
Return on average equity prior to taxation
17.70
19.60
-0.96
9.73
9.15
Return on average equity after taxation
12.76
14.60
-0.91
4.50
6.02
gross loss ratio = charged gross claims/charged gross premium
gross incurred loss ratio = (charged gross claims + modification of gross claims reserve)/(charged gross premium + modification
of gross unearned premium reserve)
net loss ratio = net claims amount/net charged insurance premium
net incurred loss ratio = net claims charges/net insurance premium revenue
return per average asset prior to taxation = profit and loss account prior to taxation/average status of the asset
return per average asset after taxation = net profit and loss account/average status of the asset
return per average equity prior to taxation = profit and loss account prior to taxation/average status of the equity
return per average equity after taxation = net profit and loss account/average status of equity
COMPANY ASSETS FROM 2007 TO 2011
On the last day of the reporting period 2the financial assets of the company amounted to
760,989,000 euros (2010: 734,042,000 euros). Relative to the previous reporting period the
financial assets increased by 26,947,000 euros or 3.7 percent.
In EUR ,000
Investments*
Assets insured
with investment risk
Technical provisions**
transferred to reinsurers
Other assets
2011
Share
in %
2010
Share
in %
2009
Share
in %
2008
Share
in %
Share
in %
2007
511,142
67.3 483,199
65.8 442,953
65.1 422,027
66.5 436,717
72.3
107,046
14.1
92,244
12.6
71,975
10.6
41,917
6.6
34,690
5.7
60,428
7.9
62,863
8.6
66,023
9.7
68,525
10.8
54,612
9.0
82,375
10.7
95,736
13.0
99,883
14.7 102,472
16.1
77,795
12.9
Total Assets
760,989 100.0 734,042 100.0 680,833 100.0 634,940 100.0 603,814 100.0
*financial investments with investment property and investment into the affiliated companies
** technical provisions
1
2
Detailed review of the business operations success with indicators is attached to the company’s business report
The reporting period of the Company represents the operating period from 1 January 2011 until 31 December
2011. The previous reporting period of the Company represents the operating period from 1 January until 31
December 2010.
9
In accordance with sales growth of unit-linked life insurance the asset value of the insured
who adopted the investment risk is also increasing. Their share in total assets amounts to
14.1 percent already. Among other assets the category of receivables towards the reinsurers
decreased the most. The latter decreased in comparison to the end of the previous reporting
period by 9,906,000 euros and represent 1.4 percent of the company's assets. Their
decrease during the monitored period is a reflection of modifications in reinsurance
agreement3.
EQUITY AND LIABILITIES OF THE COMPANY FROM 2007 TO 2011
Equity as well as other company assets have increased during the reporting period. Equity
increased by 12.4 percent and amounted to 87,540,000 euros on the last reporting day.
Company's equity increased by 71.2 percent during the monitored period (2007 - 2011).
Equity growth is a result of successful company operations especially during the last two
reporting periods and two capital increases realized in 2009 and 2011.
In EUR ,000
Equity
Gross technical
provisions
Gross technical
provisions for unit-linked
life insurance
Other liabilities
Total
3
2011
87,540
520,422
Share
in %
11.5
68.4
2010
Share
in %
77,867
500,631
10.6
68.2
2009
67,314
488,861
Share
in %
9.9
71.8
2008
51,378
464,369
Share
in %
8.1
73.1
2007
Share
in %
51,123
8.5
458,146
75.9
101,806
13.4
89,803
12.2
70,500
10.4
46,944
7.4
34,770
5.8
51,221
6.7
65,741
9.0
54,159
8.0
72,249
11.4
59,775
9.9
100.0 603,814
100.0
760,989
100.0 734,042
100.0 680,833
100.0 634,940
Reinsurance is more closely explained in the financial report of the annual report under reinsurance risk control
chapter.
10
Company liability increased by 2.6 percent and amounted to 673,449,000 euros on the last
reporting day. As in all the previous periods, the highest share of liabilities appertains to the
assessed future liability of the company towards the insured and towards the technical
provisions. The latter have increased during the reporting period by 31,794,000 euros or by
5.4 percent.
COMPANY REVENUE
The company is achieving constant revenue growth. The revenue of the company during the
reported epriod amounted to 248,712,000 euros and have increased relative to the previous
reporting period by 1,569,000 euros or 0.6 percent.
In spite of bad economic situation, the increase of unemployment and high lack of payment
discipline the company was able to increase the gross premium income. The latter has
increased during the reporting period by 1.4 percent while net premium income increased by
2.4 percent relative to the previous reporting period.
11
Movement of gross and net revenue from insurance premium from 2007 to 2011
After a constant investment revenue growth in the previous years the company noted a minor
drop of the latter during the reporting period. The investment revenue was according to the
previous reporting period lower by 5.3 percent or 1,354,000 euros. Regarding the financial
crisis and drop of price of securities we assess that the company's result in this area is good.
COMPANY CHARGES
Company charges during the reporting period amounted to 234,073,000 euros. They
increased by 0.5 percent relative to the previous period. After the company recognized
185,392,000 euors of gross claims in 2009, they were now much lower for the second year in
a row. In 2011, the company recognized gross claims in the amount of 134,635,000 euros,
which is 8.3 percent less than in 2010 and as much as 27.4 percent less as in 2009.
Movement of claims charges elements from 2007 to 2011
12
EMPLOYEES
Number of employees remains at the last year's level. On the last day of the reporting period
875 people were employed. Since 2007, the number of employees decreased by 19 (6 fulltime agents and 13 internal employees).
Employee productivity, measured as relation between insurance premium and average
number of employees, calculated based on the carried out working hours* is—with an
exception of 2010—increasing.
13
EVENTS, MARKING THE YEAR OF 2011
… in the human resources area:
o M.Sc. Borut Celcer gained a license to perform jobs and tasks as
Management Board member.
o Branko Tekmec assumed office of Maribor business unit director;
o Silvana Simič assumed office of Koper business unit acting director;
o Lea Jerič assumed office of Kranj business unit acting director;
o Darko Dukarič assumed management of representative office in Slovenska
Bistrica.
… in the communications and innovativeness area:
o we concluded the capital increase process in the amount of 12.8 million euros
and thus met the requirements of the Insurance Supervision Agency.
o Nova KBM d.d. became the preponderant owner of the company and
successfully realized the takeover offer;
o Drago Cotar received the Primus award for the most successful communicator
among managers (awarded by Public Relations Society of Slovenia – PRSS);
o General Meeting was held where they confirmed the proposition of
distributable profit distribution for the year 2010 (8.7 million euros which is
0.70 eur per no-par value stock);
o new marketing campaign for ZM PRIZMA Hibrid life insurance was initiated
with the first real active asset management on a single policy level;
o we co-created the Social Responsibility Network in Slovenia;
o we swiftly and rapidly responded to the needs of insurers due to the hurricane
in Goriško;
o we launched a new platform for the only insurance blog in Slovenia, written by
our employees;
o in order to improve the recognizability of car insurance need we realized a
marketing campaign Watch the road;
o we re-assumed general sponsorship of top skiing event the Golden Fox;
o we remained general sponsor of Folkart at the Lent Festival;
o NK Maribor and ZM as general sponsor of the best Slovenian football club
announced to the public that the club was successful not only in sports but
also financially (all past debts settled);
o we remodeled the ground floor of the central ZM building on Cankarjeva 3 in
Maribor;
o we opened new premises of the Nova Gorica business unit;
o we remodeled the premises of the ZM representative office in Postojna;
o we launched new and upgraded website.
14
COMPANY PROFILE
Zavarovalnica Maribor (hereinafter ZM) is a legal entity with company premises in the
Republic of Slovenia, holding a permit from the Insurance Supervision Agency to perform
insurance operations.
COMPANY'S IDENTITY CARD
Company name:
Short name:
Company headquarters:
Telephone:
+386 2/2332 100
Fax:
+386 2/2332 530
Toll free number for clients:
080 19 20
Registration date:
26 December 1990,
Tax number:
VAT ID
44814631
SI44814631
5063400
65.120 - Insurance other than life insurance
Capital stock:
No. of shares:
EUR 55, 426,291.38
12,453,831
Supervisory organ type:
Supervisory Board
Email address:
Home page:
info@zav-mb.si
www.ZavarovalnicaMaribor.si
15
COMPANY'S DEVELOPMENT STRATEGY
The noble idea that leads our work is to help people in need which is also represented in our
slogan:
LIFE GOES ON WITH ZM BY YOUR SIDE
The company realized the main business goals for 2011 set for this period4. Regardless of
the economic situation and negative economic predictions for 2012 the company set
optimistic goals for the year to come. With an emphasis on setting up a complete risk
management system and exploiting business opportunities the company is supposed to
reach the following goals in the next reporting period:
The main goals of company's business for the business year 2012
4
Comparison between the achieved and planned values of the basic financial categories are closely presented in
the part of the business report where the financial position and the financial results of the company are presented.
16
MAIN ACTIVITIES AND INSURANCE FORMS
ZM underwrites insurances, executes insurance contracts, and also performs other jobs
directly related to the insurance business.
The company is a universal (composite) insurance and offers a wide range of different
insurances in the group of property in life insurance. The company does not underwrite
supplementary health insurance and supplementary pension scheme.
Schematic overview of insurance classes the company underwrites
The company underwrites also supplementary insurances that comprise mostly disability
insurance due to an accident or serious illness, accidental death insurance and injury
insurance.
17
HISTORY AND DEVELOPMENT
The history of ZM goes back to the first half of the nineteenth century. The most important
milestones are:
18
OWNERSHIP STRUCTURE
On the last day of the reporting period the company had 21 shareholders (2010: 29). The two
largest owners increased their share with capital increase, realized in 2011. Nova KBM as
the largest owner of the company increased its share to 50.9963 (2010: 49.96) and
Pozavarovalnica Sava increased its share to 48.6783 (2010: 45.79) percent. Other company
owners participate in equity with 0.3264 percent only meaning they have 40,527 voting
rights. The two largest shareholders have 12,413,304 voting rights.
Ownership structure of the Company on 31.12.2011
Ownership Structure on 31 December 2011
NOVA KBM d.d.
Sava Re d.d.
No of shares
Share in %
6,350,988
6,062,316
50.9963
48.6783
Other domestic legal entities
21,182
0.1701
Domestic natural persons
19,345
0.1563
12,453,831
100
Total
The shareholders exercise their rights according to the legislation at the general meeting.
According to the statute of the company, the meeting is held at least one a year. Each share
provides a shareholder with one vote at the meeting.
Ownership structure on 31 December 2011
During the reporting period, two general meetings were held. At the General Meeting held on
23 May 2011, after discussing the Annual report of the company and the annual report of the
group, the Management and Supervisory Board were discharged for 2010 and Ernst&Young
d.o.o. were named as external auditors. At the same time the General Meeting was
acquainted with the distributable profit of the company for the year 2010 that amounted to
9,004,806 euros. The General Meeting held on 19 September 2011 decided on distributable
profit distribution for 2010 and defined the amount of basic payments, meeting fees and other
income and reimbursement for members of the Supervisory Board and members of the
Supervisory Board Committee5. The distributable profit in the amount of 8,717,682 euros was
assigned to dividend owners (0.70 euros per each no-par value stock).
5
The income of Supervisory Board and Supervisory Board Committee members, received for the reporting
period, is closely defined in the financial report among income of affiliated persons of the company.
19
ORGANIZATIONAL STRUCTURE
The highest organizational body of the company from the hierarchical point of view is the
Management Board. The shared services are divided to sectors and services at the second
level, to business units and divisions within sectors at the third level, and to the business
units divisions, sectors, representative offices and agencies at the fourth level.
From the hierarchical point of view the operations are defined within the key processes that
have their own administrators. The processes are closely defined in the Management
Regulations. The process tasks are an integral part of work division and individual
responsibilities.
The macro-organizational structure of the company can be seen in the company's
organization chart.
Organization Chart
MANAGEMENT
BOARD
Advisor to the Chairman of
the Management board
Advisor of the Management
board
Quality control Manager
Actuary Department
Marketing Sector
Internal Audit Department
Life Insurance Technology
Sector
Technical and General
Affairs Department
Non life Insurance
Technology Sector
General-Legal and Human
Resources Department
Accounting Sector
Public Relations Department
Financial Sector
Reinsurance Department
Information Technology and
Organization Sector
20
THE SALES NETWORK
The company operates and offers its services through the professional services at
company's headquarters, business units, representative offices and agencies which are
spread around the country.
Important partners at insurance services sales are the insurance agents (229 full-time
employees), insurance agencies and natural persons who perform insurance underwriting
activities (279 partners), insurance mediation companies (671 partners), car insurance
underwriting locations (165 partners) and tourist agencies (98 partners).
The Map of Business Units, Representative Offices and Agencies
Company's business with legal entities is performed within two totally different sales
channels: through insurance representation (business referents, representatives, freelancers,
agencies and other representative companies) and through insurance mediation (insurance
agents and insurance mediation companies). Regardless of the sales channel, the sales of
more demanding business insurances form the technical provisions point of view in entirely
in the domain of business referents of individual business units and business insurance
division. The latter operates within the marketing sector. An important share in the business
insurance sales represent the customers that are liable to the Public Procurement Act.
For the company's business with natural persons the insurance agents who look for potential
customers at their home or at the company's headquarters are very important. They can be
either full-time employees, agents in the insurance agencies or freelancers. Each salesman
has his own immediate superior who is in charge of professional qualifications of his
salesmen, who motivates and manages them. They also consult the customers together and
he explains and interprets specific insurance classes.
21
Gross premium by business units
In the area of claims, the contractual relationships with authorized auto repair shop that
perform valuation and hull insurance claim repairs solely through QuickCheck on-line system
(on-line valuation) are of great importance for a fast and quality solving of claims. In 2011,
the company cooperated with authorized repair shops throughout the whole country where
valuation, treatment and payment of claims regarding car damages are performed.
Professional support and claim solving from other property insurance as well as life
insurance are performed by valuation and other professional services in business units,
representative offices and agencies throughout the whole country.
Gross claims by business units
22
BUSINESS PERFORMANCE REPORT FOR 2011
The company operated in an insecure economic environment that was affected by the
increasing economic crisis and culminated market conditions. The operations of business
entities in an environment as presented hereinafter is a challenge and mastering numerous
business risks and taking advantage of business opportunities represents one of the key
competitive factors of business and sustainable development.
BUSINESS ENVIRONMENT AND INSURANCE BUSINESS
The economic crisis that spread across the global economy in 2008 had minor positive
macroeconomic trends but got worse in 2010 again. Almost all indicators of economic
situation in Slovenia point at an unfavorable economic environment. Slovenia remains within
the group of EU Member States where the activity during the crisis decreased the most.
Indicator of economic climate6 in Slovenia from 2000 until 2011
20
© SURS
15
10
ravno težje/ balance
5
0
-5
-10
-15
-20
-25
desezonirani podatki
-30
dolgoletno povprečje
-35
-40
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Source: Statistical Office of RS, February 2012
A drop in household spending was strong, as far as 1.8 percent, and was in the last quarter
of 2011 accompanied by even larger drop of state spending (-2.6 percent). The latter was the
result of measures related to budget savings and withholding of budget spending during the
last months of the previous year. The drop of investments that decreased by more than 40
percent during the crisis was a bit smaller in the last quarter of the reporting period but was
still at 6.9 percent. The changes in stocks provided almost two percentage points to the
growth of gross domestic product in the first three quarters of 2011, but decreased its value
by 1.3 percentage points in the last quarter of 2011.
6
Indicator of economic climate is a measured synthesis indicator. It comprises indicators of trust in processing
industry, retail trade, civil engineering and services, and consumer trust indicator.
23
ECONOMIC ENVIRONMENT 7
Gross domestic product (GDP) being the most spread and acknowledged indicator of
economic state, decreased realistically by 0.2 percent in 2011.
Other national key economic indicators for the reporting period period were:
Inflation, measured by a harmonized index of provisions prices, reached 2.1 percent and
was thus similar to the inflation of the last three years. The provisions prices rose in 2011 in
the euro zone more than in Slovenia. A key reason for price increase was the increase of
fuel prices due to higher oil prices at the beginning of 2011 and food prices at the end of
2010 at the global market. Annual inflation rate in EMU Member States was 2.7 percent
(2010: 2.2 percent) and in EU Member States 3.0 percent (2010: 2.7 percent). Considering
the same key inflation factors as in the euro zone the inflation in Slovenia was slightly lower
mostly due to the influence of weaker economic growth.
In Slovenia, all liquid fuel prices went up by 21.5 percent and on average the price rose most
significantly in the following groups of provisions: real estate by 5.0 percent, and food, drinks
and tobacco by 4.9 percent. On average the prices decreased in the following groups:
communications by 3.3 percent, clothing and shoes by 1.5 percent, recreation and culture by
1.2 percent.
The most characteristic changes for the reporting period are the same as for the previous
reporting period in taxes and excise duty. The excise duty on oil products were changing on
monthly basis, in January the tax rates on motor vehicles changed and some postal services
were exempt from VAT.
The labor market conditions worsened additionally in comparison to 2009 and 2010.
Unemployment grew month by month, in December it increased by 0.2 percentage points
and by the end of the month it amounted to 12.1 percent (2010: 11.8 percent). Number of
active working population decreased by more than 6,000. By the end of the year, 112,754
persons were listed as unemployed.
The average monthly gross salary in 2011 was by 0.2 percent higher than the average
gross salary in the year 2010 and it amounted to 1,524.65 euros. The average monthly net
salary for 2011 amounted to 987.39 euros and increased by 0.3 percent relative to 2010.
Insolvency worsened in 2011. The amount of unsettled liabilities of legal entities was at the
end of the year by more than a half higher relative to the previous period and amounted to
602.3 million euros. Even among sole proprietors and other natural persons that perform a
registered activity the total amount of unsettled liabilities was higher by 5.7 percent and
amounted to 106.1 million euros. One of the measures taken to improve payment discipline
was the introduction of obligatory multilateral offset.
In 2011, the number of initiated judicial compositions in courts increased by 22.9 percent
relative to previous year, the number of receivership proceedings of legal entities by 31.2
percent and the number of civil bankruptcies of sole proprietors by 29.0 percent. In 2011, 43
judicial compositions of legal entities, 588 receivership proceedings and 6 winding up
proceedings were initiated. 89 civil bankruptcies of private natural persons were initiated.
In 2011, the banks additionally decreased bank financing of Slovenian enterprises. The
amount of loans given by domestic banks to domestic non-banking sectors decreased during
the reporting period by almost 800 million euros whereas in 2010 net inflow in the amount of
7
Source: Statistical Office of RS and Institute of Macroeconomic Analysis and Development, February 2012
24
1.1 billion euros was recorded. The offer of banking resources was fairly limited. In 2011 as
well, the Slovenian banks were paying off net due liabilities abroad. In December only, the
latter strengthened their liabilities towards the Eurosystem for almost 900 million euros.
The predictions for 2012 are not favorable. Deterioration of situation internationally,
increased drop of Slovenian economic activity relative to the expected by the end of 2011
and at the same time predicted fiscal consolidation increase the risk in the drop of economic
growth in 2012 also.
Current economic environment and very pessimistic and negative predictions of experts from
this field are not a good travel ration for business entities in the future.
SLOVENIAN INSURANCE MARKET
Insurance market has lately been marked by lower interest rates, internationalization of
financial intervention, wide oscillations on financial markets, tougher competition,
appearance of new dangers and consequently new products and insurance services.
During the last four years, the insurance companies that operate on the Slovenian insurance
market collected increased gross premium in total each year whereas in the reporting period
we recorded a slight drop of it. Total charged gross premium is lower by 1,047 million euros
or 0.05 percent relative to the previous reporting period. In the previous reporting period we
recorded a slight drop of charged gross premium in the group of life insurance; however,
during the reporting period, we again recorded a slight rise. Relative to the previous reporting
period, the insurance companies collected 1.2 percent more gross premium on the Slovenian
market. The growth of the gross premium did not continue in the group of life insurance.
Within this insurance group the insurance companies collected 17,805 million euros less
gross premium. It dropped by 2.7 percent, however, it was still above a five-year average.
Gross premium income of insurance companies at the Slovenian insurance market from
2007 until 2011
In EUR ,000
Property
insurance
Charged gross
premium
2007
2008
2009
2010
2011
1,284,714
1,376,307
1,442,834
1,437,453
1,454,184
Life
insurance
Yearly
Charged gross
premium
premium
growth (in %)
8.4%
609,266
7.1%
642,653
4.8%
630,089
-0.4%
655,865
1.2%
638,060
Total
Yearly
Charged gross
premium
premium
growth (in %)
1,893,980
12.7%
2,018,960
5.5%
2,072,923
-2.0%
2,093,318
4.1%
2,092,244
-2.7%
Yearly
premium
growth (in %)
9.8%
6.6%
2.7%
1.0%
-0.1%
Source: Slovenian Insurance Association, February 2012
Domestic insurance business indicators from 2007 to 2011
2007
2008
Insurance market penetration*
0.0055
0.0054
Insurance density**
0.9454
1.0043
*insurance market penetration = charged gross premium/GDP
**insurance density = charged gross premium/number of citizens
2009
0.0059
1.0232
2010
0.0058
1.0218
2011
0.0059
1.0183
The concentration level on the Slovenian insurance market is quite high. Four insurance
companies, that hold market shares higher than 10 percent, are in command of 70.4 percent
of the insurance market. Zavarovalnica Triglav d.d. is the leading insurance company. After
its second place last year, ZM is this year holding third place among the insurance
companies in the Slovenian insurance market according to the gross premium income (more
information on company’s market share follows in a special chapter later in the document).
25
Slovenian insurance market is among the smaller markets in Europe, whereas the biggest
European insurance market represents the market of Great Britain.
LEGAL FRAME OF INSURANCE ACTIVITIES
Legal frame of insurance operations is defined by the Companies Act, the Code of
Obligations, the International Financial Reporting Standards, Slovene statistic standards and
special legal acts.
Basic specialized system act that covers all issues regarding the status, legal position and
operations of an insurance company is the Insurance Act.
The insurance legislation will go through some major changes in the following years. The
Insurance Act needs to be brought in line with the Directive of the European Parliament and
of the Council (Directive 2009/138/ES) on the taking-up and pursuit of the business of
Insurance and Reinsurance - Solvency II. The Directive and its incorporation into practice
represent one of the main challenges for the European insurance companies in the following
periods.
In 2011, four drafts of a modified Insurance Act were issued. Various working bodies,
organized by the Slovenian Insurance Association, are actively participating at forming of a
new insurance legislation. The company responded to the drafts with some of its own
suggestions and views of the proposed modifications of insurance legislation.
The approaching new Insurance Act, major changes in the field of business risk
management and calculation of capital requirements and completely remodeled International
Financial Reporting Standard that will cover accounting of insurance contracts are the fields
that will influence the operations and reports of the company in the following reporting
periods with their modified regulations and new requirements.
26
COMPANY'S FINANCIAL POSITION AND FINANCIAL RESULTS
The financial position and the financial result of the company in the reporting period are
represented through the financial state account item (balance sheet) and the profit and loss
account item respectively. The values in individual categories represented by the company
indicate that the company successfully managed the tough economic situation and the
pressure of competitive insurance companies.
FINANCIAL POSITION
The company's balance sheet total amounts to 760,989,000 euros (2010: 734,042,000
euros) and has increased by 3.7 percent (2010: 7.8 percent) during the reporting period. The
balance sheet total of the property insurance segment increased during the reporting period
relative to the previous reporting period by 4.7 percent (2010: 8.3 percentage increase). The
balance sheet total of the life insurance segment increased by 2.6 percent (2010: 4.8
percentage increase).
Structural analysis of company's assets
In EUR ,000
ASSETS
Intangible Assets
Tangible Capital Assets
Investment Property
Investments
Assets of the insured persons with unit-linked life
insurance
Sum of technical provisions transferred to reinsurers
Receivables
Other assets
Cash and Cash Equivalents
on 31.12.2011
760,989
6,809
15,245
546
510,596
Share
on 31.12.2010
in %
100.0
734,041
0.9
10,005
2.0
14,143
0.1
655
67.1
482,543
Share
in %
100.0
1.4
1.9
0.1
65.7
107,046
14.1
92,244
12.6
60,428
53,494
6,471
354
7.9
7.0
0.9
0.0
62,863
65,702
5,420
466
8.6
9.0
0.7
0.1
There are some of characteristic trends in the asset growth and structure that depend on
company's operations. The majority of the assets represent financial investments8, of which
value represents as much as 81.2 percent (2010: 78.4 percent) of total asset value.
Financial investments were during the reporting period under the influence of their fair value
decrease and increased by 5.8 percent (2010: 9.1 percentage growth), and investments
financed by the assets of insured persons with unit-linked life insurance increased by 16.05
percent (2010: 28.2 percentage growth). The latter assets are influenced by the trends of
investment fund values, selected by the insured persons. Investment properties have the
same share as in the previous reporting period (0.1 percent of all company assets) and are a
marginal item of financial investments. The company does invest in this item anymore.
In the reporting period the share of assets that represents the share of co- and reinsurers in
technical provisions decreased. The share of those assets relative to total company assets
amounts to 7.9 percent (2010: 8.6 percent).
Receivables decreased by 18.6 percent (2010: -5.6 percent). The amount of receivables
from insurance business represents 6.8 percent (2010: 8.8 percent) of total company assets.
Lower receivables are mostly a result of lower sums of receivables towards reinsurers due to
lower claims. The sum of latter claims is on the last reporting period day relative to the
8
Financial investments = investment property + investment into affiliated companies + financial
investment + assets of the insured persons assuming the investment risk
27
previous reporting period lower by 47.7 percent. The active recovery and successful
electronic executions that include far more lower amounts than in previous years softened
the effects of the financial crisis and lack of payment discipline at the market during the
reporting period. Careful segmentation of clients also has an effect on receivables and due
receivables of property insured persons was at the end of 2011 even lower by 6.8 percent
relative to the previous year but higher by 4.9 percent relative to the end of the year 2009.
Among the defaulted obligors there practically aren't any construction companies left as most
of them are under receivership, however, lack of payment discipline is spreading to all
industries. In 2011, there is 1,188,000 euros more of new receivables arising from
bankruptcies which are impaired immediately in total.
The value of intangible assets of the company is lower by 31.9 percent. The reason is in the
decrease of deferred expenses of life insurance acquisition, stated among the intangible
assets. During the reporting period, their value decreased by 33.8 percent (2010: -16.0
percent). On the last day of the reporting period, the balance sheet value of deferred
expenses of life insurance acquisition amounts to 6,344,000 euros (2010: 9,579,000 euros).
Other asset categories (cash and cash equivalents, other assets, other receivables and
active accruals) kept similar par value.
Structural analysis of company's assets
In EUR ,000
Equity
Subordinate liabilities
Technical provisions - unit-linked life insurance
Other reservations
Deferred tax liabilities
Business liabilities
Other liabilities
EQUITY AND LIABILITY
on
31.12.2011
87,540
7,000
520,422
101,806
4,851
0
23,322
16,048
760,989
Share
in %
11.5
0.9
68.4
13.4
0.6
0.0
3.1
2.1
100.0
on
31.12.2010
77,867
7,000
500,631
89,803
4,290
2,077
36,770
15,603
734,041
Share
in %
10.6
1.0
68.2
12.2
0.6
0.3
5.0
2.1
100.0
During the reporting period the company increased its equity by 12.4 percent. The equity
increase rose from positive company operations and capital increase during the reporting
period.
In accordance with the Insurance Act the company increased its equalization provisions for
loan insurances in its financial statement by 615,000 euros (2010: 860,000 euros). In
accordance with legislation the source of increased net income is treated as net gain of the
financial year and the increase of provisions is recognized through the statement of changes
in capital. The company also increased its legal reserve by 2,560,000 euros (2010:
4,883,000 euros) which have to amount to 20 percent of the company’s share capital.
On the last day of the reporting period the company accounted 520,422,000 euros of
technical provisions on property and classical life insurances (2010: 500,631,000 euros).
Through the provisions the company assures long-term security of the insured persons. Their
extent increased by 3.95 percent (2010: 2.4 percent) relative to the previous period. In the
property insurance group the technical provisions increased by 6.8 percent, and in the life
insurance group by 1 percentage point. The technical provisions for unit-linked life insurance
risk increased by 13.4 percent and amount to 101,806,000 euros (2010: 89,803,000 euros).
28
Technical provisions reached 68.4 percent of the company’s sources which is slightly lower
relative to the previous year (68.2 percent). Technical provisions from unit-linked life
insurance are increasing their share in the company sources. Their share for the reporting
period represents 13.4 percent and has increased during the reporting period by 1.2
percentage points.
With the calculation of technical provisions, the company uses proven methods that assure
meeting the long term liabilities towards the insured persons and their short term benefits
even when the company had to pay more than 10 million euro amounts in a short period of
time due to catastrophe losses.
Horizontal structure of assets* and their sources* on 31 Dec 2011
*in euro 000.000
Other business liabilities are lower by 36.6 percent. The decrease rises from the reinsurance
business liabilities which are lower by 48.0 percent. The share of business liabilities in
sources is merely 3.6 percent (2010: 5.0 percent).
The financial status within the group of property insurance depends mostly on claims reserve
and such provision depends on oscillation of loss occurrences. Claims reserve has increased
by 9.7 percent (2010: 8.1 percent) during the reporting period.
In the field of life insurance, the financial status largely depends on mathematical reserves,
including the ascribed realized gain of classic life insurance. The mathematical reserves of
classic life insurances increased by 2.4 percent (2010: 1.1 percent) during the reporting
period. The increase was influenced also by long term liabilities arising from mathematical
reserves from LAT test (Liability adequacy testing). According to the current market interest
rates, the minimum assured policy yield and realized operating expenses, the establishment
of provision adequacy for meeting the liabilities of insurance contracts for classic life
insurances at their arrival showed a potential deficiency in the sum of 9,701,000 euros (2010:
3,338,000 euros) at the common balance value of the mathematical reserves of 232,405,000
euros. Balance item of mathematical reserve for classic life insurance includes the amount of
revaluation reserve that would in case of realization at the financial market go to the insured
persons in form of profit attribution. The latter item was under strong influence of financial
market situation and decreased by 79.9 percent during the reporting period.
29
Mathematical reserves of unit-linked life insurance follow the trends of mutual fund
movements into which the insured persons invest their paid-in premiums and the company
influences the insured persons only by the fund selection and creation of products offered to
the them. The latter increased by 13.2 percent during the reporting period which is a slightly
slower growth relative to the previous years (2010: 25.9 percent, 2009: 50.3 percent).
The company realized most of the planned items in the reporting period. The table shows the
comparison of basic company's financial status items with planned amounts.
Basic categories of company's financial status items
In EUR ,000
ASSETS
on
31 December 2011
PLAN 2011
on
31 December 2010
Index
/2010
index/PLA
N
760,989
100%
809,861
100%
734,041
100%
103.7
94.0
6,809
0.9%
13,775
1.7%
10,005
1.4%
68.1
49.4
15,245
2.0%
15,130
1.9%
14,143
1.9%
107.8
100.8
0
0.0%
64
0.0%
59
0.0%
0.0
0.0
Deferred tax receivables
687
0.1%
0
0.0%
0
0.0%
-
-
Investment Property
546
0.1%
615
0.1%
655
0.1%
83.4
88.8
Fin. investments in group
companies
190
0.0%
70
0.0%
240
0.0%
79.2
271.4
510,406
67.1%
533,750
65.9%
482,303
65.7%
105.8
95.6
107,046
14.1%
100,270
12.4%
92,244
12.6%
115.7
106.4
60,428
7.9%
70,318
8.7%
62,863
8.6%
96.1
85.9
Receivables
53,494
7.0%
69,706
8.6%
65,702
9.0%
81.4
76.7
Other assets
5,784
0.8%
5,494
0.7%
5361
0.7%
107.9
105.3
354
0.0 %
669
0.1%
466
0.1%
146.6
102.1
760,989
100%
809,861
100%
734,041
100%
103.7
94.0
87,540
11.5%
103,546
12.8%
77,867
10.6%
112.4
84.5
7,000
0.9%
7,000
0.9%
7,000
0.9%
100.0
100.0
520,422
68.4%
535,073
66.1%
500,631
68.2%
104.0
97.3
Technical provisions of the
insured persons with unit-linked
life insurance
101,806
13.4%
105,750
13.1%
89,803
12.2%
113.4
96.3
4,851
0.6%
4,721
0.6%
4,290
0.6%
113.1
102.8
0
0.0%
2,781
0.3%
2,077
0.3%
0.0
0.0
23,322
3.1%
38,189
4.7%
36,770
5.0%
63.4
61.1
Other liabilities
16,048
2.1%
12,801
1.6%
15,603
2.1%
102.9
125.4
Intangible Assets
Non-current assets
for sale
Investments
Assets of the insured persons
with unit-linked life insurance
Sum of technical provisions
transferred to reinsurers
Equity
Other reservations
In the off-balance sheet record, the company states items of unclaimed recourse claims and
items of provided guarantees and warranties within call for tenders (more details on items
are available in the financial report).
30
INVESTMENTS
The company invests assets arising from technical provisions in a way that it entirely
considers all legislative limitations and forms intern limits for investments into individual
investments classes. The assets of unit-linked life insurance are invested into mutual funds
and financial instruments in accordance with a selection done by the insured persons
because with this kind of insurance the insured persons are the ones that assume the
investment risk. The assets of life insurance business fund, investment property long-term
business fund and assets invested into ZM Zajamčeni fund are invested in accordance with
legislation and regulations.
Financial investments9 include own fund investments in the financial statement. Own fund
investments represent 2.3 percent of all financial investments (2010: 1.5 percent).
Structure and value of financial investments on 31 Dec 2011
2011
17
02
Own funds
Long-term business
fund
43
38
Business funds of
classic life insurance
Business funds of unitlinked life insurance
Structure and value of financial investments on 31 Dec 2010
2010
16
01
Own funds
Long-term business
fund
48
35
Business funds of
Business funds of unitlinked life insurance
9
Financial investments represent financial investments including assets of the insured persons
assuming the investment risk, investment property and investment into affiliated companies.
31
Long-term business fund investments10
In 2011, the company again invested a large share—48.5 percent—of all property insurance
business fund assets into government bonds. We invested 23.0 percent of all assets into
non-government bonds. Investment share into bank deposits reached 25.5 percent of all
invested assets.
The structure of long-term business fund investments – 31 Dec 2011
2011
23
03
Securities of RS, BS
and abroad
Deposits with banks
25
Debt securities
49
Other investments
Classic life insurance business fund11 investments
In 2011, the government debt securities again presented an important share in the
investment structure of the long-term business fund of classic life insurance. The portfolio
includes debenture bonds issued by the countries with high rating. Such investments
reached a share of 58.6 percent of all invested assets in total portfolio. We invested 23.5
percent of all assets into non-government bonds. Assets invested into bank deposits have
reached 12.2 percent of total invested assets.
The structure of classic life insurance long-term business fund investments – 31 Dec 2011
Securities of RS, BS
and abroad
24
06
12
Real estate
Deposits with banks
00
Debt securities
59
Equity shares
10
Long-term business fund represents the assets of a company assigned for covering of future
property insurance liabilities, with reference to which the company forms technical provisions.
11
Business fund is a long-term business fund intended for covering future life insurance liabilities.
32
Unit-linked life insurance business fund investments
Unit-linked life insurance business fund investments comprise investments of three business
funds. Their share in total value of life insurance investments in presented in the table below.
In euros
Prizma
2011
In %
2010
In %
101,716,524
95.00%
90,410,988
98.00%
4,524,279
4.20%
1,832,868
2.00%
Hibrid
804,737
0.80%
0
0.00%
Total
107,045,540
100.00%
92,243,852
100.00%
ZM Zajamčeni
In 81.7 percent, the unit-linked life insurance business fund investments present investments
into mutual funds directed by the insured persons through their selection of investment
policy, enabled by the insurance conditions.
FINANCIAL RESULTS
The company ended the reporting period with positive results. The company achieved a
positive business result in the area of property insurance with net profit and loss account of
8,936,000 euros (2010: 6,411,000 euros) as well as in the area of life insurance with net
profit and loss account of 1,621,000 euros (2010: 4,184,000 euros).
The result from insurance operations of the company amounts to 17,308,000 euros (2010:
15,264,000 euros) and is 11.6 percent higher than the planned results. Other revenue and
expenditure lower the result by 2,669,000 euros (2010: 1,038,000 euros). The consequence
of successful operations is also reflected in the corporate income tax payment. According to
the 28.1 percent effective tax rate (2010: 27.1) the liability of corporate income tax payment
was higher than anticipated and amounts to 4,082,000 euros (2010: 3,631,000 euros).
33
Basic categories of company's financial result
In euros
Insurance premium net income earned premium
01 Jan - 31 Dec 2011
Plan
2011
01.01 - 31 Dec 2010
Index
Index
to
to 2010
Plan
210,302,087
217,255,343
205,300,510
102.4
96.8
263,561,785
272,955,050
259,865,597
101.4
96.6
-52,223,711
-52,514,056
-55,528,052
94.0
99.4
-9,655
-2,250,556
3,245,089
-0.3
0.4
-1,026,332
-935,095
-2,282,124
45.0
109.8
18,671,153
19,618,011
22,985,715
81.2
95.2
1,125,834
1,023,257
989,522
113.8
110.0
Net Claims Charges
129,903,266
139,710,882
130,915,985
99.2
93.0
1 Net claim amount
107,566,611
127,123,894
115,072,673
93.5
84.6
134,642,010
166,121,128
147,004,755
91.6
81.1
1.2 co- and reinsurer shares
-27,075,399
-38,997,234
-31,932,082
84.8
69.4
2 Modification of claims reserves
22,336,654
12,586,987
15,843,313
141.0
177.5
20,739,735
15,000,730
14,801,753
140.1
138.3
1,596,919
-2,413,743
1,041,560
153.3
-66.2
16,915,232
17,827,182
19,611,018
86.3
94.9
16,915,232
17,827,182
19,611,018
86.3
94.9
11,351
300,000
60,051
18.9
3.8
63,678,007
62,070,762
60,984,053
104.4
102.6
25,226,106
23,893,023
23,752,845
106.2
105.6
2,965,618
0
0
-
-
48,459,468
48,342,617
48,460,495
100.0
100.2
-10,007,568
-10,164,878
-11,229,287
89.1
98.5
2,282,720
2,480,363
2,440,927
93.5
92.0
17,308,498
15,507,422
15,263,711
113.4
111.6
Other operations revenue
3,862,476
2,244,273
5,178,538
74.6
172.1
Other operations charges
6,531,803
5,233,956
6,216,404
105.1
124.8
14,639,171
12,517,739
14,225,845
102.9
116.9
4,082,096
3,195,758
3,630,515
112.4
127.7
10,557,075
9,321,980
10,595,331
99.6
113.2
1 Charged gross premium
2 Charged premium given in coinsurance and reinsurance
3 Modification of unearned premium
reserves
4 Modification of unearned premium
reserve for the share given in co- and
reinsurance
Investment income/charges
Other Insurance Income
1.1. Charged gross amount of
claims
2.1 Change in gross claims
reserve
2.2 modification of claims reserve
for co- and reinsurance share
Modification of Other Technical
Reservations*
1 Modification of other gross
technical provisions
Bonus and Commission Charges
Operating Costs
1 Acquisition costs
1.1 out of which modification of
deferred expense of obtaining
insurance
2. General operating costs
3 Reinsurance commission and profit
participation
Other Technical Charges
Insurance operations account
Profit and loss account prior to
taxation
Revenue tax and deferred taxes
Net income
*the modification includes the modification of liability towards the insured persons with unit-linked life insurance
During the reporting period the company made together with the received co-insurance
263,562,000 euros of gross insurance premium (2010: 259,866,000 euros). Relative to the
previous reporting period the gross premium is higher by 1.4 percent.
34
During the reporting period the company charged together with the received co-insurance
claims 134,642,000 euros (2010: 147,005,000 euros) of gross claims. Gross claims were
relative to the previous reporting period lower by 8.4 percent. The result reflects a favorable
claims situation that marked the previous reporting period also. During both years, we did not
record any larger disaster claims that distinctly marked claims situation in 2009 and 2008.
Investment income shows the effects of additional asset income from capital increase that
positively influence the financial results. Profit or loss, recognized in an comprehensive
income, show an significant drop in price of securities from company's portfolio.
The comprehensive income of the business year that includes all nett profit or loss from
repeated calculation of financial assets available for sale amounts to 5,590,000 euros (2010:
10,554,000 euros). Relative to the previous reporting period the second comprehensive
income lowers the nett profit of the business year by 4,967,000 euros while in the previous
reporting period it lowered it by 42,000 euros.
The structure of
premium in 2011
the
charged
gross
The structure of the charged gross claims
in 2011
35
Financial results by insurance classes
Profit and loss account realized in the accounting period by each insurance class is
presented in the table below.
REVENUE
INSURANCE CLASS
In euros
CHARGES
from INSURANCE
OPERATIONS
1
2
FORMATION
OF
TECHNICAL
PROVISIONS
OPERATING
EXPENSES
OTHER
REVENUE/
CHARGES
TOTAL
GROSS
PROFIT
INS. CLASS
3
4
5
6
Accident insurance
16,771,130
6,817,874
-3,552
6,162,940
-402,506
3,391,362
Hull insurance of road vehicles
44,195,304
29,140,267
-532,356
12,766,159
-1,222,327
1,598,906
37,116
340,119
5,744
49,279
25,139
-332,888
292,792
383,126
68,538
3,697
-232,531
1,180,066
-207,577
7,235
887,188
9,799
503,019
6,386,313
2,914,070
-219,392
3,351,289
-131,729
208,617
21,595,131
11,477,052
-168,840
10,219,840
-543,451
-476,372
54,883,633
31,034,424
68,018
12,744,570
-1,011,187
10,025,433
-89,483
397
0
41,958
-7,787
-139,625
183,594
35,881
0
51,865
-1,397
94,451
Other liability insurance
6,825,575
8,606,849
84,943
1,386,082
-275,348
-3,527,646
Credit insurance
2,249,486
734,584
818,919
919,768
545,681
321,896
63,881
-51,033
-45,303
9,163
5,115
156,169
746,747
220,775
8,691
412,061
-24,792
80,427
-253,294
1,859
0
246,052
-2,144
-503,349
1,393,956
4,816
0
488,930
-31,978
868,232
156,461,947
91,453,483
92,645
49,814,500
-3,065,215
12,036,101
Life insurance
44,943,234
32,630,535
5,430,034
6,637,857
406,969
651,777
Unit-linked life insurance
44,224,286
13,500,452
11,403,902
17,233,217
-135,422
1,951,292
Life insurance
89,167,520
46,130,987
16,833,936
23,871,074
271,547
2,603 070
245,629,467
137,584,470
16,926,581
73,685,574
-2,793,668
14,639,171
motor insurance for airplanes
and other aircrafts
Motor insurance for sea,
river and lake
Cargo and transport insurance
Fire and
special perils insurance, etc
Other property
insurance
Land motor vehicle owners thirdparty
liability insurance
Aircraft
liability insurance
Marine
liability insurance
Suretyship insurance
Pecuniary
insurance
Legal expenses insurance
Assistance
to people in need
Property insurance
TOTAL
77,356
36
MARKET SHARE
The company recorded an increase of market share in the reporting period. It raised from
12.4 percent in 2010 to 12.6 percent. The market share of the company, calculated based on
gross premium, puts the company third on the Slovene insurance market.
The market share in the area of property insurance amounts to 12.9 percent (2010: 13.1
percent) and in the area of life insurance to 11.8 percent (2010: 10.9 percent).
Market share trends from 2007 to 2011
Source: Slovenian Insurance Association
Market share of insurance companies on the Slovene insurance market on 31 Dec 2011
Source: Slovenian Insurance Association, February 2011
37
OUTLINE OF THE MORE IMPORTANT INSURANCE CLASSES
The company acts as a composite insurance company and offers a wide range of different
insurances. Basically, the insurances are divided into property and life insurance.
Shares of each insurance class in gross
premium of property insurance
claims of property insurance
premium of life insurance
claims of life insurance
38
NON LIFE INSURANCE
In 2011, in the area of property insurance the company offered most of the insurance classes
from this group. The company does not take on risks that arise from insurance written in
insurance classes of health insurance, rail vehicle insurance and aircraft and marine liability
insurance.
Below are represented all insurance classes in which the company collected 87.6 percent of
gross premium and that in the structure of written gross claims represent 91.8 percent share.
Accident insurance (including workers compensation)
The accident insurance is according to legislation classified as property insurance, however,
it is generally classified as personal insurance. In case of death or heath problems the
accident insurance covers financial expenses, damages or expense returned in lump-sum
payment, installment payment of agreed compensation, or proceeds due to an injury,
damage to health or passenger death.
In euros
Charged gross
insurance premium
Charged gross
losses
2011
18,910,636
6,741,320
2010
18,754,966
100.8
Index 2011/2010
Gross loss ratio
Number
of insurances
36
422,239
7,006,049
37
425,156
96.2
95.4
99.3
Accident insurance represents according to the gross premium income, 10.1 percent of the
property insurance gross premium. An important share in the insurance class are subclasses
of car drivers and owners personal accident insurance with 49.3 percent and accident
insurance of people performing their regular job and beyond with 41.4 percent in gross
premium.
The gross premium income within the accident line of business amounts to 18.9 million euros
which is 155,700 euros or 0.8 percent more relative to the previous reporting period.
The charged gross claims within the accident line of business amount to 6.7 million euros
which is 264,700 euros or 3.8 percent less relative to the previous reporting period.
Gross loss ratio in 2011 is 35.7 percent and is lower than in the previous reporting period.
Land motor vehicles insurance
Land motor vehicles insurance covers all claims or losses of land motor vehicles with selfpropulsion (except rail vehicles).
In euros
Charged gross
insurance premium
Charged gross
losses
Gross loss ratio
Number
of insurances
2011
52,563,552
35,781,633
68
176,997
2010
54,261,520
40,198,747
74
170,031
96.9
89.0
91.9
104.1
Index 2011/2010
39
Land motor vehicles insurance represents according to the gross premium income, 28.0
percent of the property insurance gross premium. The insurance is underwritten only within
the subgroup of land motor vehicles with self-propulsion (except rail vehicles) within the
motor insurance subgroup.
