Glossary on

Notes to the Group’s Financial Statements

Select note 1–41

• View all notes on one page
• 1 Insurance premiums written
• 2 Net income from investments
• 3 Claims incurred
• 4 Change in liabilities for insurance and investment contracts
• 5 Staff costs
• 6 Other operating expenses
• 7 Result analysis of P&C insurance
• 8 Performance analysis per class of P&C insurance
• 9 Earnings per share
• 10 Financial assets and liabilities
• 11 Property, plant and equipment
• 12 Investment property
• 13 Intangible assets
• 14 Investments in associates
• 15 Financial assets
• 16 Fair values
• 17 Determination and hierarchy of fair values
• 18 Movements in level 3 financial instruments measured at fair value
• 19 Sensitivity analysis of level 3 financial instruments measured at fair value
• 20 Investments related to unit-linked insurance contracts
• 21 Deferred tax assets and liabilities
• 22 Taxes
• 23 Components of other comprehensive income
• 24 Tax effects relating to components of other comprehensive income
• 25 Other assets
• 26 Cash and cash equivalents
• 27 Liabilities from insurance and investment contracts
• 28 Liabilities from unit-linked insurance and investment contracts
• 29 Financial liabilities
• 30 Provisions
• 31 Employee benefits
• 32 Other liabilities
• 33 Contingent liabilities and commitments
• 34 Equity and reserves
• 35 Related party disclosures
• 36 Incentive schemes
• 37 Auditors' fees
• 38 Legal proceedings
• 39 Investments in subsidiaries
• 40 Investments in shares and participations other than subsidiaries and associates
• 41 Events after the balance sheet date

Download as Excel

27 Liabilities from insurance and investment contracts
P&C insurance
Change in insurance liabilities
	2014			2013
EURm	Gross	Ceded	Net	Gross	Ceded	Net
Provision for unearned premiums
At 1 Jan.	2,065	43	2,022	2,107	55	2,053
Acquired insurance holdings	-	-	0	38	-	-
Exchange differences	-69	1	-68	-127	-2	-125
Change in provision	3	-3	-0	46	-10	55
At 31 Dec.	1,999	41	1,958	2,065	43	2,022
	2014			2013
EURm	Gross	Ceded	Net	Gross	Ceded	Net
Provision for claims outstanding
At 1 Jan.	7,435	377	7,058	7,747	522	7,225
Disposed insurance holdings	45	-	45	61	0	61
Exchange differences	-245	-2	-243	-314	-20	-294
Change in provision	-50	-178	128	-59	-126	66
At 31 Dec.	7,185	197	6,988	7,435	377	7,058
Liabilities from insurance contracts
EURm					2014	2013
Provision for unearned premiums					1,999	2,065
Provision for claims outstanding					7,185	7,435
Incurred and reported losses					1,609	1,770
Incurred but not reported losses (IBNR)					3,298	3,538
Provisions for claims-adjustment costs					269	271
Provisions for annuities and sickness benefits					2,009	1,856
P&C insurance total					9,183	9,500
Reinsurers' share
Provision for unearned premiums					41	43
Provision for claims outstanding					197	376
Incurred and reported losses					98	270
Incurred but not reported losses (IBNR)					98	107
Total reinsurers' share					237	420
As the P&C insurance is exposed to various exchange rates, comparing the balance sheet data from year to year can be misleading.

 

Claims cost trend of P&C insurance
The tables below show the cost trend for the claims for different years. The upper part of the tables shows how an estimate of the total claims costs per claims year evolves annually. The lower section shows how large a share of this is presented in the balance sheet.
Claims costs before reinsurance
Estimated claims cost
EURm	< 2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	Total
At the close of the claims year	9,825	2,517	2,522	2,588	2,715	2,718	2,829	2,914	2,953	2,851	2,835
One year later	9,792	2,465	2,504	2,584	2,672	2,669	2,869	3,028	2,940	2,879
Two years later	9,809	2,412	2,476	2,549	2,615	2,641	2,815	3,024	2,956
Three years later	9,823	2,385	2,475	2,518	2,588	2,601	2,814	3,012
Four years later	9,789	2,352	2,435	2,472	2,565	2,582	2,807
Five years later	9,833	2,319	2,388	2,448	2,551	2,559
Six years later	9,896	2,267	2,358	2,438	2,531
Seven years later	9,902	2,244	2,348	2,425
Eight years later	9,852	2,227	2,337
Nine years later	9,874	2,210
Ten years later	9,912
Current estimate of total claims costs	9,912	2,210	2,337	2,425	2,531	2,559	2,807	3,012	2,956	2,879	2,835	36,463
Total disbursed	7,349	2,013	2,110	2,169	2,271	2,261	2,470	2,590	2,475	2,268	1,572	29,548
Provision reported in the balance sheet	2,563	197	227	256	261	298	337	422	482	611	1,263	6,916
of which established vested annuities	1,390	73	80	77	70	59	75	65	62	47	10	2,009
Provision for claims-adjustment costs												269
Total provision reported in the BS												7,185
Claims costs after reinsurance
Estimated claims cost
EURm	< 2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	Total
At the close of the claims year	9,070	2,375	2,418	2,490	2,598	2,604	2,691	2,756	2,756	2,801	2,795
One year later	9,022	2,318	2,390	2,480	2,567	2,572	2,738	2,829	2,741	2,829
Two years later	9,025	2,264	2,363	2,453	2,513	2,542	2,696	2,816	2,758
Three years later	9,032	2,244	2,367	2,422	2,487	2,515	2,689	2,810
Four years later	8,999	2,213	2,330	2,379	2,468	2,498	2,686
Five years later	8,998	2,181	2,289	2,355	2,455	2,474
Six years later	9,076	2,141	2,261	2,348	2,437
Seven years later	9,086	2,120	2,252	2,335
Eight years later	9,049	2,104	2,243
Nine years later	9,074	2,087
Ten years later	9,121
Current estimate of total claims costs	9,121	2,087	2,243	2,335	2,437	2,474	2,686	2,810	2,758	2,829	2,795	34,575
Total disbursed	6,617	1,897	2,022	2,083	2,180	2,184	2,361	2,409	2,304	2,241	1,559	27,856
Provision reported in the balance sheet	2,504	191	221	252	257	290	325	402	454	588	1,236	6,719
of which established vested annuities	1,390	73	80	77	70	59	75	65	62	47	10	2,009
Provision for claims-adjustment costs												269
Total provision reported in the BS												6,988

