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COVER BILANCIO REALE 2015.indd 2COVER BILANCIO REALE 2015.indd 2 14/04/16 15:4914/04/16 15:49
BOARD OF DIRECTORS President
* Iti MIHALICH
Directors
** Annibale AVOGADRO DI COLLOBIANO
Maurizio BAUDI DI SELVE
Mario CARRARA
Giovanni FACCHINETTI PULAZZINI
Romano GIANOTTI
Edoardo GREPPI
Luigi GUIDOBONO CAVALCHINI
* Enrico MARENCO DI MORIONDO
* Carlo PAVESIO
Gian Savino PENE VIDARI
Vittorio Amedeo VIORA
* Marco WEIGMANN
Secretary to the Board
Massimo LUVIE'
BOARD OF STATUTORY AUDITORS * Chairman
Alessandro RAYNERI
Standing Auditors
Edoardo ASCHIERI
Marco LEVIS
Substitute Auditors
Giuseppe ALDE'
Barbara Maria BARRECA
GENERAL MANAGEMENT General Manager Luigi LANA (until April 30, 2015)
Luca FILIPPONE (since May 1, 2015)
Joint General Manager
Massimo LUVIE' (since June 22, 2015)
Deputy General Managers
Luca FILIPPONE (until April 30, 2015)
Massimo LUVIE' (until June 22, 2015)
Francesco RAPETTI (until January 31, 2015)
* Members of the Committee
** