The annual financial statements of ...
The annual financial statements of the companies in Austria and abroad
included in the consolidated financial statements were predominantly
prepared up to the reporting date of UNIQA Versicherungen AG, i.e.
31 December. For recording in the consolidated financial statements, the
annual financial statements of UNIQA Versicherungen AG and its included
subsidiaries are unified to conform to the accounting and valuation principles
of IFRS/IAS and, as far as actuarial provisions, acquisition costs and
actuarial expenses and income are concerned, according to the provisions
of US GAAP.
Securities transactions are recorded using the settlement date. As a rule,
the fair values are derived from an active market.
Intangible assets include goodwill, deferred acquisition costs, the current
value of life, property and casualty insurance contracts and other items.
Goodwill is the difference between the purchase price for the stake in the
subsidiary and the Groups share in the equity after the disclosure of hidden
reserves at the time of acquisition.
Deferred acquisition costs for insurance activities that are directly related
to new business and/or to extensions of existing policies, and that vary
in line with that business, are capitalised and written off over the term of
the insurance contracts they refer to. If they are attributable to property
and casualty insurance, they are written off over the probable policy term,
with a maximum of five years. For life insurance, the acquisition costs are
amortised over the duration of the policy in the same proportion as the
expected profit margin of each individual year is realised in comparison
to the total margin to be expected from the policies. For long-term health
insurance policies, the depreciation of acquisition costs is measured in line
with the proportionate share of earned premiums in the present value of
expected future premium income. The changes in deferred acquisition
costs are shown as operating expenses.
With regard to life insurance business acquired, the updating of the current
value follows the progression of the estimated gross margins.
The other intangible assets include both purchased and self-developed
software which is depreciated on a straight-line basis over its useful economic
life of 2 to 5 years.
Land and buildings
Land and buildings that are held as long-term investments are recognised according to IAS 40 at acquisition or construction costs, reduced by the amounts of scheduled amortisations and depreciation. Owner-used land and buildings are shown at book value (IAS 16 benchmarking method). The scheduled depreciation term generally corresponds to the useful life, up to a maximum of 80 years. Real estate is depreciated on a straight-line basis over time.
The list of market values can be found in the Group notes under nos. 1 and 3.
Shares in affiliated and associated companies
To the extent that the annual financial statements of affiliated and associated
companies are not consolidated for being of minor significance and/
or included at equity, these companies are valued as available for sale in
accordance with IAS 39.
With the exception of the mortgage loans and other loans, the investments
are listed at the current fair value, which is established by determining a
market value or stock market price. In the case of investments for which
no market value can be determined, the fair value is determined through
internal valuation models or on the basis of estimates of what amounts
could be achieved under current market conditions in event of proper
Mortgage loans and other loans
These are recognised at amortised costs in the balance sheet. This means
that the difference between acquisition costs and the redemption amount
changes the book value with an effect on income in proportion to time
and/or equity. The items included under other loans are recognised at their
nominal amount less any redemptions made in the interim.
Securities available for sale
These are recognised in the financial statements at their fair value on the
reporting date. Differences between the fair value and historical acquisition
costs are dealt with under equity with a neutral effect on income, after
deduction of the provisions for latent profit sharing in life insurance and
deferred taxes. Depreciation that affects income (impairment) is undertaken
only where we anticipate a lasting fall in value. This uses the fluctuations
in fair value over the last nine months as well as the absolute difference
between acquisition costs and the fair value on the reporting date
as the basis for assessing a necessary impairment. A sustained impairment
is assumed for variable-yield securities if the highest quoted price within
the last nine months lies below the acquisition costs, or the difference of
acquisition cost less market value is greater than 20%. For fixed interest
securities, these two selection criteria are also applied in order to perform
a precise credit quality evaluation of a sustained impairment per security
for the portfolio items identified in this way. In addition, foreign exchange
differentials resulting from fixedincome securities are recognised with an
effect on income. Foreign exchange differentials resulting from variableyield
securities are recognised as equity with no effect on income to the
extent that these are not securities which are written off as the result of
impairment. The fair value of other investments is based in part on external
and internal company ratings.
Investments held for trade (trading portfolio)
Derivatives are used within the limits permitted by the Austrian Insurance
Supervisory Act for hedging investments and for increasing earnings. All
fluctuations in value are recognised in the income statement.
Investments at fair value through profit or loss
(fair value option)
Structured products are not split between the underlying transaction and
derivative, but are accounted for as a unit. All the structured products can,
therefore, be found in the Financial instruments at fair value through
profit or loss item of the balance sheet. Unrealised profits and losses are
dealt with in the income statement. In accordance with IAS 39 (11A), ABS
bonds, structured bonds, hedge funds and a special annuity fund with a
high share of derivatives are also dealt with under the items for securities
at fair value through profit or loss.
Deposits with credit institutions and other investments are recognised
at their fair value.
Investments held for unit-linked and index-linked
life insurance policyholders
These investments concern life insurance policies whose value or profit is
determined by investments for which the policyholder carries the risk, i.e.
the unit-linked or index-linked life insurance policies. The investments in
question are collected in asset pools, balanced at their current market
and managed separately from the remaining investments of the companies.
The policyholders are entitled to all income from these investments.
amount of the balanced investments strictly corresponds to the actuarial
provisions (before reinsurance business ceded) for life insurance, to the
that the investment risk is borne by the policyholders. The unrealised
profits and losses from fluctuations in the current market values of the
pools are thus counterbalanced by the corresponding changes
in these provisions.
Shares of reinsurers ...
These are recognised on the assets page, taking the reinsurance contracts
These are recognised at their nominal value, taking into account redemptions
made and reasonable value adjustments.
Liquid funds are valued at their nominal amounts.