The gross premium income within the land motor vehicles insurance class amounts to 52.6
million euros which is by 1.7 million euros or 3.1 percent less relative to the previous
reporting period.
The charged gross claims within the land motor vehicles insurance class amount to 35.8
million euros which is by 4.4 million euros or 11.0 percent less relative to the previous
reporting period.
Fire and other damage
Fire and other damage covers property damages caused by fire, explosion, storm, and other
natural occurrences, except storms, nuclear energy, land immersion and slide.
In euros
Charged gross
insurance premium
Charged gross
losses
2011
11,900,673
7,606,876
2010
11,342,916
104.9
Index 2011/2010
Gross loss ratio
Number of
insurances
64
26,385
6,204,362
55
31,886
122.6
116.9
82.7
Fire and other damage represents 6.3 percent of gross premium within the property
insurance structure. Within this line of business the subclasses of fire insurance and
insurance of some other dangers outside industry and trade as well as within industry and
trade play an important role as they represent 91.9 percent of gross premium. Within this line
of business the Electricity supply company fire insurances are also underwritten.
The gross premium income within the Fire and other damage insurance class amounts to
11.9 million euros which is by 557,000 euros or 4.9 percent more relative to the previous
reporting period.
The charged gross claims within the Fire and other damage insurance class amount to 7.6
million euros which is by 1.4 million euros or 22.6 percent more relative to the previous
reporting period.
Gross loss ratio in 2011 is 63.9 percent and is higher than in the previous reporting period.
Other indemnity insurance
Other indemnity insurance covers property claims for damages resulting from hail, frost or
other reasons.
40
In euros
Charged gross
insurance premium
Charged
gross losses
Gross loss ratio
Number
of insurances
2011
27,857,161
14,509,852
52
244,903
2010
27,330,718
16,581,524
61
239,915
101.9
87.5
85.9
102.1
Index 2011/2010
Other indemnity insurance represents according to the gross premium income, 14.8 percent
of the property insurance gross premium. We underwrite insurance in every subclass except
the danger insurance in the post and telephone traffic, tourist insurance, insurance of movie
production and mine insurance. Within this line of business the household insurance
represents the largest share with 46.4 percent of its gross premium.
The gross premium income within Other indemnity insurance class amounts to 27.9 million
euros which is 526,400 euros or 1.9 percent more relative to the previous reporting period.
The charged gross claims within Other indemnity insurance class amount to 14.5 million
euros which is by 2.1 million euros or 12.5 percent less relative to the previous reporting
period.
Liability insurance for motor vehicles
Liability insurance for motor vehicles covers all liabilities arising from the use of land motor
vehicles with self-propulsion (including the transport liability). The liability insurance is an
important insurance as it offers certain security to participants in traffic.
In euros
Charged gross
insurance premium
Charged gross
losses
Gross loss ratio
Number
of insurances
2011
59,858,525
28,932,653
48
462,154
2010
61,371,097
32,235,477
53
443,536
97.5
89.8
92.0
104.2
Index 2011/2010
Liability insurance for motor vehicles represents according to the gross premium income,
31.9 percent of the property insurance gross premium. The majority of the gross premium, as
much as 98.9 percent, is collected within the land motor vehicle owners third-party liability
insurance subclass.
The gross premium income within the Liability insurance for motor vehicles class amounts to
59.9 million euros which is by 1.5 million euros or 2.5 percent less relative to the previous
reporting period.
The charged gross claims within the Liability insurance for motor vehicles class amount to
28.9 million euros which is by 3.3 million euros or 10.2 percent less relative to the previous
reporting period.
41
General liability insurance
General liability insurance is an insurance that covers all other liabilities other than motor
vehicle liability.
In euros
Charged gross
insurance premium
Charged gross
losses
2011
7,371,138
4,606,553
2010
6,615,756
111.4
Index 2011/2010
Number of
insurances
Gross loss ratio
62
10,680
4,458,147
67
10,666
103.3
92.7
100.1
General liability insurance represents according to the gross premium income, 3.9 percent of
the property insurance gross premium. The most represented subclass of insurance is the
general liability insurance, representing 72.7 percent of this insurance class portfolio. The
general liability insurance class comprises 25 subclasses of insurance. In our insurance
company we underwrite 16 subclasses of insurance.
The gross premium income within the general liability insurance class amounts to 7.4 million
euros which is 755,400 euros or 11.4 percent more relative to the previous reporting period.
The charged gross claims within the general liability insurance class amount to 4.6 million
euros which is by 148,000 euros or 3.3 percent more relative to the previous reporting
period.
Credit insurance
Credit insurance covers the risk of default (or payment delays) due to insolvency or other
reasons (acts or facts), export credits and other risks in connection with export, trade and
investments in foreign and domestic markets, credits with installment payments, mortgage
and collateral loans, agricultural credits and other credits and loans.
In euros
Charged gross insurance
premium
Charged gross
losses
Gross loss
ratio
Number of
insurances
2011
1,909,483
1,903,881
100
40,658
2010
1,986,544
2,368,655
119
43,568
96.1
80.4
83.6
93.3
Index 2011/2010
Credit insurance represents 1.0 percent of the property insurance gross premium. The most
represented subclass of insurance is the consumer credit subclass, representing 92.3
percent of this insurance class portfolio.
The gross premium income within the Credit insurance class amounts to 1.9 million euros
which is 77,100 euros or 3.9 percent less relative to the previous reporting period.
The charged gross claims within Credit insurance class amount to 1.9 million euros which is
by 464,800 euros or 19.6 percent less relative to the previous reporting period.
42
Assistance
Assistance covers assistance for people having trouble either on their travels or in other
cases of absence from their home or permanent residence. This line of business has been
intensely developing during the last few years.
In euros
Charged gross
insurance premium
Charged gross
losses
Number
of insurances
Gross loss ratio
2011
3,073,064
797,985
26
245,886
2010
2,527,106
658,529
26
245,164
121.6
121.2
99.6
100.3
Index 2011/2010
Assistance represents 1.6 percent of the property insurance gross premium.
The gross premium income within the Assistance class amounts to 3.1 million euros which is
546,000 euros or 1.6 percent more relative to the previous reporting period.
The charged gross claims within the Assistance class amount to 798,000 euros which is by
139,500 euros or 21.2 percent more relative to the previous reporting period.
LIFE INSURANCE GROUP
In ZM we underwrite life insurance within two classes of insurance. We underwrite classic life
insurance and unit-linked life insurance.
Life insurance represents 28.6 percent of the portfolio structure.
Classic life insurance
Classic life insurance is an insurance and saving with the possibility of annuity payment of
the saved assets. Classic life insurance offers security to close family in case of death,
payment of sum insured in case of an accident, in case of serious illness, in case of
accidental death of the insured persons in a road accident, temporary coverage prior to
insurance, a bonus for each newborn child. The sum insured with added profit can be paid
out either at once or as annuity insurance.
In euros
Charged gross
insurance premium
Charged gross
losses
Gross
loss ratio
Number
of
insurances
Number of the
insured persons
2011
31,881,501
27,001,166
85
7,575
7,779
2010
33,072,748
31,368,816
95
7,497
7,777
96.4
86.1
89.3
101.0
100.0
Index 2011/2010
Classic life insurance represents 42.3 percent of the life insurance gross premium.
The gross premium income within the Classic life insurance class amounts to 31.9 million
euros which is by 1.2 million euros or 3.6 percent less relative to the previous reporting
period.
The charged gross claims within Classic life insurance class amount to 27.0 million euros
which is by 4.4 million euros or 13.9 percent less relative to the previous reporting period.
43
Unit-linked life insurance is a form of life insurance where a company invests the saving
premium component into investment funds. The unit-linked life insurance thus offers
insurance in case of death as well as savings and enrichment of means in mutual funds
selected by the insured persons themselves.
Charged gross
insurance
premium
In euros
2011
2010
Index 2011/2010
43,523,321
38,236,216
113.8
Charged
gross losses
10,490,431
8,789,550
119.4
Gross loss
ratio
Number
of insurances
24
23
104.9
Number of the
insured
persons
29,611
38,597
76.7
29,611
38,597
76.7
Unit-linked life insurance represents 57.7 percent of the life insurance gross premium.
The gross premium income within the Unit-linked life insurance class amounts to 43.5 million
euros which is by 5.3 million euros or 13.8 percent more relative to the previous reporting
period.
The charged gross claims within the Unit-linked life insurance class amount to 10.5 million
euros which is by 1.7 million euros or 19.4 percent more relative to the previous reporting
period.
INFORMATION TECHNOLOGY AND ITS DEVELOPMENT
During the reporting period the company achieved the following in the area of information
technology:
Information Support of the Insurance Process:
o We updated and additionally automatized procedures for managing claims,
o
o
o
o
o
o
o
o
payments, debit notes, settlement and liquidation of due insurance coverages and we
set up a template and basis for similar future processes.
We accomplished an integration of back office operations with customer management
system.
We provided IT support for all new insurance products and added functionalities of
monitoring product in time (settlement of mathematical reserves, link to the fund unit
value, withdrawal from the agreement prior to maturity date).
We increased the extent of the support when preparing monthly accounting
statements and when preparing data for consolidated reporting.
We updated the functionalities regarding customer correspondence.
We supported documentation e-archiving procedures.
We updated and adjusted the back office operations with front software support
WinZmp.
We improved and added functionalities for preparing insurance agreements in
business sector (archiving, support with templates).
We provided IT support for reinsurance entry process.
44
Information Support of Claims
Concluded support of electronic claims/insurance case together with immediate archiving
and prepared basis for work technology transfer from car insurance to other areas:
o Additional support for the integration of the back office claims operations with external
o
o
o
o
partners
(car workshops, Eurotax).
Set up basis for future complete support of procedures that accompany basic claims
process (investigation, censors, complaint commission, lawsuits).
Integration of recourse recovery with electronic recovery service.
Updated claims and payment management procedures.
Integration with call center.
Business Intelligence (BI) Area:
o We realized activities that will in the years to come enable total renovation of the
whole system and improvement of IT support quality regarding decision-making
processes for each area.
o In the area of infrastructure, we set up a new server, MOLAP platform and new
environment for Microstrategy reporting.
o In the area of reports and analyses we renovated existing reports and prepared a
number of new ones that serve as basis for important business decisions and actuary
calculations.
o We prepared a number of applications for individual business processes and
successfully integrated letter automation by work area, we created a new inclusive
consolidated financial card, we introduced compensation debt diary, provided support
for monthly statement creation, upgraded the register of agents, cooperated with
operations of the "Lojalnostni program" (Loyalty Program) and "Elektronski
skadencar" (Electronic Maturity Notifier).
o We increased the extent of the support when preparing monthly statements and when
preparing data for consolidated reporting.
o We successfully finished consolidation of the complete register of persons.
Telecommunications Infrastructure Area:
o We renovated the data security system.
o We introduced IP telephony in all business units.
o We set up a central system for receiving electronic faxes in two largest organization
units.
o We introduced a tool for improving management of computers in the company's
network.
o We updated and upgraded network connections and increased security rate
regarding intrusions.
Business Process Management Support Area:
In the area of business process support we worked together with all regional units on
improvement of business process operations and in accordance with improvements we
prepared all the necessary documentation, system instructions and work procedures. We
participated in preparation of internal regulations and business process definition in the area
of scanned documentation, management of life insurance portfolio, we modernized complete
documentation according to ZVOP (Personal Data Protection Act) and participated in
renovation of company's organizational structure.
Project Work Area:
We continued with the introduction of project work into the company and improved work
methods of project management. We put even more emphasis on working with members of
45
project groups and project managers and on use of organizational support for project
management and monitoring (MS Project, Project Web Access). We intensely participated at
the Solvency II project.
INVESTMENTS
The total realized value of investments in the reporting period amounts to 3,510,047 euros
(2010: 4,159,571 euros). Investments were financed from the capital assets amortization
charge and from short-term business assets.
The company invested most of its assets into real estate (1,776,308 euros) and equipment
(1,573,677 euros). In equipment, most of the assets were invested into computer equipment
(815,431) and in modernization of the vehicle fleet (458,658 euros).
Investments into Business Premises in 2011
The company invested most of its assets into purchase of land for building a claims center in
Maribor. Due to necessary changes of spatial plan of Municipality Maribor in this ares that
will take place within one year, the project documentation and all other necessary activities
for construction start will be realized at the end of first half-year in 2013.
For larger and smaller maintenance investments (rearrangement, renovation) 424,000 euros
were spent. Most assets were invested into the renovation of ground floor of the central
business premises in Maribor. Numerous maintenance investments were also made on other
locations all over Slovenia: business building in Novo mesto, business building in Ljubljana,
valuation points in Ptuj, renovation of Postojna Agency premises and smaller rented
business premises in Šoštanj, in Velenje (valuation point), in Benedikt, in Šmartno na
Pohorju and in Ajdovščina.
Investments into Hardware and Software in 2011
In the area of hardware and software investments, the company realized 73.8 percent of
planned investments. Investments into hardware and software and licenses amounted to
156,000 euros. The company follows the technical and technological requirements regarding
the purchase and update of hardware for individual positions. Server hardware was
purchased in an extent larger than planned.
Other Investments
In the area of other investments the company invested 191,000 euros into furniture. Most of
the furniture was purchased for offices where various minor construction and maintenance
work was performed. Many pieces of furniture were replaced due to decrepitude and being
outdated, which required elimination of such equipment and its possible sale or destruction.
The purchase of technical equipment was made according to requirements of individual
regional and business units, which met the accepted plans of investments the most, and
some purchases were unplanned but necessary. With classes and types of technical
equipment, new achievements in technical and technological field were considered.
46
INTERNAL AUDIT FUNCTION
According to the Insurance Act, ZM has an internal audit service, organized
independently from other sectors and subordinate directly to the Management Board.
Internal audit acts as an independent, neutral and consulting service with systematic and
professional approach to assessing risk management, controlling and business
management.
The key internal audit task is to provide the management board with an unbiased
assurance regarding the risk management efficiency and with an evaluation whether the
key risks are properly managed and whether the internal audit system is efficient. With
realization of independent and unbiased auditing and consulting services it supports the
Management Board at protecting property and improving quality and efficiency of
internal control system. With continuous surveillance and monitoring it checks whether
Zavarovalnica Maribor performs the insurance operations in accordance with Insurance
Act and its related regulations and by internal rules of company operations.
The service functions in accordance with International Standards For The Professional
Practice Of Internal Auditing, Insurance Act, Code Of Ethics Of The Internal Auditor,
Code of Internal Auditing Rules of Conduct and Constitution with rules on Internal
Auditing Service operations within ZM, for which the company acquired in 2009 a
positive external assessment on the quality operations in accordance with internal
auditing rules, adopted by the Institute of Internal Auditors with headquarters in USA and
the Slovenian Institute of Auditors. The internal auditing service renews the external
auditing compliance every five years.
At the end of 2011, the Internal Auditing Service employed 5 auditors that performed
auditing reviews in all key areas of the insurance company from the risk management
assessment point of view in 2011. The company operations in 2011 went according to
the yearly work program confirmed by the Management Board and in compliance with
the Supervisory Board
of the company.
Operation areas that were subject to internal auditing in 2011 are:
o Management of insurance agent registries
o Implementation of legal provisions regarding money laundry prevention and terrorism
financing
o Company's exposure in the field of managing strict documentation records
o Compliance of life insurance policy purchase with insurance conditions and
extraordinary purchases
o Risk management when defining benefits in the Carglass system
o Proposition of setting up a complete system for fraud risk management in the
company
o Compliance of two business unit operations with internal legislation
o Takeover of insurance risk amounts and definition of benefit amount with transport
insurance
o Internal audit actions in the process of underwriting individual insurances
o Contract agency operations (three audits)
o Payout of settlement compensation to the current accounts of employees
o Adjustment of operating in insurance product development projects
o Trends of unit-linked life insurance reversal of key selling channels
47
o
o
o
o
o
Credit exposure of the company towards specialized life insurance agencies
Fraud risk management when underwriting insurances
Selected areas of information systems
Internal audit actions in the process of claims settlement
Efficiency of legal proceedings that arise from claims cases.
Audit results are promptly presented to the persons responsible for the area of audit, the
Management Board and quarterly also the Audit Committee of the Supervisory Board and
Supervisory Board directly. Based on the above mentioned internal auditing we suggested
measures for improvement of internal auditing operations of the audited areas to the
Management Board. We report to the Management Board and Supervisory Board quarterly
on their realization.
Internal Auditing Service work program for 2011 has been entirely realized in planned
deadlines, human resources and financial frames.
EVENTS FOLLOWING THE BALANCE SHEET DATE
Events following the balance sheet date are presented under item 37 of the Explanations to
the financial statements chapter in the financial part of the annual report.
48
RISK MANAGEMENT
Risk management is one of the key company's processes. We actively manage risks in all
our business processes at all organization levels.
The top management is aware of the importance of risk management and promotes and
supports the risk management system with all company's employees.
The company manages risks in the form of spread system within which individual business
functions with the internal audit system entirely cover the attendance, surveillance and
reporting on business risks.
The risk management procedure is a continuous strategic process that is constantly being
improved and adjusted to the challenges of business environment and changing legislation in
this area. You can find out more about risk management, the main groups of identified
business risks and the manner of their management in a special chapter in the financial part
of the annual report.
49
SUSTAINABLE DEVELOPMENT REPORT
EMPLOYEES
The company follows the values of human resources management. We strive to maintain
good relationship and quality communication with employees. We are aware of the fact that
only motivated and engaged employees contribute their knowledge and energy to achieving
good business results and positive image of the company in public.
We are aware that in the time of economic crisis we need to put more emphasis on
communication with employees because it is the basis of trust and engagement of
employees on all business levels. It is particularly important that the top management feels
the so called 'communication necessity'. In 2011, Drago Cotar, the Management Board
Chairman, made the co called 'motivational visits' to all business units in Slovenia at the
beginning and end of the year to personally meet and talk to the employees which made a
positive impact on employees. The survey we made after his visits among employees
showed that people need such meetings and personal communication with top management
and want more of it in the future.
In January 2011, with an intent to intensify personal communication between employees and
management we initiated 'doors open days' of Management Board members and enabled
availability of management in case of any questions, ideas, etc.
We are aware of the fact that the easiest way to get answers to the question on how
engaged and satisfied our employees really are is with various surveys on employee
engagement and satisfaction. Again, we decided to participate at the Zlata nit (Golden
Thread) survey, realized by Dnevnik newspaper, that took place for the fourth time in
2010/2011. 33,000 Slovene employees participated in this survey in the past four years
which makes it the largest survey of its kind in South-East Europe.
According to the survey results we are somewhere at the average values of large
companies, however, we wish to step out of the average that is why we will strive for better
interrelationships, communication, setting the right goals and really do the right job at the
right working place.
The purpose of this project is among others to search for companies that can set an example
and be an inspiration of Slovene economy; the companies that are the best employers from
the creative, successful and efficient employee and organization development point of view.
We put a lot of our positive energy and time to the Family-Friendly Company certificate
(DPP) that we approached in 2006 as the first company in Slovenia. The measures taken
within DPP are constantly being improved and adjusted to the employees' needs and
desires—nevertheless, they are the ones we approached this project for.
Number of Employees
Total number of employees was at the end of the reporting period 875 (2010: 874.) There are
482 women (2010: 484) and 393 men (2010: 390).
During the reporting period the company employed 43 new employees (33 agents and 10
internal employees), whereas for 46 employees (24 agents and 22 internal employees) the
employment ceased.
50
Average years of service are 18.9 (2010: 17.8), out of which an average of 11.6 years (2010:
10.59 years) of employment in this company.
Trends in number of employees 2007 - 2011
Education
Educated and competent employees are one of the key company's goals. During the
previous years the company developed an educational system that is divided to the area of
functional and the area of formal education.
In 2011, the number of employees with college or university degree increased by 23 percent
relative to the previous year. At the same time, the number of employees with Master's and
Doctor's degree increased by 63 percent. From the given data it is clear that we are more
and more aware of importance of education.
Educational structure of employees on 31.12.2011
51
The area of functional education called ZM Academy is mostly executed according to annual
plan prepared at the end of the previous year. Each year, we execute a number of trainings
and other activities that become necessary due to novelties that appear during one year
(modified and new products, etc). This area of training is mostly covered with internal
lecturers and 4 employed trainers. In some cases, mostly in the area of personal
development, we cooperate with external contractors. In 2011, 72 percent of employees
attended at least one form of functional training.
In the area of formal education we include part-time undergraduate and postgraduate study
programs for gaining a certain degree of education which we finance for some of our
employees. With employees that approach additional formal education in an area that is
important for our operations we sign an education agreement.
Employees and Sustainable Development
The fast changing environment in which our company operates demands fast responses,
new views, adjustments and mostly solutions that help us react in the right way at the right
time. We are facing such changes in a way as we set in our system procedure that assures a
sustainable development of our employees. Through assessment interviews we monitor work
of each individual employee and plan together their future work that is adjusted with
company's goals. In 2011, we started to upgrade this area to reach better transparency and
each individual's ability to directly influence the company's success.
We continued with set activities in 2010 regarding the Family-Friendly Company certificate
that enables the employees to more easily adjust family and work. Our main focus is on
realizing measures that we set for the new triennium in the previous year because it is a way
to get closer to our employees and to fulfill their expressed needs and desires.
Our operations and its appropriateness in the area of sustainable development are
constantly monitored though an employee satisfaction survey where we once a year collect
return information regarding the actual employee satisfaction.
Taking Care of Safe and Healthy Environment of our Employees
We pay a lot of attention to health of our employees. Each year we organize preventive
medical checkups for employees with regard of their area of work.
On the other hand, we enable them to monitor and preserve their health, to stay in good
shape with the help of flu vaccinations, mammography and prostate checkups that the
employees attend voluntarily.
In cooperation with Regional organization Union the employees can attend sports activities in
rented sports facilities where they can play basketball, football, tennis, go bowling and attend
other recreational activities. There are holiday facilities available on Rogla for the employees
and their families throughout the year where they can enjoy their weekend, go skiing or enjoy
a cool summer shade of Pohorje woods and summer hikes. Athletes can also participate in
winter or summer sporting events of financial organizations (ŠIFO). The company organizes
various excursions for employees within the company union.
The company also organizes employee reunions and New Year’s distribution of presents for
children of employees with dancing and Christmas program.
52
QUALITY MANAGEMENT SYSTEM
The company set up a certified system of quality management based on the ISO 9001:2008
standard. With this certificate the company proves its systematic and organized manner of
identification for all its key business processes which the company also efficiently executes.
During the reporting period the company updated the Management Rules of Procedure
which is a document covering operation management with which the company regulates
quality policy, organization and responsibility, management processes, service realization,
support processes and their connections.
The company's quality system is monitored through regular external and internal audits.
Through audits, we want to identify irregularities regarding business processes and draw
attention to possible risks which we immediately solve by executing the suggested
measures.
RESPONSIBILITY TOWARDS SOCIAL ENVIRONMENT
We as a company take over the responsibility towards people and environment we live in.
Social responsibility is our duty and at the same time privilege. Our main mission to help
people in need is thus spread across other areas of our operations. In regard to social
responsibility we are also one of the co-founders of the Network for Social Responsibility of
Slovenia.
The extent of social responsibility:
We are actively participating in wider social happening with numerous sponsorships,
donations, preventive actions in sports, cultural, health, arts and mostly environmental area.
We believe in connecting, that is why we support team sports, achievement and projects that
connect institutions with the community. We fulfill our mission to help people in need with
53
many humanitarian projects and we also put a lot of emphasis to preventive measures
regarding health, fire and traffic safety.
The results of our activities are visible in engagement, satisfaction and loyalty of employees
which is consequently apparent in higher productivity and profit which generates positive
social changes.
In the area of art we support innovative artist with donations for studies abroad, we sponsor
individual performers or groups (Amnesty Trio International) and are sponsors (exhibitions in
arts gallery, Summer Puppet Pier, Waldorf Pre-school, etc).
With substantial financial assets we also participate in:
o
o
o
Preventive actions regarding traffic and fire safety and minimization of health risks
Raising art and physical education level (organization and realization of ZM Mountain
Run, EKO partnership of the EKO Marathon)
Humanitarian activities, education and science development
In the area of social responsibility we cooperate with the following non-governmental
organizations: IRDO (Institute for Development of Social Responsibility), Maternity Home,
Sonček, Hospic, Planet Zemlja, Beli obroč, Europa Donna and others.
COMMUNICATION WITH TARGET PUBLIC
We adapt the communication strategy with key public of ZM to the interests and
characteristics of individual public and we use those tools for communication with which one
can achieve the greatest communication impact.
Target communication groups of the company are:
In communication and relationship with the insured persons we used those communication
tools from which we can expect the biggest communication effect (direct mail,
communication through electronic media, event organization and organization of business
54
meetings with the ensured, presentation publications, surveys and questionnaires, open
phone).
In 2011, with the intentional to adapted web communication to users' habits and needs, we
and made
renovated and updated our web page www.ZavarovalnicaMaribor.si
communication of ZM through more and more popular social networks like: Facebook,
Twitter, LinkedIn, Flickr even more intense. We also launched a new platform for the only
insurance blog in Slovenia, written by our employees.
In the area of communication with employees we continued with the already existing
activities in the area of informing the employees and communicating with them (electronic
communication, internal gazette publication, informing through the intranet for employees,
electronic prize competitions, etc) and we severely intensified personal communication of top
management with employees at all levels (motivation visits of Management Board Chairman,
Management Board Members doors open days, informal personal communication, etc.).
We are aware of the importance of honest and constant communication with the media in
order to present the insurance company and to create an image about ZM for general,
business and also decision-making public. That is why we continued with our communication
with media through press conferences, breakfasts, press releases, responses and informal
meeting with reporters and also through other activities.
For timely and quality informing of our shareholders and the financial public we used active
communication (written and oral), regular introductions of our operations and other important
information. The annual report of the company remains an important source of
communication. Other efficient tools used for communication are data books, personal
presentations, meetings with company management, letters to the shareholders, quarterly
and semiannually reports, annual general assembly, etc.
55
MANAGEMENT BOARD AND SUPERVISORY BOARD
The management of the company operates according to the so called two tier system,
according to which the Management Board is managing the company, and the Supervisory
Board is supervising its operations.
The shareholders have the right to participate in company management depending on the
number of ordinary shares on their name and in accordance with the decision on company
establishment and statute of the company.
The employees participate in company management in accordance with the law and statute
of the company.
The parties of the company are: the Assembly, the Management Board and the Supervisory
Board.
THE ASSEMBLY
The Assembly is composed of legal entity representative and financial entities that are
entered into the share register or their authorized representatives. Each share provides a
shareholder with one vote at the meeting. Assembly competence is defined in the statute of
the company.
SUPERVISORY BOARD
Matjaž Kovačič,
Chairman,
Shareholders
Representative
Dušan Čeč,
Vice-Chairman,
Shareholders Representative
56
Manja Skernišak
Shareholders
Representative
M.Sc. Janez
Komelj
Shareholders
Representative
Edi Kosi, Member,
Employee Representative
Robert Ciglarič, Member,
Employee Representative
AUDIT COMMITTEE OF THE SUPERVISORY BOARD
According to the Companies Act, the Supervisory Board can name a number of committees
that perform certain tasks from the Supervisory Board competence, prepare SB decision
suggestions, take care of their realization and perform other possible professional tasks as
ordered by the Supervisory Board.
In 2009 the Supervisory Board named an audit committee. The audit committee acted in the
following composition during the reporting period:
Dušan Čeč - audit committee chairman
Ignac Dolenšek, M. Milojka Kolar Celarc, Manja Skernišak, Nataša Ziherl – audit committee
members
Robert Ciglarič – employee representative.
57
MANAGEMENT BOARD
Drago Cotar, Chairman
He graduated from the Faculty of Economics and Business in
Maribor in 1975 and started his career in Elektrokovina. In 1976 he
started working for ZM as an appraiser of transport damage. After
six years he was promoted to transport manager and in 1982 to
assistant director. In 2002 he was awarded the flattering title 'best
manager' by the people of Maribor. He has held the position of the
chairman of the ZM Management Board since 1990. He is
responsible for human resources, public relations and the
Management Board secretariat.
M.Sc. Borut Celcer, Member
In 1989 he graduated at the Faculty of Electrical Engineering
and Computer Science in Maribor. In 2011, he obtained
Master's Degree at the Faculty of Economics in Ljubljana. He
started his career in 1989, at the Tovarna dušika Ruše and
joined the Zavarovalnica Maribor team in 1991 as independent
architect of information systems and later became manager of
the Informatics Development Sector. In 1997, he took over the
IT Sector management and until March 2009 he acted as
Manager of the Informatics and Business Process Organization
Sector. In 2009, he started his duty as Management Board
authorized representative for the insurance technology,
actuarial, informatics and organization area and he has been a
member of the Management Board since 12 January 2011. He
covers technology areas of property and personal insurance, IT
and actuary service operations.
David Kastelic, Member
After graduating from the Faculty of Mechanical Engineering in
Maribor he started working for Philip Morris in Ljubljana, where
he worked in the field of marketing. On 16 March 1998 he joined
ZM and took over the duties of assistant director for automobile
damage and reimbursement realization sector. On 1 July 2004
he took over the position of executive director of property
insurance, where he was in charge of development and loss
trends of this line of business at ZM. He has been a Management
Board member since 1 November 2006 and is in charge of
marketing.
58
Marko Planinšec, Member
Marko Planinšec became a member of the Management Board of
Zavarovalnica Maribor on 1 January 2008, after obtaining license
from the Insurance Supervision Agency.
He holds a B.Sc. in Economics and civil engineering. After
graduation in analysis and planning from the Maribor Faculty of
Economics and Business in 1991, he began his career as an
apprentice in the former ‘Služba družbenega knjigovodstva’ (Public
Bookkeeping Office) and continued as an auditor in Coopers &
Lybrand and PriceWaterhouseCoopers. In April 2001 he was
appointed a member of the Management Board of KBM Infond
asset management company. As a member of the Management
Board of Zavarovalnica Maribor he is in charge of finances,
accounting, IT and organization.
Srečko Čarni, Member and Worker Director
He holds a Bachelor of Laws degree and lawyer’s state
examination. He started working at ZM in 1973 as a probationer at
the Automobile Insurance Department. He continued his career as
the manager of the Human Resources Affairs department (from
1975 to 1977), and on 1 October 1977 he took over the function of
the assistant director for self-government organization and human
resources at the Insurance Community Triglav, Regional
Community Maribor. When Zavarovalnica Maribor became
independent in 1991 he became assistant director for general legal
and human resources affairs and on 1 April 1995 a member of the
first ZM Management Board for general legal, management-legal
and human resources affairs. After expiration of his management
board function (in 2000) he took over the work and tasks of the
company secretary, and on 17 November 2004 he was promoted
to the position of the Worker Director and thus a Member of the
Management Board. He is also in charge of the legal service and
implementation of the resolutions referring to the human resources
area.
59
SECTOR AND DEPARTMENT DIRECTORS
Marketing Sector
Executive Manager: M.Sc. Evgen Likl
Personal Insurance Technology Sector
Executive Manager: Tomislav Ćaćić
Property Insurance Technology Sector
Deputy Executive Manager:
M.Sc. Uroš Pušnik, Sebastjan Strmšek and Boris
Visočnik
Financial Sector
Executive Manager: Renata Doler Tisaj, M.Sc.
Accounting Sector
Executive Manager: Anton Vadnjal
Information Technology and
Organization Sector
Executive Manager: Darko Šušter
Actuarial Sector
Manager: Aleš Tomažin, M.Sc.
Internal Audit Department
Manager: Boris Presker
Public Relations Department
Manager: Natalija Postružnik, M.Sc.
General-Legal and Human Resources
Department
Manager: Samo Červek, M.Sc.
Technical and General Affairs
Department
Manager: Marjan Makari
Reinsurance Department
Manager: Dejan Zdovc, M.Sc.
60
SELECTED INDICATORS OF BUSINESS OPERATIONS
Selected accounting and financial indicators of business operations are prepared according
to the Decision on annual report and quarterly financial statements of insurance undertakings
- SKL 2009.
1. Growth of gross premium written (index)
No.
INSURANCE CLASS
1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
2
ACCIDENT INSURANCE
HEALTH INSURANCE
LAND MOTOR VEHICLES INSURANCE
RAILWAY ROLLING STOCK INSURANCE
AIRCRAFT INSURANCE
VESSEL INSURANCE
GOODS IN TRANSIT INSURANCE
INSURANCE AGAINST FIRE AND NATURAL FORCES
OTHER DAMAGE TO PROPERTY INSURANCE
MOTOR THIRD-PARTY LIABILITY INSURANCE
AIRCRAFT LIABILITY INSURANCE
VESSEL LIABILITY INSURANCE
GENERAL LIABILITY INSURANCE
CREDIT INSURANCE
SURETYSHIP INSURANCE
MISCELLANEOUS FINANCIAL LOSS INSURANCE
PROCEDURE COSTS INSURANCE
ASSISTANCE INSURANCE
TOTAL NON-LIFE INSURANCE PRODUCTS
Gross premium written for the Gross premium written for the
current year
past year
from 1.1. to 31/12/2011
from 1.1. to 31/12/2010
3
in 2011
5 = 3 / 4 * 100
Gross premium written for the Gross premium written for the
current year
past year
from 1.1. to 31/12/2010
from 1.1. to 31/12/2009
3
4
Growth index
in 2010
5 = 3 / 4 * 100
18.910.639
18.754.966
101
18.754.966
19.617.278
96
52.563.552
54.261.520
97
54.261.520
54.308.862
100
167.451
302.624
1.788.280
11.900.673
27.857.161
59.858.525
240.969
220.998
7.371.138
1.909.483
68.395
1.108.427
497.689
3.073.064
187.839.066
282.629
356.792
1.642.401
11.342.916
27.330.718
61.371.097
220.529
207.876
6.615.756
1.986.544
60.895
848.987
478.970
2.527.106
188.289.702
59
85
109
105
102
98
109
106
111
96
112
131
104
122
100
282.629
356.792
1.642.401
11.342.916
27.330.718
61.371.097
220.529
207.876
6.615.756
1.986.544
60.895
848.987
478.970
2.527.106
188.289.702
300.371
396.508
1.380.825
10.627.898
34.932.865
64.916.755
273.008
193.354
6.428.423
2.156.430
74.104
770.226
471.536
2.167.408
199.015.849
94
90
119
107
78
95
81
108
103
92
82
110
102
117
95
31.881.501
43.523.321
33.072.748
38.236.216
35.059.852
31.964.906
71.308.964
259.598.666
96
114
106
33.072.748
38.236.216
75.404.821
263.243.887
71.308.964
259.598.666
67.024.758
266.040.607
94
120
106
19 LIFE INSURANCE
21 UNIT-LINKED LIFE INSURANCE
TOTAL LIFE INSURANCE PRODUCTS
TOTAL ZM d.d.
4
Growth index
101
98
2. Net insurance premium written in % of gross premium written
No.
INSURANCE CLASS
1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
2
ACCIDENT INSURANCE
HEALTH INSURANCE
AIRCRAFT INSURANCE
VESSEL INSURANCE
CREDIT INSURANCE
19 LIFE INSURANCE
TOTAL ZM d.d.
Net written insurance
Gross premium written for the
current year
premium for the current year
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
3
4
Share of net
premium
in 2011
5 = 3 / 4 *100
Gross premium written for the
current year
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
3
4
Share of net
premium
in 2010
5 = 3 / 4 *100
15.085.524
18.910.639
79,8
14.498.880
18.754.966
77,3
39.929.466
52.563.552
76,0
40.067.558
54.261.520
73,8
19.506
236.473
1.126.876
4.552.300
19.181.077
47.507.762
-110.031
173.519
5.438.615
1.527.586
54.716
622.337
-457.467
1.293.502
136.181.762
31.804.063
43.352.250
75.156.313
211.338.074
167.451
302.624
1.788.280
11.900.673
27.857.161
59.858.525
240.969
220.998
7.371.138
1.909.483
68.395
1.108.427
497.689
3.073.064
187.839.066
31.881.501
43.523.321
75.404.821
263.243.887
11,6
78,1
63,0
38,3
68,9
79,4
-45,7
78,5
73,8
80,0
80,0
56,1
-91,9
42,1
72,5
99,8
99,6
99,7
80,3
121.299
259.873
1.072.172
4.668.380
17.967.429
47.196.399
-45.988
158.118
4.752.668
1.546.229
55.187
458.037
-458.875
899.094
133.216.458
33.021.647
38.099.440
71.121.087
204.337.544
282.629
356.792
1.642.401
11.342.916
27.330.718
61.371.097
220.529
207.876
6.615.756
1.986.544
60.895
848.987
478.970
2.527.106
188.289.702
33.072.748
38.236.216
71.308.964
259.598.666
42,9
72,8
65,3
41,2
65,7
76,9
-20,9
76,1
71,8
77,8
90,6
54,0
-95,8
35,6
70,8
99,8
99,6
99,7
78,7
3. Movement in gross claims paid (index)
No.
INSURANCE CLASS
1
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
2
ACCIDENT INSURANCE
HEALTH INSURANCE
AIRCRAFT INSURANCE
VESSEL INSURANCE
CREDIT INSURANCE
19 LIFE INSURANCE
TOTAL ZM d.d.
Gross claims paid for the
current year
Gross claims paid for the past
year
Change index
Gross claims paid for the
current year
Gross claims paid for the past
year
from 1.1. to 31/12/2011
from 1.1. to 31/12/2010
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2009
in 2010
3
4
5 = 3 / 4 * 100
3
4
5 = 3 / 4 * 100
Change index
6.741.318
7.006.049
96
7.006.049
7.337.564
95
35.781.633
40.198.747
89
40.198.747
48.215.463
83
56.343
163.526
680.531
7.606.876
14.509.852
28.932.653
56
84
127
123
88
90
48.824
242.370
1.054.651
13.917.356
35.087.905
36.168.360
207
80
51
45
47
89
823
5.340.765
2.238.007
321.247
716.729
182
83
106
53
57
465.603
141
797.985
101.167
193.699
535.879
6.204.362
16.581.524
32.235.477
2.096
1.500
4.458.147
2.368.655
171.593
406.116
714
658.529
121
101.167
193.699
535.879
6.204.362
16.581.524
32.235.477
2.096
1.500
4.458.147
2.368.655
171.593
406.116
714
658.529
102.530.061
111.124.254
92
111.124.254
151.155.668
74
27.001.166
31.368.817
31.368.817
34.240.998
25.382
4.606.553
1.903.881
50.637
672.891
1.692
103
80
30
166
10.490.431
8.789.550
86
119
8.789.550
4.815.014
92
183
37.491.597
40.158.367
93
40.158.367
39.056.012
103
140.021.658
151.282.620
93
151.282.620
190.211.680
80
61
4. Average claim paid
No.
INSURANCE CLASS
1
2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
ACCIDENT INSURANCE
HEALTH INSURANCE
AIRCRAFT INSURANCE
VESSEL INSURANCE
CREDIT INSURANCE
Gross claims paid in current
year
Number of claims for the
current year
Average claims
in euro
Gross claims paid in current
year
Number of claims for the
current year
Average claims
in euro
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5 =3 /4
3
4
5 =3 /4
6.741.318
12.560
537
7.006.049
13.648
513
35.781.633
63.141
567
40.198.747
71.192
565
56.343
163.526
680.531
7.606.876
14.509.852
28.932.653
5
91
2.498
3.656
20.994
11.981
1
5
2.500
1.556
18
434
1
11.269
1.797
272
2.081
691
2.415
101.167
193.699
535.879
6.204.362
16.581.524
32.235.477
2.096
1.500
4.458.147
2.368.655
171.593
406.116
714
658.529
2
105
2.279
4.053
23.000
13.677
3
3
2.717
1.653
9
369
1
1
50.584
1.845
235
1.531
721
2.357
699
500
1.641
1.433
19.066
1.101
714
658.529
25.382
4.606.553
1.903.881
50.637
672.891
797.985
102.530.061
119.441
858
111.124.254
132.712
837
27.001.166
12.824
2.106
31.368.817
17.757
1.767
19 LIFE INSURANCE
10.490.431
8.567
1.225
8.789.550
6.916
1.271
37.491.597
21.391
1.753
40.158.367
24.673
1.628
140.021.658
140.832
994
151.282.620
157.385
961
TOTAL ZM d.d.
5.
Claims ratio
No.
INSURANCE CLASS
1
2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
5.076
1.843
1.224
2.813
1.550
ACCIDENT INSURANCE
HEALTH INSURANCE
AIRCRAFT INSURANCE
VESSEL INSURANCE
CREDIT INSURANCE
Gross claims paid in current Gross premium written for the
Claims ratio in %
year
current year
Gross claims paid in current Gross premium written for the
Claims ratio in %
year
current year
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5 = 3 / 4 (%)
3
4
5 = 3 / 4 (%)
6.741.318
18.910.639
35,6
7.006.049
18.754.966
37,4
35.781.633
52.563.552
68,1
40.198.747
54.261.520
74,1
56.343
163.526
680.531
7.606.876
14.509.852
28.932.653
33,6
54,0
38,1
63,9
52,1
48,3
282.629
356.792
1.642.401
11.342.916
27.330.718
61.371.097
220.529
207.876
6.615.756
1.986.544
60.895
848.987
478.970
2.527.106
35,8
54,3
32,6
54,7
60,7
52,5
1,0
0,7
67,4
119,2
281,8
47,8
0,1
26,1
797.985
167.451
302.624
1.788.280
11.900.673
27.857.161
59.858.525
240.969
220.998
7.371.138
1.909.483
68.395
1.108.427
497.689
3.073.064
26,0
101.167
193.699
535.879
6.204.362
16.581.524
32.235.477
2.096
1.500
4.458.147
2.368.655
171.593
406.116
714
658.529
102.530.061
187.839.066
54,6
111.124.254
188.289.702
59,0
19 LIFE INSURANCE
27.001.166
31.881.501
84,7
31.368.817
33.072.748
94,8
10.490.431
43.523.321
24,1
8.789.550
38.236.216
23,0
37.491.597
75.404.821
49,7
40.158.367
71.308.964
56,3
140.021.658
263.243.887
53,2
151.282.620
259.598.666
58,3
TOTAL ZM d.d.
25.382
4.606.553
1.903.881
50.637
672.891
11,5
62,5
99,7
74,0
60,7
6. Operating costs in % in regard to gross written premium
No.
INSURANCE CLASS
1
2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
Operating costs
Gross written premium for the
current year
% of operating
costs
Operating costs
Gross written premium for the
current year
from 1.1. to 31/12/2011
3
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
% of operating
costs
6.162.941
18.910.639
32,6
6.297.009
18.754.966
33,6
12.766.159
52.563.552
24,3
13.911.187
54.261.520
25,6
49.279
77.356
887.188
3.351.289
10.219.840
12.744.570
41.958
51.865
1.386.082
919.768
9.163
412.061
246.052
488.930
167.451
302.624
1.788.280
11.900.673
27.857.161
59.858.525
240.969
220.998
7.371.138
1.909.483
68.395
1.108.427
497.689
3.073.064
29,4
25,6
49,6
28,2
36,7
21,3
17,4
23,5
18,8
48,2
13,4
37,2
49,4
15,9
53.875
78.711
784.093
3.347.038
10.256.724
12.433.394
28.819
46.396
1.242.126
1.093.595
7.967
258.757
199.636
412.789
282.629
356.792
1.642.401
11.342.916
27.330.718
61.371.097
220.529
207.876
6.615.756
1.986.544
60.895
848.987
478.970
2.527.106
19,1
22,1
47,7
29,5
37,5
20,3
13,1
22,3
18,8
55,1
13,1
30,5
41,7
16,3
49.814.501
187.839.066
26,5
50.452.116
188.289.702
26,8
6.637.857
31.881.501
20,8
6.901.133
33.072.748
20,9
17.233.217
43.523.321
39,6
14.860.092
38.236.216
38,9
23.871.074
75.404.821
31,7
21.761.224
71.308.964
30,5
TOTAL ZM d.d.
73.685.575
263.243.887
28,0
72.213.340
259.598.666
27,8
ACCIDENT INSURANCE
HEALTH INSURANCE
AIRCRAFT INSURANCE
VESSEL INSURANCE
CREDIT INSURANCE
19 LIFE INSURANCE
62
7. Insurance acquisition costs in % of gross insurance premium written
No.
INSURANCE CLASS
1
2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
Acquisition costs
Gross written premium for the % of acquisition
costs
current year
Acquisition costs
Gross written premium for the % of acquisition
costs
current year
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
6,8
1.233.924
18.754.966
6,6
52.563.552
6,1
3.624.740
54.261.520
6,7
11,9
6,1
10,2
11,6
10,3
5,0
4,3
4,2
6,5
21.823
22.093
185.064
1.283.309
2.767.249
2.813.115
8.786
8.239
499.341
13,0
6,7
4,0
663
107.471
32.606
102.670
282.629
356.792
1.642.401
11.342.916
27.330.718
61.371.097
220.529
207.876
6.615.756
1.986.544
60.895
848.987
478.970
2.527.106
7,7
6,2
11,3
11,3
10,1
4,6
4,0
4,0
7,5
144.631
33.287
123.752
167.451
302.624
1.788.280
11.900.673
27.857.161
59.858.525
240.969
220.998
7.371.138
1.909.483
68.395
1.108.427
497.689
3.073.064
12.776.425
187.839.066
6,8
12.711.092
188.289.702
6,8
885.649
31.881.501
2,8
631.073
33.072.748
1,9
21 ŽIVLJENJSKO ZAVAROVANJE VEZANO NA ENOTE INVESTICIJSKIH SKLADOV
11.564.032
43.523.321
26,6
10.410.680
38.236.216
27,2
NEZGODNO ZAVAROVANJE
ZDRAVSTVENO ZAVAROVANJE
ZAVAROVANJE KOPENSKIH MOTORNIH VOZIL
ZAVAROVANJE TIRNIH VOZIL
LETALSKO ZAVAROVANJE
ZAVAROVANJE PLOVIL
ZAVAROVANJE PREVOZA BLAGA
ZAVAROVANJE POŽARA IN ELEMENTARNIH NESREČ
DRUGO ŠKODNO ZAVAROVANJE
ZAVAROVANJE ODGOVORNOSTI PRI UPORABI MOTORNIH VOZIL
ZAVAROVANJE ODGOVORNOSTI PRI UPORABI ZRAKOPLOVOV
ZAVAROVANJE ODGOVORNOSTI PRI UPORABI PLOVIL
SPLOŠNO ZAVAROVANJE ODGOVORNOSTI
KREDITNO ZAVAROVANJE
KAVCIJSKO ZAVAROVANJE
ZAVAROVANJE RAZLIČNIH FINANČNIH IZGUB
ZAVAROVANJE STROŠKOV POSTOPKA
ZAVAROVANJE POMOČI
PREMOŽENJSKA ZAVAROVANJA SKUPAJ
19 ŽIVLJENJSKA ZAVAROVANJA
1.287.266
18.910.639
3.211.314
19.962
18.495
183.202
1.376.132
2.856.762
3.021.304
10.391
9.279
480.648
1,1
12,7
6,8
4,1
ŽIVLJENJSKA ZAVAROVANJA SKUPAJ
12.449.681
75.404.821
16,5
11.041.753
71.308.964
15,5
SKUPAJ VSA ZAVAROVANJA V ZM d.d.