 

Life insurance
Change in liabilities arising from other than unit-linked insurance and investment contracts
EURm				Insurance contracts	Investment contracts	Total
At 1 Jan. 2014				3,924	4	3,928
Premiums				148	1	149
Claims paid				-397	-0	-397
Expense charge				-36	-	-36
Guaranteed interest				131	-	131
Bonuses				0	-	0
Portfolio transfers				1,337	-	1,337
Other				-48	-0	-48
At 31 Dec. 2014				5,061	4	5,065
Reinsurers' share				-3	-	-3
Net liability at 31 Dec. 2014				5,058	4	5,062
EURm				Insurance contracts	Investment contracts	Total
At 1 Jan. 2013				4,065	6	4,071
Premiums				159	0	159
Claims paid				-396	-1	-396
Expense charge				-37	-0	-37
Guaranteed interest				139	0	139
Bonuses				3	0	3
Other				-11	-1	-12
At 31 Dec. 2013				3,924	4	3,927
Reinsurers' share				-3	-	-3
Net liability at 31 Dec. 2013				3,921	4	3,925
Change in liabilities arising from unit-linked insurance and investment contracts
EURm				Insurance contracts	Investment contracts	Total
At 1 Jan. 2014				3,095	1,522	4,617
Premiums				513	448	961
Claims paid				-191	-294	-485
Expense charge				-39	-21	-60
Other				220	59	279
At 31 Dec. 2014				3,599	1,714	5,312
At 1 Jan. 2013				2,665	1,168	3,833
Premiums				469	440	909
Claims paid				-173	-172	-345
Expense charge				-36	-18	-54
Other				169	104	274
At 31 Dec. 2013				3,095	1,522	4,617
The liabilities at 1 Jan. and at 31 Dec. include the future bonus reserves and the effect of the reserve for the decreased discount rate. The calculation is based on items before reinsurers' share. A more detailed specification of changes in insurance liabilities is presented in Group's Risk Management.
EURm					2014	2013
Insurance contracts
Liabilities for contracts with discretionary participation feature (DPF)
Provision for unearned premiums					2,625	1,969
Provision for claims outstanding					2,434	1,948
Liabilities for contracts without discretionary participation feature (DPF)
Provision for unearned premiums					-	0
Provision for claims outstanding					-	1
Total					5,059	3,918
Assumed reinsurance
Provision for unearned premiums					1	4
Provision for claims outstanding					0	2
Total					2	5
Insurance contracts total
Provision for unearned premiums					2,626	1,973
Provision for claims outstanding					2,434	1,951
Total					5,061	3,924
Investment contracts
Liabilities for contracts with discretionary participation feature (DPF)
Provision for unearned premiums					4	4
Liabilities for insurance and investment contracts total
Provision for unearned premiums					2,631	1,976
Provision for claims outstanding					2,434	1,951
Life insurance total					5,065	3,927
Reinsurers' share
Provision for claims outstanding					-3	-3
Investment contracts do not include a provision for claims outstanding.
Liability adequacy test does not give rise to supplementary claims.
Exemption allowed in IFRS 4 Insurance contracts has been applied to investment contracts with DPF or contracts with a right to trade-off for an investment contract with DPF. These investment contracts have been valued like insurance contracts.
EURm					2014	2013
Group, total					14,248	13,427

Note

Save Delete

Saving...

Deleting...

✕

Make a note