Other tangible assets
The tangible assets and inventories included on the balance sheet under
other assets are recognised at acquisition and production costs, net of
depreciation. Tangible assets are depreciated on a straight-line basis over
their useful lifetime (up to a maximum of 10 years).
The subscribed capital corresponds to the calculated nominal value per
share that was achieved upon issuing of the shares.
The capital reserves represent the amount earned over and above the calculated
nominal value upon issue of the shares.
The revaluation reserve contains unrealised profits and losses from market
valuations of securities available for sale.
The revenue reserves include the withheld profit of the UNIQA Group and
proceeds from transactions with UNIQA shares.
The portfolio of UNIQA shares is deducted from the equity (revenue
The minority interests in shareholders equity represent the proportional
minority shares in equity.
Unearned premiums are, in principle, calculated for each individual policy
and exactly to the day. If they are attributable to life insurance, they are
included in the actuarial provision.
Actuarial provisions are established in the property, life and health insurance
lines. Their recognition value on the balance sheet is determined
according to actuarial principles on the basis of the present value of future
benefits to be paid by the insurer less the present value of future net
premiums the insurer expects to receive. The actuarial provision of the life
insurer is calculated by taking into account a prudent and contractually
agreed calculation basis.
For policies of a mainly investment character (e.g. unit-linked life insurance),
the regulations in the Statement of Financial Accounting Standards no. 97
(FAS 97) are used to value the actuarial provision. The actuarial provision is
arrived at by combining the invested amounts, the change in value of the
underlying investments and the withdrawals under the policy.
For unit-linked insurance policies, where the policyholder carries the sole
risk of the value of the investment rising or falling, the actuarial provision is
listed as a separate liability entry under Technical provisions for life insurance
where the investment risk is carried by policyholders.
The actuarial provisions for health insurance are determined on a calculation
basis of best estimate, taking into account safety margins. Once the calculation
basis has been determined, it must be applied to the corresponding
partial portfolio for the whole term (locked-in principle).
Provision for outstanding claims
The provision for outstanding claims in the property insurance line consists
of the future payment obligations determined by realistic estimation, using
recognised statistical methods, taking into account current or expected volumes
and including the related expense of loss adjustment. This applies to
claims already reported as well as for claims incurred but not yet reported.
In insurance lines where past experience does not allow the application of
statistical procedures, individual loss provisions are made.
Life insurance is calculated on an individual loss basis with the exception
of the provision for unreported claims.
For health insurance, the provisions for outstanding claims are estimated
on the basis of past experience, taking into consideration the known arrears
in claim payments.
The provision for the assumed reinsurance business generally complies with
the figures of the cedents.
Provision for premium refunds and profit sharing
The provision for premium refunds includes, on the one hand, the amounts
for profit-related and profit-unrelated profit sharing to which the policyholders
are entitled on the basis of statutory or contractual regulations, and
on the other hand, the amount resulting from the valuation of assets and
obligations of life insurers deviating from valuation under commercial law.
The amount of the provision for latent profit sharing amounts to generally
85% of the valuation differentials before tax.
Other technical provisions
This item basically contains the provision for contingent losses for acquired
reinsurance portfolios as well as a provision for expected cancellations and
Technical provisions for life insurance policies held on account and
at risk of policyholders
This item concerns the actuarial provisions and the remaining technical
provisions for obligations from life insurance policies whose value or income
is determined by investments for which the policyholder bears the
risk, or for which the benefit is index-linked. As a general rule, the valuation
corresponds with the investments of the unit-linked and index-linked life
insurance written at current market values.
Other provisions for pensions and similar obligations
For the performance-oriented old-age provision systems of the UNIQA
Group, pension provisions are calculated in accordance with IAS 19, using
the projected unit credit method. Future obligations are spread over the
whole employment duration of the employees. All actuarial profits and
losses due to changed parameters are recognised as having an effect on
income. The calculation is based on current mortality, disability and fluctuation
probabilities, expected increases in salaries, pension entitlements
and pension payments as well as a realistic technical interest rate. The
technical interest rate, which is determined in conformity with the market
and on the basis of the reporting date, is in line with the market yield of
long-term, high-quality industrial or government bonds.
The amount of other provisions is determined by the extent to which the
provisions will probably be made use of.
Payables and other liabilitiesare shown at the amount to be repaid.
Deferred tax assets and liabilities are to be created according to IAS 12
for temporary differences arising from the comparison of a stated asset
or an obligation using the respective taxable value. This results in probable
tax burdens affecting future cash-flow. These are to be accounted
for independent of the date of their release. Moreover, according to IAS,
deferred taxes for accumulated losses brought forward and not yet used
are to be capitalised to the extent that they can be used in the future with
Value adjustments (impairments)
In principle, the carrying amounts of assets on the balance sheet are
checked at least once a year with regard to possible impairment. Securities
with an expected lasting decrease in value are depreciated with an effect
on income. The entire real estate inventory is subject to recurrent valuation
through external reports prepared by legally sworn experts. If there is a
foreseeable lasting reduction in the value of assets, their carrying amount
Of the premiums written in the area of unit-linked and index-linked life insurance,
only those parts calculated to cover the risk and costs are allocated
Classes of insurance
(direct business and partly accepted reinsurance business)
- Life insurance
- Unit-linked and index-linked life insurance
- Health insurance
- Casualty insurance
- General liability insurance
- Motor TPL insurance, vehicle and passenger insurance
- Marine, aviation and transport insurance
- Legal expense insurance
- Fire and business interruption insurance
- Housebreaking, burglary and robbery insurance
- Water damage insurance
- Glass insurance
- Storm insurance
- Household insurance
- Hail insurance
- Livestock insurance
- Machinery and business interruption insurance
- Construction insurance
- Credit insurance
- Other forms of insurance