25.226.106
263.243.887
9,6
23.752.845
259.598.666
9,1
8. Impact of investments in % of average investments (of opening and closing balance)
No.
INSURANCE CLASS
1
Return on investments
(income less expenses)
Average investments (1.1. +
31.12. / 2)
% return
Return on investments
(income less expenses)
Average investments (1.1. +
31.12. / 2)
from 1.1. to 31/12/2011
in 2011
in 2011
from 1.1. to 31/12/2010
in 2010
in 2010
3
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
2
1 BUSINESS FUND INVESTMENTS
% return
10.273.557
215.978.448
4,8
6.801.345
180.441.525
3,8
8.397.724
369.791.342
2,3
16.186.426
356.863.247
4,5
2 LONG-TERM BUSINESS FUND INVESTMENTS
3 OWN RESOURCES INVESTMENTS
124.217
11.194.781
1,1
842.035
9.411.460
8,9
TOTAL INVESTMENTS OF ZM d.d.
18.795.498
596.964.570
3,1
23.829.806
546.716.231
4,4
9. Net provisions for claims outstanding in % of net income arising from insurance premiums
No.
INSURANCE CLASS
1
2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
PREMOŽENJSKA ZAVAROVANJA SKUPAJ
Net provisions for claims
outstanding
Net income from insurance
premiums
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
premiums
from 1.1. to 31/12/2011
3
Net reserves for
claims
outstanding in
net revenue
from insurance
premiums
12.742.950
14.893.347
85,6
11.160.210
14.617.236
76,3
16.628.830
39.892.280
41,7
15.252.670
40.017.915
38,1
308.752
717.466
272.579
3.290.391
9.968.854
76.169.525
19.135
239.898
1.087.433
4.632.027
18.827.205
47.056.494
-106.931
168.119
5.307.663
1.644.770
53.435
607.617
-503.294
1.242.824
1.613,5
299,1
25,1
71,0
52,9
161,9
16.889
466.918
839.012
2.905.451
9.404.989
67.029.592
14,4
173,8
80,0
63,4
52,1
138,8
15,1
424,2
172,3
111,0
50,3
9.724
17.382.704
1.972.050
124.779
633.520
8
67
116.952
268.581
1.049.007
4.586.087
18.043.237
48.306.434
-58.229
154.124
4.816.515
1.706.016
52.177
461.631
-467.571
480.574
145.841.480
135.062.022
108,0
127.198.585
134.150.686
94,8
12.884.599
31.890.445
40,4
9.761.592
33.051.171
29,5
NEZGODNO ZAVAROVANJE
ZDRAVSTVENO ZAVAROVANJE
ZAVAROVANJE KOPENSKIH MOTORNIH VOZIL
ZAVAROVANJE TIRNIH VOZIL
LETALSKO ZAVAROVANJE
ZAVAROVANJE PLOVIL
ZAVAROVANJE PREVOZA BLAGA
ZAVAROVANJE POŽARA IN ELEMENTARNIH NESREČ
DRUGO ŠKODNO ZAVAROVANJE
ZAVAROVANJE ODGOVORNOSTI PRI UPORABI MOTORNIH VOZIL
ZAVAROVANJE ODGOVORNOSTI PRI UPORABI ZRAKOPLOVOV
ZAVAROVANJE ODGOVORNOSTI PRI UPORABI PLOVIL
SPLOŠNO ZAVAROVANJE ODGOVORNOSTI
KREDITNO ZAVAROVANJE
KAVCIJSKO ZAVAROVANJE
ZAVAROVANJE RAZLIČNIH FINANČNIH IZGUB
ZAVAROVANJE STROŠKOV POSTOPKA
ZAVAROVANJE POMOČI
19 ŽIVLJENJSKA ZAVAROVANJA
Net reserves for
claims
outstanding in
net revenue
from insurance
premiums
Net provisions for claims
outstanding
25.429
22.516.902
2.834.597
59.326
305.877
21 ŽIVLJENJSKO ZAVAROVANJE VEZANO NA ENOTE INVESTICIJSKIH SKLADOV
4.032.534
6,3
360,9
115,6
239,1
137,2
0,0
0,0
43.349.620
9,3
3.461.782
38.098.653
9,1
ŽIVLJENJSKA ZAVAROVANJA SKUPAJ
16.917.134
75.240.065
22,5
13.223.374
71.149.824
18,6
162.758.613
210.302.087
77,4
140.421.959
205.300.509
68,4
% of profit/loss in
net premium
Gross profit (+) or loss (-) for
the current year
Net insurance premium
written for the current year
10. Gross profit or loss for the current year in % of net premium written
No.
INSURANCE CLASS
1
2
1 NON-LIFE INSURANCE
the current year
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5 = 3 / 4 (%)
3
4
5 = 3 / 4 (%)
% of profit/loss in
net premium
12.036.101
136.181.762
8,8
8.800.761
133.216.458
2 LIFE INSURANCE
2.603.070
75.156.313
3,5
5.425.085
71.121.087
7,6
TOTAL ZM d.d.
14.639.171
211.338.074
6,9
14.225.846
204.337.544
7,0
Zavarovalnica Maribor d.d. Enclosure to the Business Report
6,6
63
11. Gross profit or loss for the current year in % of average capital
No.
INSURANCE CLASS
1
2
1
NON-LIFE INSURANCE
2
LIFE INSURANCE
TOTAL ZM d.d.
the current year
Average balance
of capital
(1.1.+ 31.12. / 2)
% of profit/loss in
capital
the current year
Average balance
of capital
(1.1.+ 31.12. / 2)
from 1.1. to 31/12/2011
3
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 (%)
3
4
5 = 3 / 4 (%)
% of profit/loss in
capital
12.036.101
53.193.840
22,6
8.800.761
45.401.167
2.603.070
29.509.696
8,8
5.425.085
27.189.529
19,4
20,0
14.639.171
82.703.536
17,7
14.225.846
72.590.696
19,6
12. Gross profit or loss for the current year in % of average assets
No.
INSURANCE CLASS
1
2
1
NON-LIFE INSURANCE
2
LIFE INSURANCE
TOTAL ZM d.d.
the current year
Average assets
(1.1. + 31.12. / 2)
% of profit/loss in
assets
the current year
Average assets
(1.1. + 31.12. / 2)
from 1.1. to 31/12/2011
3
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
% of profit/loss in
assets
12.036.101
360.621.751
3,3
8.800.761
338.954.028
2.603.070
388.150.323
0,7
5.425.085
374.500.015
2,6
1,4
14.639.171
747.515.670
2,0
14.225.846
707.437.667
2,0
13. Gross profit or loss for the current year per share
No.
INSURANCE CLASS
1
2
TOTAL ZM d.d.
the current year
Number of shares
Profit/loss per
share
the current year
Number of shares
Profit/loss pe r
sha re
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5=3 /4
3
4
5=3/4
14.639.171
12.453.831
1,2
14.225.846
10.214.938
1,4
14. Net profit or loss for the current year in % of average capital
No.
INSURANCE CLASS
1
2
Net profit (+) or loss (-)
Average capital
(1.1. + 31.12./ 2)
% of profit/loss in
capital
Net profit (+) or loss (-)
Average capital
(1.1. + 31.12./ 2)
from 1.1. to 31/12/2011
3
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
% of profit/loss in
capital
1
NON-LIFE INSURANCE
8.935.884
53.193.840
16,8
6.411.003
45.401.167
14,1
2
LIFE INSURANCE
1.621.191
29.509.696
5,5
4.184.328
27.189.529
15,4
10.557.075
82.703.536
12,8
10.595.331
72.590.696
14,6
TOTAL ZM d.d.
15. Available capital of insurance company in % of net premium
No.
INSURANCE CLASS
1
2
Available capital of insurance
company
% avail. capital
in net premium
company
from 1.1. to 31/12/2011
3
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
% a vail. capital
in net pre mium
1
NON-LIFE INSURANCE
51.999.008
136.181.762
38,2
48.511.865
133.216.458
36,4
2
LIFE INSURANCE
28.835.180
75.156.313
38,4
22.918.600
71.121.087
32,2
TOTAL ZM d.d.
80.834.188
211.338.074
38,2
71.430.465
204.337.544
35,0
16. Available capital of insurance company in % of minimum capital
No.
INSURANCE CLASS
1
2
% of a vailable
capital in
minimum capital
company
Minimum capital of the
insurance company
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
company
Minimum capital of the
insurance company
from 1.1. to 31/12/2011
3
% of ava ilable
capital in
minimum ca pital
1
NON-LIFE INSURANCE
51.999.008
23.883.399
217,7
48.511.865
23.777.467
204,0
2
LIFE INSURANCE
28.835.180
15.099.408
191,0
22.918.600
14.251.379
160,8
TOTAL ZM d.d.
80.834.188
38.982.807
207,4
71.430.465
38.028.846
187,8
17. Available capital of insurance company in % of net technical provisions
No.
INSURANCE CLASS
1
2
% of a vailable
capital in
provisions
company
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
company
from 1.1. to 31/12/2011
3
% of ava ilable
capital in
provisions
1
NON-LIFE INSURANCE
51.999.008
212.827.517
24,4
48.511.865
192.956.948
2
LIFE INSURANCE
28.835.180
348.972.775
8,3
22.918.600
334.614.339
25,1
6,8
TOTAL ZM d.d.
80.834.188
561.800.292
14,4
71.430.465
527.571.287
13,5
18. Available capital of insurance company in % of receivables from reinsurance and technical provisions allocated for reinsurers
No.
INSURANCE CLASS
1
2
company
Receivables from reinsurance
% of a vailable
and technical provisions
capital in
allocated for reinsurers
minimum capital
company
Receivables from reinsurance
% of ava ilable
and technical provisions
capital in
allocated for reinsurers
minimum ca pital
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
1
NON-LIFE INSURANCE
51.999.008
2
LIFE INSURANCE
28.835.180
TOTAL ZM d.d.
80.834.188
60.272.559
86,3
48.511.865
62.596.642
198267,55 14.543,6
22.918.600
-
71.430.465
62.596.642
60.470.826
133,7
77,5
114,1
64
19. Net premium written in regard to average capital and technical provisions
No.
INSURANCE CLASS
1
2
% net premium
in capital and
provisions
Average capital + TP
(1.1. + 31.12.) / 2
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
Average capital + TP
(1.1. + 31.12.) / 2
from 1.1. to 31/12/2011
3
% net premium
in capital and
provisions
136.181.762
256.086.073
53,2
133.216.458
232.164.685
57,4
2 LIFE INSURANCE
75.156.313
371.303.253
20,2
71.121.087
350.880.368
20,3
TOTAL ZM d.d.
211.338.074
627.389.325
33,7
204.337.544
583.045.053
35,0
20. Net premium written with regard to average capital
No.
INSURANCE CLASS
1
2
% net premium
with regard to
capital
Average capital
(1.1. + 31.12.) / 2
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
Average capital
(1.1. + 31.12.) / 2
from 1.1. to 31/12/2011
3
% net premium
with regard to
capital
136.181.762
53.193.840
256,0
133.216.458
45.401.167
293,4
2 LIFE INSURANCE
75.156.313
29.509.696
254,7
71.121.087
27.189.529
261,6
TOTAL ZM d.d.
211.338.074
82.703.536
255,5
204.337.544
72.590.696
281,5
21. Average net technical provisions in regard to net income from insurance premium
% of net TP in
net revenue
from insurance
premiums
Average net TP
(1.1. + 31.12.) / 2
premium
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
150,2
186.763.518
134.150.686
139,2
454,3
323.690.839
71.149.824
454,9
259,0
510.454.357
205.300.509
248,6
Average net TP
(1.1. + 31.12.) / 2
premium
from 1.1. to 31/12/2011
3
202.892.233
135.062.022
2 LIFE INSURANCE
341.793.557
75.240.065
TOTAL ZM d.d.
544.685.790
210.302.086
No.
INSURANCE CLASS
1
2
% of net TP in
net revenue
from insurance
premiums
22. Capital with regard to net unearned premium
No.
INSURANCE CLASS
1
2
Insurance company capital
Net unearned premium
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
% capital in net
unearned
premium
in 2011
3
4
5 = 3 / 4 *100
Net unearned premium
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
% capital in net
unearned
premium
in 2010
3
4
5 = 3 / 4 *100
57.792.399
61.616.146
93,8
48.595.281
60.457.246
80,4
2 LIFE INSURANCE
29.747.214
579.002
5.137,7
29.272.177
662.753
4.416,8
TOTAL ZM d.d.
87.539.613
62.195.148
140,7
77.867.459
61.119.999
127,4
23. Capital in regard to liabilities
No.
INSURANCE CLASS
1
Liabilities
% of capital in
total liabilities
Liabilities
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
in 2011
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
in 2010
3
4
5 = 3 / 4 *100
3
4
5 = 3 / 4 *100
2
% of capital in
total liabilities
57.792.399
368.811.755
15,7
48.595.281
352.431.747
2 LIFE INSURANCE
29.747.214
393.089.139
7,6
29.272.177
383.211.506
13,8
7,6
TOTAL ZM d.d.
87.539.613
760.989.148
11,5
77.867.459
734.042.192
10,6
24. Net technical provisions in regard to liabilities
No.
INSURANCE CLASS
1
2
Net technical provisions
Liabilities
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
% of provisions
in total liabilities
in 2011
5 = 3 / 4 *100
Liabilities
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
% of provisions
in total liabilities
in 2010
5 = 3 / 4 *100
3
4
3
4
212.827.517
368.811.755
57,7
192.956.948
352.431.747
54,8
2 LIFE INSURANCE
348.972.775
393.089.139
88,8
334.614.339
383.211.506
87,3
TOTAL ZM d.d.
561.800.292
760.989.148
73,8
527.571.287
734.042.192
71,9
25. Net mathematical provisions with regard to net technical provisions
No.
1
INSURANCE CLASS
2
Balance of net mathematical
provisions
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
% of MP in total
provisions
in 2011
3
4
5 = 3 / 4 *100
329.973.862
561.800.292
58,7
Balance of net mathematical
provisions
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
% of MP in total
provisions
in 2010
3
4
5 = 3 / 4 *100
313.243.271
527.571.287
59,4
26. Gross premium written in regard to the number of regular employees
No.
INSURANCE CLASS
1
2
from 1.1. to 31/12/2011
from 1.1. to 31/12/2011
Amount of gross
premium per
employee
in 2011
3
4
5=3/4
Gross premium written for the Average number of employees
current year
(1.1.+31.12) / 2
263.243.887
875
301.022
from 1.1. to 31/12/2010
from 1.1. to 31/12/2010
Amount of gross
premium per
employee
in 2010
3
4
5=3/4
Gross premium written for the Average number of employees
current year
(1.1.+31.12) / 2
259.598.666
897
289.514
65
FINANCIAL REPORT
Company name:
Short name:
Registration date:
26 December 1990,
Tax number:
44814631
5063400
62.120 - other insurances
0
Zavarovalnica Maribor d.d. Financial Report
0
CONTENTS OF FINANCIAL REPORT
Statement of Management Responsibility ..................................................................................................... 68
Financial Statements ...................................................................................................................................... 69
BA...................................................................................................................................................................... 69
PROFIT AND LOSS ACCOUNT ............................................................................................................................ 70
STATEMENT OF OTHER COMPREHENSIVE INCOME ......................................................................................... 71
CASH FLOWS STATEMENT ................................................................................................................................ 72
STATEMENT OF MOVEMENTS IN EQUITY ......................................................................................................... 73
Introductory Notes and Accounting Policies ................................................................................................... 74
Consolidation .................................................................................................................................................... 74
Statement of Compliance ................................................................................................................................. 74
The Procedure for Adopting the Annual Report ............................................................................................... 78
Functional and Reporting Currency .................................................................................................................. 79
Transfer of Events ............................................................................................................................................. 79
The Use of Assessments and Audits ................................................................................................................. 79
The Operations Revision by the Controller....................................................................................................... 80
Summary of Significant Accounting Policies ..................................................................................................... 80
Risk Management .......................................................................................................................................... 98
Insurance Risk ................................................................................................................................................... 99
Reinsurance Risk ............................................................................................................................................. 106
CAPITAL AND CAPITAL ADEQUACY RISK ......................................................................................................... 108
MARKET RISK .................................................................................................................................................. 109
Credit Risk ....................................................................................................................................................... 115
Risk Management – Future Changes .............................................................................................................. 119
Segment Reporting ...................................................................................................................................... 120
Explanations to the Accounting Statements ................................................................................................. 125
1
1
STATEMENT OF MANAGEMENT RESPONSIBILITY
The Management Board confirms in accordance with its responsibility for preparation of
financial statements that the financial statements together with explanations are composed
with the presumption of continuing company operations and are in accordance with the
current legislation and International Financial Reporting Standards. When composing
financial statements we used corresponding audits, assessments and presumptions,
including actuary audits that in given circumstances consider the most society suitable
methods based on which we can provide the following guarantees.
The Management Board members assure that at their best knowledge:
•
•
The financial report, including the financial statements, is composed in accordance
with the adopted principles of company reporting and states the actual and fair
statement of assets, liabilities towards asset sources, financial situation and profit and
loss account;
The annual report includes a fair presentation of development and results of company
operations and its financial situation including descriptions of all important risks and
opportunities the company has been exposed to during its operations and an actual
presentation of company's operations.
Taxation authorities may in frame of 5 years after the end of the year in which tax was to be
charged check the insurance company operations which can lead to additional tax liability
payment, default interest and penalties arising from corporate income tax or other taxes. The
Management Board is not familiar with circumstances that might lead to any significant
liabilities on this account.
Zavarovalnica Maribor is the signer of the Insurance Codex which was adopted by most
insurance companies in the Country and is effective as of 1 July 2004.
The Management Board members sign and confirm their full responsibility and agreement
with the herein presented Annual Report of Zavarovalnica Maribor for 2011, dated 13 March
2012.
Management Board:
Management Board
Management Board
Management Board
Management Board
Zavarovalnica Maribor d.d. Financial report
68
68
68
FINANCIAL STATEMENTS
BALANCE SHEET
Explanation
in euros
ASSETS
on
31.12.2011
on
31.12.2010
760,989,148 734,042,192
A.
Intangible Assets
1
6,809,471
10,005,231
B.
2
15,245,340
14,142,724
C.
Non-current Assets Held for Sale
3
0
59,003
D.
17
687,302
0
E.
F.
Investment Property
4
546,368
655,432
Investment in group companies and associates
5
190,000
240,134
Investments:
Into loans and deposits
In possession until maturity
Available for sale
Evaluated by their fair value
Assets of the insured persons with unit-linked life insurance
6
7
The amount of technical provisions transferred to reinsurers
8
60,428,019
62,862,885
Receivables
Receivables from direct insurance operations
Receivables from co-insurance and reinsurance
Other receivables
9
53,493,554
40,876,477
11,011,185
1,605,891
65,702,018
43,384,554
20,925,670
1,391,794
L.
Other assets
10
5,784,249
5,361,478
M.
11
353,720
466,035
A.
Equity
Share capital
Capital reserve
Profit reserve
Revaluation reserve
Retained net profit and loss account
Net profit and loss account of the financial year
12
87,539,613
55,426,291
2,811,907
23,500,341
-1,867,823
287,125
7,381,772
77,867,459
42,626,092
2,811,907
20,325,039
3,099,615
4,152,726
4,852,080
13
7,000,000
7,000,000
Unearned premium reserve
Mathematical reserves
Claims reserve
Other technical provisions
Technical Provisions in Favor of the Insured Persons with Unitlinked life insurance
14
520,422,350 500,631,039
74,920,388 74,817,004
233,907,792 234,560,429
206,180,753 185,922,000
5,413,418
5,331,606
15
101,805,961
89,803,133
E.
Other reservations
16
4,851,153
4,289,548
G.
17
0
2,077,323
Liabilities from direct insurance operations
Liabilities from co-insurance and reinsurance
Current tax liabilities
18
23,322,480
11,858,267
10,444,939
1,019,275
36,770,266
13,152,813
20,087,876
3,529,577
Other liabilities
19
16,047,590
15,603,425
G.
H.
1
2
3
4
I.
K.
1
2
3
1
2
3
4
5
6
B.
C.
D.
1
2
3
4
J.
1
2
3
K.
510,405,586 482,303,400
92,941,507 86,863,614
151,655,900
3,111,836
241,686,813 372,544,619
24,121,366 19,783,331
107,045,539 92,243,852
760,989,148 734,042,192
Notes to the financial statement items in Chapter 5 of the financial report are an integral part
of the financial statements.
69
69
69
PROFIT AND LOSS ACCOUNT
1 Jan until
31 December
2011
1 Jan until
31 December
2010
210,302,087
205,300,509
- Charged gross premium
263,243,887
259,598,666
- Charged premium given in reinsurance and
co-insurance
-51,905,813
-55,261,121
-1,035,988
962,965
21
126
2,057
in euros
A.
B.
NET INSURANCE PREMIUM REVENUE
- Modification of unearned premium reserves
INCOME FROM INVESTMENTS INTO AFFILIATED
COMPANIES
Explanation
20
C.
INVESTMENT INCOME
22
24,268,062
25,622,060
D.
OTHER INSURANCE INCOME
23
11,133,402
12,218,809
10,614,954
11,704,879
Out of which:
- income from provisions
E.
OTHER INCOME
24
3,008,648
4,000,199
F.
NET CLAIMS CHARGES
25
129,903,266
130,915,985
- Charged gross amount of claims
134,635,191
146,823,173
- Charged shares of reinsurers and co-insurers
-27,068,580
-31,750,499
- Modification of claims reserves
MODIFICATION OF OTHER TECHNICAL
RESERVATIONS
MODIFICATION OF TECHNICAL
RESERVATIONS OF THE INSURED PERSONS
WITH UNIT-LINKED LIFE INSURANCE
22,336,654
15,843,312
26
5,511,330
1,863,193
27
11,403,902
17,747,825
BONUS AND REBATE CHARGES
28
11,351
60,051
OPERATING EXPENSES
29
73,685,575
72,213,340
25,226,106
23,752,845
5,472,691
1,794,311
2,843,388
1,658,409
G.
H
K.
Out of which:
- Deferred acquisition costs
M.
INVESTMENT CHARGES
22
Out of which:
N.
- Impairment of financial assets not measured by
their fair value through the profit and loss account
OTHER TECHNICAL CHARGES
30
2,282,720
2,440,927
O.
OTHER CHARGES
31
5,802,318
5,882,157
P.
PROFIT AND LOSS ACCOUNT PRIOR TO TAXATION
14,639,171
14,225,846
R.
INCOME TAX
NET PROFIT AND LOSS ACCOUNT OF THE
REPORTING PERIOD
4,082,096
3,630,514
10,557,075
10,595,331
Basic Net Earnings Per Share
0.931
1.037
Modified Net Earnings Per Share
0.931
1.037
S.
32
Notes to the financial statement items in Chapter 5 of the financial report are an integral part
of the financial statements.
70
70
70
STATEMENT OF OTHER COMPREHENSIVE INCOME
Explanation
in euros
I.
II.
1.1. until 31.12.2011
1.1. until 31.12.2010
NET PROFIT/LOSS OF FINANCIAL YEAR AFTER TAXATION
10,557,075
10,595,331
OTHER COMPREHENSIVE INCOME AFTER TACATION
(1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9)
-4,967,437
-41,806
-6,209,297
-52,258
1
Net profit/loss recognized in revaluation surplus regarding tangible fixed assets
2
Net profit/loss recognized in revaluation surplus regarding intangible fixed assets
3
4
Actuarial net profit/loss for retirement plans
Net profit/loss from re-measurement of financial asset, available for sale
5
6
12
4.1
Profit/loss recognized in revaluation surplus
-4,358,646
-419,709
4.2
Revaluation surplus profit/loss transfer into the profit and loss account
-1,850,651
367,451
1,241,859
10,452
5,589,637
10,553,525
Net profit/loss of non-current assets, available for sale
5.1
5.2
Net profit/loss from cash flow hedges
6.1
6.2
6.3
Revaluation surplus profit/loss transfer to the book value of the hedge item
7
Associated net profit/loss recognized in revaluation surplus and retained profit/loss from capital
investments of associated and jointly controlled companies, charged with capital method
8
Other net profit/loss of other comprehensive income
9
Tax from other comprehensive income
III. TOTAL COMPREHENSIVE INCOME OF THE FINANCIAL YEAR AFTER TAXATION (I + II)
32
Notes to the financial statement items in Chapter 5 of the financial report are an integral part of the financial statements.
71
71
CASH FLOWS STATEMENT
In euros
Explanation
1 Jan to 31 Dec 2011
1 Jan to 31 Dec 2010
A. Operating cash flows
a) Items of profit and loss account statement
1 Balanced net insurance premiums for the period
2 Investments income (excluding financial income), financed by:
- other sources
3 Other operating income (except for revaluation and with ought reversal of provisions) and financial
income from operating claims
4 Balanced net claims for the period
746.830
4.205.726
621.102
195.740
125.728
14.054.809
16.167.880
-129.903.266
-130.915.985
5 Balanced costs of bonuses and rebates
6 Net operating costs, excluding depreciation costs and without changes in deferred acquisition
costs
7 Investments charges (excluding depreciation and financial charges), financed by:
- technical sources
- other sources
Other operating charges, excluding depreciation (except for revaluation and without allocation of
provisions)
9 Income taxes and other taxes that are not included in operating charges
b)
13.901.080
205.300.509
4.401.467
- technical provisions
8
18.763.335
210.302.087
Changes in net current assets (insurance claims, other receivables other assets, deferred
receivables and tax liabilities) of operating items of balance sheet
-11.351
-60.051
-69.540.618
-68.294.560
-2.910.489
-138.485
-2.910.499
-163.099
10
24.614
-3.519.982
-5.230.456
-4.109.321
-3.674.602
-1.472.249
8.170.379
1 Opening less closing receivables from direct insurances
2.508.077
-194.519
2 Opening less closing receivables from reinsurances
9.914.485
1.141.065
4 Opening less closing other receivables and assets
-629.830
3.018.467
5 Opening less closing deferred tax assets
-588.104
3 Opening less closing other receivables from (re)insurance operations
6 Opening less closing stocks
-44.087
-7.038
14.914
7 Closing less opening debts from direct insurances
-1.294.546
-729.236
8 Closing less opening debts from reinsurances
-9.642.938
4.811.384
444.165
183.786
9 Closing less opening other operating debts
10 Closing less opening other liabilities (excluding unearned premiums)
c)
11 Closing less opening deferred tax liabilities
-2.176.521
-31.395
Operating net receipts or net expenditures (a + b)
17.291.086
22.071.459
355.603.228
355.913.963
19.738.087
18.284.719
19.535.461
18.170.318
202.626
114.401
B. Investment activities cash flows
a) Investment activities receipts
1 Interest receipts relating to investment activities and to:
- investments, financed from technical provisions
- other investments
2 Receipts from dividends and other profit shares relating to:
290.584
630.845
- financed from technical provisions
179.110
174.768
- other investments
111.473
456.077
0
831.501
89.789
2.203.283
3 Receipts from disposal of intangible assets, financed from:
- other sources
831.501
4 Receipts from disposal of tangible fixed assets, financed from:
- other sources
5 Receipts from disposal of long-term financial investments, financed from:
- other sources
6 Receipts from disposal of short-term financial investments, financed from:
89.789
2.203.283
127.304.030
246.307.970
124.085.896
245.808.049
3.218.134
499.921
208.180.739
87.655.645
145.678.231
- other sources
b) Investment activities expenditures
85.645.571
62.502.507
2.010.074
-376.556.845
-380.653.171
1 Expenditures for acquisition of intangible assets
2 Expenditures for acquisition of tangible fixed assets, financed from:
-155.622
-166.886
-3.355.594
-3.946.708
- other sources
3 Expenditures for acquisition of long-term financial investments, financed from:
-3.355.594
-3.946.708
-152.414.134
-271.291.800
-144.893.978
-269.490.156
- other sources
4 Expenditures for acquisition of short-term financial investments, financed from:
-7.520.157
-1.801.644
-220.631.495
-105.247.777
-157.989.384
-104.143.195
- other sources
c)
Investment activities net receipts or net expenditures (a + b)
-62.642.111
-1.104.583
-20.953.617
-24.739.208
12.800.199
3.011.466
Financial cash flows
a) Financial receipts
1 Paid capital receipts
12.800.199
0
0
3.011.466
-9.249.983
-532.301
-532.301
-532.301
0
0
2. Receipts from long-term loans
3 Receipts from short-term loans
b) Financial expenditures
1 Interest expenditures
2. Expenditures for profit refunds
3 Expenditures for payments of long-term financial liabilities
4. Expenditures for payment of short-term financial liabilities
5. Expenditures for payment of dividends and other profit shares
c)
-8.717.682
3.550.216
Financial net receipts or net expenditures (a + b)
C. Finances and their equivalents at end of period
x)
Financial account for the period (sum of expenditures Ac, Bc and Cc)
y)
Finances and their equivalents at the beginning of period
11
2.479.165
353.720
466.035
-112.314
-188.584
466.035
654.619
Cash flow in dividend and interest operations
In euros
Interest paid
Interest received
received dividends
2011
2010
202,626
111,473
183,324
114,401
19,801
Notes to the financial statement items in Chapter 5 of the financial report are an integral part of the
financial statements.
72
72
OBDOBJE od 1. 1. 2011 do 31. 12. 2011
Pojasnilo
STATEMENT OF MOVEMENTS IN EQUITY
I. Osnovni kapital
v evrih
1.
ZAČETNO STANJE NA DAN 1. 1. 2011
2.
Vseobsegajoči donos poslovnega leta po obdavčitvi
II.Kapitalske
rezerve
III. Rezerve iz dobička
Zakonske in
Za kreditna tveganja
42.626.092
2.
2.811.907
4.
8.525.219
V. Zadržani čisti
poslovni izid
10.
11.
dobička
statutarne
1.
Druge rezerve iz
IV. Presežek iz
prevrednotenja
6.
9.
2.451.265
9.348.555
3.099.615
4.152.726
-4.967.437
2.a Čisti poslovni izid poslovnega leta
2.b Drugi vseobsegajoči donos
3.
5.
6.
Čisti dobiček /
izguba poslovnega
leta
12.
(od 1 do 13)
14.
4.852.080
5.589.637
10.557.075
10.557.075
-4.967.437
12.800.199
12.800.199
8.
Razporeditev čistega dobička v rezerve iz dobička
Oblikovanje in poraba rezerv za kreditna tveganja in za
10. katastrofalne škode
2.560.040
-2.560.040
615.263
11. Prenos izida preteklega leta med zadržane posl.izide
12. KONČNO STANJE na dan 31. 12. 2011
(1+2+3+4+5+6+7+8+9+10+11)
55.426.291
-12.800.199
77.867.459
10.557.075
-4.967.437
Vpis (ali vplačilo) novega kapitala
Čisti nakup/ prodaja lastnih delnic
Izplačilo (obračun) dividend/nagrad v obliki delnic
Bilančni dobiček 2011
VI. Čisti poslovni SKUPAJ KAPITAL
izid
2.811.907
11.085.258
-2.560.040
3.066.528
-615.263
-615.263
9.348.555
-1.867.823
4.967.437
34
4.852.080
-4.852.080
287.125
3.865.601
7.381.772
-2.529.692
87.539.613
-323.600
287.125
7.381.772
7.668.897
OBDOBJE od 1. 1. 2010 do 31. 12. 2010
IZKAZ SPREMEMB LASTNIŠKEGA KAPITALA ZA OBDOBJE od 1. 1. 2010 do 31. 12. 2010
1.
ZAČETNO STANJE NA DAN 1. 1. 2010 (popravljeno)
2.
Vseobsegajoči donos poslovnega leta po obdavčitvi
42.626.092
2.811.907
3.642.151
1.591.082
9.348.555
3.141.421
5.155.860
-41.806
2.a Čisti poslovni izid poslovnega leta
2.b Drugi vseobsegajoči donos
8.
-1.003.134
67.313.934
10.595.331
10.553.525
10.595.331
10.595.331
-41.806
Razporeditev čistega dobička v rezerve iz dobička
-41.806
4.883.068
Poravnava izgube prejšnjih let
Oblikovanje in poraba rezerv za kreditna tveganja in za
10. katastrofalne škode
-4.883.068
9.
11. Prenos ČD preteklega leta med zadržane dobičke
12. KONČNO STANJE na dan 31. 12. 2010
(1+2+3+4+5+6+7+8+9+10+11)
860.183
42.626.092
2.811.907
8.525.219
2.451.265
-860.183
9.348.555
3.099.615
-1.003.134
1.003.134
4.152.726
4.852.080
Notes to the financial statement items in Chapter 5 of the financial report are an integral part of the financial statements.
73
73
77.867.459
INTRODUCTORY NOTES AND ACCOUNTING POLICIES
The presented annual financial statements relate to the yearly period ending on 31
December 2011. The financial report period coincides with the calendar year. The data for
the comparative period (2010) were revised. The financial statement audit was performed by
Ernst&Young, d.o.o.
Complete financial statement, presented in the annual report of the company, contains items
sufficiently important to influence the estimates and decisions of the intended audience.
Once the Supervisory Board confirms the annual report, the financial statement remains
unchanged.
CONSOLIDATION
The company issues group financial statements for the ZM Group. The group comprises ZM,
Vivus d.o.o., its dependent company, and Ornatus d.o.o, indirectly independent company.
The European Commission took a stand that a company within European Union, which
chooses to issue separate financial statements or for which the preparation of separate
financial statements in accordance with International Financial Reporting Standards (IFRS)
as adopted by the EU is required, is allowed to prepare and publish separate financial
statements independent from the group financial statements even prior to the publishing of
group financial statements when the national legislation and relevant European Union
directives demand or allow such separate publication.
When such separate publication is allowed, as is the case in Slovenia, the effect of the
European Union Committee standpoint is such that those companies are excluded from the
IAS 27 Consolidated and Separate Financial Statements, however they must list the related
group financial statements within their separate financial statements. In accordance with this,
the companies that publish their separate financial statements prior to group financial
statements and thus cannot publish statements in accordance with IAS 27 provisions can still
state that they have prepared their separate financial statements in accordance with IFRS as
adopted by the EU.
Group financial statements and notes to the items of consolidated financial statements are
prepared in accordance with the International Financial Reporting Standards, adopted by the
European Union, and are in force for the reporting periods, starting with 1 January 2011.
The consolidated report of the Zavarovalnica Maribor Group will be publicly available on the
company’s website www.zav-mb.si and at the company’s headquarters – Zavarovalnica
Maribor d.d., Cankarjeva 3, 2507 Maribor.
STATEMENT OF COMPLIANCE
The financial statements of the company including the explanatory notes are prepared in
accordance with requirements of the International Financial Reporting Standards (hereinafter
IFRS) adopted by the International Accounting Standards Board (IASB) and in compliance
with interpretations of the International Financial Reporting Interpretations Committee (IFRIC)
adopted by the European Union.
74
The applied accounting policies are the same as previous years with the exception of newly
adopted standards and notes, entered into force on 1 January 2011 as listed below.
IAS 24 – Related Party Disclosures
The IAS 24 amendment closely defines and simplifies the categorization of the related party.
The amended standard also decreases the extent of disclosed transactions between a public
corporation and the state and other public companies. The amendments are effective from 1
Jan 2011 or later. The amendments are to be used for the past cases. The amendment does
not influence the financial statement of the company.
IAS 32 – Financial Instruments: Presentation, classification of right to purchase shares in
foreign currency (amendment)
The amended relates to the rights for share purchase for a fix amount in foreign currency that
were in the existing standard treated as financial liabilities of the executed financial
instrument. The amendment defines that in case of certain conditions met such rights are
sorted as capital instrument regardless of the foreign currency in which the starting price is
denominated. The amendment is effective from 1 Feb 2010 or later. The amendment does not
influence the financial statement of the company.
IFRIC 14 amendment - Prepayments of a minimum funding requirement
IFRIC 14 amendment is effective from 1 Jan 2011 and is valid for past cases. The amendment
includes instructions for the assessment net realizable value of pension assets. The
amendment enables companies to consider the prepayment on the basis of minimum funding
requirement as asset. The amendment does not influence the financial statement of the
company.
IFRIC 19 - Extinguishing Financial Liabilities with Equity Instruments
It is effective for periods starting after 1 Jul 2010. The explanation states that all equity
instruments a company issues to a creditor to extinguish financial liability are to be treated as
payment of liability. The equity instruments are measured by their fair value. If the fair value is
not reliably determinable, the equity instruments issued are measured at the fair value of the
liability extinguished. Profit and loss is recognized instantly in the profit and loss account
statement. The explanation does not influence the financial statement of the company.
Improvements of IFRS
In May 2010 the International Accounting Standards Board published the IFRS
improvements and issued amendments and modifications to those standards with the
intention to abolish all differences and to additionally explain their contents. Those
amendments are effective for periods starting on 1 Jul 2010 or 1 Jan 2011. The
improvements that did not influence changes of accounting policy, financial status and
company/bank/group operations are:
IFRS 3 – Business Combinations
The possibilities to measure the non-controllable share have been modified. Only the
components of the non-controlling share that represent current ownership that provides the
owner the right to proportionate participation in net assets of the company in case of windup
are measured at fair value or as the non-controlling interest’s proportionate share of the
acquiree’s net identifiable assets. All other components are measured by their fair value on
the date of the acquisition. Those modifications are effective for periods starting on 1 Jul
2010 or later.
The second improvement is about the explanation that conditional payments arising from
business combination prior to IFRS 3R approval (as modified in 2008), the accounting
records it in accordance with IFRS 3, approved in 2005.
The last improvement refers to non-exchanged and voluntary exchanged bonuses from
75
payments arising from shares and their accounting treatment within business combination.
IFRS 7 – Financial Instruments: Disclosures
The modification is intended for simplification of disclosures with decreased level of
disclosures regarding the received insurances and improvement of disclosures with a
request to include qualitative information for simplified interpretation of quantitative
information. Those modifications are effective for periods starting on 1 Jan 2011 or later.
IAS 1 - Presentation of Financial Statements
The modification explains that the possibility to present items of another comprehensive
income includes their presentation in the statement of movements in equity or in financial
statement explanations. Those modifications are effective as of period starting on 1 Jan 2011
or later.
IAS 27 – Consolidated and Separate Financial Statements
The improvement states that transitional provisions of the IAS 27R as modified in 2008 are to
be appropriately used for afterwards modified standards. Those modifications are effective
as of period starting on 1 Jul 2010 or later.
IAS 34 – Interim Financial Reporting
The modification requires additional disclosures of fair values and modifications in
classification of financial assets as well as modifications in conditional assets and liabilities in
interim condensed financial statements.
IFRIC 13 – Customer Loyalty Programs
When determining the fair value of customer bonuses the company must consider discounts
and bonuses that would otherwise be offered to their customers that do not participate in
customer loyalty program. Those modifications are effective as of period starting on 1 Jan
2011 or later.
Standards and explanations that are not valid yet
The company did not prematurely apply any of the standards or explanations that weren’t
valid and are yet to come into force in the future.
In accordance with requirements of the IFRS and EU the company will have to consider the
following amended and updated standards and explanations for future periods:
IFRS 7 – Financial Instruments: Disclosures - Transfer of financial assets
The modification is effective as of period starting on 1 Jul 2011 or later and defines
disclosures on such transferred financial assets that present total abolishment of financial
asset recognized and such that do not present that. The modification is to be applied for past
cases also.
In accordance with IFRS requirements the company will have to follow those new, updated
or amended standards and explanations in case adopted by the EU:
IFRS 7 – Financial Instruments: Disclosures (modification) — Offsetting Financial Assets and
Financial Liabilities
The modification is effective as of annual periods starting on 1 Jan 2013 or later. The
modified standard introduces common requirements on disclosures that would offer users
information useful for assessment of an effect or possible effect of offsets to the financial
status of the company. The IFRS 7 amendment is to be used for the past cases. The EU has
not adopted the standard modification yet.
IFRS 9 – Financial Instruments:
76
This standard substitutes IAS 39 with the effective beginning for periods starting on 1 Jan
2015. The by now adopted first part of the standard sets new requirements regarding
classification and measurement of financial assets. The EU has not adopted the standard
yet.
IFRS 10 – Consolidated Financial Statements
This standard substitutes a part of the IAS 27 Consolidated and separate financial
statements standard, that relates to group financial statements, that are effective for periods
as of 1 Jan 2013. IFRS 10 sets a model of unified control for all companies. The
management will thus have to consider which companies are controlled and consequently
grouped. The standard modifies the definition of company control. The EU has not adopted
the standard yet.
IFRS 11 – Joint Arrangements
This standard substitutes the IAS 31 Interest in Joint Ventures standard and SOP 13 Joint
Ventures - non-monetary contributions of clients. The new standard defines only two more
types of joint investments where control is possible: joint operations and joint venture. The
standard uses the control definition as defined in IFRS 10. The standard also abolished the
possibility of proportionate grouping for joint ventures with which only the equity method of
grouping in still possible. The standard is effective for periods as of 1 Jan 2013. The EU has
not adopted the standard yet.
IFRS 12 – Disclosure of Interests in Other Entities
This standard is effective as of 1 Jan 2013 and includes all disclosures regarding joint
financial statements included in IAS 27 Consolidated and Separate Financial Statements and
also disclosures included in IAS 28 Investments in Associates and Joint Ventures and IAS
31 Interests In Joint Ventures. At the same time numerous new disclosures are defined,
especially in connection with used assumptions for determining whether a company controls
another company. The EU has not adopted the standard yet.
IFRS 13 – Fair Value Measurement
The new standard is effective for periods as of 1 Jan 2013. IFRS 13 does not alter the
principle of when to use the fair value but suggests on how to measure fair value of financial
and other assets and liabilities when it is obligatory or allowed according to IFRS. The EU
has not adopted the standard yet.
IAS 1 – Presentation of Financial Statements Presentation of items in the second
comprehensive income
The modification of the IAS 1 modifies the collection of items, presented in the second
comprehensive income. The items of the second comprehensive income that may or will be
'transfered' into the Profit and Loss Account Statement in the future, will be stated separately
from those that are not recognized in the Profit and Loss Account Statement. The
modification is effective for periods as of 1 Jul 2012; however, EU has not adopted the
modification yet.
IAS 12- Deferred Tax (amendment)
The amendment is effective as of 1 Jan 2012. The amendment refers to measurement of the
deferred tax relating to investment property valuated by its fair value. The goal of this
amendment is to include a) an assumption that the deferred tax for investment property
valuated by its fair value in accordance with IAS 40 is defined based on the assumption that
the book value of the investment will return through sale and b) a requirement that the
deferred tax for assets not depreciated and calculated by the IAS 16 model is always
measured on the basis of the sale value of those assets. The EU has not adopted the
amendment yet.
77
IAS 19 – Employee Benefits (amendment)
In June 2011, the committee issued numerous amendments of the IAS 19 standard. The
basic amendment relates to eliminating the corridor mechanism for recognizing program
modifications with particular earnings. It means that all modifications are recognized at their
creation depending on the modification type in the Profit and Loss Account Statement or in
the statement of the second comprehensive income. The amendment is effective as of 1 Jan
2013. The EU has not adopted the amendment yet.
IAS 27 – Separate Financial Statements
The standard was issued in May 2011 due to new IFRS 10, IFRS 11 and IFRS 12 standards.
IAS 27 includes accounting and disclosures of investments into associates, affiliated
companies and joint ventures in separate financial statements of the company. The
amendment is effective as of 1 Jan 2013. The EU has not adopted the standard yet.
IAS 28 – Investments in Associates and Joint Ventures
The standard was issued in May 2011 due to new IFRS 10, IFRS 11 and IFRS 12 standards.
IAS 28 thus includes accounting of investments into associates and requirements for use of
equity method when grouping investments into associates and joint ventures. The
amendment is effective as of 1 Jan 2013. The EU has not adopted the standard yet.
IAS 32 – Financial Instruments: Presentation (modification) — Offsetting Financial Assets
and Financial Liabilities
The modification is effective as of annual periods starting on 1 Jan 2014 or later. Its
application prior to this date is allowed. The amendment defines the meaning of 'has a legally
enforceable right to set off the amounts' and at the same time describes the use of IAS 32
criteria for setoff with settlement systems (e.g. systems of the central clearing house) that
use gross settlement mechanisms which are, however, not synchronized. The IAS 32
amendments are to be used for the past cases. When a company decides to use a standard
early it must disclose this fact and at the same time consider disclosure requirements that
are introduced by amendments to IFRS 7 Offsetting Financial Assets and Financial Liabilities
. This amendment has not been confirmed by the EU yet.
IFRIC 20 – Stripping Costs in the Production Phase of a Surface Mine
IFRIC 20 deals with costs of removing waste material from surface mines at the production
phase of a mine. The explanation presents deviation from the use of approach of average
ratio of waste material volume and output of ore in the existing life span of a mine that is
used by many mining and metal companies when reporting in accordance with IFRS. The
explanation is effective as of 1 Jan 2013 or later. The EU has not adopted the explanation
yet. The explanation will not influence the financial situation or operation of the company.
The company still examines the effects of optional standards and explanations and has at
this moment not yet assessed the effects of new requirements. The company will use new
standards and explanations in accordance with the requirements in case EU adopts them.
THE PROCEDURE FOR ADOPTING THE ANNUAL REPORT
The annual report of the company is adopted by the Management Board that presents it to
the Supervisory Board for approval. The Management and Supervisory Board also decide on
the net profit use for forming reserve of the company in accordance with the Companies Act.
Such use of profit is included into the current year statements while the distribution of profit is
in the domain of the company Assembly.
78
FUNCTIONAL AND REPORTING CURRENCY
Reporting and at the same time also functional currency of the company is euro. The
amounts in the financial statements are rounded to 1 euro. Due to rounding of data some
differences in sums might appear.
TRANSFER OF EVENTS
The transactions in foreign currency are calculated into the functional currency on the day of
the deal and are calculated according to the reference conversion list of the European
Central Bank, published by the Bank of Slovenia. The company transfers such calculated
exchange rate differences directly into its profit and loss account statement.
The company calculates the assets and liabilities items, nominated in foreign currencies, with
the use of exchange rates from the Bank of Slovenia reference list. Currency rate differences
from the calculations are recognized in the Profit and Loss Account balance.
THE USE OF ASSESSMENTS AND AUDITS
When creating the accounting statements, the accounting has to, in accordance with IFRS,
present the audits, estimates and assumptions that influence the use of guidance and the
accounted values of assets and liabilities and income and charges. The estimates and
assumptions base on previous experience and many other factors that are considered in the
given situation as reasonable and based on which we can present the opinion on carrying
amount of assets and liabilities that are not immediately obvious in other sources. The actual
results may deviate from those estimations. The amendments of accounting estimates are
recognized only for the period in which the estimate is amended and if influences the related
period only, or for the period of amendment and for the following years if the amendment
influences the current as well as the following years.
The liability estimate of claims arising from insurance contracts is one of the most crucial
accounting estimates. The insurance company must consider the uncertainty at estimating
the liabilities which it will have to pay out as the result of the claims. The suitability test for
claim liabilities was performed to ensure the suitability of contractual obligation disclosure.
The insurance company has considered the best possible estimate of future cash flows,
adjustment and administrative expenses and investment income with which the claim
liabilities are being covered. To assure the suitability of stated contractual obligations the
insurance company performed a suitability test on the day of balance. The test was
performed based on the use of the best estimate of future cash flows, estimates of
administrative expense and financial profits, arising from assets intended for liability cover.
The possible deficit in liabilities would be charged to the profit and loss account.
The total claims reserve calculation is based on estimates and assumptions of the final
development of the arisen claims. The claims reserve for registered claims is based on
estimates of the expected value payments of registered claims. The estimates are empirically
defined with inclusion of suspected future trends (inflation, service expense inflation, change
in legislation, etc.).
The calculation of the claims reservation for arisen and unreported claims (IBNR – Incurred
But Not Reported) is based on the estimation of number and amount of claims that already
occurred but were not yet reported and that were in the time of calculation still unknown to
the insurance company. The insurance company defines the IBNR claims estimation based
on the study of the previous claims activities with the use of various life assurance statistical
methods. The insurance company assumes that the claims development will realize similarly
79
in the future as it has in the past and also considers the noted trends and deviations. When
calculating the claims reserve we also prepare estimations for future recourse and estimates
for the level of future claims handling expenses. The suitability of the used assumptions and
estimations is checked periodically and new findings are used with the next evaluation.
THE OPERATIONS REVISION BY THE CONTROLLER
In October 2010, a supervisor (Insurance Supervision Agency) started with the audit of
company operations of which purpose was to review, together with the Bank of Slovenia
inspectors, all operations with affiliated persons of the company in 2009 and 2010 and to
perform review of procedures for underwriting life insurance through the agents network in
2010. The audit concluded at the end of 2011 and on 5 January 2012 the audit report was
issued. On 9 February 2012, the Insurance Supervision Agency notified the company that it
was going to issue a decision according to which only agents that meet all legal conditions
for underwriting insurance will be able to perform operations for agencies. Until the
conclusion of the annual report the decision had not been issued yet.
In 2011 no other inspection supervisions of company operations were performed.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting policies presented hereinafter are consistently applied by the Company in all
periods indicated in enclosed annual financial statements.
Intangible Assets
Intangible assets are stated at cost less accumulated depreciation and any impairment
losses. The acquisition cost includes the purchase price and any costs directly attributable to
the acquisition. The company uses the Acquisition Cost Method for its accounting policy of
measuring intangible assets according to their recognition. The intangible assets are thus
accounted by their acquisition cost less depreciation and impairment losses.
Subsequent expenditure related to intangible non-current assets is recognized as operating
expense of the reporting period. Subsequently incurred expenditure is stated as an increase
in the acquisition value of an intangible asset if it contributes to an increase in its future
benefits, or as a decrease in the value adjustment if it prolongs its useful life.
The company balances the depreciation of intangible assets according to the straight-line
depreciation method. The depreciation rate of intangible assets depends exclusively on the
useful life of the assets. The company starts with asset depreciation when the asset is ready
for use. All intangible assets in the company have their limited useful life. The depreciation
of intangible assets begins on the first day of the month following the month when the assets
are ready for use and ends on a date prior to the actual classification for sale or the
recognition annulment.
In the reporting period, the following depreciation rates were applied:
o software licenses
o 20 to 50
o other intangible assets
o 5 to 25
percent
percent
Disclosed intangible assets are impaired when their book value exceeds their net
replacement value. In the event of impairment, the carrying amount of the asset is decreased
to its net replacement value and at the same time expenditure arising from impairment is
recognized directly in the Profit and Loss Account.
80
The Company also states non-current deferred acquisition costs, which represent contract
commissions paid in advance, under intangible assets. The Company will transfer them to
expenses in the period, in which revenue arising from premiums, based on which the
Company calculated deferred expenses, will be recognized.
Tangible capital assets are initially recognized as acquisition cost including directly
attributable cost of acquisition. Following initial recognition, the assets are stated at cost less
accumulated depreciation and any impairment in value. Due to their non-finite useful life,
items of property are not subject to depreciation. The acquisition price of some key business
buildings was divided into smaller individual items having different useful lives and
depreciation periods. Licensed software that has to be bought with new hardware thus
guaranteeing its functionality is activated as part of the equipment.
The costs of business premises that make part of a building (condominium) also comprises
the value of the functional land of the building and is not depreciated.
Subsequent expenditure related to tangible assets is recognized as an operating expense in
the accounting period in which it incurred. Subsequent expenditure on an intangible asset
incurring during its use and increasing its future economic benefits is stated as an increase in
acquisition cost. Subsequent expenditure resulting in the extension of the useful life of a
tangible capital asset is stated as a reduction in the valuation adjustment.
Depreciation of plant and equipment of the Company is calculated on a monthly basis by
applying the straight-line depreciation. The company starts with asset depreciation when the
asset is ready for use. The depreciation of tangible assets ends on a date prior to the actual
classification for sale or the recognition annulment.
o plant and buildings
o 3 percent
o parts of buildings of higher value
o 3 to 6 percent
o motor vehicles
o 20 percent
o other equipment
o 15 to 33.3 percent
o small inventory
o 30 percent.
Each year the company estimates whether there are any signs of impairment of tangible
capital assets. Such events arise when their book value exceeds their net replacement value.
In the event of impairment, the carrying amount of the asset is decreased to its net
replacement value. The decrease represent loss due to impairment which the company
recognizes directly in the Profit and Loss Account.
As small inventory within the tangible capital assets the company defines purchased assets
similar or the same to those already categorized as small inventory. In general only items of
acquisition cost lower than 500 euros, which contribute to improvement of working
environment, where process are being performed or are a result of constant modernization of
office equipment but are not necessary for execution of processes, are categorized as small
inventory.
Small inventory of value up to 100 euros is immediately registered as cost. The same goes
for inventory for which we justifiably believe that its use will not exceed one year, and for the
inventory, regardless of its value, that an individual employee receives for its daily use.
Investment Property
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Investment property is property, held by the Company with the purpose of earning with rent
or of long-term investment appreciation or both. Subsequent to its initial recognition,
investment property is valued by the company on the basis of the Cost Method model. The
company thus records the investment property by its acquisition cost, decreased by the
depreciation and possible impairment.
Depreciation of investment property is calculated on a monthly basis by applying the straightline depreciation considering the useful life of individual item and/or the duration of the rent.
Buildings
3 to 3.3 percent.
The Company leases the majority of its investment properties. Most of the lease agreements
are underwritten for definite period of time. All lease agreements may be revoked at any
moment. Revenue arising from lease agreements is disclosed directly in the Profit and Loss
Account under financial revenue proportionately with lease duration.
Investment property is impaired when its carrying amount exceeds its net replacement value.
In the event of impairment of investment property, carrying amount of such assets is
decreased to its net replacement value and, at the same time, expense arising from assets
impairment is recognized directly in the Profit and Loss Account.
Lease
Lease is a contractual relationship in which the lessor transfers the right to use the assets to
the lessee in return of financial payment or a series of payments for a specified period. The
financial lease is a lease where all important forms of risk and benefit related to the asset
ownership are transferred. With the financial lease the ownership right may or may not
transfer to the other side.
Lease agreements signed by the company do not fulfill the conditions entirely to be
categorized as financial leases. The company thus recognizes the rent in case of a business
lease as cost in the Profit And Loss Account applying the straight-line depreciation during the
complete lease period. When the company acts as a lessor, the assets spent for a business
lease are recognized as assets in the balance sheet of the company, and the rent revenue is
recognized equally during the complete lease period.
Investments
Financial investments of an insurance company are the most important part of its financial
assets and, at the same time, are assets intended to meet its future liabilities arising from
insurances and to cover its possible loss resulting from insurance operations risks. A
financial investment is recognized as company’s financial asset if there is an option of
economic benefits related to it and it is possible to measure its acquisition cost reliably. The
Company conducts recognition of financial investments on the day of trading. The same
goes for the balance of regular sale of financial investment.
With regard to the accounts they are arising from, financial investments are categorized by
their recognition under one of the life insurance long-term business funds, or under property
long-term business funds, or as assets from available own fund of individual insurance
groups.
The company uses the unified valuation methods for valuating financial investments of the
long-term business fund, business fund and financial investments of its own free sources.
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For the purpose of statement, the purchase or sale business for the same financial
investments, categorized into the same group of financial assets, are calculated by the FIFO
method.
The company categorizes its financial investments at the initial recognition according to their
acquisition purpose, time of possession and type of financial investment into one of the
financial asset groups that define their accounting balance and their measurement. Upon
acquisition financial investments are also classified in one of the following groups:
o
o
o
o
o
o
o
o
Financial assets measured according to their fair value through profit and loss
account. This group includes all the financial instruments of life insurance long-term
business fund whereby the investment risk and all financial instruments with
embedded derivatives are assumed by the insured person. The Company holds no
such financial instruments which would be intended for active trading among financial
assets measured at fair value. Revaluation effects of such investments are included
in the profit and loss account statement for the current year
Financial assets available for sale. Financial investments available for sale are all the
remaining financial assets held by the Company for an indefinite period of time and
which can be sold due to market conditions, due to important loss events which
cannot be foreseen, due to investment structure, ensuring required structure of
investments, operational needs or other business reasons. The Company recognizes
unrealized profits or loss arising from fair value change of financial assets through the
comprehensive technical account and includes them into the revaluation surplus as a
separate item of equity;
Loans are loans and deposits with banks with fixed or determinable payments not
quoted on an active market. The Company measures them at amortized cost by using
the effective interest rate. Financial investments in loans also include monetary
deposits;
Financial assets in possession until maturity date. Into this group the company
categorizes those financial investments with identified or identifiable payments and
identified maturity date that the company certainly intends to and is able to possess
until maturity date. The company measures them at the amortized cost method with
the use of effective interest rate.
The company does not use derivative instruments for the purpose of hedge.
With the initial recognition of financial investment the company recognizes their fair
value. The company adds to the initial recognized value the operation expenses
(stock market provision, stock broker provision, CSCC expenses, possible interest
accruing during purchase or sale) that arise directly from purchase or lease of the
financial investment. An exception is financial investments categorized at recognition
as financial assets measured by their fair value through the profit and loss account
where the operation costs are not included into the initial recognition of the financial
investment. The company recognizes them directly as charge under investment costs
in profit and loss account.
Any subsequent measurement of financial investments of the company depend on
their categorization at recognition and can be made according to their fair value or at
the amortized cost, by the effective interest rate method.
The valuation of financial investment fair value depends on market data availability,
based on which the company can evaluate the fair value. The company categorizes
the financial investments into three levels according to its fair value valuation. Within
each level the fair value is valuated as:
• 1st level: The financial investment fair value is the same as its market value,
valid for financial investments that quote at the active securities market.
• 2nd level: The financial investment fair value is the same as its valuated fair
value, valid for financial investments that do not quote at the active securities
market, and the company can evaluate their fair value based on the internal
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evaluation model in which it includes data, available at the securities market
(verifiable data);
• 3rd level: The financial investment fair value is the same as its valuated fair
value, valid for financial investments that do not quote at the active securities
market, and the company can evaluate their fair value based on the internal
evaluation model in which it includes data, unavailable at the securities market
(unverifiable data).
For evaluation of fair value of financial investments that do not quote at the active securities
market the company uses the following verifiable data from the securities market:
o
o
Values from the written instrument of a broker agency or a bank on the last known
price at trading with financial investments in traffic
values based on which the buyer would want to buy off complete or most of the
financial investment stock in the possession of a company, based on a written offer or
publication.
When evaluating the evidence for the purpose of establishing the needs for eventual
impairment of an investment or a group of investments available for sale, the company
evaluates whether it is a trend of a significant and a long-term drop in the financial
investment fair value.
A significant drop in fair value of the financial investment occurs when:
o
the fair value of the financial investment compared to its acquisition cost is lower by
40 percent, regardless of the duration of such drop.
A long-term drop in fair value of the financial investment is defined by:
o
o
a period of up to nine months from the day of the first financial investment value drop
under its acquisition value and the value remained below its acquisition value for the
complete period of nine months.
a period of at least two years passing from the day of the first investment value drop
under its acquisition value with the exception of occasional market fluctuations.
The company assesses the loans by the necessity of their impairment, based on the
ascertained insolvency or on payment delay individually according to the delay scale. If the
loan is irrecoverable, the company writes off the loan in total.
Investments into Affiliated Companies and Associates
The company valuates investments into affiliated companies and associates, which are in the
company’s portfolio due to reaching or increasing market share and with which the company
signed an agreement on underwriting for the company exclusively, in separate accounting
statements by their acquisition value.
The company valuates the investments into other affiliated companies and associates in
separate accounting statements in accordance with IAS 39.
For the needs of preparation of disclosure in financial statements the company includes
affiliated companies and associates, members of the supervisory board, the audit committee
and members of the management board.
Coinsurer and Reinsurer Assets
Among the coinsurer and reinsurer assets the company accounts the entitlements that arise
from estimated long-term liabilities from insurance agreements. The company is entitled to
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them based on the underwritten coinsurance and reinsurance agreements with which it
transferred a share of insurance risk to coinsurers and reinsurers.
The company recognizes the assets based on received or own coinsurance or reinsurance
balance, adjusted with partners.
If there is objective proof that the company will not be able to realize the estimated monetary
flow, that appertains to it in accordance to the underwritten agreement and that the influence
of nonperformance can be precisely measured, the company impairs coinsurer and reinsurer
assets.
As an objective proof, due to which the company would impair interest in other insurance
agreements, would count the refusal or failure to settle the liabilities by coinsurer or reinsurer
with reference to reinsurance claims or retrocessions.
Receivables
The company accounts the receivables in the balance sheet by their original value less
impairment loss due to revaluation of the receivables value. The company accounts the initial
receivables recognition based on the issued policy, receipt or other authentic document (e.g.
a confirmed coinsurance or reinsurance balance).
Due to the fact that not all of the receivables will be paid or will be paid in time, the company
assesses their impairment loss. Thus the company creates revaluation and adjusts their
carrying amount to the probability of their realization. The receivables revaluation is
recognized directly in the profit and loss account statement under financial expenses for
revaluation.
The company performs the impairment of receivables towards the insured persons at each
quarterly reporting based on the movement of the receivables towards the insured persons in
previous periods, and at the end of the year based on new recalculations for cumulative
three-year period.
The impairment towards the insured persons from the insurance business of property
insurance is performed based on individual assessment for the large insured whose yearly
invoiced gross premium exceeds 500,000 euros. Individual assessment is performed also in
case of accounted impairment of economic conditions of operations in certain sectors, major
financial problems of companies, breach of contract or nonperformance in payoffs. For other
receivables a flat-rate (group) impairment is performed.
Individual assessment of fair, i.e. collectable value of receivables arising from insurance
business is carried out based on the estimation of financial standing and solvency of the
insured persons based on credit rating report, type and scope of receivables insurance
towards individual insured and fulfillment of his obligations towards the company in previous
periods.
Flat rate (collective) assessment of fair, i.e. collectable, value of receivables arising from
insurance business is calculated by the company based on consideration of receivables
structure towards the insured persons with similar credit risk. Indication of the necessary
impairment is supported by the fact that the amount of paid out premium is always lower than
the amount of invoiced premium. The rate of premium non-payment is established on the
basis of a three-year average. The rate regarding the balance of receivables is calculated as
potential impairment, whereby the receivables with maturity longer than 36 months (period of
limitation) are fully impaired (100 per cent impairment). The company calculates the average
three-year rate of written-off receivables and receivables declared in receivership separately.
For rates calculated in this manner the company conducts impairment of receivables balance
within 360 days. The company corrects the total amount for the ex-post repayment
coefficient. The coefficient of repayment probability and other relevant data for potential
85
corrections of estimated amounts for impairment are based on internal data, including data
on successful executions, repaid receiverships, repayments of receivables already written
off, etc.
Receivables declared in receivership proceedings and receivables which are due to their
doubtful or disputed nature subject to legal dispute and which are at the same time not
covered by mortgage insurance are impaired fully.
Impairment of receivables from the insured persons arising from life insurances is carried out
by the company after the insured persons failed to settle three installments of insurance
premium. Receivables adjustment is made for the full amount of unsettled receivables arising
from insurance business (100 percent impairment).
Recourse recovery is recognized under assets if a substantial legal basis was obtained by
the company for such recovery (final judicial execution, concluded written contract with the
insurer or debtor, commencement of the debt repayment by the insurer or debtor, credit
insurance subrogation). Even in an event of subrogation the company recognizes the
recourse recovery only after establishing the actual existence and/or the physical presence
of the debtor. Recognizing the principal of the recourse recovery among the company’s
assets reduces its expenses for claims paid.
The company conducts impairment of recourse recovery where it is reasonably assumed
they will not be settled or will not be settled in full. The company revaluates the recourse
recovery on the level of proceedings for recourse, chargeable to financial expenses for
revaluation. The company conducts impairment of the principal, interests and judicial costs
recognized in the recourse receivable separately. Indication of impairment of recourse
recovery for the recourse principle appears if the overdue part of recourse recovery is not
settled within 60 days after the maturity date. Due to the nature of recourse recovery, the
company in this case impairs the entire unpaid value of recourse principal, regardless of
recourse recovery installments that are not due yet.
Charged but unpaid interests (installment or on arrears) arising from recourse proceeding
and recognized as recourse recovery is fully impaired. Receivables arising from costs of
recourse proceedings and recognized as recourse recovery which are not settled within 30
days after maturity date are fully impaired by the company.
Written-off receivables are recognized on the basis of an estimate regarding impossibility of
collectability or its uneconomical nature for the company. The estimate is based on
appropriate documentary evidence. Written-off receivables are debited to revaluation
adjustments of receivables values arising from impairment procedures or directly to
company’s financial expenses for revaluation.
Non-current assets held for sale are assets whose carrying amount will be recovered
principally through a sale transaction rather than through continuing use. The asset meets
this condition when it is available for immediate sale and its sale must be highly probable.
Non-current assets held for sale are measured by their carrying amount or fair value less
selling costs or depreciation until decommissioning, by the lower of the two values. All
changes to non-current assets held for sale are immediately recognized in the Profit and
Loss Account. Non-current assets held for sale are not subject to depreciation.
Stocks
The company categorizes office material and durable goods for office and agency work as
stocks. Stock of printed matters and forms is evaluated by their wholesale value comprising
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purchase value and direct purchase expenses. At the consumption the company uses the
method of weighted average prices.
Regarding the purposeful production of printed matters for the needs of insurance business
that have no actual market value the revaluation due to impairment is not realized for stocks.
Other types of stocks are revaluated due to impairment only if their book value exceeds their
realizable value.
As monetary assets the company defines cash in the central cash register, deposit money on
company’s bank accounts, cash on course representing cash transferring from the cash
register to an appropriate bank account, and cash equivalents. Cash equivalents are so
called overnight deposits and non-current deposits closed for a one-month period and
receivables from checks to be cashed immediately.
Monetary assets are revaluated only in case of monetary assets in foreign currency if the
currency rate changes after the initial recognition. Currency rate differences are accounted
for in the Profit and Loss Account balance.
Equity
Company’s equity consists of its equity capital (share capital), capital reserves, profit
reserves, the retained profit or loss, revaluation reserves and the profit and loss account of
the financial period.
The company does not have statutory defined capital shares for property or life insurances.
Accounted allocation is based on the ratio determined upon establishment of the company in
1990 and content of later capital increase of the company.
Share capital is a liability towards owners and does not become payable until dissolution of
the company. It represents par value of paid-up ordinary shares denominated in EUR. Each
no-par value stock is issued on a name and enables one vote when realizing management
(voting) rights. The shares are issued in a non-materialized form and are managed by the
Securities Clearing Corporation.
Capital reserves are formed and used in line with the Companies Act. Under capital
reserves the company discloses only the amount of general revaluation adjustment of equity
elimination which was made during statutory revaluation of equity. Capital reserve may only
be used in line with the Companies Act that closely defines the conditions of capital reserve
use for covering net loss from the company’s assets. Capital reserve is not subject to
distributable profit and allocation to the company’s owners.
Profit reserves are recognized on the basis of:
o
o
o
o
the Insurance Act, which defines creation of credit insurance equalization provision
categorized under other profit reserves;
the Companies Act, which defines creation in special cases (acquisition of own
shares, statutory reserves);
decisions of the Management Board and the Supervisory Board, which may
adjudicate in accordance with the Companies Act upon half of created remaining net
profit for the current year;
decision of the Company’s Assembly adjudicating upon distributable profit.
The Company does not have statutory addressed assigned profit reserves, however, it has
established with the statute that the amount of statutory reserves must reach 20 percent of
the company’s share capital.
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Considering that the company does not have its own shares and does not need reserves for
own shares, the company ensures with regard to disposition of profits in the order indicated
below:
o
o
o
risk equalization reserves (equalization provision) in the calculated amount;
statutory reserves, whereby it gives priority due to statutory capital adequacy hedge –
within the limits of the amount the Management Board and the Supervisory Board are
allowed to allocate by the Companies Act – to directing profit to statutory reserves
until they reach 20 percent of nominal capital;
other profit reserves, which, apart from being used for covering potential losses in
business operations, also increase available solvency margin in calculation of capital
adequacy.
The company can use profit reserves in accordance with Companies Act. With its use it is
following the goal of assuring capital adequacy of the company prior to its allocation to the
company owners.
Capital reserve, profit reserve above legal limit and profit of previous years and of the current
year can be transformed into share capital by an Assembly decision.
Revaluation reserve arises solely from the revaluation effects of the financial assets,
available for sale by their fair value. In the balance sheet the accounted amounts of the
revaluation reserve are corrected for amounts of the referred tax. Mathematical reserves
include part of the revaluation reserve, recognized based on financial investments available
for sale and in ownership of the long-term business fund of classic life insurance, as it
belongs to the insured persons in accordance with provisions of insurance agreements.
Earnings Per Share
When calculating net earnings per share, the company takes into account all issued shares
in all presented periods. Weighted average of ordinary shares exercised in the accounting
period is equal to the total number of shares. When calculating the total number of shares,
the company considers the number of days when individual shares were winning recognition
as a multiplier of timely weighing regarding the share of all accounting period days. Earnings
per share are the same for all shares.
All shares issued by the company are ordinary registered shares and there are no potential
ordinary shares.
Subordinated Debt
Subordinated debt represents issued bonds valued at amortized cost.
As subordinated debt the company accounts issued dematerialized registered bonds issued
during one issuing, with a coupon fixed rate12.
Insurance Agreements
All concluded contracts were classified by the company as insurance contracts in compliance
with IFRS, since by agreeing to refund the damage which the policy holder might suffer at
some point in the future the insurance company assumes material insurance risk from the
policyholder.
12
For more information on issued subordinated bond characteristics see item 13 in Explanations to financial
statements.
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According to IFRS, an event is accidental when at the time of underwriting isn’t obvious if or
when it is going to happen and what the amount of the benefit is going to be. On the other
hand an insurance risk is materially high if the insurance event caused company’s payout of
material additional sums, by any scenario except those that do not include a trading
component.
With classification of insurance contracts the company categorized risks and their transfer
and also stated the existence of material additional sums with the help of risk sum definition
for each insurance agreement. In most insurance agreements the risk sum represents the
benefit itself or the benefit less the mathematical reserve in the insurance agreement.
Insurance Agreement Categorization
In regard to risk duration and determination of insurance conditions, the company
categorizes insurance agreements into three main groups:
o Insurance agreements of property (non-life) insurance,
o Insurance agreements of classic life insurance and
o Insurance agreements of life insurance, in which the insured person assumes
investment risk.
Within property insurance, the company additionally identifies the following (homogeneous)
types of insurance contracts:
o
o
o
o
o
Car insurance
Agricultural insurance
Credit insurance
Accident insurance
Other property insurance
o
o
o
o
Liability insurance
Property insurance
Transport insurance
Railway rolling stock insurance
In regard to fulfillment of uncertainty conditions for a loss event and material insurance risk,
the company identified the following (homogeneous) types of insurance agreements within
classic life insurance in 2010:
o Endowment life insurance with critical illness protection
o Endowment life insurance
o Endowment life insurance with agreed payout period
o Endowment life insurance with interval payouts of the maturity value
o Joint endowment life insurance
o Term life insurance
o Term life insurance with decreasing sum assured
o Whole life insurance
o Joint whole life insurance
In regard to fulfillment of uncertainty conditions for a loss event and material insurance risk,
the company identified the following (homogeneous) types of insurance agreements within
unit-linked life insurance in 2010:
o Unit-linked life insurance with possible critical illness protection
o Single-premium unit-linked life insurance with additional accidental death
insurance
Dismantling Insurance Contract Components
According to IFRS an agreement is an agreement between two or more parties with clear
economic consequences. To define an appropriate IFRS, an analysis of the economic point
of view of the agreement is necessary – thus an agreement can be presented as number of
agreements for accounting purposes.
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Dismantling is required when the insurer can measure the components (including the
integrated option of redemption) and if the insurer’s accounting policy otherwise doesn’t
require recognition of all rights and liabilities.
Dismantling is prohibited when the insurer cannot measure the components. At dismantling
the insurer must use IFRS 4 for insurance component and IAS 39 for savings part.
The company does not use this dismantling process.
Discretionary Participation
According to IFRS 4 the discretionary participation presents the contractual right to additional
benefits as addition to guaranteed benefits. Additional benefits must meet the following
criteria:
o They need to represent a significant share of all contractual liabilities
o The amount and the time of annotation is in the hands of the insurer
o Contractually they are based on:
success of a certain group (or type) of agreements
realized/unrealized investment return in connection with certain groups of
assets in the ownership of the issuer or
profit and loss account of the company, long-term business fund, or third
person that issued the agreement.
In accordance with IFRS 4 an insurer can recognize the guaranteed component separately
from the discretionary participation. In this case the guaranteed component is categorized as
liability and the discretionary participation as debt or as a separate equity item. Otherwise (if
not recognized separately) the whole contract is categorized as liability.
The insurer can recognize all received premiums as income and has no need to separate
any part, related to an equity component.
For companies that would according to IFRS 4 be categorized as financial instruments the
incorporation of discretionary participation influences the valuation of the whole agreement in
the following way:
o When the insurer classifies the discretionary participation as liability, he has to
perform the adequacy test of liabilities for the complete agreement, meaning he
valuates the complete agreement according to IFRS 4, the same as if
categorized as insurance agreement.
o When the insurer categorizes a part or the complete possibility of discretionary
participation as a separate equity component, the liability recognized for the
complete agreement cannot be lower than the result of the IAS 39 use for the
assured component.
The company signs insurance agreements in life insurance class that also include the
possibility of discretionary participation of the insured persons (e.g. insurance profit sharing).
The profit sharing is defined in general terms and conditions of life insurance in which it
refers to the regulations on forming mathematical reserve of life insurance. The discretionary
rights included into the insurance agreements are not valuated separately because the
possible additional payout doesn't represent a material share in the total payout by the
insurance agreement. The liabilities arising from the discretionary right are completely
recognized as mathematical reserves.
Incorporated (Realized) Financial Instruments
The insurance company offers many possibilities or options in theory and practice. For each
possibility or option we have to ascertain whether a financial instrument has been realized
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and determine the appropriate valuation manner. The company applies the following
procedure for that:
o If a financial instrument has already been realized – is it valuated by its fair
value?
o If it's not – is it an independent component?
o If it is – is it tightly connected to the host agreement?
o If it's not – separate it from the host agreement and measure it by its fair value (in
all other cases listed above there are no additional valuation requirements).
The above is void if the realized financial instrument is an insurance agreement by itself.
For identification of an incorporated financial instrument tightly connected to the host
agreement and for fair value valuation IAS 39 is used.
Frequent possibilities or options that we come across in theory and practice are: premium
holiday, sum insured modification, premium modification, payout of advances, payout of
partial buyoffs, payment of additional premium sums, additional insurance, buyoff possibility,
possibility of insurance capitalization, payout of bonuses, one-time payouts or annuity
payouts after the termination of insurance period, possibility to discontinue the insurance and
renew it, transfer of assets between investment funds, modification of premium distribution
key, prolongation or shortening of insurance period, indexation.
Technical Provisions (Insurance Agreement Liabilities)
According to the provisions of Article 113 of the Insurance Act (Official Consolidated Text)
the company creates technical provisions intended for covering of future insurance liabilities
and possible risk-related losses arising from insurance business performed by the company
for each performed insurance business separately.
The company acknowledges the following technical provisions:
o
o
o
o
Claims reserve
Provisions for unearned premium
reserve
Equalization provisions
o
o
Bonus and Rebate Provisions
The technical provisions have to be formed in sum adequate for coverage of all liabilities
from insurance agreements that can be anticipated. An authorized actuary for property and
life insurance, appointed by the Management Board, inspects and comments the calculation
of technical provisions from insurance agreements and their adequacy at a yearly level.
Under obligations arising from insurance agreements, the company accounts gross amounts
of technical provisions and technical provisions referring to insurance business arising from
assumed coinsurance. The share of obligations from insurance contracts which has been
ceded in reinsurance and coinsurance is accounted by the company under assets.
Particularities of the source for formation and categorization of equalization provisions into
accounts are disclosed below.
Claims reserve
Claims reserve are established in the amount of estimated liabilities that the company has to
pay out based on insurance agreements, with regard to which an insured event has occurred
before the end of insurance period, regardless of whether the insured event has been
reported, including all the expenses of the company arising from those agreements.
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The company’s claims reserve are composed of:
o
o
o
Provisions for reported and unsettled claims outstanding (claims reserve according to
inventory),
Provisions for claims incurred but not reported (IBNR),
Annuity insurance liabilities deriving from liability insurance.
Provisions for reported claims that remain unsettled are those provisions that were already
reported, but remained completely or partially unsettled on the date of statement. They will
be calculated for each claim separately, based on the estimated value of expected claim.
Provisions for occurred but not yet reported claims are provisions for those claims that are
assumed to have already happened but were not yet reported. The amount of provisions for
claims incurred but not reported (IBNR) is calculated by the company using two methods.
According to the first method the company first estimates the total amount of required claims
reserve on the day of estimation based on triangles of liquidated claim development and the
Chain Ladder Method. Such estimation of claims reserve comprises both provisions for
reported incurred claims as well as provisions for claims incurred but not reported (IBNR).
Provisions for claims incurred but not reported (IBNR) are calculated by the company as the
margin between the amount of claims reserve based on triangle method and provisions for
incurred reported claims. The adequacy of claims reserve sum total is assessed with
executed approaches (Mack and Bootstrap Chain Ladder) that, regarding risk assumption,
correspond to Solvency 2 Directive norms.
According to the second method, the company calculated provisions for claims incurred but
not reported (IBNR) as a product of the expected number of subsequently reported claims
and the expected average amount of subsequently reported claims.
In claims reserve the company also discloses its liabilities for recognized annuities deriving
from liability insurance, if recognized to claimants on the basis of a final judicial decision,
settlement or an agreement between the claimant and the insurer.
Claims reserve are reduced by estimated expected recourses. The estimation is based on
average recourse movement during a five-year period and decreased by valuation costs.
Valuation costs are based on a three-year average of such costs share in gross claims.
Net claims reserve is the gross claims reserve increased by the claims reserve from the
received coinsurance and reduced by the claims reserve from the submitted coinsurance and
reinsurance.
With the exception of annuity from liability insurance the company does not discount claims
reserve.
Mathematical reserves for classic life insurance agreements are calculated as the difference
between short-term values of estimated future underwriting liabilities and the short-term
estimated value of future premiums that will be paid based on these insurances. For
calculations the Zillmer method is used. The calculation is performed on the individual policy
level in compliance with valid technical bases of the company’s life insurance. Negative
values of mathematical reserves are set to zero. The difference between the positive
Zillmer’s mathematical reserve and Zillmer’s mathematical reserve is disclosed in assets as
the deferred insurance acquisition costs.
For insurance policies not having an equal reporting period and course of insurance year, the
company calculates mathematical reserves using linear interpolation of the provision
between two subsequent years.
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Mathematical reserves for additional entitlements have been established by the company for
liabilities that are established for guaranteed payouts upon the birth of a child. The amount of
provisions for the birth of a child is calculated based on the estimated number and amount of
payouts for insurances already underwritten. The procedure of calculating such provisions is
based on the estimation of future payouts using the triangle method, also taking in
consideration the number of births of children within one year of insurance underwriting and
within the insurance development year. Mathematical reserves for traditional life insurance
are increased by a share of distributed profit. Provisions for profit attribution among the
insured persons are based on the contribution method. The profit is attributed to the insured
persons annually at the end of the year for the previous business year. The profit attributed
to the insured persons is guaranteed. Mathematical reserves include also part of the
revaluation reserve, recognized based on financial investments available for sale and in
ownership of the long-term business fund of classic life insurance, as it belongs to the
insured persons in accordance with provisions of insurance agreements.
Mathematical reserves for unit-linked life insurance are established at the level of individual
policies as:
o
o
Mathematical reserves of units, corresponding to the product of the number of units
and the value of a unit, calculated per individual investment fund, and
Mathematical reserves composed of paid premiums that have not been converted to
units (due to the delay between the premium payment and purchase order, and the
entry of purchased fund units to the insured person’s personal account).
The company forms additional mathematical reserves for insurance agreements from
insurance class 21, where some of the insurance entitlements are bound to units of financial
instruments or mutual funds.
Unearned premium reserves
The company forms unearned premium reserves for individual insurance agreement in the
amount of the gross insurance written premium pertaining to coverage during an insurance
period after the cessation of the accountancy period for which the provisions are calculated.
Provisions for unearned premium reserves are calculated individually for each insurance
agreement by the “pro rata temporis” method, except for the insurance agreements where
the amount of the insurance coverage is changing (decreasing of the sum insured in credit
insurance).
Equalization provisions
The company calculates equalization provisions in the credit insurance class. They are
calculated in accordance with provisions of Decision on detailed rules and minimum
standards to be applied in the calculation of technical provisions.
The company performs formation of equalization provisions through allocation of net profit,
after the decision of the management board or with a direct increase of net loss of the
business year. Their formation is accounted in the Statement of Changes in Equity. To meet
the provisions of IFRS the company recognizes and accounts the equalization provisions as
a separate item of profit reservations in company’s equity as expected by the Decision on
annual report and quarterly financial statements of insurance undertakings SKL 2009
(including the amendment from the Official Gazette of RS 99/2010). This equity item is
regarded as business fund liability for which coverage from investments is required.
Bonus provisions are established in amounts of payouts, which the insured persons are
entitled to receive based on their right of profit participation deriving from their insurances, or
93
other entitlements based on the insurance agreement. Liabilities are calculated based on the
rule of bonus reimbursement as defined in insurance agreement. The share of bonuses
within an insurance period is calculated according to the “pro rata temporis” principle.
On the day of valuation, the company discloses among other technical provisions, the
provisions for unexpired risks.
Provisions for unexpired risks are established by the company as additional provisions for
insurance groups where the estimated liabilities for unexpired risks exceed the established
provisions for unearned premium reserves. They are formed for coverage of claims and
expenses related to the existing insurance agreements that will occur after the accounting
period and are not covered by the unearned premium reserve. The amount of those
provisions is a difference between the actual amount needed for covering unexpired risks
and the unearned premium reserve.
Additional provisions for unexpired risks are formed by the value of net amounts.
Financial Agreements
Financial agreements are those agreements that carry financial risk without material
insurance risk. The company does not have any agreements underwritten that would fall into
this category regarding the risk assumption.
Provisions for Other Liabilities and Costs
Among other provisions the company accounts long-term provisions for long-service awards
to employees and severance pay upon their retirement. These provisions are established
based on the method of actuarial valuation (the method used comprises the imputation of
earnings proportionally to the work executed), which is affected by mortality rate, employee
fluctuation, future salary raises and the expected inflation rate. The liabilities are
acknowledged based on liabilities deriving from concluded employment contracts and labor
legislation in force.
The short-term value of anticipated cash flows is calculated on bases of the Euro Benchmark
Curve (source: Bloomberg) that incorporates German and French government bonds.
The calculation comprises the probability that the employee does not receive the longservice award or severance pay due to preliminary cancellation of employment or death in
time of employment. The future fluctuation is defined through internal data based on previous
experience (separately for full-time employees and agents). Slovenian tables are used for
expected mortality.
Any changes to provisions for long-service awards and severance pay to employees are
acknowledged by the company within labor costs, included in operational costs.
Assets for employee’s pensions within the pension pillar are acknowledged by the company
as short-term costs of the period, in which the payment is made to the pension fund of a
pension company.
Among other provisions the company also accounts retention sums from excess employment
with regard to disabled quota deriving from labor legislation. The assets are purpose-based,
and can as such only be used by the company for purposes defined in labor legislation.
Liabilities for short-term employee earnings (salary, allowances...) are measured based on
their nominal value and recognized within labor costs, included in operational costs.
Accruals
94
Within active accruals the company recognizes short-term deferred expenses (charges) and
previously uncharged income, and in passive accruals the included expenses (charges) in
advance and deferred income.
With accruals the company adjusts temporal differences between the issuing of an insurance
policy and the beginning of insurance cover either as uncharged income or a short-term
deferred income. The initial recognition is the same as the amount stated in the insurance
policy.
The previously uncharged income from interest on active accruals represents accounting
interest for debt securities that are not accounted by their amortized cost.
Other items in accruals are short-term deferred expenses (charges) and included expenses
(charges) in advance. In both cases it is about adjusting the existing instruments with the
actual service offered that has to relate to the accounting period.
Through the accrual of expenses the company adjusts also the temporal difference between
the costs incurred when acquiring insurance—paid out provisions for underwritten life
insurance—and incomes from premiums of those insurances. Due to longer period of
transfer into costs (probably more than one year) they represent long-term deferred expense
and the company accounts for them in financial statement as an item of intangible assets.
Tax
The company balances and pays tax on insurance transactions in accordance with the
Insurance Transaction Tax Act at a 6.5 percent rate of the tax base.
Corporate income tax is imposed on the Profit and Loss Account. Levied tax is charged from
taxable profit for business year at tax rates in force on the date of the balance sheet. Tax rate
for the presented reporting periods (2010 and 2011) amounts to 20 percent.
Deferred Taxes
Deferred taxes occur as deferred tax receivables or as deferred tax liabilities. When
balancing deferred taxes, the company uses the balance sheet liability method. The
company defines the differences between the accounting value of assets and liabilities for
the needs of the financial report and the values for the needs of the tax report as permanent
or temporary differences. Temporary differences are divided into taxable and deductible.
Deferred taxes are recognized based on the calculated temporary deductible difference if
there is a possibility of company enforcing all recognized deferred tax receivables in the
following tax periods.
The company recognizes the deferred tax liabilities based on the calculation of taxable
temporary differences.
The company recognizes the receivables or deferred tax liabilities in charged amounts
calculated by multiplying the temporary differences with the tax rate that will assumingly be
used during the time of receivable or liability realization.
The deferred tax receivables or liabilities are not discounted.
The company offsets the deferred tax receivables and liabilities in the financial statement.
The company calculates and recognizes deferred taxes arising from
o
o
valuation of those financial assets classified under the group available for sale
(disclosure of fair value through the statement of total return),
provisions for other long-term employees earnings.
95
Deferred tax receivables are not recognized when impairing investments categorized in the
group of assets available for sale through the Profit and Loss Account for those that the
company intends to keep for longer period of time and has no intentions of trading with such
investments in the foreseeable future, however at the same time it has no assurances that
transactions will be recognized in a reasonable period in terms of tax with regards to fiscal
rules. The company doesn't recognize the receivables for deferred taxes with impaired
receivables for the same reason.
The company recognizes the deferred tax receivables and liabilities related to business
events, recognized in the Profit and Loss Account Statement, in the Profit and Loss Account
Statement. The company recognizes the expenses or income for deferred tax in the Profit
and Loss Account Statement for the accounting period as a difference between final and
initial deferred tax receivable/liability state.
The company recognizes the referred tax receivable and liabilities related to business
events, recognized in the statement of total return, directly in the statement of total return.
Revenue and Expenses
The recognized revenue of the company represents the increase of economic benefit of the
company in the financial period in form of influx of asset increase or lower debt, with the
consequence of increasing equity, except those related to contributions of company owners.
The company recognizes the expenses in financial statements when they represent
decrease of economic benefits of the company for the financial period in form of outflow or
decrease of assets or increase of debt, with the consequence of decreased equity, except
those related to allocation among company owners.
The company assures separate balance of all kinds of income and expenses for the property
and life insurance class.
Insurance Premium Revenue
When accounting the income from insurance premium the company follows the rule of
business event formation and increase of economic benefit in the form of increase of influx or
assets. The company monitors the gross insurance premium, the coinsurance and
reinsurance premium and unearned premium reserve separately. The income is measured
based on insurance premiums listed in insurance agreements and other instruments. The
approved rebate on underwritten insurance is recorded as decrease of premium income. The
recognized premium income during the reporting period is proportionate to the assumed
coverage from insurance agreements.
The unearned premium reserve is calculated for each insurance agreement separately and is
intended for segregation of income from insurance premium to the whole coverage period.
Insurance premiums, charged subsequently for the assumed insurance coverage in 2011 are
also included into the income of a reporting period.
In case of insurance suspension the company decreases the charged premium income by a
proportionate share of the unfinished period, for which the insurance premium was charged.
The net premium income is gross premium income, amended by the premium from the
assumed/ceded coinsurance and reduced for the reinsurance share in gross premium and
amended by the modification of the unearned premium reserve.
The company monitors the income from insurance premium for each insurance group and
line of business separately.
96
Financial Revenue and Expenses
According to its nature of operations, the company makes revenue and expenses mostly by
investments. Revenue and expenses from technical provision investments and from its own
fund are recorded directly without keys based on analytical calculations from the company’s
chart of accounts, that establish relation between investment account and revenue account.
Under financial revenue/expenses, the company recognizes revenue/expenses from
investment interests, revenue/expenses from disposal of investments, from investment real
estate, income from dividends, negative and positive exchange rates and recognized
impairment or repealed impairment of financial investments.
Under revenue from dividends, the company recognizes received dividends or shares to
which it is entitled to on the basis of investments in capital of other companies. They are
recognized in the Profit and Loss Account on the date on which the shareholder’s right to
payment is enforced.
Revenue from interests is recognized upon its formation by using the effective interest rate.
In the balance sheet the interest from debt securities are accounted together with financial
investments.
Claims Incurred
When disclosing claims incurred, the company takes into consideration the principle of
occurrence of an event and reduction of economic benefit in the form of expenses or reduced
assets.
Net claims incurred are composed of gross claims payments amended by charged claims
from assumed/ceded coinsurance and reduced for the share of reinsurers in gross claims
and for amounts of exercised recourse recovery. Net claims incurred also include change of
net claims reserve, i.e. gross claims reserve corrected for coinsurers’ share in claims
reserve.
The company monitors the claims incurred for each insurance group and line of business
separately.
Operating Costs
The company recognizes operating costs according to natural classes for values of original
or realized accounting instruments with obligatory use of cost centers from the company’s
organization chart.
For accounting needs, costs are reallocated according to functional groups into insurance
acquisition costs, valuation costs and other operating costs. The company applies fixed rules
for allocation.
To carry out technical balance, the company reallocates all operating costs to cost drivers
also by taking into account the already realized allocation to functional groups. Amount of
costs charged to individual insurance class depends primarily on the number and value of
transactions carried out in individual organizational unit.
Cash Flow Statement
The company prepares the cash flow statement by indirect method.
97
RISK MANAGEMENT
One of the key elements of the company's business strategy is a complete and planned risk
management that enables efficient, successful and economical business operations,
achievement of set business goals, realization of company’s vision and mission and a
sustainable company development. The company's goal in the field of risk management is to
set up a complete insight into the business risks that endanger company's operations and
also to register and use opportunities, which arise from business risks, on time.
The company’s risk management process is continuous and it involves all organizational
levels of the company’s business operations and all employees.
Presentation of Individual Operations Level Involvement into the Risk Management System
MANAGEMENT BOARD:
Responsible for complete risk management of the company
MIDDLE
MANAGEMENT
OPERATIONS
MANAGEMENT
Responsible for
establishment and
operations of internal
controls in individual
business processes
under the
responsibility of a
manager within the
insurance company
Responsible for
risk management
of the company
Responsible for
risk management
in business areas
under the
responsibility of a
manager
OTHER EMPLOYEES OF THE COMPANY
Responsible for operations of internal controls and for suggesting their
improvements with the activities performed by the employee
Within its operations the company develops and establishes a strategic access to risk
management with which a consistent and clear risk management will be assured.
For the needs of risk management the company identifies the risks, assesses them and then
defines the procedures for their management.
Below we disclose and explain key business risks and processes for their management.
98
Company Business Risks
INSURANCE RISK
Insurance risk is a risk arising from underwritten insurance contracts. The company pays the
most attention to the management of those risks as they arise from its main operations.
Material insurance risks that the company is exposed to are mostly claims risks, technical
provision risks and reinsurance risks.
Claims Risk
Claims risk is monitoring of the risk when the number of claims is higher than expected or the
average amount of claims is higher than expected. Claims risk also covers the possibility of
the company defining too high retention due to inadequate reinsurance protection,
particularly against catastrophic events.
Epidemics and changes of lifestyle, i.e. dietary habits, physical exercise and smoking, affect
the number and amount of claims arising from life insurance agreements to the greatest
extent. The greatest risk factors for endowment life insurances are development of medical
science and improvement of the population’s social position, which increases longevity. In
this case we talk about the risk as a consequence of the insured actions and the environment
in which they live on one hand and the cost risk on the other.
99
Climate changes, which cause more frequent extreme weather events (floods, hail…), are a
major factor in property insurance agreements. An important risk factor in third party liability
insurances, where claims procedures are typically long and can last several years, is the
increase of the number of actions based on claims, particularly for non-material claims
(coverage and amount). Here we also talk about the risk as an environmental consequence,
however, the risk of improperly planned product and the risk of improper risk assumption play
a more important role with property insurance agreements.
To manage insurance risks, the insurance company concludes reinsurance contracts, with
which a part of the risk is transferred to the reinsurer. Each business year, the Management
Board adopts a program of planned reinsurances with calculated maximum own shares for
each insurance type, a table of maximum coverage and established procedures, bases and
criteria for estimation of maximum probable damage. Reinsurance program is composed of
traditional proportionate and disproportionate forms of reinsurance protection.
The Management Board of the insurance company is confident that the amounts of own
shares in tables of maximum coverage have been determined in a prudent manner and
appropriate reinsurance agreements have been underwritten so that the insurance company
is not exposed to excessive risk.
Claims Development
In continuation, development of claims in property insurance is shown. The development of
recognized claims according to the year when claims incurred is represented in the claims
development triangle. Amounts include claims paid and reserved which the insurance
company recognized for each individual year when claims incurred up to and including the
relevant calendar year.
Triangle of claim recognition development – property insurance*
Year of claim occurrence
In euros
Cumulative claim
assessment
By the end of the claims
year
Prior to
2007
One year later
Two years later
Three years later
Four years later
Cumulatively paid out
claims until the end of 2011
Claims reserve* status
on 31.12.2011
38,387,099
Total
2007
2008
2009
2010
2011
118,436,45
7
114,095,30
1
115,577,02
1
114,720,40
0
114,032,78
9
101,966,69
4
180,116,03
2
178,461,26
8
180,494,44
8
182,243,07
9
157,618,59
3
147,362,02
2
146,952,74
1
130,787,71
0
119,539,51
1
125,345,39
6
164,899,21
1
125,290,17
8
91,881,898
58,141,332
12,066,095
17,343,868
21,662,563
27,657,613
67,204,064
184,321,30
2
Claims reserve for property insurance, recognized in the balance sheet
In euros
Claims reserve on 31 Dec
2011
Claims reserve on 31 Dec
2010
Claims reserve
– recourse
Claims reserve
– valuation
costs
184,321,302
-938,912
9,720,654
193,110
193,296,153
169,315,365
-964,704
7,734,789
74,958
176,160,408
Bordereaux
and IBNR
Coinsurance
business
Total
100
Risk Concentration
The danger of insurance risk concentration may occur on account of one or several events
which may cause a substantial increase of the insurance company’s liabilities. It may arise
from one insurance agreement or a smaller number of agreements covering events with low
probability of occurrence but which cause substantial damage (e.g. earthquake insurance or
other natural disasters).
Spread of insurance portfolio and exposure of the company to great insured
for 2011
Premium total
Share of the
of 10 biggest
total premium
insured
Property insurance
for 2010
Premium total
Share of the
of 10 biggest
total premium
insured
17,061,610*
9.08%
15,043,776*
7.99%
81,001
0.34%
120,303
0.50%
Life insurance
165,803
0.43%
168,708
0.49%
* Annual gross premium according to all classes of insurance, of which overage starts between 1.1.2011 and
31.12.2011
The company estimates that the share of 10 largest insured persons in proportion to the
entire portfolio is relatively small, therefore we conclude that the concentration of large
insured persons does not pose a high risk on the company.
Technical Provisions Risk
When forming technical provisions, there is a risk that the amount of the estimated provisions
will not suffice to cover all liabilities arising from the already accepted insurance agreements.
The risk of mathematical reserves being too low would occur if the actual mortality rate
surpassed the values in mortality tables, which are used in technical bases for calculation of
life insurance premiums. Similarly, the risk of the actual morbidity rate being higher than the
values in morbidity tables with regard to life insurances in conjunction with critical illnesses
risk may also occur. Insurance company compares the actual morbidity and mortality rates of
insured persons with the values in the tables on yearly bases and finds that the actual
mortality and morbidity rates are lower than the values in the tables.
The highest risk in property insurance is carried by the claims reserve, which can be divided
into two parts: underwriting liabilities for already reported claims and underwriting liabilities
for claims incurred but not yet reported (IBNR claims). Incorrectly assessed provisions for
reported claims affect also the calculation of incurred but not reported claims (IBNR claims).
The company is monitoring the risks of claims reserve being lower than they should be with
procedures realized by the actuary service. It monitors the use of such provisions in previous
years by individual insurance class and by each year of a claims event. By calculating the
quotient of the claims reserve amount against the collected premiums and paid out claims
one can assess whether the newly calculated provisions are properly formed.
Liability Adequacy Test (LAT) with Regard to Property Insurance Agreements
With regard to property insurance agreements, the insurance company performs the
adequacy test for unearned premium reserves only. For claims reserve as well as for bonus
and rebate provisions the company assumes that they are formed in appropriate amounts.
101
Claims reserve for:
o
o
Incurred, reported and unsettled claims are evaluated based on current prices and
envisaged estimates of future payouts (inventory method)
Claims incurred but not reported (IBNR claims) are evaluated as estimated envisaged
payout amounts based on statistical monitoring of such claims in the past.
The calculation of claims reserve for IBNR claims is performed for each insurance group
based on triangles of liquidated claim development or the number of claims. It is assumed
that the claim development sample will in future be similar to the model from previous years.
Using appropriate annual development factors, the envisaged payout amounts will be
estimated.
Claims reserve are not discounted, which provides additional guarantee that the calculation
based on the chosen method is sufficient.
The consideration with regard to unearned premium reserves adequacy test relates to the
difference between expected claims and costs for the remaining unexpired portion of
agreements, which were valid on the balance date, and the provision amount for unearned
premium reserves. Reduction of gross unearned premium reserves for the proportionate
share of deferrable acquisition costs arising from commissions, fire tax costs, printed material
and policy tariffing by transferring them to deferred acquisition costs is based on calculation
supported with actual data in data warehouse.
With regard to insurance classes where it has been established that unearned premium
reserves are insufficient in relation to the expected claim activity, the insurance company
established additional provisions for unexpired risks and recognizes them in financial
statements as additional liability – other technical provisions.
When preparing the adequacy test of liability formed within property insurance agreements,
the guideline No 1 of the Slovenian Association of Actuaries is applied: Introduction of IFRS
4, which was adopted by the Slovenian Association of Actuaries, in the company.
In addition to poor assessment of claims reported and not yet paid, risk factors affecting
assessment of the amount of claims reserve include:
o
o
o
o
o
o
o
The risk of claim amount variability being above average,
The risk of selected quotients in the triangle method inadequately describing the
trends in the insurance subclass. Consequently in accordance with precautionary
principle, conservative methods are selected to calculate quotients, particularly in the
dominant insurance types,
The risk of the amount of average expected claim being too low as the increase of
prices could significantly raise these claims,
The risk of the relevant services underestimating the reported and not yet paid
claims,
The risk of the amount of claims determined in disputes being higher than assessed
by individual services,
The risk of the short-term net value of annuities payable, which might still be
recovered, being underestimated due to strong growth of cost of living,
The risk of economic trends increasing inflation and consequently the amount of
claims paid for past events.
The insurance company regularly examines suitability of used parameters in calculation of
liabilities as well as adequacy of established underwriting liabilities in relation to the actual
claims experience and it promptly adopts the established deficiencies.
102
Liability Adequacy Test (LAT) with Regard to Life Insurance Agreements
With regard to insurance agreements, the insurance company performs the liability adequacy
test on each balance day.
The company performs the test based on the short-term assessments of the future
contractual cash flows in which it considers the short-term (best) assessment of all
contractual and related cash flows like valuation costs, administration costs, financial income
from investments that cover liabilities from insurance agreements. The company performs
the test on formed gross liabilities that arise from insurance agreements less deferred
acquisition costs.
If the test proves that currently formed liabilities are inadequate, the company recognizes the
shortage as the increase of liability by the amount of the shortage.
The test is performed for each life insurance agreement valid on the balance date. The
results are organized in insurance product groups – classic life insurance and unit-linked
insurance.
Expected contractual cash flows:
o
o
o
o
Income deriving from premiums (insurance contracts and additional accident
insurances),
Claim payouts (death, endowment, surrender, payout in case of accident),
Costs (agent commission, valuation costs, administrative costs),
Investment income.
The following is considered in treatment of individual contracts:
o
o
o
Annual premium, payment frequency, the sum insured for death and endowment,
Product technical bases: technical insurance rate, mortality tables, costs,
Assumptions: mortality margin, cancellation ratio, future profitability, realized costs,
future inflation rate, claim ratio of additional accident insurances.
For cash flows dealt with prior to policy expiration, their short-term value is calculated upon
balance date.
Detailed Explanation of Assumptions used in LAT Test for Life Insurance
1. Discount rate
For the calculation of short-term expected cash flow value the Euro area yield curve on 31
December 2011 based on AAA rated government bonds is used13.
2. Investment profit rate
For the calculation of investment income the Euro area yield curve on 30 December 2011
based on AAA rated government bonds is used14.
3. Inflation rate
13
14
Source: web address: http://www.ecb.int/stats/money/yc/html/index.en.html
Source: web address: http://www.ecb.int/stats/money/yc/html/index.en.html
103
For the estimated cost increase a 3% annual rate of inflation is used.
4. Mortality margin rate
Based on an internal analysis of mortality rate with regard to the used mortality tables, a 50
percent mortality rate applies to classic life insurances apart from whole life insurance. A 60
percent mortality rate applies to whole insurance, and a 50 percent mortality rate applies to
unit-linked life insurance.
5. Cancellation rate
Based on an internal analysis of life insurance cancellations, the following cancellationratios
apply:
Insurance year
Cancellation rate in percent
1
12.5
11.7
2
8.5
8
3
6
8.1
4
8
14
5
7.5
9.5
6
7.3
10.5
7
7
7.5
8
6.5
7
9
6
7
10
5
7
≥11
5
7
6. Realized costs
The operational costs stated within accounting items are split between fixed costs and costs
expressed as a share of gross premium. For capitalized policies 80 percent of fixed costs per
policy are considered in case of classic life insurance and 75 percent of fixed costs per policy
in case of unit-linked life insurance.
7. Claim ratio of supplementary accident insurances
Based on an internal analysis of claim ratio of supplementary accident insurances, the claim
ratio applies that comprises also valuation costs in case of additional accidents.
Liability Adequacy Test Results for 2011
The estimated short-term value of future cash flows, for classic life insurance and unit-linked
life insurance separately, is compared to the existing formed mathematical reserves and
unearned premium reserves less deferred acquisition costs. If the test proves that currently
formed liabilities are inadequate, the company recognizes the shortage as the increase of
liability by the amount of the shortage.
The liabilities calculated with the LAT test on a balance date of 31 December 2011 are higher
for classic life insurance as the sum of mathematical reserves and unearned premium
reserves less deferred acquisition costs that the company listed in the statement of
operations. The company thus recognized the shortage as an increase of liabilities in the
amount of 9,700,742 euros (2010: 3.337.905 euros).
104
The liabilities calculated with the LAT test on a balance date of 31 December 2011 are lower
for unit-linked life insurance as the sum of mathematical reserves and unearned premium
reserves less deferred acquisition costs that the company listed in the statement of
operations. The test proved the adequacy of formed liabilities for unit-linked life insurance.
Sensitivity analysis of liability adequacy test for 2011
The insurance company has performed an analysis of LAT test with regard to the influence of
various parameters. Each time only one assumption was modified while the others remained
unchanged.
Performed sensitivity analyses – changes in assumptions:
1. The interest rate used in the calculation of short-term value of expected cash flows
and in the forecast of investment profitability, is decreased by 100 basis points,
2. The interest rate used in the calculation of short-term value of expected cash flows
and in the forecast of investment profitability, is increased by 100 basis points,
3. The ratio of mortality margin is increased relatively by 10 percent,
4. The cancellation ratio is increased relatively by 10 percent,
5. Realized costs are increased relatively by 10 percent,
6. Inflation rate increased relatively by 10 percent.
Results of sensitivity analysis – changes in liability amount calculated through the LAT test
on the balance date of 31 December 2011:
Modification of
Modified
assumption
Modification of
Modified
assumption
assumption
Liability
amount
(in euros)
Interest rate
- 100 basis points
13,138,743
Interest rate
- 100 basis points
79,070
Interest rate
+ 100 basis points
-8,788,078
Interest rate
assumption
Liability
amount
(in euros)
+ 100 basis points
149,683
768,009
Mortality margin
rate
+ 10 % relatively
944,478
+ 10 % relatively
-77,298
Cancellation rate
+ 10 % relatively
774,376
Realized costs
+ 10 % relatively
1,914,786
Realized costs
+ 10 % relatively
2,327,643
Inflation rate
+ 10 % relatively
176,134
Inflation rate
+ 10 % relatively
244,024
Mortality margin
rate
+ 10 % relatively
Cancellation rate
Results of sensitivity analysis – changes in liability amount calculated through the LAT test
on the balance date of 31 December 2010:
105
Modification of
Modified
assumption
assumption
Modification of
Liability
amount
Modified
assumption
assumption
(in euros)
Interest rate
Interest rate
- 100 basis
points
+ 100 basis
points
Liability
amount
(in euros)
10,879,776
Interest rate
- 100 basis points
-444,821
-8,096,392
Interest rate
+ 100 basis points
614,331
Mortality margin
rate
+ 10 % relatively
817,973
Mortality margin
rate
+ 10 % relatively
1,199,198
Cancellation rate
+ 10 % relatively
26,198
Cancellation rate
+ 10 % relatively
1,251,677
Realized costs
+ 10 % relatively
2,194,858
Realized costs
+ 10 % relatively
2,883,477
Inflation rate
+ 10 % relatively
173,485
Inflation rate
+ 10 % relatively
239,203
REINSURANCE RISK
With an active reinsurance policy the insurance company covers that share of risks assumed
in insurance which exceeds own shares in equalization of risks according to maximum
coverage tables. Based on the reinsurance underwriting the company transfers a part of the
risk to reinsurance companies.
The company pursues a conservative risk reinsurance policy and gives priority to the safety
of the company and the insured persons. In terms of reinsurance risk, the company is
exposed in the group of property insurance while in the class of life insurances the company
is not significantly exposed as the insurance sums of domestic insured persons mostly do not
reach reinsurance limits.
The company planned the reinsurance program considering:
o
o
o
o
o
o
o
Legislation
Maximum own share in individual insurance class according to the actuary calculation
Planned scope of insurance businesses
Estimated risk exposure and scope
Available reinsurance coverage and reinsurance costs
Reinsurance market conditions
Good business relations with the reinsurer
Based on the portfolio analysis the deviations from the estimated values were estimated and
those reinsurance types selected that protect the company from possible deviations best.
With the selected reinsurance program the company significantly decreased the risks
adopted for insurance.
The program of planned reinsurance is composed of number of adequate proportionate and
disproportionate reinsurance types because the company’s structure contains also
insurances in which individual serious damage might occur, insurances in which deviations in
size and frequency of small and medium damages might occur, and insurances that might
lead to accumulation of large number of damages in case of damages.
106
The proportionate types include quota share and surplus reinsurance and a combination of
both. The company is insured against serious damage of individual risks and accumulation of
damages by disproportionate excess of loss reinsurances.
The table below shows the reached shares in adequacy and efficiency of reinsurance from
the premium, unearned premium reserve and claims reserve premium effect point of view in
the area of property insurance. Lower share of reinsurance part in premium items is a
consequence of changes in the area of quota share reinsurance.
31 December 2011
Item from the Profit and loss account/Balance sheet
31 December 2010
Share of reinsurance in gross premium
26.79%
28.57%
Reinsured unearned premium reserve
17.14%
18.49%
Reinsured part of gross damage
24.51%
29.39%
Reinsured part of claims reserve
27.31%
27.72%
Lower share of reinsurance part in premium items is a consequence of changes in the area
of quota share reinsurance.
In 2011 the company turned the most attention in reinsurance to the structure or form of
reinsurance.
Reinsurance concentration in contractual/underwriting year 2011 for property insurance
for 2011
Proportionate reinsurance
Reinsurance
net premium*
Structure of
reinsurance net
premium
Charged
reinsurance
claims
Reserved
reinsurance
claims
Structure of
reserved
reinsurance
claims
31,784,224
78.78%
23,188,824
46,543,653
98.93%
Earthquake reinsurance
1,048,621
2.60%
19,124
7,335
0.02%
Disproportionate reinsurance
3,728,618
9.24%
1,334,920
301,035
0.64%
Other reinsurance
3,784,778
9.38%
1,991,335
195,608
0.42%
40,346,242
100.00%
26,534,203
47,047,632
100.00%
Total
*reinsurance net premium = gross reinsurance premium – reinsurance commission
Reinsurance concentration in contractual/underwriting year 2010 for property insurance
for 2010
Proportionate reinsurance
Reinsurance
net premium*
Structure of
reinsurance net
premium
Charged
reinsurance
claims
Reserved
reinsurance
claims
Structure of
reserved
reinsurance
claims
34,440,904
80.93%
27,266,826
46,242,638
94.42%
Earthquake reinsurance
1,048,486
2.46%
0
37,810
0.08%
Disproportionate reinsurance
3,915,017
9.20%
2,348,648
2,281,018
4.66%
Other reinsurance
3,153,065
7.41%
1,773,938
413,799
0.84%
42,557,473
100.00%
31,389,412
48,975,264
100.00%
Total
*reinsurance net premium = gross reinsurance premium – reinsurance commission
107
CAPITAL AND CAPITAL ADEQUACY RISK
The primary goal of the company in the area of equity management is to assure adequate
and appropriate capital adequacy of the company.
The capital adequacy is according to the legislation projected as company liability where the
company has to at all times dispose of a high enough equity, dependent of the scope and
line of business businesses performed by the company and risks the company is exposed to
when performing those business.
Capital adequacy is calculated by the methodology defined in the Insurance Act and the
executive regulation15. In accordance with the provided measures by the supervisor, the
company calculates the capital adequacy for insurance business in the property insurance
group and for insurance businesses in the life insurance group separately. The calculations
and capital adequacy verification are performed quarterly.
For the purposes of establishing and verifying capital adequacy of the company the main
forms of the equity are guarantee fund, supplementary capital, required minimum level of
funds and available capital. The legislator regulated which items can be included into the
calculation of available capital, composed of core capital and supplementary capital and
decreased by the deductible items that the company cannot include into the calculation of
capital adequacy. The core capital is composed of share capital, capital reserves, profit
reserves (except its own shares and equalization provision) and unearned net profit from
previous years and from the short-term profit and loss account (when determining capital
adequacy on a yearly level). In supplementary capital items (discounted) the company
includes the value of subordinate debt instruments. At any moment the available capital has
to be higher than the required minimum capital.
The risk that the company will not have sufficient available capital at its disposal can arise
from:
o
o
o
o
Unexpected exceptional increase of gross premiums or gross claims or even a change in
the structure of realized premium according to insurance classes,
A change in reinsurance relationships or the amount of own equalization of claims,
Great quarterly loss in business operations, which is debited directly to available capital,
depending from the reinsurance share in this loss,
Investment of assets in investments which represent equity or subordinated debt of
financial organizations.
Overview of basic capital adequacy categories
31 December 2011
In euros
Core capital
Property
insurance
31 December 2010
Life insurance
Property
insurance
Life insurance
48,788,643
29,135,629
43,901,500
23,219,049
Guarantee fund
7,961,133
5,033,136
7,925,822
4,750,460
Supplementary capital
4,200,000
5,600,000
0
Available capital
51,999,008
28,835,180
48,511,865
22,918,600
Required minimum capital
23,883,399
15,099,408
23,777,467
14,251,379
Surplus of available capital
28,115,609
13,735,772
24,734,398
8,667,221
118%
91%
104%
61%
Percent of lacking/surplus
15
Decision amending the decision on detailed method of calculating own funds and compliance with capital
requirements and capital adequacy requirements of insurance companies
108
According to the surplus of available capital the company assesses that the capital adequacy
would not be threatened in case of realization of listed risks.
In June 2011 the company realized the second part of the required capital increase in
accordance with the decision of the Insurance Supervision Agency16. Capital increase in the
sum of 12.8 million euros was realized by current ownerswith cash contributions.
MARKET RISK
Market risk is a risk of loss incurrence due to unfavorable change of prices, assets and
agreements that the company owns at a certain moment. Market risks depend on general
economy conditions.
Below we present market risks and risk management procedures for those market risks that
the company pays the most attention to.
The Risk with the Adjustment of Investments with Technical Provisions
The business fund and the long-term business fund represent the company assets intended
for coverage of future liabilities from insurance underwritten by the company and possible
losses due to risks that arise from insurance business, in regard to which the company is
obliged to form technical provisions.
The business fund is formed for the coverage of liabilities from property insurance
agreements while the long-term business fund is formed for the coverage of life insurance
agreements. The legislation dictates strict provisions regarding the class and location of
allowed investments from the business fund and/or long-term business fund, and it also sets
certain limitations regarding the scope of individual investment. The company has to adjust
the business fund and long-term business fund investments, on account of which it is
exposed to eventual loss risk due to changes in interest rates, exchange rates or market
risks, with the technical provisions, the value of which depends on the same changes. At the
same time the company has to follow the liability maturity from the insurance agreements
appropriately when investing.
The company invests assets arising from technical provisions in a way that it entirely
considers all legislative limitations regarding the investments into individual investments
classes.
When ascertaining the investment coverage with technical provisions, the company
considers as investment the assets that are according to the Insurance Supervision Agency
decision17 listed as investment items. Into this group the company also includes receivables
from the policyholders for insurance premiums from property insurance with 30-day maturity.
16
In 2009, the Insurance Supervision Agency demanded capital increase in the sum of 27 million
euros. The company realized a part of the capital increase at the end of 2009 in the sum of 14.2
million euros.
17
Decision on detailed rules of assets covering technical provisions and assets covering life
assurance provisions, and rules of investments not financed form technical provisions.
109
Coverage of technical provisions with company investments on 31 December 2011
Business funds
Comparative items
Gross technical provisions*
Total asset value permitted for
investment coverage
Classic life
insurance
ZM
Zajamčeni
Prizma
Long-term
business fund
Hibrid
Total
245,853,411
96,590,813
4,508,372
517,401
275,867,980
623,337,977
265,552,563
101,778,985
4,532,497
809,404
300,061,738
672,735,187
Investment surplus/lack
19,699,152
5,188,172
24,125
292,003
24,193,758
49,397,210
Surplus/lack percentage
8%
5%
1%
56%
9%
8%
*technical provisions from coinsurance businesses excluded and equalization provisions included
Coverage of technical provisions with company investments on 31 December 2010
Business funds
Comparative items
Gross technical provisions*
Total asset value permitted for investment
coverage
Classic life
insurance
Long-term
business fund
Total
Prizma
ZM
Zajamčeni
237,487,259
87,994,878
1,808,255
258,029,636
585,320,028
275,405,855
90,470,030
1,840,256
271,706,573
639,422,714
Investment surplus/lack
37,918,596
2,475,152
32,001
13,676,937
54,102,686
Surplus/lack percentage
16%
3%
2%
5%
9%
*technical provisions from coinsurance businesses excluded and equalization provisions included
Interest Rate Risk
Interest rate risk is a risk of interest rate change.
The company did not use the derived financial instruments for immunization of interest rate
risk during the reporting period. The company managed the investment portfolio in a way that
it decreased the margin between maturity and investments liability as much as possible.
The investments into debt financial instruments that bear interest, present a large share of
investments. The table below presents the share of such investments that bear fixed interest
rate and the share of investments that bear floating interest rate.
Investment share according to the interest rate type
31 December 2011
Amount in euros
Investments bearing:
- floating interest rate
- fixed interest rate
498,063,203
31 December 2010
Percent
80.66%
Amount in euros
465,273,871
Percent
80.95%
4,871,414
0.79%
8,348,431
1.45%
493,191,789
79.88%
456,925,440
79.52%
Non-interest bearing investments
119,387,923
19.34%
109,513,515
19.03%
Investments total*
617,451,126
100.00%
574,787,386
100.00%
*investment real estate excluded
For the analysis of the influence of market interest rate change on investments and
insurance agreement liabilities the company used a methodology in which it used growth or
drop of the interest rate for 100 basis points as a presumption in the reporting period. The
company justifies the modification of the used presumption by oscillation of market interest
rates in financial markets during the reporting period.
110
Sensitivity Analysis – Property Insurance
The company executed the analysis of property insurance investment sensitivity to market
interest rate change on that part of the investment portfolio that is sensitive to interest rate
change. With the presumption of interest rate growth of 100 basis points the value of
investment into business fund bonds18 would decrease by 3,079,041 euros, resulting in the
decrease of the reserve for modification of fair value in equity. With the presumption of
interest rate decrease of 100 basis points the value of investment into business fund bonds
would increase by 3,218,980 euros, resulting in the increase of the reserve for modification of
fair value in equity.
The value of technical provisions in property insurance would remain unaffected by the
interest rate change due to non-discount.
Sensitivity Analysis – Life Insurance
With the presumption of interest rate growth of 100 basis points the value of investment into
long-term business fund bonds would decrease by 2,555,216 euros, resulting in the
decrease of the reserve for modification of fair value in equity. With the presumption of
interest rate decrease of 100 basis points the value of investment into business fund bonds
would increase by 2,718,872 euros, resulting in the increase of the reserve for modification of
fair value in equity.
The company executed the analysis of sensitivity to market interest rate change for those
insurance agreement liabilities for which the accounted liabilities are directly sensitive to the
market interest rate change. The classic life insurance liabilities are thus sensitive to the
market interest rate only in case when the LAT test shows deficit. The company thus
calculated only the LAT test liabilities while the calculation of liabilities arising from
mathematical reserves remained unchanged.
With the presumption of interest rate growth of 100 basis points the liability value arising from
classic life insurance agreements would decrease by 8,788,078 euros. With the presumption
of interest rate decrease of 100 basis points the liability value arising from classic life
insurance agreements would increase by 13,138,743 euros. Liability increase or decrease
directly influence the income and/or charges of the company and thus also the higher or
lower participation of the insured persons in the result of classic life insurances.
Analysis of Investment and Insurance Agreement Liability Portfolio Duration
An average duration of business fund bonds portfolio on 31 December 2011 is 4.11 years
(31 December 2010: 4.05 years) while the average duration of liabilities arising from property
insurance portfolio is 2.58 years (2010: 2.38 years).
An average duration19 of long-term business fund bonds20 portfolio for classic life insurance
on 31 December 2011 is 3.56 years (31 December 2010: 3.85 years).
The average duration of liabilities arising from classic life insurance portfolio (the calculation
includes only long-term mathematical reservs of the above mentioned insurance) on 31
December 2011 is 8.37 years (31 December 2010: 9.06 years).
18
Bonds with fixed interest rate are considered.
The calculation of duration and interest rate sensitivity with all investments into bond is based on the
presumption of horizontal curve of profitability, thus considering a unified discount rate throughout the whole
period.
20
Bonds with fixed interest rate are considered.
19
111
Investment Sensitivity Analysis
The influence of interest rate change to profit and loss account items or to equity depends on
involvement of individual investment, which reacts to the interest rate change, into individual
group of financial assets of the company. The following table shows the effect on profit and
loss account items and/or the surplus arising from revaluation, which is a part of equity, for
the complete investment portfolio (business fund, long-term business fund and own fund).
Interest rate
Market value***
Balance on 31 Dec 2011
Impact on
Impact
on
profit and
Presumption change profit and loss
Impact on equity**
loss account prior to Impact on equity**
account prior
taxation*
to taxation*
+ 100 basis points
198,429
-5,980,645
240,442
-12,478,726
+10 %
2,564,439
2,873,508
Interest rate
Market value***
- 100 basis points
- 10 %
-198,429
-
6,310,497
-2,564,439
-240,442
-
13,375,498
-2,873,508
* bonds with floating interest rate
** bonds with fixed interest rate
*** market and equity securities
Currency Risk
Currency risk is a risk of currency exchange rate change influencing the value of assets and
liabilities towards the asset source of the company.
The Insurance Act imposes the company the currency adjustment liability from insurance
agreements and investments in the amount of minimum 80 percent.
The company fulfilled the legal demand regarding the currency adjustment in full during the
reporting period. With the introduction of the Euro as the legal means of payment in the
Republic of Slovenia, the currency adjustment of investments and liabilities came near to 100
percent. For this reason, the currency risk and company’s exposure to it are negligibly low
and consequently no special measures for its reduction are being taken in the insurance
company.
Due to almost perfect currency adjustment of investments and liabilities the analysis of
change sensitivity with other currencies doesn’t materially influence the equity or the profit
state of the company. The manner of monitoring the currency change influence on
company’s equity and profit has not changed, relative to the previous year.
Risk of Equity Security Market Value Change
The risk of equity security market value change is the risk of drop in market value of the
equity securities.
The company invests in equity securities in such a way that it ensures an adequate
investment diversification and regularly monitors and analyses the operations of individual
issuers. The investment portfolios mostly include shares with higher market capitalization
and sufficient liquidity.
The company has 12,313,447 euros (2010: 14,030,032 euros) worth of investments in
shares of trade companies and 107,074,471 euros (2010: 95,431,840 euros) worth of
investments in shares of investment companies and points of mutual funds of which
87,460,837 euros (2010: 78,006,582 euros) in KSNT – long-term business fund for unitlinked life insurance.
112
With the presumption of a 10 per cent drop in the market value of shares, the value of share
investments would decrease by 2,564,439 euros, which would result in reduction of fair value
reserve. We did not consider the KSNT investments in this calculation as their investment
risk is assumed by the insured persons.
Liquidity Risk
Liquidity risk is the risk of the company not having enough assets to cover all of its liabilities
or to maintain current operations at a certain point in time.
The company carries out its investment activities in such a way that, at all times, it is able to
fulfill all its mature liabilities. That is why it has developed an efficient liquidity risk
management system within the scope of which it plans cash flows for daily, weekly, monthly,
quarterly and yearly periods.
In the process of liquidity management, the company regularly monitors cash flow. Cash
outflow in respect of salaries and taxes as well as cash outflow that remains relatively
unchanged throughout the year are planned as total amounts for the period of up to one
year. Cash outflow arising from claims are planned as average total amounts estimated on
the basis of cash flow observed in the past one to three years, inflation estimates in the
current year, and the operational plan of indemnities liquidated.
Data on the total cash outflow arising from the payment of suppliers’ invoices and other
payments exceeding the anticipated amounts are forwarded by individual organization units
to the persons responsible for liquidity management as soon as their first estimates are
known.
Individual major claims are observed by means of a detailed system of prompt internal
reporting by individual organization units on any claims above the previously determined
amounts. Thus, the liquidity management is informed of all estimated major claims and of the
expected dates of payment as soon as the first valuations are made.
To establish a full picture of liquidity, we also plan cash inflow in respect of premiums,
investment, and other cash inflow. If the actual flow deviates from the planed and liquidity
assets fail to cover the liabilities on a specific day, we adopt short-term measures to
guarantee solvency. Thanks to the established liquidity management system, the extent of
derogations from the planned cash flow is small and controllable.
In accordance with the Insurance Act and executive regulations the company is bound to
weekly liquidity monitoring through calculation of liquidity quotient, for each long-term
business fund and for business fund of the company separately. The liquidity quotients that
were calculated during the reporting period were always significantly above the minimum
required quotient value.
The following table represents the state of undiscounted accounting values of the company’s
financial assets and liabilities by their maturity date.
113
Maturity dates of financial assets21 and liabilities22 for 2011
In euros
Investments
Loans and deposits
In possession until maturity date
Available for sale
By the fair value through profit and
loss account
Reinsurers Assets
From unearned premium reserve
From provisions for claims
outstanding
Form other technical provisions
Receivables
Financial Assets Total
of insurances
of insurances
Claims reserve
Other reservations
Other liabilities
(accruals excluded)
Financial Liabilities Total
Book value
31 December 2011
617,641,126
100,607,673
155,841,253
241,876,813
139,136,923
70,813,160
990,790
50,767,323
From 1 to 5
years
174,019,243
29,303,733
37,399,664
92,795,221
From 5 to 10
years
211,587,285
460,024
113,332,351
62,254,088
Over 10
years
30,822,365
4,118,448
4,081,457
No
maturity
62,075,310
30756
31,978,724
119,315,387
16,565,650
14,520,625
35,540,822
22,622,460
30,065,830
60,428,019
12,740,443
60,386,617
12,740,443
12,521
-
7,807
-
21,075
-
-
47,644,049
47,644,049
-
-
-
-
43,527
53,493,554
353,720
731,916,419
7,000,000
622,213,110
74,920,388
2,125
53,493,554
353,720
253,370,813
173,343,811
73,194,588
12,521
174,031,764
7,000,000
149,158,336
1,497,451
7,807
211,595,092
205,891,990
200,793
21,075
30,843,440
92,135,651
27,556
62,075,310
1,683,322
-
233,907,792
11,199,679
54,194,610
128,295,145
38,715,579
1,502,779
Up to 1 year
97,568,849
96,804
16,244,922
45,341,053
35,705,527
180,543
210,402,663
5,413,418
4,851,153
23,322,480
83,563,519
5,289,221
218,625
23,322,480
77,113,589
107,764
1,288,385
-
32,040,549
14,450
803,381
-
17,685,006
1,983
2,168,609
-
372,153
-
10,676,155
10,676,155
-
-
-
-
668,062,899
207,561,072
157,446,720
206,695,371
94,304,260
2,055,475
Maturity dates of financial assets and liabilities for 2010
In euros
Investments
Loans and deposits
Available for sale
By the fair value through profit
and loss account
Reinsurers Assets
From unearned premium reserve
From provisions for claims
outstanding
Form other technical provisions
Receivables
Financial Assets Total
Book value 31.12.2010
Up to 1 year
From 1 to 5
years
From 5 to 10
years
Over 10
years
No
maturity
574,787,386
91,259,537
4,619,914
372,734,619
69,383,677
34,593,650
24,790,293
214,283,764
52,109,222
76,671
158,396,967
201,872,559
4,556,665
4,543,243
149,301,597
28,366,618
8,738,827
60,880,766
31,506,933
106,173,316
62,862,885
13,709,578
9,999,734
33,846,524
13,347,088
3,700,904
17,045,222
319,086
43,471,054
7,221,282
39,656
19,627,791
4,749,857
3,748
29,373,833
-
49,122,817
30,490
65,702,018
466,035
703,818,324
20,469,754
29,682
65,629,963
466,035
200,833,132
16,725,424
712
72,055
231,401,041
7,181,538
88
209,093,841
4,746,101
8
33,116,475
60,880,766
21
Financial assets in chapter 3 represent the following balance items: investments, investments in group
companies, assets of the insured who assume the financial risk, the amount of technical provisions transferred to
co- and reinsurers, receivables, and cash and cash equivalents.
22
Financial liabilities in chapter 3 represent the following balance items: subordinate liabilities, technical
reservations, technical reservations in favor of life insured that assume the investment risks, other provisions,
operation liabilities and other liabilities.
114
In euros
MP of classic ins.
MP of investment ins.
Claims reserve
Other reservations
Other liabilities
(accruals excluded)
Financial Liabilities Total
Book value 31.12.2010
No
maturity
Up to 1 year
From 1 to 5 years
From 5 to 10 years
Over 10 years
7,000,000
590,434,172
74,829,578
234,560,429
86,167,784
189,544,776
5,331,606
4,289,548
36,770,266
170,468,587
72,948,217
11,999,775
130,956
80,190,405
5,199,234
176,553
36,770,266
7,000,000
121,249,050
1,639,167
50,221,342
3,703,878
65,569,332
115,332
1,251,255
-
186,516,577
214,805
114,197,185
43,497,096
28,592,377
15,114
607,863
-
100,994,618
27,388
46,936,786
38,835,854
15,192,662
1,927
1,969,105
-
11,205,342
11,205,342
284,772
-
9,795,720
648,289,706
9,795,720
217,211,125
129,500,305
187,124,440
102,963,722
11,490,114
Investment Concentration Risk
The company manages the investment portfolio in such a way that it assures proper
dissemination of investments and thus decreases the risk while still maintaining the same
estimated portfolio profitability. The company complies with all legislative dissemination
limitations and also forms internal limits for individual investments types.
The risk of issuer country is due to the demands in previous insurance legislation regarding
the investment localization less disseminated risk.
Geographic structure of investments
31 December 2011
Amount in euros
31 December 2010
%
Amount in euros
%
Slovenia
473,736,736
76.72%
440,752,729
76.68%
EU
143,714,390
23.28%
134,034,657
23.32%
Total
617,451,126
100.00%
574,787,386
100
The company does not hold Greek bonds in its portfolio.
CREDIT RISK
Credit risk represents the risk of loss due to unexpected non-payment or deterioration of
credit position of opposite parties and company debtors.
The investment portfolios of the company (loans, deposits and other debt securities) are
subject to credit risk of unsettled liabilities or modifications of credit advantage of security
issuers. To reduce such exposure as much as possible the company invests into securities
of issuers with high credit assessments. The opposite parties, the insured persons and the
reinsurer companies mostly, not fulfilling an obligation in time or at all represent another
credit risk for the company.
115
In the table below the structure of financial assets by their credit assessment23 is presented.
Some of the domestic issuers are listed under the ‘no assessment’ category while the
company does not invest into investments of foreign issuers with no assessment. The
amount of 990,790 euros represents an investment into a business security with maturity
date in 2012.
The structure of financial assets by their credit assessment for 2011
31 December 2011
In euros
AAA
AA
A
BBB
No assessment
129,212,662
21,187,417
498,253,208
80,236,979
13,183,696
100,607,674
2,070,000
29,880,086
Loans and deposits**
0
0
7,187,000
0
0
298,621
154,382,520
25,387
143,933
990,790
155,841,251
Available for sale
By the fair value through
profit and loss account
0 10,745,415
138,999,996 4,359,641
48,831,750
7,012,931
209,949,733
Investments*
2,070,000
18,836,050
10,480,800
467,700
-
-
31,854,550
49,386
1,039,845
59,161,832
24,209
-
152,747
60,428,019
Reinsurers Assets
-
-
-
-
-
53,493,554
53,493,554
353,720
-
-
-
-
-
353,720
2,473,106
30,919,932
370,212,147 4,876,937
129,212,662
74,833,718
612,528,501
Receivables
Total
311,050,316 4,852,728
Total
Less than
BBB
* Equity securities excluded
** Deposits with domestic banks
The structure of financial assets by their credit assessment for 2010
31 December 2010
In euros
Investments*
Loans and deposits**
In possession until
maturity date
Available for sale
Reinsurers Assets
Receivables
Cash and
cash equivalents
Total
AAA
AA
A
BBB
Less than
BBB
No
assessment
Total
48,886,037
223,312,329
43,865,261
118,598,429
13,270,507
17,342,817
465,275,380
-
-
11,055,568
63,149,285
5,198,395
11,806,155
91,209,403
-
4,424,785
67345.07
76329.12
51455.21
-
4,619,915
36,869,304
212,996,994
22,941,648
54,914,065
8,020,656
5,536,662
341,279,328
12,016,734
5,890,550
9,800,700
458,750
-
-
28,166,734
-
31,563
62,817,861
-
-
13,461
62,862,885
-
-
-
-
-
65,702,018
65,702,018
466,035
-
-
-
-
-
466,035
49,352,072
223,343,892
106,683,122
118,598,429
13,270,507
83,058,297
594,306,318
* Equity securities excluded
** Deposits with domestic banks
The company is constantly following the investment portfolio ratings. The drop of the average
rating in portfolio in 2011 is the result of rating drop of issuers of existing securities and
deposits in our portfolio. When the rating drops we decide for securities sale if we assess
that the probability of liabilities repayment is lower than the acceptable one and that the
realization of liabilities is jeopardized. The characteristics of liabilities like guaranteed
profitability and liability maturity have an important impact on investment decisions.
The analysis of financial assets that were due on the reporting date but the company did not
impair them in accordance with the adopted directives in the area of asset impairment
realization is presented in the following table.
23
In case of various assessments we arranged the issuers in both tables according to the lower
allocated assessment. The issuers that were assessed only by Moody's and not by Fitch or S&P also,
were listed into the table according to the equivalent assessment from the latter two.
116
The biggest exposure to credit risk by financial asset groups
31 December 2011
Fin. assets of longterm business fund
of unit-linked life
insurance
Other
financial
assets of
the
company
Total
In euros
Investments*
Loans and deposits
- loans
31 December 2010
Fin.
assets of
Other
long-term
financial
business
assets of
Total
fund of
the
unit-linked
company
life
insurance
19,584,702 478,668,506 498,253,208 14,237,271 451,038,111 465,275,380
7,666,167
92,941,507 100,607,674
4,345,789
86,863,615
91,209,403
-
778,769
778,769
-
899,875
899,875
- deposits
7,666,167
92,162,738
99,828,905
4,345,789
85,963,740
90,309,529
4,185,351 151,655,900 155,841,251
1,508,079
3,111,836
4,619,915
Available for sale
0 209,949,733 209,949,733
0 341,279,329 341,279,328
- debt securities
- 209,898,090 209,898,090
- 341,227,686 341,227,686
- Other investment forms
-
51,643
51,643
-
51,643
51,643
7,733,184
24,121,366
31,854,550
8,383,403
19,783,331
28,166,734
- debt securities
7,733,184
24,121,366
31,854,550
8,383,403
19,783,331
28,166,734
Reinsurers Assets
189,376
60,238,644
60,428,019
160,994
62,701,891
62,862,885
Receivables
851,986
52,641,568
53,493,554
436,860
65,265,158
65,702,018
Total credit
risk exposure
152,479
201,241
353,720
36,408
429,626
466,035
20,778,542 591,749,959 612,528,501 14,871,533 579,434,787 594,306,318
In the area of insurance business receivables the company continuously monitors and
assesses the repayable receivable values. Due to the risk that not all of the receivables will
be settled in time or will not be settled at all, the company assesses the repayable receivable
value on each reporting date. The original value of the receivables is decreased by the
calculated modification of value and then the assessed short-term value of receivables is
accounted in the profit and loss account. The company forms the assessed short-term value
of receivables based on a special methodology (presented in the accounting policy). The
table below displays the age structure of insurance business receivables that are subject to
revaluation to their assessed repayable value.
117
Insurance business receivable impairment
In euros
31 December 2011
Receivable
impairment
Receivable
amount
Current
value
Receivable
amount
31 December 2010
Receivable
impairment
Current
value
Property insurance receivables
Mature receivables
Up to 1 year
From 1 to 3 years
26,573,240
11,560,938
15,012,303
24,869,956
8,642,919
16,227,036
6,398,917
740,355
5,658,562
13,442,076
1,354,514
12,087,562
15,295,516
5,941,776
9,353,740
7,317,816
3,178,342
4,139,475
Over 3 years
Non-mature
receivables
4,878,807
4,878,807
0
4,110,063
4,110,063
0
25,050,264
1,753,518
23,296,746
26,139,465
1,842,785
24,296,679
Total
51,623,504
13,314,456
38,309,048
51,009,420
10,485,705
40,523,717
15,554,904
15,521,974
32,930
15,275,832
14,922,437
353,396
Up to 1 month
236,565
224,167
12,398
242,692
133,202
109,491
From 1 to 3 months
410,637
390,105
20,532
561,717
317,812
243,905
Over 3 months
Non-mature
receivables
14,907,702
14,907,702
0
14,471,423
14,471,423
0
3,038,469
2,905,793
132,676
3,283,669
3,279,356
4,314
Total
18,593,373
18,427,767
165,606
18,559,502
18,201,793
357,709
1,284,850
389,179
895,671
1,054,605
226,215
828,390
Up to 3 months
895,671
-
895,671
828,390
-
828,390
Over 3 months
Non-mature
receivables
389,179
389,179
0
226,215
226,215
0
0
0
0
0
0
0
1,284,850
389,179
895,671
1,054,605
226,215
828,390
123,107
474,360
832,540
172,684
659,856
Recourse recovery
Mature receivables
Life insurance receivables
Mature receivables
Total
Other insurance related receivables
Mature receivables
597,467
Non-mature receivables
1,036,464
4,672
1,031,792
1,015,441
559
1,014,882
Total
1,633,931
127,779
1,506,152
1,847,982
173,243
1,674,739
73,135,659
32,259,181
40,876,477
72,683,998
29,299,445
43,384,555
Total receivables from
direct insurance
operations
Movements in insurance business receivable value modification in 2011
In euros
Recourse recovery
Total
Balance on
1 Jan 2011
Increase
Decrease
Write-off
Balance on
31 Dec 2011
10,485,705
3,562,057
-
-733,306
13,314,456
438,704
16,978
-66,864
360
389,179
18,201,793
549,810
-240,719
-83,117
18,427,767
173,243
4,113
-49,493
-84
127,779
29,299,445
4,128,845
-307,583
-816,063
32,259,181
Movements in insurance business receivable value modification in 2010
In euros
Recourse recovery
Total
1 Jan 2010
Increase
Decrease
Write-off
7,494,544
3,419,212
-
-428,051
Balance on
31 Dec 2010
10,485,705
438,704
455,702
-447,340
-8,362
438,704
18,001,380
270,354
-
-69,941
18,201,793
173,243
4,301
-
-4,301
173,243
26,107,871
4,149,569
-447,340
-510,655
29,299,445
118
The procedures of credit risk management with reinsurance relate to credit assessment of
reinsurers. In accordance with credit risk management goals the company only makes
insurance business with reinsurers with high credit assessment. Most of the reinsurance
businesses in made with Pozavarovalnica Sava, which is regularly assessed by the renown
Standard & Poor's agency that may issue an assessment grade between AAA (highest) and
D (lowest).
The S&P credit rating agency confirmed to the Pozavarovalnica Sava the current
assessment of the financial strength and credit risk, which is A−. Pozavarovalnica Sava does
not have a stable medium-term forecast but has a negative one, just like Slovenia. The
company is thus no more listed at the observation list (DreditWatch)24.
RISK MANAGEMENT – FUTURE CHANGES
In the following years the company will go through important changes in the area of risk
management. The European Parliament has namely in April 2009 confirmed a Solvency II
directive proposal, and in May the Ministers of Economic and Financial Affairs Council signed
the formal validity of the directive.
As arising from the European Parliament and European Council Directive 2009/138/ES, the
transition period for directive implementation in the Member States of the EU will probably
last until the end of 2012 when the insurance companies are for the first time going to report
on capital adequacy in accordance with the new system.
24
Source: http://www.sava-re.si/si/vlagatelji/bonitetna-ocen
119
SEGMENT REPORTING
Segment reporting is drawn up in accordance with decision on annual reports of insurance
undertakings25.
By its organization and operations the company enables monitoring of assets and liabilities,
income and charges, and profit and loss account separately for:
o
o
property insurance group
life insurance group
In accordance with legislation and executive regulations of Insurance Supervision Agency
both insurance groups form independent reporting segments of the company. Each business
segment in managed separately and the management of the company regularly reviews
efficiency of segment operations. On account of those reviews it makes business decisions.
The reporting section of property insurance offers an operations overview in the area of
property insurance underwritten by the company and its insured.
The reporting section of life insurance combines an insight into the classic life insurance
operations and into unit-linked life insurance.
The assets and liabilities from business segments comprise assets and liabilities of the
company that can be directly attributed to an individual business segment as well as those
that can reasonably be attributed to business segment.
Income and charges of a business segment arise from business segment operations and can
be directly attributed to the business segment, and also a corresponding share of income
and charges that can reasonably be attributed to the business segment. The business
segments make all recognized income with external clients (the insured persons). The
charges that appear at a company level, are allocated to the business segment charges
indirectly. Indirect allocation (operative costs mostly) is performed quarterly based on the
already known procedures and allocation keys (number of claims, number of insurances,
gross premium, settled damages, number of employees, etc.) that do not change during
individual reporting periods.
Accounting policies of business segments are entirely the same as accounting policies of the
company.
The company is not bound to business segment reporting in accordance with IFRS, as it
does not publicly trade with its own and debt securities. The report by business segments is
thus prepared in accordance with Decision on annual reports of insurance undertakings
(SKL-2009).
25
The Official Gazette of the RS No 47/2011, 99/2010 and 47/2009
120
In euros
explanati
on
Balance Sheet by Business Segments, in Accordance with SKL-2009
ASSETS
Intangible Assets
Investment Property
Investment in group companies and associates
Investments:
- Into loans and deposits
- In possession until
- Available for sale
- Evaluated by their fair value
Assets of the insured persons WITH unit-linked life insurance
The amount of technical provisions transferred to reinsurers
Receivables
Other assets
Equity
- Share capital
- Capital reserve
- Profit reserve
- Revaluation reserve
- Retained net profit and loss account
- Net profit and loss account of the financial year
- Unearned premium reserve
- Mathematical reserves
- Claims reserve
- Other technical provisions
Technical provisions in favor of life insured with unit-linked life insurance
Other reservations
Other liabilities
on 31.12.2011
Property
insurance
368,811,755
4b
4a
14
15
4b
4a
465,603
13,927,322
0
910,195
497,368
0
235,187,095
60,335,228
62,100,070
95,830,835
16,920,962
0
60,229,752
51,818,750
5,525,652
250,018
368,811,755
57,792,399
39,998,605
739,652
11,645,873
-1,838,831
46
7,247,053
7,000,000
273,057,269
74,347,697
0
193,296,153
5,413,418
0
3,734,987
0
14,660,016
12,567,084
Life
insurance
on 31.12.2010
Total
Property
insurance
Life insurance
Total
393,089,139
760,989,148
352,431,747
383,211,506
734,042,192
6,343,868
1,318,018
0
0
49,000
190,000
275,218,490
32,606,279
89,555,830
145,855,978
7,200,404
107,045,539
198,268
1,674,803
947,451
103,703
393,089,139
29,747,214
15,427,686
2,072,254
11,854,468
-28,991
287,079
134,719
0
247,365,082
572,691
233,907,792
12,884,599
0
101,805,961
1,116,167
222,892
8,662,464
4,169,359
6,809,471
15,245,340
0
687,302
546,368
190,000
510,405,586
92,941,507
151,655,900
241,686,813
24,121,366
107,045,539
60,428,019
53,493,554
5,784,249
353,720
760,989,148
87,539,613
55,426,291
2,811,907
23,500,341
-1,867,823
287,125
7,381,772
7,000,000
520,422,350
74,920,388
233,907,792
206,180,753
5,413,418
101,805,961
4,851,153
0
23,322,480
16,047,590
426,273
12,726,188
59,003
117,711
605,090
50,134
204,341,488
57,890,992
3,111,836
130,876,902
12,461,759
0
62,701,891
64,415,494
6,746,562
241,913
352,431,747
48,595,281
34,630,766
739,652
9,957,043
1,218,633
1,381,436
667,752
7,000,000
255,658,839
74,166,824
0
176,160,408
5,331,606
0
3,214,203
0
26,478,415
11,485,009
9,578,958
1,416,536
0
0
50,342
190,000
277,961,912
28,972,622
0
241,667,718
7,321,572
92,243,852
160,994
1,286,524
98,265
224,122
383,211,506
29,272,177
7,995,326
2,072,254
10,367,996
1,880,982
2,771,290
4,184,328
0
244,972,200
650,180
234,560,429
9,761,592
0
89,803,133
1,075,345
2,195,034
10,291,851
5,601,765
10,005,231
14,142,724
59,003
0
655,432
240,134
482,303,400
86,863,614
3,111,836
372,544,619
19,783,331
92,243,852
62,862,885
65,702,018
5,361,478
466,035
734,042,192
77,867,459
42,626,092
2,811,907
20,325,039
3,099,615
4,152,726
4,852,080
7,000,000
500,631,039
74,817,004
234,560,429
185,922,000
5,331,606
89,803,133
4,289,548
2,077,323
36,770,266
15,603,425
121
In euros
BUSINESS SEGMENT INCOME
NET INSURANCE PREMIUM REVENUE
- Charged gross premium
- Charged premium given in reinsurance and co-insurance
- Modification of unearned premium reserves
INCOME FROM INVESTMENT INTO CONNECTED CLIENTS
INVESTMENT INCOME
Out of which:
- income from interest
OTHER INSURANCE INCOME
Out of which:
- income from provisions
OTHER INCOME
BUSINESS SEGMENT CHARGES
NET CLAIMS CHARGES
- Charged gross amount of claims
- Charged shares of reinsurers and co-insurers
- Modification of claims reserves
MODIFICATION OF OTHER TECHNICAL RESERVATIONS
MODIFICATION OF TECH. RES. WITH UNIT-LINKED LIFE
INSURANCE
BONUS AND REBATE CHARGES
OPERATING EXPENSES
Out of which:
- Depreciation
INVESTMENT CHARGES
Out of which:
- Impairment of financial assets not measured by their fair value
through the profit and loss account
OTHER TECHNICAL CHARGES
OTHER CHARGES
Out of which:
- Charges from financial liabilities
PROFIT AND LOSS ACCOUNT PRIOR TO TAXATION
INCOME TAX
NET PROFIT AND LOSS ACCOUNT OF THE BUSINESS SEGMENT
explanati
on
Profit and Loss Account Statement by Business Segments, in Accordance with SKL-2009
20
4c
24
4c
1.1. until 31.12.2011
Property
insurance
159,089,808
135,062,022
187,839,066
-51,657,304
-1,119,740
126
11,001,115
1.1. until 31.12.2010
13,266,946
248,712,324
210,302,087
263,243,887
-51,905,813
-1,035,988
126
24,268,062
Property
insurance
156,321,327
134,150,686
188,289,702
-55,073,244
934,228
2,057
7,993,279
10,456,325
677,077
11,133,402
9,974,795
2,570,220
150,153,924
88,777,227
97,143,594
-27,009,262
18,642,895
81,295
640,159
438,428
88,001,325
41,126,039
37,491,597
-59,318
3,693,760
5,430,034
11,403,902
Life insurance
89,622,516
75,240,065
75,404,821
-248,509
83,752
Total
Life insurance
90,822,306
71,149,824
71,308,964
-187,877
28,737
Total
17,628,782
247,143,634
205,300,509
259,598,666
-55,261,121
962,965
2,057
25,622,060
7,061,881
11,701,078
11,222,838
517,731
18,284,719
12,218,809
10,614,954
3,008,648
238,155,249
129,903,266
134,635,191
-27,068,580
22,336,654
5,511,330
11,210,538
2,474,228
149,910,324
89,167,503
106,664,806
-31,708,432
14,211,129
-848,517
494,341
1,525,971
86,637,978
41,748,482
40,158,367
-42,067
1,632,183
2,711,710
11,704,879
4,000,199
236,548,303
130,915,985
146,823,173
-31,750,499
15,843,312
1,863,193
17,747,825
60,051
50,452,116
21,761,224
17,747,825
60,051
72,213,340
11,351
49,814,501
23,871,074
11,403,902
11,351
73,685,575
12,776,425
2,187,533
543,884
12,449,681
100,768
4,928,806
25,226,106
2,288,301
5,472,691
12,711,092
1,959,250
589,275
11,041,753
102,874
1,205,036
23,752,845
2,062,124
1,794,311
486,245
2,357,143
2,843,388
533,108
1,125,301
1,658,409
2,190,010
5,635,437
92,709
166,881
2,282,720
5,802,318
2,351,318
5,748,821
89,609
133,336
2,440,927
5,882,157
1,196,180
12,036,101
-3,100,217
8,935,884
62
2,603,070
-981,879
1,621,191
1,196,242
14,639,171
-4,082,096
10,557,075
964,936
8,800,761
-2,389,758
6,411,003
2,067
5,425,085
-1,240,757
4,184,328
967,003
14,225,846
-3,630,514
10,595,331
122
in euros
I.
Explanati
on
Statement of Comprehensive Income by Business Segments, in Accordance with SKL-2009
NET PROFIT/LOSS OF FINANCIAL YEAR AFTER TAXATION
OTHER COMPREHENSIVE INCOME AFTER TACATION
(1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9)
1 Net profit/loss recognized in revaluation surplus regarding tangible fixed assets
2 Net profit/loss recognized in revaluation surplus regarding intangible fixed assets
3 Actuarial net profit/loss for retirement plans
4 Net profit/loss from re-measurement of financial asset, available for sale
4.1
4.2
5 Net profit/loss of non-current assets, available for sale
5.1
5.2
6 Net profit/loss from cash flow hedges
6.1
6.2
6.3
Revaluation surplus profit/loss transfer to the book value of the hedge item
Associated net profit/loss recognized in revaluation surplus and retained profit/loss
7 from capital investments of associated and jointly controlled companies, charged with
capital method
8 Other net profit/loss of other comprehensive income
9 Tax from other comprehensive income
TOTAL COMPREHENSIVE INCOME OF THE FINANCIAL YEAR AFTER TAXATION
III.
(I + II)
PROPERTY
INSURANCE
8,935,884
II.
From 1.1. until 31.12.2011
12
32
LIFE
INSURANCE
From 1.1. until 31.12.2010
TOTAL
1,621,191 10,557,075
PROPERTY
INSURANCE
6,411,003
LIFE
INSURANCE
TOTAL
4,184,328 10,595,331
-3,057,464
-1,909,973
-4,967,437
-22,775
-19,031
-41,806
-3,821,830
-1,825,864
-1,995,966
-2,387,467
-2,532,781
145,315
-6,209,297
-4,358,646
-1,850,651
-28,469
-240,614
212,145
-23,789
-179,096
155,306
-52,258
-419,709
367,451
764,366
477,493
1,241,859
5,694
4,758
10,452
5,878,420
-288,783
5,589,637
6,388,228
4,165,297 10,553,525
123
4a) The State of Mutual Receivables/Liabilities
Property insurance
Life insurance
31 December 2011 31 December 2010 31 December 2011 31 December 2010
282,597
1,488,113
406,256
4,765
-406,256
4,765
-282,597
1,488,113
In euros
Receivables
Liabilities
Possible mutual relationships between reporting business segments are evaluated by the
current market prices. Relationships between segments that present receivables/liabilities,
recorded by the company for each business segment separately, the company doesn't
include into the balance sum of the company due to the assurance of balance equilibration of
internal relationship on the company level. The latter mutual relationships arise from
settlement of mutual company charges from the property insurance current account and
payment transactions in credit/charge of an incorrect current account.
4b) Deferred Taxes
Netted receivables
and liabilities*
31 December 31 December 31 December 31 December 31 December 31 December
2011
2010
2011
2010
2011
2010
910,195
422,369
246,726
146,447
1,156,921
568,816
0
-304,658
-469,618
-2,341,481
-469,618
-2,646,139
Property insurance
In euros
Netted receivables and
liabilities total**
*Company level
**Business segment level
910,195
Life insurance
117,711
-222,892
-2,195,034
687,302
-2,077,323
The sum of deferred tax is in the company balance sheet accounted in the sum of netted
amount of deferred taxes that fall off to an individual business segment, because the
company ascertains and settles the corporate income tax for the company as a whole.
4c) Financial Revenue and Expenditure
Property insurance
In euros
Investment
income
Investment
charges
1.1. until
31.12.2011
Life insurance
1.1. until
31.12.2010
1.1. until
31.12.2011
1.1. until
31.12.2010
Financial Revenue and
Expenditure total
1.1. until
1.1. until
31.12.2011
31.12.2010
11,001,115
7,993,279
13,266,946
17,628,782
24,268,062
25,622,060
543,884
589,275
4,928,806
1,205,036
5,472,691
1,794,311
124
EXPLANATIONS TO THE ACCOUNTING STATEMENTS
1. Intangible assets and long-term deferred acquisition costs
In euros
Long-term deferred costs
- Other long-term accruals
Software
Assets in acquisition
Intangible Assets Total
31 December 2011
6,405,019
6,343,868
61,152
404,451
0
6,809,471
31 December 2010
9,630,886
9,578,958
51,927
374,346
0
10,005,231
Under the intangible asset item the company accounts non-monetary assets without physical
existence - software (in use and in acquisition) as well as long-term deferred expenses.
There are no such expenses among the intangible assets that the company would create on
its own or with the government support.
Business liabilities of the company due to the purchase of intangible assets, accounted
among other liabilities of the company, amounted on 31 December 2011 to 63,680 euros
(2010: 227,401 euros). Intangible assets of the company are not pawned as debt warranty
nor exist any other legal limitations in relation to them.
Complete accounted intangible assets of the company have a due date of utility and are
depreciated with the use of depreciation rates that remain unchanged, relative to the
previous period. Depreciation of depreciative intangible assets, recognized in the profit and
loss account among operative costs, amounted to 125,516 euros in 2011 (2010: 106,519
euros).
The company decided that there was no need for intangible asset depreciation on 31
December 2011.
Movements in intangible assets in year 2011
In euros
PURCHASE VALUE
Balance on 1 Jan 2011
Increase
Transfer between assets
Disposal
Other reductions
VALUE ADJUSTMENT
Depreciation (explanation 29)
Software
equipment
Assets in
acquisition
Long-term
deferred costs
Total
849,145
155,622
1,004,767
0
0
9,630,886
550,085
-540,862
-3,235,090
6,405,019
10,480,031
705,707
0
-540,862
-3,235,090
7,409,787
474,800
125,516
0
-
0
-
474,800
125,516
-
-
-
0
Disposal
-
-
-
0
Impairment
-
-
-
0
600,316
374,346
404,451
0
0
0
0
9,630,886
6,405,019
0
600,316
10,005,232
6,809,471
Other reductions
Current value on 1.1.2011
125
Depreciation of depreciative intangible assets, recognized in the profit and loss account
among operative costs, amounted to 125,516 euros in 2011 (2010: 106,519 euros).
Movements in intangible assets in year 2010
In euros
Software
equipment
PURCHASE VALUE
Increase
Transfer from assets in acquisition process
Disposal
Other reductions
VALUE ADJUSTMENT
Depreciation
Disposal
1,506,403
174,244
-831,501
Assets in
acquisition
Long-term
deferred costs
Total
849,145
7,378
166,866
-174,244
0
11,467,739
49,760
-1,886,614
9,630,886
12,981,520
216,626
0
-831,501
-1,886,614
10,480,031
1,199,782
106,519
-831,501
474,800
306,621
374,346
0
0
7,378
0
0
0
11,467,739
9,630,886
1,199,782
106,519
-831,501
474,800
11,781,738
10,005,231
Decreased deferred expenses of insurance underwriting are the result of considering time value of
cash flow that occurs in the calculation of the mentioned category, and the fact that the cessation of
insurance agreement payments according to which ZM had to defer the included acquisition expenses
to the whole insurance premium automatically decrease the mentioned category in the sum of
deferred expenses of those insurance agreements.
2. Land, Buildings and Equipment
In euros
Land
Buildings
Equipment and small tools
Assets in acquisition
- for advance payment for equipment and small tools
Investments in foreign tangible capital assets
- for buildings
Land, Buildings and Equipment Total
31 December 2011
1,982,500
8,700,862
3,463,559
1,170
1,170
1,097,249
1,097,249
15,245,340
31 December 2010
627,805
8,945,298
3,234,911
63,836
1,334
1,270,873
1,270,873
14,142,724
Business liabilities of the company due to the purchase of tangible capital assets, accounted
among other liabilities of the company, amounted on 31 December 2011 to 362,408 euros
(2010: 63,199 euros). Tangible assets of the company are not pawned as debt warranty nor
exist any other legal limitations in relation to them.
The company did not change the depreciation rates in the accounting period. Depreciation of
treated assets, recognized in the profit and loss account among operative costs, amounted to
2,163,189 euros in 2011 (2010: 1,956,057 euros).
126
Movements in tangible fixed assets in year 2011
Land
In euros
PURCHASE VALUE
Increase
Disposal
VALUE ADJUSTMENT
Depreciation (explanation 29)
Disposal
Equipment
and small
tools
Buildings
Investments
in foreign
tangible
capital
assets
Assets in
acquisition
Total
627,805
1,354,695
1,982,500
16,178,944
421,613
16,600,557
11,374,356
1,637,512
-1,225,882
11,785,986
63,836
3,351,154
-3,413,820
1,170
1,465,753
4,440
-814
1,469,379
29,710,694
3,355,594
0
-1,226,697
31,839,591
0
0
627,805
1,982,500
7,233,646
666,049
7,899,695
8,945,298
8,700,862
8,139,445
1,319,076
-1,136,094
8,322,427
3,234,911
3,463,559
0
0
63,836
1,170
194,880
178,064
-814
372,129
1,270,873
1,097,249
15,567,970
2,163,189
-1,136,908
16,594,252
14,142,724
15,245,340
Total
Movements in tangible capital assets in year 2010
Equipmen
t and
small
tools
Assets in
acquisitio
n
Investment
s in foreign
tangible
capital
assets
Land
Buildings
540,19
9
15,418,45
3
11,646,962
16,416
345,239
27,967,26
9
-
-
-
2,803,270
1,143,438
3,946,708
90,069
-2,463
627,80
5
967,682
-207,191
16,178,94
4
1,698,099
-1,970,705
-2,755,850
-
-22,924
11,374,356
63,836
1,465,753
0
-2,203,283
29,710,69
4
0
6,697,472
8,824,011
0
106,617
15,628,09
9
Depreciation
-
646,349
1,207,308
-
102,400
1,956,057
Disposal
-
-110,175
-1,891,875
-
-14,137
0
540,19
9
627,80
5
7,233,646
8,139,445
0
194,880
8,720,982
2,822,951
16,416
238,622
8,945,298
3,234,911
63,836
1,270,873
-2,016,186
15,567,97
0
12,339,16
9
14,142,72
4
In euros
PURCHASE VALUE
Increase
Transfer from assets in acquisition
process
Disposal
VALUE ADJUSTMENT
The company decided that there was no need for land, building and equipment asset
depreciation on 31 December 2011.
3. Non-Current Assets Held for Sale
In euros
Land
Buildings
Total
31 December 2010
0
0
0
2,295
56,708
59,003
In the reporting period, the company reallocated a real estate that was actively on sale in the
previous year. Due to the real estate market crisis and the need for additional own archive
space the company reallocated the real estate to assets in use. The effect of charged
depreciation of the previous years for the reallocated asset is insignificant.
127
Movements in non-current assets held for sale in year 2011
In euros
Reallocations during the year
Total
Land and buildings
59,003
-59,003
0
59,003
-59,003
0
Movements in non-current assets held for sale in year 2010
Total
Land and buildings
In euros
63,700
63,700
Impairment of assets
-4,697
0
59,003
59,003
4. Investment Property
In euros
Land
Buildings
Investment property total
31 December 2011
31 December 2010
17,684
528,684
546,368
17,684
637,748
655,432
Among the investment real estate the company accounts mostly apartments gained though
recovery of unsettled premiums. The apartments are occupied and are not unconditionally
sellable, that is why they are not listed in the group of assets available for sale. Due to sale
limitation of such real estate it is not possible to evaluate their fair value.
Investment properties of the company are not pawned as debt warranty nor exist any other
legal limitations in relation to them.
Items recognized from investment property account statement
Direct business charges from investment
property that generate revenue from rent
Income from rents
In euros
2011
2010
94,956
103,098
Profit from disposal
65,027
66,996
77,880
19,801
Movements in investment property in year 2011
In euros
PURCHASE VALUE
Disposal
VALUE ADJUSTMENT
Depreciation
Disposal
Land
Buildings
17,684
17,684
1,491,350
-132,947
1,358,403
0
0
17,684
17,684
853,602
38,843
-62,726
829,719
637,748
528,684
Total
1,509,034
-132,947
1,376,087
0
853,602
38,843
-62,726
829,719
655,432
546,368
128
Depreciation of investment real estate, recognized in profit and loss account under
investment charges, amounts to 38,843 euros (2010: 40,731 euros).
Movements in investment property in year 2010
Land
In euros
Buildings
Total
PURCHASE VALUE
17,684
1,500,756
Acquisitions
-
29,580
29,580
Disposal
-
-38,986
-38,986
17,684
1,491,350
1,509,034
0
835,095
835,095
Depreciation
-
40,731
40,731
Disposal
-
-22,224
-22,224
1,518,439
0
VALUE ADJUSTMENT
0
853,602
853,602
17,684
665,660
683,344
17,684
637,748
655,432
The company decided that there was no need for investment property depreciation on 31
December 2011.
5. Investments in group companies and associates
In euros
Participation in affiliated companies
Loans given to group companies
Total
31 December 2011
190,000
0
190,000
31 December 2010
190,000
50,134
240,134
Movements in Company’s participation in affiliated Company Vivus d,o,o,
Amount
In euros
In %
60,000
-
As on 1 Jan 2010
Acquisition of new contributions – 2
June
Purchase of members participations –
24 June
80
95.4786
10,000
100
Recapitalisation – 21 December
Residual purchase price for basic
contribution – 21 December
100,000
100
20,000
100
As on 31 Dec 2010 = 12/31/2011
190,000
100
Data on affiliated companies
Company
Vivus d.o.o. - affiliated Company
Ornatus d.o.o. - indirect affiliated Company
Company headquarters
Capital share
Connection type
100%
100%
- affiliated Company
- indirect affiliated Company
Karantanska 35, 2000 Maribor
Karantanska 35, 2000 Maribor
Basic categories of accounting statements of ZM group companies
In euros
Assets
Equity
Liabilities towards asset sources
Revenue Total
Charges Total
Profit and loss account
31 December 2011
Vivus d.o.o.
Ornatus d.o.o.
202,568
698
110,069
-411
92,499
1,109
944,337
57
932,698
2,151
11,639
-2,094
31 December 2010
Vivus d.o.o.
Ornatus d.o.o.
226,454
1,816
98,430
1,683
128,024
133
676,938
53,647
700,855
12,031
-23,917
41,616
129
6. Investments
The company performed reallocation of a share of financial investments in the business year
due to equalization of liquidity and investment maturity with liability maturity from insurance
agreements and the possibility and intention of the company to posses them until their
maturity. The company reallocated a share of bonds that were at the initial recognition
allocated into the group available for sale into the group in possession until maturity. From
the reallocation the company recognized reallocated difference in the amount of 190,398
euros. The amount of reallocation differences will gradually—until each reallocated financial
instrument delivery—influence the future Profit and Loss Account Statement. In the reporting
period the company recognized the amount of 19,248 euros of reallocation profit from
reallocation of investment revenue.
Company’s financial investments of property insurances based on groups of financial assets
In euros
Loans and deposits
Loans
Deposits
date
Debt securities
Available for sale
Debt securities
- market
- non-market
Equity shares
- market
- non-market
Other forms of fin. investments
Debt securities
Total
31 December 2011
LONG-TERM
OWN
BUSINESS
SOURCE
FUND
TOTAL
31 December 2010
LONG-TERM
OWN
BUSINESS
SOURCE
FUND
TOTAL
781,206
59,554,022
60,335,228
1,383,905
56,507,087
57,890,992
212,072
569,134
566,697
58,987,325
778,769
59,556,459
211,360
1,172,545
688,515
55,818,573
899,875
56,991,117
0
62,100,070
62,100,070
0
3,111,836
3,111,836
1,361,019
122,522
122,522
1,186,854
943,807
243,047
51,643
62,100,070
94,469,816
82,506,440
81,596,672
909,768
11,963,376
8,978,764
2,984,612
-
62,100,070
95,830,835
82,628,962
81,719,194
909,768
13,150,230
9,922,571
3,227,659
51,643
1,866,832
1,104,407
1,104,407
710,782
467,734
243,047
51,643
3,111,836
129,010,070
119,890,961
118,981,073
909,888
9,119,109
7,134,481
1,984,628
-
3,111,836
130,876,901
120,995,368
120,085,480
909,888
9,829,891
7,602,215
2,227,675
51,643
1,159,912
15,761,050
16,920,962
1,255,275
11,206,484
12,461,759
1,159,912
3,302,137
15,761,050
231,884,958
16,920,962
235,187,095
1,255,275
4,506,011
11,206,484
199,835,477
12,461,759
204,341,488
Company’s financial investments of life insurances based on groups of financial assets
In euros
Loans and deposits
Deposits
date
Debt securities
Available for sale
Debt securities
- market
- non-market
Equity shares
- market
- non-market
and loss account
Debt securities
Total
31 December 2011
OWN
BUSINESS
TOTAL
SOURCE
FUND
212,341
32,393,938
32,606,279
212,341
32,393,938
32,606,279
OWN
SOURCE
1,410
1,410
31 December 2010
BUSINESS
TOTAL
FUND
28,971,212
28,972,622
28,971,212
28,972,622
0
89,555,830
89,555,830
0
0
0
7,674,539
6,365,842
6,365,842
89,555,830
145,855,978
127,269,128
126,359,360
909,768
18,586,850
17,284,331
1,302,519
517,895
215,359
215,359
1,308,697
1,006,162
302,535
89,555,830
138,181,439
120,903,286
119,993,518
909,768
17,278,153
16,278,169
999,984
302,535
302,535
241,149,822
220,016,958
219,107,071
909,888
21,132,864
21,132,864
-
241,667,717
220,232,318
219,322,430
909,888
21,435,399
21,132,864
302,535
2,260,904
2,260,904
10,147,784
4,939,500
4,939,500
265,070,707
7,200,404
7,200,404
275,218,491
2,448,222
2,448,222
2,967,527
4,873,350
4,873,350
274,994,384
7,321,572
7,321,572
277,961,912
130
Company’s financial investments based on groups of financial assets
In euros
Loans and deposits
Loans
Deposits
date
Debt securities
Available for sale
Debt securities
- market
- non-market
Equity shares
- market
- non-market
Other forms of fin. investments
and loss account
Debt securities
Investments total
31 December 2011
BUSINESS
FUND/
OWN
LONGTOTAL
SOURCE
TERM
BUSINESS
FUND
993,547
91,947,960
92,941,507
212,072
566,697
778,769
781,475
91,381,263
92,162,738
31 December 2010
BUSINESS
FUND/
OWN
LONGTOTAL
SOURCE
TERM
BUSINESS
FUND
1,385,315
85,478,299
86,863,614
211,360
688,515
899,875
1,173,955
84,789,785
85,963,740
0
151,655,900
151,655,900
0
3,111,836
3,111,836
0
9,035,558
6,488,364
6,488,364
0
2,495,551
1,949,969
545,582
51,643
151,655,900
232,651,255
203,409,726
201,590,190
1,819,536
29,241,529
25,256,933
3,984,596
0
151,655,900
241,686,813
209,898,090
208,078,554
1,819,536
31,737,080
27,206,902
4,530,178
51,643
0
2,384,726
1,319,766
1,319,766
0
1,013,317
467,734
545,583
51,643
3,111,836
370,159,892
339,907,919
338,088,144
1,819,776
30,251,973
28,267,345
1,984,628
0
3,111,836
372,544,618
341,227,686
339,407,910
1,819,776
31,265,290
28,735,079
2,530,211
51,643
3,420,816
3,420,816
13,449,921
20,700,550
20,700,550
496,955,665
24,121,366
24,121,366
510,405,586
3,703,497
3,703,497
7,473,538
16,079,834
16,079,834
474,829,861
19,783,331
19,783,331
482,303,400
Movements in investments in year 2011
In euros
Equity
shares
Debt
securities
Deposits
Loans
Financial assets of property insurances
9,881,532
136,568,963
56,991,117
899,876
New acquisitions
4,870,162
147,896,714
291,382,272
246,730
Transfer between investment groups*
-33,182,304
Maturity
-70,357,378 -290,995,463 -414,493
Disposal
-1,000,136
-21,000,840
Change of fair value - in capital
-64,013
-6,159,932
Change of fair value - from capital in profit/loss
account - sales
322
2,523,753
account - impairment
-485,995
Change of fair value through profit/loss account
-41,294
Change of amortized costs
5,402,313
2,178,532
46,657
13,201,872
161,649,995
59,556,458
778,770
Financial assets of life insurances
21,435,398
227,553,891
28,972,623
0
New acquisitions
1,999,984
120,313,820
105,103,173
-72,738,119
Maturity
-25,684,219 -101,505,755
Disposal
-27,719,161
-2,500,736
-9,271,400
account - sales
9,347
1,604,645
-2,357,143
-121,168
10,087,071
36,239
18,586,850
224,025,361
32,606,280
0
Financial assets total
31,316,930
364,122,854
85,963,740
899,876
New acquisitions
6,870,146
268,210,534
396,485,445
246,730
0 -105,920,423
0
0
Maturity
0
-96,041,597 -392,501,218 -414,493
Disposal
-1,000,136
-48,720,001
0
0
-2,564,749
-15,431,332
0
0
account - sales
9,669
4,128,398
0
0
-2,843,138
0
0
0
0
-162,462
0
0
0
15,489,384
2,214,771
46,657
31,788,722
385,675,356
92,162,738
778,770
*transfer of financial investments from the 'available for sale' group to the 'in possession until maturity' group
Total
204,341,488
444,395,878
-33,182,304
-361,767,334
-22,000,976
-6,223,945
2,524,075
-485,995
-41,294
7,627,502
235,187,095
277,961,912
227,416,977
-72,738,119
-127,189,974
-27,719,161
-11,772,136
1,613,992
-2,357,143
-121,168
10,123,310
275,218,491
482,303,400
671,812,855
-105,920,423
-488,957,308
-49,720,137
-17,996,081
4,138,067
-2,843,138
-162,462
17,750,812
510,405,586
131
Movements in investments in year 2010
Equity
shares
In euros
Debt
securities
Deposits
Loans
Total
Financial assets of property insurances
New acquisitions
Maturity
Disposal
Change of fair value - from capital in profit/loss account - sales
Change of fair value - from capital in profit/loss account - impairment
Financial assets of life insurances
New acquisitions
Maturity
Disposal
Financial assets total
New acquisitions
Maturity
Disposal
5,310,875 113,739,260
44,717,990 1,221,046 164,989,171
5,454,539 39,951,931 218,563,958
327,500 264,297,928
- -10,747,005 -209,596,660 -710,249 -221,053,914
- -12,330,180
- -12,330,180
-534,820
643,075
108,255
-136,917
-136,917
-349,062
-349,062
261,482
261,482
5,187,317
3,305,829
61,579
8,554,725
9,881,532 136,568,963
56,991,117
899,876 204,341,488
22,435,549 232,204,123
2,000,000 15,490,167
-49,000 -19,606,205
- -12,753,870
-1,825,857
2,169,184
7
-471,841
-1,125,301
501,218
- 10,021,116
21,435,398 227,553,891
22,571,882
51,334,116
-45,961,117
1,027,742
28,972,623
0
0
277,211,554
68,824,283
-65,616,322
-12,753,870
343,327
-471,834
-1,125,301
501,218
11,048,858
277,961,912
27,746,424 345,943,383
67,289,872 1,221,046 442,200,725
7,454,539 55,442,098 269,898,074
327,500 333,122,211
-49,000 -30,353,210 -255,557,777 -710,249 -266,670,236
-25,084,050
-25,084,050
-2,360,677
2,812,259
0
0
451,582
7
-608,758
0
0
-608,751
-1,474,363
0
0
0
-1,474,363
0
762,700
0
0
762,700
0 15,208,433
4,333,571
61,579
19,603,583
31,316,930 364,122,854
85,963,740
899,876 482,303,400
Among financial investments of the company the investment into the bonds of banks that
present subordinate instruments with the issuer, represent 29,588,542 euros (2010:
3,962,318 euros).
Financial Investments into Bonds
31 December 2011
Fair value
Amortized cost
Government bonds
259,826,465
262,216,798
Other bonds
125,848,887
105,235,471
Bonds total*
385,675,352
367,452,269
*bonds of own fund, business fund and long-term business fund of classical life insurance
In euros
31 December 2010
Fair value
Amortized cost
233,134,094
228,413,886
130,988,758
110,520,985
364,122,852
338,934,871
Book and fair value of financial assets
31 December 2011
In euros
Loans and deposits
Book value
Fair value
31 December 2010
Book value
Fair value
92,941,507
92,941,507
86,863,614
151,655,900
143,360,390
3,111,836
3,164,126
Available for sale
241,686,813
241,686,813
372,544,619
372,544,618
24,121,366
24,121,366
19,783,331
19,783,331
510,405,586
502,110,076
482,303,400
482,355,690
By the fair value through profit and loss account
Bonds total*
86,863,614
In the following table we display the allocation of investments evaluated by the fair value of
each level, in regard to defining fair value of individual investment. The company assumes
that the book value of deposits is an accurate enough proxy of their fair value.
132
Analysis of financial investments evaluated according to fair value based on its determination
– 31 December 2011
In euros
31 December 2011
Level 2
Level 1
Total
Financial investments of property insurances
16,920,962
0
16,920,962
Debt securities
16,920,962
-
16,920,962
Available for sale
91,641,765
909,768
92,551,533
Debt securities
81,719,194
909,768
82,628,962
Equity shares
Total
9,922,571
-
9,922,571
108,562,727
909,768
109,472,495
7,200,404
0
7,200,404
Financial investments of life insurances
Debt securities
7,200,404
-
7,200,404
Available for sale
143,643,691
909,768
144,553,459
Debt securities
126,359,360
909,768
127,269,128
Equity shares
17,284,331
-
17,284,331
150,844,095
909,768
151,753,863
24,121,366
0
24,121,366
Debt securities
24,121,366
-
24,121,366
Available for sale
235,285,456
1,819,536
237,104,992
Debt securities
208,078,554
1,819,536
209,898,090
Equity shares
27,206,902
-
27,206,902
259,406,822
1,819,536
261,226,358
Total
Company's Investments
Total
Analysis of financial investments evaluated according to fair value based on its determination
– 31 December 2010
In euros
Level 1
31 December 2010
Level 2
Total
Financial investments of property insurances
12,461,759
0
12,461,759
- debt securities
12,461,759
-
12,461,759
Available for sale
127,687,695
909,888
128,597,583
- debt securities
120,085,480
909,888
120,995,368
7,602,215
-
7,602,215
140,149,454
909,888
141,059,342
7,321,572
0
7,321,572
- debt securities
7,321,572
-
7,321,572
Available for sale
240,455,294
909,888
241,365,182
- debt securities
219,322,430
909,888
220,232,318
- equity shares
Total
Financial investments of life insurances
- equity shares
Total
21,132,864
-
21,132,864
247,776,866
909,888
248,686,754
133
In euros
Level 1
31 December 2010
Level 2
Total
Company's Investments
- debt securities
19,783,331
0
19,783,331
19,783,331
-
19,783,331
Available for sale
368,142,989
1,819,776
369,962,765
- debt securities
339,407,910
1,819,776
341,227,686
- equity shares
28,735,079
-
28,735,079
387,926,320
1,819,776
389,746,096
Total
For valuation of debt securities that do not quote at an organized market, the company uses
the evaluation model, according to which the demanded profitability per share on evaluation
date is defined based on the market interest rate analysis. By that it is considered its maturity
as well as credit rate and/or issuer quality rate. Profitability defined in such a way is used in
the bond depreciation plan as discount rate with help of which the bond price at given
demanded profitability is calculated. Such price is used for evaluation of debt security (bond).
Among investments available for sale the company also accounts in the balance sheet the
investments evaluated by their acquisition cost in the sum of 4,581,821 euros (2010:
2,581,854 euros).
During the reporting period the company realized profits in the sum of 135,478 euros (2010:
454,545 euros). During the previous reporting period the company realized losses in the sum
of 24,607 euros from financial investments which are accounted at their purchase value and
did not recognize any losses on this account in 2011.
When evaluating the evidence for the purpose of establishing the needs for eventual
impairment of an investment or a group of investments available for sale, the company
evaluates whether it is a trend of a significant and a long-term drop in the financial
investment fair value26.
7. Assets of the insured persons with unit-linked life insurance
Financial investments representing the assets of the insured persons with underwritten unitlinked life insurance are by the nature of insurance agreements mostly categorized under the
group of financial assets by their fair value of which movement is recognized directly in the
profit and loss account statement.
Assets of the insured persons with unit-linked life insurance, by financial asset groups
In euros
Loans and deposits
- deposits
- domestic mutual funds
- foreign mutual funds
- debt securities
Total
26
31 December 2011
7,666,168
7,666,168
4,185,351
95,194,021
29,620,849
57,839,987
7,733,184
107,045,539
31 December 2010
4,345,789
4,345,789
1,508,079
86,389,985
29,373,833
48,632,749
8,383,403
92,243,852
Detailed criteria for recognition of investment impairment are given under accounting policy.
134
Movements in assets of the insured persons with unit-linked life insurance in year 2011
In euros
Increase during the year
Acquisitions
Decrease during the year
Disposal, maturity
Equity shares
78,006,582
24,835,167
20,506,409
4,328,758
15,380,911
9,254,525
6,126,386
87,460,838
Debt securities
Deposits
9,891,481
2,749,362
2,643,396
105,966
722,309
650,219
72,090
11,918,534
4,345,789
31,635,207
31,566,472
68,735
28,314,829
28,305,320
9,509
7,666,167
Total
92,243,853
59,219,736
54,716,277
4,328,758
174,701
44,418,049
37,559,845
6,776,605
81,599
107,045,539
Movements in assets of the insured persons with unit-linked life insurance in year 2010
In euros
Increase during the year
Acquisitions
Decrease during the year
Disposal, maturity
Equity shares
Debt securities
60,744,015
19,426,045
15,143,472
4,282,573
2,163,478
2,163,478
78,006,582
7,520,531
2,370,950
1,277,234
1,077,196
16,520
0
9,891,481
Deposits
3,710,063
22,654,026
22,651,000
3,026
22,018,300
22,018,300
4,345,789
Total
71,974,610
44,451,021
39,071,706
5,359,769
19,546
24,181,778
24,181,778
92,243,852
8. Amount of Technical Provisions Transferred to Co-Insurers and Reinsurers
In euros
Reinsurance Agreements
- from unearned premium reserves
- from claims reserves
- from bonus and rebate provisions
Co-insurance Agreements
- from claims reserves
Total
31 December 2011
60,305,204
12,740,443
47,521,234
43,527
122,815
122,815
60,428,019
31 December 2010
62,715,332
13,709,578
48,975,264
30,490
147,553
147,553
62,862,885
Recognized assets of reinsurers and coinsurers belong in their entirety to the reporting
segment of property insurance and according to their maturity represent short-term assets of
the company.
Recognized reinsurance assets are in 98.1 percent (in 2010: 98.4 percent) bound to the
Pozavarovalnica Sava d.d.
The company estimates that the book value of receivables from reinsurance agreements,
accounted as the amount of technical provisions transferred to co- and reinsurers, is the
same as their repayment value that is why the company did not impair the recognized
reinsurance assets.
The company estimates that the book value of assets represents an accurate enough proxy
of their fair value.
The reinsurance business account (reinsurance purchase) that is included into the profit and
loss account amounts to -17,157,030 euros (2010: -15,550,789 euros) during the reporting
period.
135
9. Receivables
31 December 2011
In euros
Initial value
Impairment
31 December 2010
Current value
Initial value
Impairment
Current
value
Receivables from insurance
operations
73,135,659
-32,259,181
40,876,477 72,471,509
-29,086,955
43,384,554
- Receivables on policyholders
52,908,354
-13,703,635
39,204,720 52,064,025
-10,711,919
41,352,106
1,310,467
-123,107
1,581,392
-172,684
1,408,708
18,593,373
-18,427,767
165,606 18,559,502
-18,201,793
357,709
266,590
-559
266,031
- Receivables on insurance brokers
1,187,360
- Recourse receivables
- Other receivables from insurance
operations
Receivables from co-insurance and
reinsurance
323,464
-4,672
11,011,185
0
11,011,185 20,925,671
0
20,925,670
- Receivables on reinsurers
10,854,813
0
10,854,813 20,761,133
0
20,761,133
156,372
0
156,372
164,538
0
164,538
0
0
0
0
0
0
1,713,288
-107,396
1,605,891
1,636,544
-244,750
1,391,794
85,860,131
-32,366,578
53,493,554 95,033,724
-29,331,705
65,702,018
- Receivables on co-insurers
Current tax receivables
Other receivables
Total
318,792
The receivables arising from insurance businesses and receivables arising from co- and
reinsurance are not insured.
In accordance with its accounting policy the company evaluates the fair – cashable value of
receivables in each reporting period. The evaluation methodology in 2011 has not changed.
Based on the evaluation, the company forms revaluation of receivable values. The formation
or the withdrawal of revaluation are accounted directly in the profit and loss account. In the
reporting period, the company recognized the receivable impairment in the amount of
3,617,365 euros (2010: 3,524,714 euros) and final cancellations due to inability of recovery
of mature receivables in the amount of 929,315 euros (2010: 530,712 euros).
10. Other assets
31 December 2011
In euros
Stocks
31 December 2010
96,788
Valuables
89,750
0
13,870
Active accruals
5,687,461
5,257,858
Other Assets Total
5,784,249
5,361,478
The company estimates that the book value of assets represents an accurate enough proxy
of their fair value.
Movements in active accruals in year 2011
In euros
Previously unaccounted revenue
Short-term deferred costs
- Other deferred costs
Short-term deferred charges
Total
1.1.2011
Increase
Decrease
31 December 2011
329,969
229,090
-292,431
266,628
4,927,217
5,687,867
-5,194,923
5,420,161
4,734,694
4,273,318
-3,811,942
5,196,070
192,523
1,414,549
-1,382,981
224,091
672
876,420
-876,420
672
5,257,858
6,793,377
-6,363,774
5,687,461
136
Movements in active accruals in year 2010
In euros
Previously unaccounted revenue
Short-term deferred costs
- Other deferred costs
1.1
Increase
31.12.
342,153
-403,244
329,969
4,935,563
5,720,850
-5,729,195
4,927,218
4,788,542
4,389,497
-4,443,344
4,734,695
147,020
1,331,353
-1,285,851
192,523
0
942,327
-941,655
672
5,326,623
7,005,330
-7,074,095
5,257,858
Short-term deferred charges
Total
Decrease
391,061
11. Cash and Cash Equivalents
In euros
31 December 2011
31 December 2010
Cash in hand
57,264
46,116
Cash in bank
124,297
322,050
cash equivalents
172,159
97,869
Cash and cash equivalents total
353,720
466,035
Cash equivalents are overnight deposits in banks and receivables for checks sent to
realization.
12. Equity
Structure of the company’s equity
31 December 2011
In euros
31 December 2010
Share capital
Capital reserve
- General revaluation adjustment of the capital
Profit reserve
Capital reserve
- Risk equalization reserves
- Other reserves from profit
Revaluation reserve
- From fair value change in financial assets
- Charged liabilities from deferred taxes
Retained net profit and loss account
55,426,291
2,811,907
2,811,907
23,500,341
11,085,258
3,066,528
9,348,555
-1,867,823
-2,334,778
466,956
287,125
42,626,092
2,811,907
2,811,907
20,325,039
8,525,219
2,451,265
9,348,555
3,099,615
3,874,519
-774,904
4,152,726
Net profit and loss account of the financial year
Equity total
7,381,772
87,539,613
4,852,080
77,867,459
Share capital amounts to 55,426,291 euros and is divided to 12,453,831 regular, freely
transferable no-par value stocks that do not run on nominal value; each of them has the
same share and corresponding amount in company's share capital.
As the result of capital increase by the existing company owners, share capital increased
during the reporting period.
Book value of Shares
31 December 2011
Book value of Shares
87,539,613
12,453,831
31 December 2010
7.03
77,867,459
10,214,938
7.62
137
Movement in number of shares
10,214,938
Shares issue
2,238,893
12,453,831
10,214,938
Shares issue
0
10,214,938
On 31 December 2011 there were 21 shareholders: 13 legal persons (99.8447 percent of
equity) and 8 natural persons (0.1553 percent of equity).
Ownership structure of the Company’s equity on 31.12.2011
No of shares
Share in %
NOVA KBM d.d.
6,350,988
50.9963%
Sava Re d.d.
6,062,316
48.6783%
21,182
0.1701%
19,345
0.1563%
12,453,831
100%
Other domestic legal entities
Domestic natural persons
Total
In the 2011 financial year the company made net profit of 9,735,148 euros. The company
impaired the accounted net profit in profit and loss account in the amount of 10,557,075
euros (2010: 10,595,331 euros) by 615,263 euros (2010: 860,183 euros), representing the
amount of additional formation of equalization provision which is entirely accounted in the
profit reserves. Other reserve items relate to legal reserve and other profit reserves that the
company can form and use in accordance to Insurance Act provisions and the company
rules27. The Management Board allocated a part of the net profit, 2,560,040 euros (2010:
4,883,068 euros), to formation of legal reserve.
The trend in individual equity items is represented in the equity modification account in which
it includes states and modifications of all equity components.
In equity the company also accounts the amount of reserves from the fair value movement of
investments, evaluated by their fair value and allocated into the group of investments
available for sale. A part of the revaluation reserve that would according to the insurance
agreements belong to the insured persons if it were actually realized on the market, the
company accounts among technical provisions.
In euros
Revaluation reserve
- stated in capital
- stated in technical provisions
31 December 2011
-365,044
-1,867,823
1,502,779
31 December 2010
10,584,557
3,099,615
7,484,942
Movements in revaluation surplus shown in capital*
27
More on formation and use of profit reserves is written under financial policies.
138
Business funds of
In euros
- Change in revaluation reserve
Transfer of revaluation reserve to profit/loss account impairment
Transfer of revaluation reserve to revenue/charges
Transfer of revaluation surplus to
mathematical reserves of classic life insurances
Transfer of deferred tax liabilities
- Change in revaluation reserve
Transfer of revaluation reserve to revenue/charges
Transfer of revaluation reserve to profit/loss account impairment
Transfer of revaluation surplus to
mathematical reserves of classic life insurances
Transfer of deferred tax liabilities
Other investments
Total
1,871,236
1,228,379
3,099,616
-11,959,706
-2,301,789
-14,261,495
2,357,143
485,995
2,843,138
-1,613,992
-2,524,076
-4,138,068
7,851,588
-
7,851,588
1,869,426
867,974
2,737,400
375,695
-2,243,517
-1,867,823
1,892,180
1,249,242
3,141,422
-810,536
-262,838
-1,073,374
1,125,301
349,062
1,474,363
-471,841
-112,302
-584,143
109,954
-
109,954
26,179
5,216
31,395
1,871,236
1,228,379
3,099,615
*Movement of items in 2011 significantly deviated from movements in 2010 due to large oscillation of securities
market prices in comparison to 2010 and at the same time transfer to monthly recognition of investment
categories.
13. Subordinate liabilities
Subordinate liabilities of the company are in their entirety represented by the issued bonds
with the following characteristics:
Bonds – 2nd issue
Type of bond
Dematerialized register bond, one issue
Issue date
25.8.2008
Maturity date of last coupon and principal
25.8.2015
Coupon interest rate
Fixed rate of 7.5% annual
Nominal value of the issue
EUR 7,000,000
Volume of the issue
700 lots, with nominal value of EUR 10,000
The ZMV2 issued bond does not include the clause of recall prior to their maturity and it does
not assure the right to exchange for other securities.
The book value of subordinate bonds on 31 December 2011 amounts to 7,000,000 euros
(2010: 7,000,000 euros).
The company accounts coupon interests accruing from
subordinate bonds among accruals. On 31 December 2011 they amount to 52,500 euros
(2010: 52,200 euros).
Movements in subordinated liabilities of the Company
In euros
Revaluation
interests
Payment
Bond ZVM2
7,000,000
-
-
7,000,000
Total
7,000,000
0
0
7,000,000
139
In euros
Revaluation
interests
Payment
Bond ZVM2
7,000,000
-
-
7,000,000
Total
7,000,000
0
0
7,000,000
In the amount of 4,200,000 euros (2010: 5,600,000 euros), subordinate bonds are included
into the calculation of capital adequacy of the company as addition capital item.
The accounted liabilities from subordinate bonds in the amount of 7,000,000 euros mature in
their entirety in 2015. All coupon interest accrued from subordinated bonds amount to 52,500
euros (2010: 52,200 euros) on 31 December 2011.
14. Technical provisions
Technical provisions from insurance contracts of property insurances
In euros
31 December 2011
31 December 2010
UNEARNED PREMIUM RESERVES
Share of unearned premium reserves in coinsurance
74,284,990
74,161,314
62,707
5,510
-12,731,551
-13,709,578
Gross unearned premium reserve
74,347,697
74,166,824
Net unearned premium reserve
61,616,146
60,457,246
Provisions for incurred and reported claims - inventory
49,159,146
52,699,486
Provisions for incurred but not reported claims - IBNR
135,162,155
116,615,880
Share of provisions in reinsurance
CLAIMS RESERVE
Recourse provisions
Provision for valuation costs
Share of provisions assumed from co-insurances
-938,912
-964,704
9,720,654
7,734,789
193,110
74,958
-47,331,858
-48,814,270
-122,815
-147,553
Gross claims reserve
193,296,153
176,160,409
Net claims reserve
145,841,480
127,198,586
Provisions for non-lapse risks
67,505
5,345,913
-43,527
66,988
5,264,618
-30,490
Gross other technical provisions
5,413,418
5,331,606
Net other technical provisions
5,369,891
5,301,116
Gross technical provisions total
Technical provisions in co-insurance and reinsurance
(explanatory note 8)
273,057,269
255,658,839
-60,229,752
-62,701,891
Net technical provisions total
212,827,517
192,956,948
Share of provisions given in co-insurance
OTHER TECHNICAL PROVISIONS
Among mathematical reserves the company also accounts a share of provisions for fair value
modification of investments allocated into the group of financial assets available for sale. In
case of sale of such an investment, 80 percent of sale profit would be allocated to the
insured persons with classic life insurance according to the insurance terms and conditions.
The revaluation reserve amounts to 1,502,779 euros (2010: 7,484,942 euros). The amount is
impaired for the value of deferred tax by 20 percent rate.
140
Technical provisions from insurance contracts of classic life insurances
In euros
31 December 2011
31 December 2010
572,691
Share of unearned premium reserves in reinsurance
650,180
-8,892
0
572,691
650,180
563,799
650,180
232,405,013
227,075,487
1,502,779
7,484,942
0
0
Gross mathematical reserves
233,907,792
234,560,429
Net mathematical reserves
233,907,792
234,560,429
1,461,338
1,547,985
10,220,167
7,876,197
1,203,094
337,410
MATHEMATICAL RESERVES
Revaluation reserve to policyholders
Share of mathematical reserves in reinsurance
CLAIMS RESERVE
Net claims reserve
Technical provisions in co-insurance and reinsurance (explanatory note 8)
0
0
12,884,599
9,761,592
12,884,599
9,761,592
247,365,082
244,972,201
-8,892
0
247,356,190
244,972,201
Technical provisions from insurance contracts of the company
In euros
Gross unearned premium reserve total
Net unearned premium reserve total
CLAIMS RESERVE
Recourse provisions
Share of provisions assumed from co-insurances
Share of provisions given in co-insurance
Gross claims reserve total
Net claims reserve total
Gross mathematical reserves total
Net mathematical reserves total
OTHER TECHNICAL PROVISIONS
Provisions for non-lapse risks
Gross other technical provisions total
Net other technical provisions total
31 December 2011
31 December 2010
74,857,681
62,707
-12,740,443
74,920,388
62,179,945
74,811,494
5,510
-13,709,578
74,817,004
61,107,426
50,620,484
145,382,322
-938,912
10,923,748
193,110
-47,331,858
-122,815
206,180,753
158,726,079
54,247,470
124,492,077
-964,704
8,072,199
74,958
-48,814,270
-147,553
185,922,000
136,960,176
233,907,792
0
233,907,792
233,907,792
234,560,429
0
234,560,429
234,560,429
67,505
5,345,913
-43,527
5,413,418
5,369,891
66,988
5,264,618
-30,490
5,331,607
5,301,116
520,422,350
500,631,039
Technical provisions in co-insurance and reinsurance (explanatory note 8)
-60,238,644
-62,701,891
141
Movements in Technical Provisions in year 2011
In euros
Balance on 1 Jan
2011
Balance on 31 Dec
2011
Increase
Decrease
74,166,824
72,466,337
-72,285,464
74,347,697
176,160,408
59,626,839
-42,491,094
193,296,153
66,989
32,953
-32,436
67,505
5,264,618
5,585,441
5,345,913
255,658,839
137,711,56
9
-5,504,146
120,313,14
0
Property insurance
Claims reserve
Movements in provisions for property insurances
total
Life insurance
Claims reserve
Revaluation reserve belonging to policyholders
Movements in provisions for life insurances total
Total
273,057,268
650,180
887,348
-964,838
572,691
9,761,592
5,715,898
-2,592,890
12,884,600
227,075,487
28,819,183
-23,489,658
232,405,013
7,484,942
0
-5,982,163
1,502,779
247,365,082
237,487,259
35,422,430
-27,047,386
74,817,004
73,353,685
-73,250,302
74,920,388
Claims reserve
185,922,000
65,342,737
-45,083,984
206,180,753
227,075,487
28,819,183
-23,489,658
232,405,013
7,484,942
0
-5,982,163
1,502,779
66,989
32,953
-32,436
67,505
5,264,618
5,585,441
5,345,913
500,631,039
173,133,99
9
-5,504,146
153,342,68
9
Movements in provisions for property insurances
total
520,422,350
Movements in Technical Provisions in year 2010
In euros
Balance on
1 Jan 2010
Increase
Decrease
Balance on 31
Dec 2010
Property insurance
Claims reserve
Movements in provisions for property insurances total
Life insurance
Claims reserve
Movements in provisions for life insurances total
Total
77,437,023
72,101,055
-75,371,253
74,166,824
163,004,280
57,941,747
-44,785,618
176,160,408
38,781
93,901
-65,694
66,989
6,113,134
4,442,194
-5,290,711
5,264,618
246,593,218 134,578,897 -125,513,276
255,658,839
679,704
2,314,331
-2,343,855
650,180
9,525,723
4,238,990
-4,003,122
9,761,592
224,493,300
29,459,027
-26,876,839
227,075,487
7,568,716
-
-83,775
7,484,942
242,267,443
36,012,348
-33,307,591
244,972,201
78,116,726
74,415,386
-77,715,108
74,817,004
Claims reserve
172,530,003
62,180,737
-48,788,740
185,922,000
232,062,017
29,459,027
-26,960,614
234,560,429
Movements in provisions total
38,781
93,901
-65,694
66,989
6,113,134
4,442,194
-5,290,711
5,264,618
488,860,661 170,591,245 -158,820,867
500,631,039
142
15. Technical Provisions in Favor of the Insured Persons with Unit-linked
Life Insurance
31 December 2011
In euros
31 December 2010
TECHNICAL PROVISIONS FROM INSURANCE CONTRACTS OF UNIT-LINKED LIFE INSURANCE
15,203
12,573
0
0
15,203
12,573
15,203
12,573
97,568,849
86,167,784
0
0
Gross mathematical reserves
97,568,849
86,167,784
Net mathematical reserves
97,568,849
86,167,784
CLAIMS RESERVE
710,409
520,334
3,179,853
2,941,157
331,648
161,285
-189,376
-160,994
4,221,910
3,622,776
Net claims reserve
4,032,534
3,461,782
Technical provisions in co-insurance and reinsurance (explanatory
note 8)
101,805,961
89,803,133
-189,376
-160,994
101,616,586
89,642,139
Movements in technical provisions for unit-linked life insurance in year 2011
In euros
Increase
Decrease
Claims reserve
Total
12,573
3,622,776
86,167,784
89,803,133
15,203
17,088
-14,458
1,693,248
-1,094,114
4,221,910
20,858,759 -9,457,694
22,569,095 -10,566,266
97,568,849
101,805,961
Movements in technical provisions for unit-linked life insurance in year 2010
In euros
As on 1 Jan
Increase
Decrease
As on 31 Dec
11,788
12,573
-44,782
2,065,468
2,429,309
-872,001
3,622,776
68,422,640
70,499,895
24,567,216
27,042,094
-6,822,072
-7,738,855
86,167,784
89,803,133
Claims reserve
Total
45,569
16. Other reservations
In euros
31 December 2011
Provisions for employees
Other reservations
Other reservations total
31 December 2010
4,479,000
4,004,776
372,153
284,772
4,851,153
4,289,548
Among employee provisions the company accounts the provisions for long-service awards
and retirement indemnity that the employees are entitled to in accordance with employment
agreements or the collective wage agreement of the company.
143
Movements in year 2011
In euros
Total
Other reservations
4,004,776
284,772
4,289,548
584,221
Increase
516,889
67,332
Elimination
-633,536
-
633,536
Payment/decrease
-676,201
24,478
-651,723
-
-4,429
-4,429
372,153
4,851,153
Depreciation*
4,479,000
*intended for covering charges of capital asset depreciation for disabled workers
Movements in year 2010
In euros
Other reservations
Total
As on 1 Jan
3,250,038
189,095
3,439,132
Increase
1,646,134
97,301
1,743,436
Elimination
-577,533
-
-577,533
Payment
-313,863
-1,623
-315,487
4,004,776
284,772
4,289,548
As on 31 Dec
17. Deferred Tax Receivables/Liabilities
In euros
Receivables
31 December
31 December
2011
2010
Netted receivables and
liabilities total
31 December
31 December
2011
2010
Liabilities
31 December
31 December
2011
2010
Investments
Provisions for
employees
-
-
1,156,921
568,816
Total
1,156,921
568,816
469,618
2,646,139
-469,618
-2,646,139
-
-
1,156,921
568,816
469,618
2,646,139
687,302
-2,077,323
When calculating deferred tax receivables/ liabilities, the company considered the maturity of
items and statutory defined declining tax rates.
The company does not restore receivables for deferred taxes on account of taxable
unacknowledged values with asset impairment, as it cannot assure that those values will be
annulled in a way that is acknowledged by the tax legislation.
The effects of deferred taxes on profit and loss account are described in explanation 32.
18. Business liabilities
In euros
Liabilities from direct
insurance operations
- Liabilities towards policyholders
- Liabilities towards insurance
brokers
Liabilities from co-insurance and
reinsurance
- Liabilities for co-insurance
premiums
- Liabilities for charged shares
of reinsurers
Current tax liabilities
Business liabilities total
Property
insurance
31 December 2011
Life
insurance
Total
31 December 2010
Property
Life
insurance
insurance
Total
3,429,725
8,428,542
11,858,267
4,119,136
9,033,677
13,152,813
1,738,248
8,428,542
10,166,790
2,209,117
9,033,677
11,242,794
1,691,477
0
1,691,477
1,910,019
0
1,910,019
10,315,961
128,978
10,444,939
19,944,002
143,875
20,087,877
306,125
0
306,125
336,653
0
336,653
10,009,836
128,978
10,138,814
19,607,349
143875
19,751,224
914,331
104,944
1,019,275
2,415,277
1,114,300
3,529,577
14,660,016
8,662,464
23,322,480
26,478,414
10,291,852
36,770,266
144
Liabilities towards the insured persons arising from life insurance represent liabilities of the
company from received but not yet settled classic life insurance policies in the amount of
1,559,879 euros (2010: 2,012,046 euros) and liabilities for yet unpaid distributed profit in the
amount of 6,275,102 euros (2010: 5,975,281 euros). The remaining amount, accounted in
the latter item in the amount of 593,560 euros (2010: 1,046,350 euros), is related to other
liabilities towards the insured persons.
The accounted amount from operations liabilities is due in the 2012 financial year.
19. Other liabilities
In euros
Property
insurance
31 December 2011
Life
insurance
31 December 2010
Property
Life
Total
insurance
insurance
Total
Other liabilities from insurance operations
1,921,345
29
1,921,373
1,786,864
232
1,787,096
Short-term liabilities towards employees
1,549,232
-
1,549,232
1,449,405
-
1,449,405
Liabilities towards suppliers
1,395,110
-
1,395,110
1,044,104
-
1,044,104
Financial liabilities
3,011,466
-
3,011,466
3,011,466
-
3,011,466
Other liabilities and taxes
2,652,237
146,736
2,798,974
2,382,469
121,181
2,503,650
Passive accruals
1,631,437
3,739,997
5,371,434
1,810,702
3,997,003
5,807,705
3,886,762 16,047,590
11,485,010
Other Liabilities Total
12,160,828
4,118,416 15,603,425
Among financing liabilities the company accounts the received loan that is due in January
2012. The loan is evaluated by its amortized cost. In the recognized value on 31 December
2011 there are 11,466 euros of liabilities from interest for December 2011. The loan is
leased by a fixed interest rate of 4.5 percent. The book value of the received loan is an
accurate enough proxy of its fair value.
Movements in passive accruals in year 2011
In euros
Short-term deferred premium income
1.1.2011
Formation
31 December 2011
5,433,117
-46,153,761
46,039,579
374,589
-918,608
596,519
52,500
5,807,705
-47,072,369
46,636,098
5,371,434
Predefined included costs and charges
Total
Withdrawals
5,318,934
Movements in passive accruals in year 2010
In euros
1.1
Short-term deferred premium income
5,773,111
-50,187,810
49,847,815
5,433,117
149,032
-744,780
970,337
374,589
975
-98,277
97,301
0
5,923,119
-51,030,867
50,915,453
5,807,705
Predefined included costs and charges
Other passive accruals
Total
Withdrawals
Formation
31.12.
145
20. Insurance Premium Revenue
The elements of accounted net revenue from insurance premiums arising from underwritten
insurance agreements
In euros
1.1. until 31.12.2011
1.1. until 31.12.2010
Property insurance
Share of co-insurance and reinsurance in charged gross premium
Net written insurance premium
Change in gross unearned premium reserve
Change in unearned premium reserve for co-insurance and
reinsurance operations
Net income from insurance premiums
187,839,066
-51,657,304
136,181,762
-84,515
188,289,702
-55,073,244
133,216,458
934,228
-1,035,224
135,062,022
134,150,686
75,404,821
-248,509
75,156,313
74,860
71,308,964
-187,877
71,121,087
28,737
Life insurance
Share of co-insurance and reinsurance in gross premium
8,892
0
75,240,065
71,149,824
263,243,887
-51,905,813
211,338,074
-9,655
259,598,666
-55,261,121
204,337,545
962,965
Total
Share of co-insurance and reinsurance in gross premium
-1,026,332
0
210,302,087
205,300,509
Written insurance premium by insurance classes for year 2011
In euros
Insurance class
Charged
gross premium
Accident insurance
Aviation insurance
Ships insurance
Goods in transit insurance
Other indemnity insurances
Land motor vehicle owners third-party liability insurance
Aircraft liability insurance
Marine liability insurance
Credit insurance
Pecuniary insurance
Assistance
Property insurance total
Life insurance
Life insurance total
Total
18,910,638
52,563,553
167,451
302,624
1,788,280
11,900,671
27,857,161
59,858,525
240,969
220,998
7,371,138
1,909,483
68,395
1,108,427
497,689
3,073,064
187,839,066
31,881,501
43,523,320
75,404,821
263,243,887
1.1. until 31.12.2011
Premium given
Accepted coin
insurance and
co-insurance
reinsurance
and
premium
reinsurance
-3,825,114
-12,634,087
-147,945
-66,151
-661,405
119,723
-7,468,094
101,287
-8,777,371
-12,350,763
-351,000
-47,479
80,916
-2,013,438
-381,897
-13,679
9,755
-495,845
6,217
-961,373
-1,779,561
317,898
-51,975,202
-77,437
-171,071
0
-248,508
317,898
-52,223,710
Net premium
total
15,085,524
39,929,466
19,506
236,473
1,126,875
4,552,300
19,181,077
47,507,762
-110,031
173,519
5,438,616
1,527,586
54,716
622,337
-457,467
1,293,503
136,181,762
31,804,064
43,352,249
75,156,313
211,338,075
146
Written insurance premium by insurance classes for year 2010
Accident insurance
Aviation insurance
Ships insurance
Marine liability insurance
Credit insurance
Pecuniary insurance
Assistance
Life insurance
18,754,966
54,261,520
282,629
356,792
1,642,401
11,342,916
27,330,718
61,371,097
220,529
207,876
6,615,756
1,986,543
60,895
848,988
478,970
2,527,106
188,289,702
33,072,748
38,236,216
71,308,964
2010
Accepted coinsurance and
reinsurance
premium
12,300
111,140
36,545
84,436
7,993
12,989
1,529
266,931
0
Total
259,598,666
266,931
In euros
Insurance class
Charged
gross premium
Premium
given in
co- and
reinsurance
-4,256,086
-14,206,262
-161,330
-96,919
-570,230
-6,785,676
-9,399,834
-14,174,699
-266,517
-49,757
-1,947,524
-440,315
-13,701
-403,940
-939,374
-1,628,011
-55,340,175
-51,101
-136,776
-187,877
14,498,880
40,067,558
121,299
259,873
1,072,172
4,668,380
17,967,429
47,196,399
-45,988
158,118
4,752,668
1,546,229
55,187
458,037
-458,875
899,094
133,216,458
33,021,647
38,099,440
71,121,087
-55,528,052
204,337,545
Net
premium
total
21. Income from Investments into Affiliated Companies
The recognized revenue in the amount of 126 euros (2010: 2,057 euros) are entirely arising
from interests of loans, leased to an affiliated company at the market interest rate.
22. Net Financial Account of Investment
Net financial account of investment in year 2011
In euros
Income from interest and dividends
Loans
and
deposits
In
possession
until
maturity
1.1. until 31.12.2011
By the fair
Available
value through
for sale
profit and loss
account
Total
3,521,715
1,729,836
14,688,546
88,574
Impairment elimination
2,742
0
0
0
2,742
Net realized profit/loss
256
0
4,228,161
-11,016
4,217,401
Net revaluation according to FV through P/L account
0
0
0
Net investment property
0
0
0
Other investment revenue
20,028,671
0
0
0
0
19,248
0
0
19,248
3,524,713
1,749,084
18,916,707
77,558
24,268,062
0
0
0
2,619,985
2,619,985
0
0
0
0
0
Net revenue total
Impairment
250
0
2,843,138
0
2,843,388
0
0
9,318
0
9,318
Other investment charges
0
0
0
0
0
250
0
2,852,456
2,619,985
5,472,691
3,524,463
1,749,084
16,064,251
-2,542,427
18,795,371
Net charges total
Net Financial Account from Investments
147
Net financial account of investment in year 2010
31 December 2010
By the fair
In
value
possession
Available
through
until
for sale
profit and
maturity
loss
account
Loans
and
deposits
In euros
Income from interest and dividends
2,909,556
146,319
Impairment elimination
2,828
-
-
-
2,828
101
-
604,848
-20,937
584,012
Net revenue total
Impairment
15,770,329
89,362
Total
18,915,565
-
-
-
6,119,656
6,119,656
2,912,485
146,319
16,375,177
6,188,081
25,622,060
1,658,408
184,046
-
1,474,362
-
-
-
5,081
-
5,081
-
-
-
130,822
130,822
184,046
0
1,479,443
130,822
1,794,311
2,728,439
146,319
14,895,733
6,057,259
23,827,749
Net charges total
Net Financial Account from Investments
Income from financial investments in year 2011
In euros
1.1. until 31.12.2011
In
By the fair
Loans and possession Available for value through
deposits
until
sale
profit and loss
maturity
account
Total
Income from property insurance investments
2,349,595
704,221
5,176,947
18,323
8,249,086
256
-
2,641,423
8,383
2,650,062
-
-
136,013
-
136,013
2,742
-
-
-
2,742
Income from property investments
-
-
94,956
-
94,956
Unrealized asset incomes according to FV trough PL
-
-
-
323,400
323,400
-
2,680
-
-
2,680
Total
Income from life insurance investments
2,352,593
706,901
8,049,339
350,106
11,458,940
Investment interests
1,172,120
1,025,615
9,221,015
70,251
11,489,001
Gains on the disposal of investments
-
-
1,634,458
-
1,634,458
Dividends and shares in investment profit
-
-
154,570
-
154,570
-
-
-
11,980,567
11,980,567
Elimination of investment impairment
-
16,568
-
-
16,568
Total
Investment income
1,172,120
1,042,183
11,010,043
12,050,818
25,275,164
3,521,715
1,729,836
14,397,962
88,574
19,738,087
256
0
4,275,881
8,383
4,284,520
0
0
290,583
0
290,583
2,742
0
0
0
2,742
0
0
94,956
0
94,956
0
0
0
12,303,967
12,303,967
0
19,248
0
0
19,248
Investment income total
3,524,713
1,749,084
19,059,382
12,400,924
36,734,104
148
Income from financial investments in year 2010
2010
In euros
In
possession
until
maturity
Loans
and
deposits
By the fair
value through
profit and loss
account
Available
for sale
Total
Income from property insurance investments
1,814,991
115,196
5,117,004
14,691
7,061,881
101
-
137,819
-
137,920
-
-
510,268
-
510,268
2,828
-
-
-
2,828
122,899
-
122,899
-
-
-
-
291,430
291,430
Total
Income from life insurance investments
1,817,920
115,196
5,887,990
306,121
8,127,226
1,094,565
31,123
10,022,479
74,671
11,222,838
-
-
471,842
11,340
483,182
-
-
120,578
-
120,578
-
-
-
11,009,996
11,009,996
Total
Investment income
1,094,565
31,123
10,614,899
11,096,007
22,836,593
2,909,556
146,319
15,139,483
89,362
18,284,719
101
0
609,661
11,340
621,102
630,846
0
630,846
0
0
0
0
2,828
0
0
122,899
0
122,899
0
0
0
11,301,426
11,301,426
2,912,485
146,319
16,502,888
11,402,128
30,963,819
Investment income total
0
2,828
Charges from financial investments in year 2011
In euros
1.1. until 31.12.2011
In
By the fair
Loans and possession Available for value through
deposits
until
sale
profit and loss
maturity
account
Total
Charges from property insurance investments
250
-
485,995
-
486,245
Losses of financial assets according to FV trough PL
-
-
-
373,063
373,063
Losses on the disposal of investments
-
-
39,469
-
39,469
Charges from real estates
-
-
102,932
-
102,932
250
0
628,396
373,063
1,001,709
-
-
2,357,143
-
2,357,143
Impairment of investment value
Total
Charges from life insurance investments
-
-
-
14,550,889
14,550,889
-
-
8,252
19,399
27,651
-
-
1,341
-
1,341
Total
Investment charges
0
0
2,366,736
14,570,288
16,937,024
250
0
2,843,138
0
2,843,388
0
0
0
14,923,952
14,923,952
0
0
47,721
19,399
67,120
0
0
104,273
0
104,273
Investment charges total
250
0
2,995,132
14,943,351
17,938,734
149
Charges from financial investments in year 2010
2010
Loans and
deposits
In
possession
until
maturity
Available for
sale
In euros
By the fair
value
through
profit and
loss
account
Total
Charges from property insurance investments
532,386
183,324
-
349,062
-
-
-
-
30,850
30,850
-
-
107,559
-
107,559
-
-
-
52,429
52,429
183,324
0
456,621
83,279
723,224
-
-
1,125,301
-
-
-
-
-
Total
Investment charges
Total
Charges from life insurance investments
-
1,125,301
5,150,920
5,150,920
24,614
32,277
56,891
-
1,342
-
1,342
-
-
-
78,393
78,393
0
0
1,151,257
5,261,590
6,412,847
183,324
0
1,474,362
0
1,657,687
0
0
0
5,181,770
5,181,770
0
0
24,614
32,277
56,891
0
0
108,901
0
108,901
0
0
0
130,822
130,822
183,324
0
1,607,877
5,344,869
7,136,071
Investment charges total
23. Other Insurance Income
In euros
Income from provisions
1.1. until 31.12.2011
10,614,954
1.1. until 31.12.2010
11,704,879
10,007,568
11,229,287
607,387
475,592
518,447
513,930
11,133,402
12,218,809
1.1. until 31.12.2011
2,077,192
1.1. until 31.12.2010
2,364,961
1,240,055
1,342,496
724,093
708,639
87,241
51,128
844,215
1,584,110
3,008,648
4,000,199
Out of which:
- Reinsurance commission
- Managing and output commissions
Other insurance income and other services
Other revenue total
24. Other Revenue
In euros
Financial revenue from business relations
Out of which:
- Charged interest from recourse claims
- Interests accepted from insurance premiums
Financial revenue from revaluation
Other revenue from business relations
Total
Financial revenue from business relations is formed by interests from premiums, recourse
recovery and other receivables, and revenue from paid receivables from previous years.
150
25. Net Charges for Claims
Elements of accounted net charges for claims
In euros
1.1. until 31.12.2011
1.1. until 31.12.2010
Property insurance
Share of reinsurance and co-insurance in gross claims
Charged recourses in claims
Net claim amount
111,124,254
-31,708,432
-4,459,448
74,956,374
13,222,647
988,483
89,167,503
102,530,061
-27,009,262
-5,386,467
70,134,332
Change in gross claims reserve
Change in claims reserve for co-insurance and reinsurance operations
Net Claims Charges
Life insurance
17,017,594
1,625,301
88,777,227
Share of reinsurance and co-insurance in gross premium
Net claim amount
37,491,597
-59,318
0
37,432,279
Net Claims Charges
Total
3,722,141
-28,382
41,126,039
Share of reinsurance and co-insurance in gross premium
Net claim amount
140,021,658
-27,068,580
-5,386,467
107,566,611
Net Claims Charges
20,739,735
1,625,301
129,903,266
40,158,367
-42,067
0
40,116,299
1,793,177
-160,994
41,748,482
151,282,621
-31,750,499
-4,459,448
115,072,673
15,015,824
988,483
130,915,985
Net charges for claims by insurance classes for year 2011
1.1. until 31.12.2011
Amount from coinsurance
operations
Amount given
in
reinsurance
6,741,318
35,781,633
56,343
163,526
680,531
7,606,876
14,509,852
0
-172,877
0
0
-225,828
-7,084
-12,288
28,932,653
Life insurance
25,382
4,606,553
1,903,881
50,637
672,891
0
797,985
102,530,061
27,001,166
10,490,431
37,491,597
Total
140,021,658
Gross claims
In euros
Accident insurance
Aviation insurance
Ships insurance
Land motor vehicle owners third-party
liability insurance
Credit insurance
Pecuniary insurance
Assistance
Amount of
recourse
claims
Net claims
-1,592,362
-7,717,543
-11,269
-36,243
-85,393
-4,569,400
-3,883,475
0
-839,057
0
0
-31,741
-1,065,939
-3,678
5,148,956
27,052,156
45,074
127,283
337,569
1,964,453
10,610,411
-25,323
-6,504,953
-1,375,153
21,027,224
0
-32,383
0
0
0
724
0
-475,059
0
0
0
-5,711
-1,150,892
-31,480
-1,967
-145,530
0
-797,985
-26,534,203
0
-59,318
-59,318
0
-11,548
-2,024,700
-34,650
0
0
0
-5,386,467
0
0
0
19,671
3,411,730
-152,299
14,020
527,361
724
0
70,134,332
27,001,166
10,431,113
37,432,279
-475,059
-26,593,521
-5,386,467
107,566,611
151
Net charges for claims by insurance classes for year 2010
2010
Amount
given
in
reinsurance
-1,807,283
-10,214,699
-25,292
-46,434
-72,029
-3,236,712
-5,559,384
-8,189,615
-472
-375
-1,181,504
-191,476
-41,395
-121,969
-179
-658,529
-31,347,345
-42,067
-
Amount of
recourse
claims
Net claims
-994,598
-40,676
-55,739
-31,811
-1,503,159
-17,907
-1,807,557
-8,000
-4,459,448
-
5,198,767
29,141,838
75,875
147,264
592,011
2,975,973
11,027,292
22,644,442
1,625
1,125
3,271,700
369,622
-53,036
284,146
-97
0
74,956,374
31,326,749
8,789,550
Accident insurance
Aviation insurance
Ships insurance
Credit insurance
Pecuniary insurance
Assistance
Life insurance
7,006,049
40,198,747
101,167
193,699
535,879
6,204,362
16,581,524
32,235,477
2,096
1,500
4,458,147
2,368,655
171,593
406,116
714
658,529
111,124,254
31,368,817
8,789,550
Amount
from coinsurance
operations
-152,388
-168,837
-64,062
-36,963
-101,740
-12,963
0
175,234
633
-361,087
-
40,158,367
0
-42,067
0
40,116,299
Total
151,282,620
-361,087
-31,389,412
-4,459,448
115,072,673
Gross claims
In euros
26. Modification of Other Technical Reservations
In euros
Modification of mathematical reserves for life insurances
1.1. until 31.12.2011 1.1. until 31.12.2010
5,430,034
2,711,710
Modification of provisions for non-lapse risks
81,295
Modification of Other Technical Reservations
0
0
5,511,330
1,863,193
Total
-848,517
Modification of mathematical reserves for life insurances is the result of mathematical
reserve transfer into proceeds (endowment, surrender), increase of mathematical reserve for
active life insurance agreements and increase of profit, belonging to the insured persons. In
accordance with the achieved results from classic life insurance, calculated based on the
attribution of profits methodology, the company did not recognize liabilities from the
attribution of profits for business year 2011 (2010: 3,720,400) in the reporting period.
27. Modification of Technical Provisions of the Insured Persons With Unit-linked
Life Insurance
In euros
Modification of technical provisions
Additional reservations - guaranteed value*
Total
1.1. until 31.12.2011 1.1. until 31.12.2010
11,403,754
17,747,825
148
0
11,403,902
17,747,825
*The company forms them for insurance agreements that the company guarantees for in accordance with
insurance terms and conditions.
152
28. Bonus and Rebate Charges
In euros
Modification of gross bonus and rebate provisions
Reinsurance part of modification
Total
1.1. until 31.12.2011 1.1. until 31.12.2010
32,953
93,901
-21,602
-33,851
11,351
60,051
The recognized charges are entirely related to the modification of bonus provisions that the
company forms with the purpose to return a part of the gross premium that belongs to the
insured person in case of a positive claims result according to the agreed rights of the
insured person in the insurance agreement.
29. Operating Costs
In euros
1.1. until 31.12.2011
1.1. until 31.12.2010
Property insurance
Acquisition costs
Depreciation of assets needed for operation
12,776,425
12,711,092
2,187,533
1,959,250
Labor costs
22,780,388
23,316,428
- Wages and salaries
16,799,595
17,228,558
- Pension insurance costs
1,505,173
1,477,791
- Social security costs
1,233,052
1,210,620
- Other labor costs
2,656,936
2,673,593
585,632
725,867
Other operating costs
12,070,155
12,465,346
Operating costs by natural classes total
49,814,501
50,452,116
12,449,681
11,041,753
- Provisions for severance benefits and long-service awards
Life insurance
Acquisition costs
100,768
102,874
Labor costs
8,169,470
8,635,351
5,575,733
6,324,315
499,562
542,472
409,246
444,398
1,594,359
981,431
- Other labor costs
90,569
342,734
3,151,155
1,981,247
23,871,074
21,761,224
25,226,106
23,752,845
Total
Acquisition costs
2,288,301
2,062,123
Labor costs
30,949,857
31,951,779
22,375,328
23,552,873
2,004,736
2,020,263
1,642,298
1,655,018
- Other labor costs
4,251,295
3,655,024
676,201
1,068,601
15,221,310
14,446,593
73,685,575
72,213,340
Average number of employees in year
879
897
Employees as on 31. Dec
875
874
The costs of acquiring insurances represent the charged commission to external contractor
agents and brokers for the underwritten insurances. There is an amount of 2,965,618 euros
(2010: 1,856,656 euros) of costs recognized among the insurance acquisition costs under
153
the life insurance reporting section, arising from modification in deferred expenses from
insurance acquisition.
Other costs include material, advertising, marketing and representation costs, donations and
sponsorships, and other operating costs.
Among the operating costs the company also accounts the sum of auditing services in the
amount of 69,551 euros (2010: 73,496 euros). Total auditing costs, recognized in 2011,
relate to auditing services of the annual report, out of which 30,484 euros represent the cost
of auditing the 2010 annual report. The total contractual amount of annual report audit for
2011 is 52,000 euros (VAT excluded). In the business year the company had 396,872 euros
of expenses arising from consulting business which is mostly related to the area of business
process improvement, transition to digital operations and consultations in the area of
adjusting and assuring data within new insurance legislation - Solvency II.
The company leases premises for performing insurance services. Most of the lease
agreements are underwritten for indefinite period of time. All lease agreements may be
revoked at any moment. Charges arising from lease agreements are disclosed directly in
the Profit and Loss Account in a straight line throughout the whole period of the lease. Total
lease costs, recognized in the profit and loss account for 2011 amount to 1,076,601 euros
(2010: 1,072,002 euros). Among the lease costs there is the amount of 224,420 euros
(2010: 207,835 euros) of operating costs for managers of leased premises.
30. Other Technical Charges
1.1. until 31.12.2011
1,234,167
1.1. until 31.12.2010
1,194,228
Contribution for loss coverage by non-insured and unknown vehicles
530,179
590,556
Other Technical Charges
518,374
656,143
2,282,720
2,440,927
1.1. until 31.12.2011
1,196,242
1.1. until 31.12.2010
967,002
- Interests from subordinated liabilities
532,301
532,301
- Interests from loans
135,164
34,767
4,565,056
4,059,630
41,020
855,525
5,802,318
5,882,157
In euros
Fire tax
Total
31. Other Charges
In euros
Financial charges from business relations
Out of which:
Financial charges for revaluation
Other charges from business relations
Total
32. Revenue Tax
In euros
Current revenue tax
Charges from deferred tax from investments
31 December 2011 31 December 2010
4,109,321
3,674,602
43,301
0
Revenue tax recognized in profit/loss account statement
-70,526
4,082,096
-44,087
3,630,514
Revenue tax recognized in comprehensive income
1,241,859
10,452
Revenue from deferred tax from employees provisions
Tax liability of the company was calculated using the 20 percent tax rate. The tax rate will
not change in 2012 and will also amount to 20 percent. Monthly installment of revenue tax
prepayment in 2012 amounts to 342,443 euros (2010: 306,217 euros).
154
Adjustment of revenue tax by revenue regulations
2011
In euros
Accounting profit
2010
14,639,171
Statutory tax rate - %
14,225,846
20.00%
20.00%
Tax charged by statutory rate
2,927,834
2,845,169
Adjustment of accounting profit by revenue regulations
5,907,435
4,147,163
-322,952
-859,534
7,480,858
6,742,905
-201,976
-313,863
Adjustment of revenue on tax recognized revenue
Revenue that increases tax base
Adjustment of charges on tax recognized charges (reduction)
Modification of tax base because of transition to a new accounting method,
at changes in accounting policy, adjustment of errors and revaluations
Increase of tax base – excluding charges concerning dividends
16,203
34,928
Tax reliefs
-1,064,699
-1,457,273
Basis for corporate revenue tax
20,546,606
18,373,009
4,109,321
3,858,332
-27,225
-44,087
28.07
27.12
Corporate revenue tax
Deferred Taxes
Effective tax rate*
* Calculated as a quotient of revenue tax and accounting profit/loss
33. Review of Distributable Profit or Loss
In accordance with insurance legislation provisions the company formed (equalization)
provisions for credit risks, chargeable to net profit and loss account of the reporting period.
31 December
2011
In euros
Net profit and loss account of the reporting period
Transferred profit (+) / transferred loss (-)
Reversal of profit reserves
31 December
2010
10,557,075
10,595,331
287,125
4,152,726
0
0
Increase of profit reserves by the decision of the Management Board
3,175,302
5,743,251
- Increase of statutory reserves
2,560,039
4,883,068
615,263
860,183
0
0
7,668,897
9,004,806
- Increase of credit risks reserves
Increase of other reserves by the decision of the Management Board and
Supervisory Board
Distributable profit
The Assembly can allocate the distributable profit in the amount of 7,668,897 euros (2010:
9,004,806 euros) among shareholders, to other reserves, transfer it to the next year or use it
for other purposes.
In accordance with the statute of the company the Assembly first considers the aspect of
capital adequacy when deciding on the use of profits for formation of other profit reserves.
The amount for proceeding dividends to shareholders is defined in gross amount.
34. Net Earnings Per Share
In euros
Net = adjusted profit per share
31 December 2011
10,557,075
11,334,385
1.091
31 December 2010
10,595,331
10,214,938
1.037
155
35. Potential Receivables and Liabilities
Potential receivables of the company represent recourse recoveries that do not meet all the
conditions for recognition as receivables among the company assets.
In euros
31 December 2011
Unclaimed recourse claims
18,458,632
31 December 2010
19,009,397
Potential liabilities of the company amount to 1,424,277 euros (2010: 734,590 euros). They
arise from given guaranties for call for tenders in the amount of 926,737 euros (2010:
732,580 euros) and liabilities towards civil claims in the amount of 497,539 euros (2010: 0
euros).
36. Business with Related Parties
During the reporting period there were no transactions between the company and its related
parties that would have been realized under unusual market conditions and would by that
have influenced the presentation of the company's financial state. Below we present the
operations between the company and its two largest owners that have increased their share
in the company and possess on the last day of the reporting period 99.6746 percent of all
shares. We also present the operations and earnings of key company management.
Equity of Related Parties
The largest shareholders of the company are Nova KBM d.d with 50.9963 percent and Sava
Re d.d. with 48.6783 percent of capital share.
At the end of the year 2011 the Management Board members owned 14,147 shares, which
represents only 0.1136 percent of the share capital. Among the equity owners there is also
an employee, employed based on an individual employment agreement, that owns 674
shares (0.0054 percent of equity). Members of the Supervisory Board do not have their own
share in the shareholding structure.
Transactions with Key Management
Key management of the company is represented by the members of the Supervisory Board,
members of the audit committee, members of the Management Board and employees with
individual employment agreements.
In 2011 there were 6 active members of the Supervisory Board. Income of the Supervisory
Board members is presented by the payments (awards) for performing their function within
the Supervisory Board and meeting fees of the body and reimbursement of eventual traveling
expenses regarding their meeting attendance, with the exception of both employee
representatives that also receive salary and other contributions based on the employment
agreement.
156
Remuneration of members of the Supervisory Board in year 2011
Meeting fees*
In euros
Supervisory Board
Bonuses**
10,544
20,394
Kovačič Matjaž
2,184
4,650
Dušan Čeč
1,771
3,384
Edi Kosi
1,595
3,090
Janez Komelj
1,496
3,090
Manja Skernišak
1,727
3,090
Robert Ciglarič
1,771
3,090
*the amount includes also travel reimbursement
**payments for performance of the function
In 2011 the audit committee was also active. The remuneration of audit committee members
(payments - bonuses, for performance of the function and meeting fees for attending the
committee meetings and travel expenses reimbursement regarding the meeting attendance)
for 2010:
Meeting fees*
In euros
Bonuses**
Audit committee of the company
9,443
8,106
Dušan Čeč
3,292
1,158
424
1,800
2,389
1,800
Andreja Rahne (since 16 August 2011)
Ignac Dolenšek
M. Milojka Kolar Celarc (until 5 October 2011)
495
-
Manja Skernišak
990
774
687
1,800
1,166
774
Nataša Ziherl
Robert Ciglarič
*the amount includes also travel reimbursement
**payments for performance of the function
In 2011 there were 5 active members of the Management Board. The income of
Management Board members and employees with individual employment agreements are
accounted among labor costs.
Remuneration of Management and representatives of employees in the Supervisory Board
and Audit Committee of the Company in year 2011
Gross salary
Advantages
In euros
Company’s administration and
administration officer
Drago Cotar
Other gross Travel and food
income**
reimbursement
Premium for
voluntary pension
insurance
737,564
39,544
51,861
6,566
3,225
162,732
13,676
10,700
1,206
645
M.Sc. Borut Celcer
148,727
10,826
10,190
1,316
645
David Kastelic
148,785
6,696
10,500
1,450
645
Marko Planinšec
149,625
5,372
12,171
1,297
645
127,696
2,975
8,300
1,297
645
2,536,107
144,008
91,719
46,446
21,093
71,210
186
33,899
3,457
1,290
3,344,882
183,738
177,480
56,469
25,608
Srečko Čarni
Employed on the basis of individual
contracts*
Representatives of employees in
supervisory bodies****
Total
*employees for which the tariff part of collective agreement is not valid
**recourse for vacation, severance pay at retirement, long-service awards and
possible other incomes
***including payment of daily allowance and mileage
****Supervisory Board and Audit Committee
157
Among the loans, the company accounts also loan receivables for loans received by the
employees with individual employment agreements. A loan is made with a loan agreement
with 4.5 percent interest rate. In 2011, 9,335 euros of loan principal were paid off. The
liabilities from a credit agreement are paid regularly and amounted to 37,599 euros on 31
December 2011.
Other related private parties are according to IAS 24 and Companies Act-1 members of
key management close family (spouse or partner, children and other surviving dependents).
In the reporting period none of the latter persons had any share capital in the company and
no business that would have been closed based under unusual market conditions.
Other related private parties employed at the company received during the reporting period
income for performing their tasks according to employment agreements, made based on the
collective wage agreement.
Key management persons and other related physical parties to the members of key
management have underwritten insurance agreements for a group of property and life
insurances. Insurance agreements are underwritten based on regular selling options (agents,
underwriting locations) and do not stand out in any way from agreements with other insured.
The company doesn’t have any loan agreements signed with other related private parties
and it also hasn’t paid out any advances or given any guaranties.
Transactions with Nova KBM d.d.
Nova KBM d.d. is an important partner with asset investment of long-term business funds
and business funds in various forms, including the investment into bank shares from public
sales and into issued bank bonds. The company has four current accounts open at the bank.
It is also a lessee of the premises in the joint information technology center for which it pays
the rent and it also takes a lease on bank’s POS terminals.
The bank performs operations of insurance agency for some of the insurance products for
which the company pays commission. The bank assets and some of the credit businesses
are insured with the company.
The company and Nova KBM d.d. do not have any mutual credit relations.
Classes and scale of transactions with Nova KBM d.d.
In euros
Income from gross premium of insurances
2011
2010
848,372
839,457
2,141,233
2,153,809
Costs of payment transactions and commissions
-732,017
-539,966
Rents and operating costs
-427,871
-397,774
-86,996
-54,564
Charges for compensations
-379,341
-635,751
Investment charges (impairment of equity shares)
-860,605
0
502,775
1,365,212
12,391,138
16,543,409
Investment income
Commission for insurance representation
Effect in profit/loss account total
Debt securities from organized market with fixed income
Equity securities in ZM portfolio
525,002
1,694,628
22,247,782
29,638,040
Cash in sight monetary account
70,134
143,981
Liabilities from commissions and rents
21,670
-8,679
35,255,726
48,011,379
Bank deposits
Total in balance sheet
158
Transactions with Pozavarovalnica Sava d.d.
Business relations with Pozavarovalnica Sava are related mostly to reinsurance transactions
and are reflected in charges, revenues, assets and liabilities. In company’s investment
portfolio there are also shares of the reinsurance company, and the employees of the
company have an accident insurance underwritten.
Classes and scale of transactions with Pozavarovalnica Sava d.d.
In euros
2011
2010
Income for reinsurance share in charged claims
24,603,472
29,666,550
Income from reinsurance share in claims reserve
-1,408,291
-1,041,560
43,357
33,851
4,001
3,319
11,119
46
-47,365,112
-51,052,514
9,670,183
10,858,730
-969,135
-2,282,124
-1,165,497
0
Income from reinsurance share in other technical provisions
Income from gross premiums
Services income
Charges for reinsurance share in gross premium
Reduction of charges for reinsurance commission from gross premium
Charges for reinsurance share in unearned premium reserve
Investment charges (impairment of equity shares)
Charges for compensations
Claims from reinsurance returns
Claims on reinsurance from technical provisions
Other receivables
Equity securities in ZM portfolio
Liabilities from reinsurance returns
-11,119
-818
-16,587,022
-13,814,520
9,976,053
20,081,769
60,642,707
61,880,314
0
248
2,419,476
3,331,464
9,759,645
19,506,430
Liability towards the reinsurance companiy from unearned premium reserve
12,878,833
13,141,666
50,399,759
52,645,699
Transactions with Moja naložba, d.d., Pension Company
The company invested capital into the pension company, 15.2 percent of which is financed
from the business fund of the company and only 4.8 percent from its own fund. A member of
the Management Board is a member of the pension company’s Supervisory Board.
The company signed an agreement with the pension company to join the pension plan and
thus included all its employees into the voluntary supplemental pension insurance. In 2011,
the company paid monthly payments of 53.74 euros (2010: 53,00 euros) for each employee.
Sum total of all payments in 2011 amounts to 514,062 (2010: 511,175 euros).
Transactions with Vivus d.o.o.
Vivus d.o.o. is an agency specialized in trading with life insurances of the company. Basic
data of the affiliated company are given in the table below.
Headquarters
Tax number:
Activity
Share capital
Share of insurance company Zavarovalnica Maribor d.d.
Profit and loss account in 2011
Average number of employees in year 2011
Karantanska ulica 35, 2000 Maribor
2154170000
99886669
Insurance agency
38,763
100 percent
11,639
42
159
All transactions with the affiliated company were performed as transactions between two well
informed parties.
Classes and scale of transactions with Vivus d.o.o.
2011
In euros
Income from gross premium of insurances
Interest income
2010
0
1,352
126
2,057
Commission for insurance representation
-944,079
-673,391
-943,953
-669,982
Given loans
Investment in Company’s portfolio
Liabilities from commission
50,134
190,000
190,000
59,114
-64,307
249,114
175,827
The manager of the Vivus d.o.o. affiliated company is a ZM employee. The affiliated
company signed a lease agreement with the company manager for renting the premises. The
rent, paid to the company manager amounted in the reporting period to 22,600 euros.
Transactions with Ornatus d.o.o.
During the reporting period the company had no transactions with the Ornatus d.o.o.
company. The manager of the Ornatus d.o.o. affiliated company is a ZM employee.
37. Events Following the Balance Sheet Date
In the period between the financial statement date—31 December 2011— and the approval
of unrevised financial statement for public release—13 March 2012— none of the events
occurred that:
•
would affect the accounted financial statement items (adjustment events)
•
have no effect on the accounted financial statement items and the company would
have to disclose them in case they would suggest significant circumstances that
occurred after the balance sheet date (non-adjustable events)
160
CERTIFIED AUDITOR REPORT
To the owners of Zavarovalnica Maribor d.d. Company
Report on Financial Statements
We audited all the attached financial statements of the Zavarovalnica Maribor d.d. Company, that include balance sheet on 31
December 2011, profit and loss account statement, statement of the second comprehensive income, statement of movements
in equity and cash flow statement for the then ended year and the summary of essential financial views and other explanatory
information.
Management Responsibility Regarding Financial Statement
The Management is responsible for preparation and honest presentation of financial statements in accordance with International
Financial Reporting Standards adopted by the EU and Companies Act referring to the preparation of financial statements, and
for such internal audit that the Managements decides is suitable and enables preparation of financial statements that do not
include any significantly false statements due to fraud or mistake.
Auditor's Responsibility
Our responsibility is to pass an opinion on these financial statements based on an audit. We conducted our audit in accordance
with international audit standards. Those standards require realization of ethical requirements, and planning and realization of
audit for acquiring sufficient assurance that the financial statements do not include significantly false references.
The audit includes procedures of acquiring audit evidence on amounts and disclosures in financial statements. The selected
procedures depend on auditor's estimation and include risk assessment of false reference in financial statements due to fraud or
mistake. When assessing those risks the auditor assesses internal controlling related to preparation and honest presentation of
company's financial statements. The audit includes also evaluation of suitability of used financial views and grounds for financial
estimates of the Management as well as evaluation of the whole presentation of financial statements.
We believe that the acquired audit evidence is a sufficient and suitable basis for our audit opinion.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the
Zavarovalnica Maribor d.d. Company as of 31 December 2011, and the results of its operations and its cash flows for the year
then ended in accordance with International Financial Reporting Standards adopted by the EU and Companies Act referring to
the preparation of financial statements.
Report on Requirements in Other Legislation
The Managements is responsible also for preparation of business report in accordance with the Companies Act. It is our
responsibility to assess uniformity of the business report with the revised financial statements. Our procedures in relation to the
business report were performed in accordance with the International Standard on Auditing 720 and are limited to the
assessment of uniformity of the business report with the revised financial statements and do not include revision of other
information arising from unrevised financial statements.
According to our opinion the report is in accordance with the revised financial statements.
Ljubljana, 29 March 2012
Janez Uranič
Manager
Primož Kovačič
Certified Auditor
Ernst & Young d.o.o.
Dunajska 111, Ljubljana
Note: the translation of the Certified Audit Report has not been authorized
by the Audit Firm.
161
ATTACHMENT TO THE ANNUAL
REPORT
OF ZAVAROVALNICA MARIBOR D.D.
Financial Statements According to Schemes of the Supervisory
Organ
Balance Sheet of the Property Insurance Group
163
Balance Sheet of the Life Insurance Group
166
Zavarovalnica Maribor Balance Sheet
169
Statement of the Comprehensive Income
172
Presentation of Assets and Liabilities of the 5063400020 Business Fund
175
5063400020 Business Fund Statement
176
Presentation of Assets and Liabilities of KSNT -1 5063400022
177
KSNT -1 5063400022 Business Fund Statement
178
Presentation of Assets and Liabilities of KSNT -2 5063400023
179
KSNT -2 5063400023 Business Fund Statement
180
Presentation of Assets and Liabilities of KSNT – 2A 5063400025
181
KSNT – 2A 5063400025 Business Fund Statement
182
162
BALANCE SHEET OF THE PROPERTY INSURANCE GROUP
In euros
on 31 Dec 2011
on 31 Dec 2010
Growth
index
A. ASSETS
368.811.755
352.431.747
A. Intangible non-current assets,
1.562.852
1.470.401
1.418.473
1 Intangible non-current assets
1.501.701
2 Goodwill
3 Long-term deferred acquisition costs
4 Other long-term active accruals
61.152
51.927
B. Investments in land and buildings and financial investments
305.272.427
275.854.570
I. Land and buildings
9.907.223
8.812.701
a) For direct implementation of insurance activity
9.409.855
8.207.611
1 Land for direct implementation of insurance activity
1.927.409
572.714
2 Buildings for direct implementation of insurance activity
7.482.446
7.634.896
3 Other land/buildings for direct implementation of insurance activity
b) Investments in real estates that are not intended for direct
implementation of insurance activity
497.368
605.090
1 Land
2.379
2.379
2 Buildings
494.989
602.712
II. Financial investments in group companies and in associated companies
50.134
1 Shares and participation in group companies
2 Debt securities and loans, given to other group companies
50.134
3 Shares and participation in associated companies
4 Debt securities and loans, given to associated companies
5 Other fin. investments in group companies and in associated companies
III. Other financial investments
235.135.452
204.289.845
1 Long-term financial investments
196.421.574
174.224.264
1.1. Shares and other variable-yield securities with and
coupons in mutual funds
3.947.369
3.354.018
1.2. Debt securities and other fixed-income securities
146.163.554
126.569.229
1.3. Participation in investment funds
8.959.814
6.232.825
1.4. Mortgage
Mortgage credits
credits
91.479
120.011
1.5. Other
Other lendings
lendings
131.241
134.250
1.6. Bank
Bank deposits
deposits
36.409.850
37.002.380
1.7. Other
Other financial
financial investments
investments
718.266
811.552
2 Short-term financial investments
38.713.879
30.065.581
2.1. Shares and participation bought for sale
2.2. Securities bought for sale or with a residual maturity of up
to one year
15.486.440
9.999.734
2.3. Given short-term loans
80.830
77.110
2.4. Short-term bank deposits
23.146.608
19.988.737
2.5. Other short-term financial investments
IV. Financial investments of reinsurance companies in respect of reinvest. contracts at ceding undertakings
V. Resources from financial contracts
VI. Amount of technical provisions transferred to reinsurance
60.229.752
62.701.891
companies and in co-insurance (if insurance company transacts
a) from unearned premium
12.731.551
13.709.578
1 Amount given in reinsurance
12.731.551
13.709.578
2 Amount given in co-insurance
b) from life assurance provisions
c) from claims outstanding
47.454.674
48.961.823
47.331.858
48.814.270
122.815
147.553
d) from provisions from bonuses and rebates
43.527
30.490
43.527
30.490
e) from other technical provisions
from technical provisions for life-insurance policies in favor of the
f) insured assuming the investment risk
C. Investments for life-insurance policies in favor of the insured assuming the investment risk
105
106
106
118
111
112
115
337
98
82
100
82
115
113
118
115
144
76
98
98
89
129
155
105
116
96
93
93
97
97
83
143
143
163
In euros
on 31 Dec 2011
on 31 Dec 2010
52.989.773
66.221.530
D. Receivables (receivables on associated companies and group companies are shown separately as
sub-items of the items
I, II, III)
I. Receivables from direct insurance operations
39.499.291
41.936.733
1 Receivables towards the policyholders
38.309.048
40.523.716
2 Receivables towards the agents
1.187.360
1.408.708
3 Other claims from direct insurance operations
2.883
4.309
II. Receivables from co-insurance and reinsurance
10.935.474
20.828.679
1 Receivables for accepted co-insurance premium
175.025
472.692
2 Receivables for accepted reinsurance premium
3 Receivables for co-insurers participation in claims
146.969
151.599
4 Receivables for reinsurers participation in claims
10.582.771
20.179.858
5 Other receivables from co-insurance and reinsurance
30.709
24.531
III. Other receivables and deferred tax assets
2.555.007
3.456.118
1 Receivables for advances for intangible assets
226.745
2 Other short-term receivables from insurance operations
418.333
568.248
3 Short-term financial receivables
325.513
1.500.864
4 Other short-term receivables
865.108
992.264
5 Long-term receivables
35.858
50.285
6 Receivables for corporate income tax
7 Deferred tax receivables
910.194,65
117.711
IV. Unpaid called-up share capital
3.840.435
3.652.779
E. Other resources
I. Tangible fixed assets, excluding land and buildings
3.420.218
3.247.704
1 Equipment
3.269.560
3.101.805
2 Other tangible fixed assets
150.658
145.899
II. Finances
250.018
241.913
III. Stocks and other resources
170.200
163.162
1 Stocks
96.788
89.750
2 Other resources
73.412
73.412
5.146.267
5.173.463
F. Short-term active accruals
1 Accrued interest and rent
147.649
231.704
2 Short-term deferred acquisition costs
4.773.856
4.734.695
3 Other short-term active accruals
224.763
207.064
G.
59.003
Non-current assets held for sale and discontinued operations
H. Off-balance-sheet register
B. LIABILITIES
A. Equity
I. Called-up capital
1 Share capital
2 Uncalled capital (as deductible item)
II. Share premium account
III. Profit reserves
1 Safety margin
2 Statutary and statutory reserves
3 Own shares reserves
4 Own shares (as deductible item)
5 Credit risk equalization reserves
6 Catastrophic losses equalization reserves
7 Other profit reserves
IV. Revaluation surplus
1 Revaluation surplus in respect of tangible fixed assets
2 Revaluation surplus in respect of long-term financial investments
3 Revaluation surplus in respect of short-term financial investments
4 Other revaluation surplus
V. Retained net profit or loss
VI. Net profit or loss account for the financial year
Growth
index
80
94
95
84
67
53
37
97
52
125
74
74
22
87
71
773
105
105
105
103
103
104
108
100
99
64
101
109
19.882.909
19.743.987
101
368.811.755
57.792.399
39.998.605
39.998.605
352.431.747
48.595.281
34.630.766
34.630.766
105
119
116
116
739.652
11.645.873
739.652
9.957.043
100
117
7.999.721
6.926.153
116
3.066.528
2.451.265
125
579.624
-1.838.831
579.624
1.218.633
100
-151
-1.838.831
1.218.633
-151
46
7.247.053
1.381.436
667.752
0
1.085
164
In euros
B. Subordinated liabilities
C. Gross technical provisions and deferred premiums income
I. Gross unearned premiums
II. Gross life assurance provisions
III. Gross claims reserves
IV. Gross provisions for bonuses and rebates
V. Other gross technical provisions
D. Gross technical provisions for life-insurance policies in favor of the insured
assuming the investment risk
E. Provisions for other risks and charges
1. Provisions for pensions
2. Other provisions
F. Obligations for financial investments of reinsurers in respect of reinvest. contracts
at ceding undertakings
G. Other liabilities
I. Liabilities from direct insurance operations
1 Liabilities towards the policyholders
2 Liabilities towards the agents
3 Other liabilities from direct insurance operations
II. Liabilities from co-insurance and reinsurance
1 Liabilities for co-insurance premiums
2 Liabilities for reinsurance premiums
3 Liabilities for shares in co-insurance claims
4 Liabilities for shares in reinsurance claims
5 Other creditors from co-insurance and reinsurance
III. Loans insured with fixed-income securities
IV. Liabilities to banks
V. Liabilities from financial contracts
VI. Other liabilities
a) Other long-term liabilities
1 Long-term liabilities from financial leasing
2 Other long-term liabilities
3 Deferred tax liabilities
b) Other short-term liabilities
1 Short-term liabilities towards employees
2 Other short-term liabilities from insurance operations
3 Short-term financial liabilities
4 Liabilities for corporate income tax
5 Other shot-term liabilities
H. Passive accruals
1. Predefined deferred costs and charges
2. Other passive accruals
I. Non-current creditors under non-current assets held for sale and discontinued
operations
J. Off-balance-sheet register
on 31 Dec 2011
7.000.000
273.057.269
74.347.697
on 31 Dec 2010
7.000.000
255.658.839
74.166.824
Growth
index
100
107
100
193.296.153
67.505
5.345.913
176.160.408
66.988
5.264.618
110
101
102
3.734.987
3.214.203
116
3.734.987
3.214.203
116
25.595.663
3.429.725
1.196.536
1.691.477
541.712
10.315.961
130.891
10.009.836
175.234
36.152.721
4.119.136
1.647.219
1.910.019
561.897
19.944.002
95.785
19.596.748
240.868
10.600
71
83
73
89
96
52
137
51
73
11.849.978
12.089.583
98
11.849.978
2.604.077
2.704.810
3.417.722
914.331
2.209.038
1.631.437
52.500
1.578.937
12.089.583
2.348.362
2.560.301
3.011.466
2.415.277
1.754.178
1.810.702
344.963
1.465.739
98
111
106
113
38
126
90
15
108
19.882.909
19.743.987
101
165
BALANCE SHEET OF THE LIFE INSURANCE GROUP
on 31 Dec 2011
on 31 Dec 2010
Growth
index
393.089.139
6.708.897
2 Goodwill
6.708.897
276.929.265
1.322.507
1.273.507
55.091
1.218.416
b) Investments in real estates that are not intended for direct implementation of insurance
activity
49.000
1 Land
15.305
2 Buildings
33.695
190.000
190.000
275.218.490
261.867.149
1.1.
Shares and other variable-yield securities with and coupons in mutual funds
7.930.946
224.025.361
10.653.818
1.4. Mortgage
Mortgage credits
credits
1.5. Other
Other lendings
lendings
1.6. Bank
Bank deposits
deposits
19.254.938
1.7. Other
Other financial
investments
2.086
13.351.341
2.2.
Securities bought for sale or with a residual maturity of up to one year
13.351.341
VI. Amount of technical provisions transferred to reinsurance companies and in co198.268
insurance (if insurance company transacts with co-insurances, it separately shows the
8.892
8.892
189.376
189.376
from technical provisions for life-insurance policies in favor of the insured assuming the
f) investment risk
C. Investments for life-insurance policies in favor of the insured assuming the investment risk
107.045.539
383.211.506
9.578.958
103
70
9.578.958
70
279.728.741
1.415.835
1.365.493
55.091
1.310.402
99
93
93
100
93
50.342
15.305
35.037
190.000
190.000
97
100
96
100
100
277.961.912
268.327.312
99
98
11.835.089
227.553.890
9.598.224
67
98
111
19.338.022
2.086
9.634.600
100
100
142
9.634.600
142
160.994
123
160.994
160.994
118
118
92.243.852
116
In euros
A. ASSETS
166
Growth
In euros
on 31 Dec 2011
on 31 Dec 2010
index
2.081.060
D. Receivables (receivables on associated companies and group companies are shown separately as
sub-items of the 1.286.524
items I, II, III)
162
896.027
831.164
108
895.671
828.390
108
356
2.774
13
75.711
96.991
78
75.711
96.991
78
1.109.322
358.369
310
62.826
48.409
130
406.256
361.901
309.959
117
278.338
148.213
275.165
E. Other resources
54
44.511
51.043
87
1 Equipment
29.128
35.660
82
15.383
15.383
100
II. Finances
103.703
224.122
46
1 Stocks
2 Other resources
176.165
98.265
179
118.979
98.265
121
57.185
0
G.
B. LIABILITIES
A. Equity
1 Share capital
1 Safety margin
393.089.139
31.249.993
15.427.686
15.427.686
383.211.506
36.757.119
7.995.326
7.995.326
103
85
193
193
2.072.254
11.854.468
2.072.254
10.367.996
100
114
3.085.537
1.599.065
193
8.768.931
1.473.788
8.768.931
9.365.924
100
16
1.473.788
9.365.924
16
287.079
134.719
2.771.290
4.184.328
10
3
A part of the revaluation reserve arising for evaluating investment available for sale and which would
in actual realization on the market belong to the insured persons is stated in equity as a part of
revaluation reserve item, while in the accounting reports it is stated among technical provisions.
167
In euros
2. Other provisions
H. Passive accruals
operations
on 31 Dec 2011
on 31 Dec 2010
Growth
index
245.862.303
572.691
232.405.013
12.884.599
237.487.259
650.180
227.075.487
9.761.592
104
88
102
132
101.805.961
1.116.167
89.803.133
1.075.345
113
104
1.116.167
1.075.345
104
9.314.718
8.428.542
141.663
14.091.647
9.033.677
254.282
66
93
56
8.286.879
128.978
8.779.394
143.875
94
90
128.978
143.875
90
757.198
222.892
4.914.096
2.195.034
15
10
222.892
534.306
2.195.034
2.719.062
10
20
65.834
282.597
104.944
80.930
3.739.997
81.850
1.483.349
1.114.300
39.563
3.997.003
29.626
3.967.377
80
19
9
205
94
3.739.997
168
94
BALANCE SHEET
on 31 Dec 2011
on 31 Dec 2010
Growth
index
760.989.148
8.271.750
1.501.701
2 Goodwill
6.708.897
61.152
582.201.692
11.229.730
10.683.362
1.982.500
8.700.862
b) Investments in real estates that are not intended for direct implementation of insurance
activity
546.368
1 Land
17.684
2 Buildings
528.684
190.000
190.000
510.353.943
458.288.723
1.1.
Shares and other variable-yield securities with and coupons in mutual funds
11.878.315
370.188.915
19.613.632
1.4. Mortgage
Mortgage credits
credits
91.479
1.5. Other
Other lendings
lendings
131.241
1.6. Bank
Bank deposits
deposits
55.664.788
1.7. Other
Other financial
investments
720.352
52.065.220
2.2.
Securities bought for sale or with a residual maturity of up to one year
15.486.440
80.830
36.497.949
VI. Amount of technical provisions transferred to reinsurance companies and in co60.428.019
insurance (if insurance company transacts with co-insurances, it separately shows the
12.740.443
12.740.443
47.644.049
47.521.234
122.815
43.527
43.527
from technical provisions for life-insurance policies in favor of the insured assuming the
f) investment risk
C. Investments for life-insurance policies in favor of the insured assuming the investment risk 107.045.539
734.042.192
11.049.359
1.418.473
104
75
106
9.578.958
51.927
555.583.311
10.228.536
9.573.104
627.805
8.945.298
70
118
105
110
112
316
97
655.432
17.684
637.748
240.134
190.000
50.134
83
100
83
79
100
482.251.757
442.551.576
106
104
15.189.107
354.123.119
15.831.050
120.011
134.250
56.340.402
813.638
39.700.182
78
105
124
76
98
99
89
132
9.999.734
77.110
29.623.337
155
105
124
62.862.885
96
13.709.578
13.709.578
93
93
49.122.817
48.975.264
147.553
30.490
30.490
97
97
83
143
143
92.243.852
116
In euros
A. ASSETS
169
Growth
In euros
on 31 Dec 2011
on 31 Dec 2010
index
D. Receivables (receivables on associated companies and group companies are shown separately
54.159.086
as sub-items of the
65.906.995
items I, II, III) 82
40.395.318
42.767.897
94
39.204.720
41.352.106
95
1.187.360
1.408.708
84
3.238
7.083
46
11.011.185
20.925.670
53
175.025
472.692
37
146.969
151.599
97
10.658.481
20.276.849
53
30.709
24.531
125
2.752.584
2.213.427
124
226.745
481.159
616.657
78
42.916
17.516
245
1.227.009
1.302.223
94
35.858
50.285
71
278.338
687.302
3.988.649
3.927.944
E. Other resources
102
3.464.729
3.298.747
105
1 Equipment
3.298.688
3.137.465
105
166.041
161.282
103
II. Finances
353.720
466.035
76
170.200
163.162
104
1 Stocks
96.788
89.750
108
2 Other resources
73.412
73.412
100
5.322.432
5.271.728
101
266.628
329.969
81
4.831.041
4.734.695
102
224.763
207.064
109
G.
59.003
B. LIABILITIES
A. Equity
1 Share capital
1 Safety margin
19.882.909
19.743.987
101
760.989.148
89.042.392
55.426.291
55.426.291
734.042.192
85.352.400
42.626.092
42.626.092
104
104
130
130
2.811.907
23.500.341
2.811.907
20.325.039
100
116
11.085.258
8.525.219
130
3.066.528
2.451.265
125
9.348.555
-365.044
9.348.555
10.584.556
100
-3
-365.044
10.584.556
-3
287.125
7.381.772
4.152.726
4.852.080
7
152
170
In euros
2. Other provisions
H. Passive accruals
operations
on 31 Dec 2011
7.000.000
518.919.571
74.920.388
232.405.013
206.180.753
67.505
5.345.913
on 31 Dec 2010
7.000.000
493.146.097
74.817.004
227.075.487
185.922.000
66.988
5.264.618
Growth
index
100
105
100
102
111
101
102
101.805.961
4.851.153
89.803.133
4.289.548
113
113
4.851.153
4.289.548
113
33.998.635
11.858.267
1.338.199
1.691.477
8.828.591
10.444.939
130.891
10.138.814
175.234
48.643.308
13.152.813
1.901.502
1.910.019
9.341.292
20.087.876
95.785
19.740.623
240.868
10.600
70
90
70
89
95
52
137
51
73
11.695.430
15.402.619
2.077.323
76
11.695.430
2.604.077
2.770.645
3.011.466
1.019.275
2.289.968
5.371.434
52.500
5.318.934
2.077.323
13.325.296
2.348.362
2.642.151
3.011.466
3.529.577
1.793.741
5.807.705
374.589
5.433.117
88
111
105
100
29
128
92
14
98
19.882.909
19.743.987
101
171
STATEMENT OF THE COMPREHENSIVE INCOME
In euros
from 1 Jan to
31 Dec 2011
from 1 Jan to
31 Dec 2010
Growth
index
A. Property insurance account statement, excluding health insurances
I.
Net profit from insurance premiums
1 Balanced gross insurance premium
2 Balanced accepted co-insurance premium (+)
3 Balanced given co-insurance premium (-)
4 Balanced reinsurance premiums (-)
5 Change in gross unearned premiums (+/-)
6 Change in unearned premiums for reinsurance and co-insurance operations (+/-)
135.062.022
187.839.066
317.898
-1.654.165
-50.321.037
-84.515
-1.035.224
134.150.686
188.289.702
266.931
-1.553.415
-53.786.760
3.216.279
-2.282.051
101
100
119
106
94
-3
45
10.273.430
480.774
88.777.227
102.530.061
-5.386.467
-475.059
-26.534.203
17.017.594
1.625.301
-81.295
11.351
39.839.706
12.776.425
6.799.288
490.540
89.167.503
111.124.254
-4.459.448
-361.087
-31.347.345
13.222.647
988.483
848.517
60.051
39.241.578
12.711.092
151
98
100
92
121
132
85
129
164
-10
19
102
101
37.038.076
2.187.533
23.383.362
16.799.595
2.738.225
3.845.542
37.741.024
1.959.250
23.316.428
17.228.558
2.688.411
3.399.460
98
112
100
98
102
113
302.263
11.164.917
486.401
11.978.945
62
93
-9.974.795
2.190.010
164.520
530.179
1.495.311
-11.210.537,81
2.351.318
182.251
590.556
1.578.511
89
93
90
90
95
14.916.635
11.468.581
130
Net profit from insurance premiums
75.240.065
71.149.824
1 Balanced gross insurance premium
75.404.821
71.308.964
2 Balanced accepted co-insurance premium (+)
3 Balanced given co-insurance premium (-)
4 Balanced reinsurance premiums
-248.509
-187.877
5 Change in gross unearned premiums (+/-)
74.860
28.737
6 Change in unearned premiums for reinsurance operations (+/-)
8.892
Investments income
13.812.377
12.669.749
1 Income from dividends and participating interest
154.570
120.578
1.1. Income from dividends and other profit participation in group companies
1.2. Income from dividends and other profit participation in associated companies
1.3. Income from dividends and other profit participation in other companies
154.570
120.578
12.023.348
12.065.990
companies and group
companies)
2 Other investments income (in items 2.1., 2.2. and 2.3. insurance company separately shows investments income in associated
2.1. Incomes
Incomesfrom
fromland
landand
andbuildings
buildings
2.2. Interest
Interestincome
income
11.489.000
11.223.037
2.3. Other
Otherinvestment
investmentincome
income
534.347
842.953
2.3.1. Financial income for revaluation
514.740
628.989
2.3.2. Other financial income
19.607
213.963
3 Value re-adjustments on investments
4 Gains on the disposal of investments
1.634.459
483.182
106
106
II.
Allocated investments return transferred from net technical account (D.VIII)
III. Other net technical income
IV. Net charges for claims
1 Balanced gross claims
2 Income from established gross recourse claims (-)
3 Balanced co-insurers participation (+/-)
4 Balanced reinsurers participation (+/-)
5 Change in gross claims outstanding (+/-)
6 Change in claims outstanding for reinsurance and co-insurance operations (+/-)
V. Change in other net technical provisions (+/-)
VI. Net charges for bonuses and rebates
VII. Net operating expenses
1 Acquisition costs
2 Changes in deferred acquisitions costs (+/-)
3 Other operating expenses
3.1. Depreciation of assets value needed for operation
3.2. Labour costs
3.2.1. Employees salaries
3.2.2. Social and pension insurance costs
3.2.3. Other labour costs
3.3. Service costs of natural persons, who are not pursuing activity (costs by work
agreements, copyright agreements and relating to legal relations), with
company charges
3.4. Other operating expenses
4
Income from reinsurance commissions and profit participation (+/-)
VIII. Other net technical charges
1 Charges for preventive action
2 Contributions for loss coverage by non-insured and unknown vehicles
3 Other net technical charges
IX. Property insurance account, excluding health insurance (I + II + III - IV + V - VI VII - VIII)
B. Life insurance account statement
I.
II.
132
260
109
128
128
100
102
63
82
9
338
172
In euros
III. Net unrealized investment profit of life-insurance policies in favor of the insured
IV. Other net income from insurances
V. Net charges for claims
1 Balanced gross claims
2 Income from established gross recourse claims (-)
3 Balanced reinsurers participation (+/-)
4 Change in gross claims outstanding (+/-)
5 Change in claims outstanding for reinsurance operations (+/-)
VI. Change in other net technical provisions (+/-)
1 Changes in life assurance provisions
1.1. Changes in gross life assurance provisions
1.2. Change in reinsurance participation (+/-)
2 Change in other net technical provisions (+/-)
2.1. Change in other gross technical provisions (+/-)
2.2. Change in reinsurance participation (+/-)
VII. Net charges for bonuses and rebates
VIII. Net operating expenses
1 Acquisition costs
3.2. Labour costs
3.3. Service costs of natural persons, who are not pursuing activity (costs by work
agreements, copyright agreements and relating to legal relations), with
company charges
4 Income from reinsurance commissions and profit participation (+/-)
IX. Investment charges
1 Depreciation of asset investments that are not needed for operation
2
Charges for asset management, interest charges and other financial charges
3 Financial charges for revaluation
4 Losses on the disposal of investments
X. Net unrealized investment losses of life-insurance policies in favor of the
insured assuming the investment risk
XI. Other net technical charges
1 Charges for preventive action
2 Other net technical charges
XII.
Allocated investments return transferred in net technical account (-)
XIII. Life insurances account
(I+ II + III + IV – V + VI – VII – VIII – IX – X – XI – XII)
from 1 Jan to
31 Dec 2011
from 1 Jan to
31 Dec 2010
Growth
index
11.465.827
644.304
41.126.039
37.491.597
10.381.006
498.982
41.748.482
40.158.367
110
129
99
93
-59.318
3.722.141
-28.382
-16.833.937
-16.833.937
-16.833.937
-42.067
1.793.177
-160.994
-20.459.535
-20.459.535
-20.459.535
141
208
18
82
82
82
23.838.301
9.484.063
2.965.618
11.421.392
100.768
7.657.064
5.575.733
908.808
1.172.523
21.742.475
9.185.097
1.856.656
10.719.471
102.874
8.635.351
6.324.315
986.871
1.324.165
110
103
160
107
98
89
88
92
89
201.509
3.462.052
-32.772
3.022.044
1.342
71.398
1.909.849
-18.749
1.391.766
1.342
282
181
175
217
100
2.993.051
27.651
80.460
1.253.072
56.892
239
49
13.914.980
92.709
92.709
5.023.148
89.609
2.500
87.109
277
103
106
-27.331
455.858
-6
2.361.893
3.788.688
62
C. Health insurance account statement
Ca. Supplementary insurance account statement
Breakdown as in C (to the order no. XI - Supplementary insurance account)
D. Net technical account
I.
II.
III.
IV.
Property insurance account, excluding health insurances (A.IX)
14.916.635
11.468.581
130
Life insurances account (B.XIII)
2.361.893
3.788.688
62
Health insurances account (C.XIII)
Investment income
13.597.816
10.280.083
132
136.769
510.268
27
136.769
510.268
27
10.484.843
9.317.835
113 companies)
2 Other investments income (in items 2.1., 2.2. and 2.3. insurance company separately shows investments
income in associated
companies and group
2.1. Incomes from land and buildings
94.956
103.098
92
2.2. Interest income
10.214.924
9.120.408
112
> Income from group company interests
2.057
> Income from participating interest
10.214.924
9.118.351
112
2.3. Other investment income
174.963
94.329
185
174.963
94.329
185
3 Investment revaluation income
2.742
2.828
97
2.973.462
449.152
662
173
from 1 Jan to
31 Dec 2011
In euros
V. Allocated investments return transferred from life insurances (B.XII)
-27.331
VII. Investment charges
2.197.486
37.501
2 Charges for asset management, interest charges and other financial charges
1.261.208
859.308
39.469
VIII. Allocated investments return transferred from property insurances account
statement, excluding health insurances (A.II)
10.273.430
IX. Other insurance income
49.145
1 Other income from property insurance, excluding health insurances
49.145
2 Other life insurance income
X. Other insurance charges
4.538.750
1 Other charges from property insurance, excluding health insurances
4.398.690
2 Other life insurance charges
140.059
XI. Other income
818.470
1 Other income from property insurance, excluding health insurances
383.081
2 Other life insurance income
435.388
XII.
Other charges
67.792
1 Other charges from property insurance, excluding health insurances
40.970
2 Other life insurance charges
26.822
(I +
XIII. Profit or loss account for accounting period prior to taxation
II + III + IV + V + VI - VII - VIII + IX - X + XI - XII)
14.639.171
1 Profit or loss for accounting period from property insurance, excluding health insurances
12.036.101
2 Profit or loss for accounting period from life insurances
2.603.070
XIV. Income tax
4.109.321
XV. Deferred taxes
-27.225
XVI. Net profit or loss account for accounting period (XIII - XIV + XV)
10.557.075
from 1 Jan to
31 Dec 2010
455.858
1.683.010
39.389
1.079.663
563.958
Growth
index
-6
131
95
117
152
151
6.799.288
81.689
81.667
22
4.059.630
4.051.066
8.563
1.553.549
241.763
1.311.786
860.674
737.968
122.706
112
109
1.636
53
158
33
8
6
22
14.225.846
8.800.761
5.425.085
3.674.602
-44.087
10.595.331
103
137
48
112
62
100
10.557.075
-4.967.437
10.595.331
-41.806
100
11.882
-6.209.297
-52.258
11.882
1.241.859
10.452
11.882
5.589.637
10.553.525
53
60
60
E. All-encopassing return calculation
I.
II.
Net profit / loss for the financial year after taxation
Other all-encopassing output after taxation (1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 + 9)
3
4
5
6
7
8
9
III.
Actuarial net profit/loss for retirement plans
Net profit/loss from re-measurement of financial asset, available for sale
Net profit/loss of non-current assets, available for sale
Net profit/loss from cash flow hedges
Associated net profit/loss recognized in revaluation surplus and retained profit/loss
from capital investments of associated and jointly controlled companies, balanced
Other net profit/loss of other all-encompassing return
Tax from other all-encompassing return
Total all-encopassing return (I + II)
174
PRESENTATION OF ASSETS AND LIABILITIES OF CLASSIC LIFE INSURANCE
BUSINESS FUND - 5063400020
In euros
on 31 Dec 2010
269.001.143
Investments in real estates and financial investments
265.119.706
I.
Investment property
49.000
1 Investments in group companies
2 Investments in associated companies
265.070.706
1 Shares and other variable-yield securities and coupons
in mutual funds
7.630.497
2 Fixed-income debt securities
215.398.615
3 Participation in investment funds
9.647.656
4 Given loans with security right
5 Other loans
6 Bank deposits
32.393.938
7 Other financial investments
271.289.797
270.171.377
50.342
99
98
97
270.121.035
98
11.534.640
220.016.959
9.598.224
66
98
101
28.971.212
112
3.600.071
527.853
518.499
854.429
508.879
506.105
421
104
102
9.354
337
3.072.218
2.774
33.596
311.953
113.965
113.965
187.714
187.714
61
61
167.399
96.996
70.403
76.276
76.276
219
127
256.809.142
317.100
245.862.303
572.691
232.405.013
12.884.599
261.988.727
9.356.177
237.487.259
650.180
227.075.487
9.761.592
98
3
104
88
102
132
8.049.512
8.023.400
94.714
12.459.762
8.510.775
254.282
65
94
37
7.928.687
8.932
17.180
2.580.226
8.256.493
143.875
3.805.112
2.685.528
96
6
0
96
ASSETS
A.
B.
C.
D.
Receivables
I.
3 Other receivables from direct insurance operations
II. Reinsurance receivables
III. Other receivables
Other resources
I.
Finances
II. Other resources
Short-term active accruals
LIABILITIES
A.
B.
C.
E.
F.
Growth
index
on 31 Dec 2011
Revaluation surplus
Gross technical provisions
I.
Gross unearned premiums
Gross technical provisions for life-insurance policies in
favor of the insured assuming the investment risk
Other liabilities
I.
III. Other liabilities
Passive accruals
985
175
CLASSIC LIFE INSURANCE BUSINESS FUND STATEMENT -5063400020
In euros
I.
II.
III.
IV.
V.
VI.
VII.
Insurance premium income
1 Balanced insurance premium
2 Changes in unearned premiums
Investments income
2 Other investment income
4 Profit on the disposal of investments
Other income from insurances
Charges for claims
1 Balanced claims
2 Changes in claims outstanding
Change in other technical provisions (+/-)
1 Changes in life assurance provisions (+/-)
1.1. Changes in life assurance provisions, excluding participation in profits (+/-)
1.2. Changes in life assurance provisions in respect of participation in profits (+/-)
2 Change in other technical provisions (+/-)
Charges for bonuses and rebates
Costs internalized according to insurance policies
1 Initial costs
2 Incasso, administrative expenses and overheads
3 Final or payment costs
from 1 Jan to 31 Dec 2011
Growth
index
31.890.445
31.804.063
86.381
13.281.265
154.570
33.102.272
33.072.748
29.524
12.070.185
120.578
96
96
293
110
128
154.570
11.504.451
120.578
11.477.766
128
100
11.113.984
390.468
373.900
16.568
11.121.816
355.950
355.950
100
110
105
1.622.244
27.557
30.124.174
27.001.166
3.123.008
-5.430.034
-5.430.034
-5.430.034
0
0
471.841
20.341
31.604.685
31.368.817
235.869
-2.711.710
-2.711.710
1.008.690
-3.720.400
344
135
95
86
1.324
200
200
-538
0
5.329.755
1.430.113
3.899.642
5.436.719
98
4.169.697
94
6.621.478
6.885.036
96
VII.a. Net operating costs
1 Acquisition costs
863.905
631.073
137
-70.403
0
5.844.355
6.270.060
93
100.768
102.874
98
3.2. Labour costs
3.454.089
4.517.049
76
2.357.445
3.308.174
71
384.248
516.220
74
712.395
692.655
103
43.508
46.587
contracts and relating to legal
relations), with
107
company charges
3.3. Service costs of natural persons, who are not pursuing activity (costs by work contracts, copyright works
2.242.911
1.606.629
140
4
Incomes from reinsurance commissions and profit participation (+/-)
-16.379
-16.097
102
2.674.487
1.313.336
204
VIII. Investment charges
1.342
1.342
100
0
78.393
0
2.664.893
1.233.601
216
8.252
0
43.276
65.332
66
IX.
Other net technical charges
1.597.542
4.061.016
39
X.
Life insurance account (I+ II + III - IV + V - VI - VII - VIII - IX)
305.818
2.612.699
12
X.a. Life insurance account (I+ II + III - IV + V - VI - VII.a - VIII - IX)
176
PRESENTATION OF ASSETS AND LIABILITIES OF UNIT-LINKED LIFE
INSURANCE BUSINESS FUND 5063400022 (KSNT1)
In euros
on 31 Dec 2011
on 31 Dec 2010
102.746.913
101.936.390
I.
Investment property
0
101.747.015
in mutual funds
87.015.856
7.733.184
5 Other loans
6 Bank deposits
6.997.975
IV.
Amount of technical provisions transferred to reinsurers
189.376
91.069.671
90.571.978
ASSETS
A.
B.
C.
D.
E.
F.
113
113
0
90.410.985
113
86.389.985
101
4.021.000
174
160.994
118
Receivables
I.
Other resources
I.
Finances
II. Other resources
486.424
354.969
354.969
439.922
322.285
322.285
111
110
110
75.711
55.744
7.490
7.490
73.216
44.421
35.779
35.779
103
125
21
21
316.609
21.983
294.626
21.992
21.992
1.440
100
98.515.417
89.991.718
109
4.237.112
3.613.034
117
92.543.076
611.697
382.508
46.539
84.359.528
707.681
522.901
110
86
73
335.969
120.046
109.142
1.123.532
522.901
104.413
80.367
1.311.475
64
115
136
86
LIABILITIES
A.
B.
C.
Growth
index
Revaluation surplus
Other liabilities
I.
1 Liabilities towards policyholders
2 Liabilities towards insurance brokers
Passive accruals
177
UNIT-LINKED LIFE INSURANCE BUSINESS FUND STATEMENT 5063400022
(KSNT1)
In euros
I.
II.
from 1 Jan to
31 Dec 2011
Balanced gross insurance premium
Investments income
1.1. Income from dividends and group participating interest
1.2. Income from dividends and associated participating interest
1.3. Income from dividends and other participating interest
III. Charges in respect of insurance sum payment or redemption value
1 Regular termination
2 Extraordinary termination
1.1. with insurance withdrawal
1.2. with termination of insurance contract
1.3. with death of an insured person
VI. Balanced costs and commissions
1 Balanced input costs
2 Output costs
3 Management commission
VIII. Long-term business fund account (I+II-III+IV+V-VI-VII)
from 1 Jan to
31 Dec 2010
39.980.656
11.576.512
0
0
0
0
11.564.298
0
129.473
11.434.825
11.434.825
0
0
12.214
10.479.286
10.479.286
0
Growth
index
36.759.158
10.443.827
0
109
111
10.432.487
111
51.481
10.381.006
10.381.006
251
110
110
11.340
8.789.550
8.789.550
0
108
119
119
-17.775.448
-16.378.347
-1.397.101
12.372.652
9.747.355
49
50
41
112
107
3.421.705
2.625.296
13.877.739
0
0
13.858.340
19.399
4.579.610
5.055.425
130
275
5.023.148
32.277
3.209.910
276
60
143
-8.759.767
-8.186.385
-573.381
13.860.767
10.439.062
178
INSURANCE BUSINESS FUND – 5063400023 (KSNT-2 ZM ZAJAMČENI)
In euros
on 31 Dec 2010
4.532.497
4.524.279
I.
Investment property
4.524.279
in mutual funds
4.185.351
5 Other loans
6 Bank deposits
338.928
IV.
1.840.255
1.832.868
246
247
1.832.868
247
1.508.079
278
324.789
104
7.883
6.758
117
7.883
335
335
6.758
629
629
117
53
53
4.508.404
1.808.297
249
4.508.372
32
1.808.255
41
249
78
32
41
78
ASSETS
A.
B.
C.
D.
Receivables
I.
Other resources
I.
Finances
II. Other resources
LIABILITIES
A.
B.
C.
E.
F.
Growth
index
on 31 Dec 2011
Revaluation surplus
Other liabilities
I.
Passive accruals
179
UNIT-LINKED LIFE INSURANCE BUSINESS FUND STATEMENT – 5063400023
(KSNT-2 ZM ZAJAMČENI)
In euros
I.
II.
Investments income
Charges in respect of insurance sum payment or redemption value
VI. Balanced costs and commissions
2 Output costs
VIII. Long-term business fund account (I+II-III+IV+V-VI-VII)
Growth
index
2.506.240
117.810
1.477.058
41.175
170
286
117.810
41.175
286
117.810
41.175
286
-2.700.116
-2.700.116
-1.369.477
-1.369.477
197
197
148.756
-73
III.
32.188
32.188
-108.255
180
INSURANCE BUSINESS FUND – 5063400025 (KSNT-2A ZM PRIZMA HIBRID)
In euros
on 31 Dec 2011
ASSETS
A.
B.
C.
D.
I.
Investment property
in mutual funds
5 Other loans
6 Bank deposits
IV.
A.
B.
C.
E.
F.
804.737
444.980
359.756
23.167
22.204
22.204
57.185
Revaluation surplus
Other liabilities
I.
Passive accruals
Growth
index
889.374
804.737
Receivables
I.
Other resources
I.
Finances
II. Other resources
LIABILITIES
on 31 Dec 2010
964
4.284
4.284
57.185
577.560
517.401
23.920
22.633
410
22.223
1.287
36.239
181
UNIT-LINKED LIFE INSURANCE BUSINESS FUND STATEMENT – 5063400025
(KSNT-2A ZM PRIZMA HIBRID)
In euros
I.
II.
III.
V.
VI.
VII.
VIII.
Investments income
Charges in respect of insurance sum payment or redemption value
Change in other net technical provisions (+/-)
Balanced costs and commissions
2 Output costs
Investment charges
Long-term business fund account (I+II-III+IV+V-VI-VII)
from 1 Jan to
31 Dec 2011
from 1 Jan to
31 Dec 2010
Growth
index
1.036.425
32.428
0
0
0
0
32.428
0
1.425
31.002
31.002
0
0
0
11.145
11.145
0
-517.401
-517.401
0
362.706
323.821
38.885
56.640
0
0
56.640
0
120.960
182

ZAVAROVALNICA MARIBOR D.D. ANNUAL REPORT

Transcription

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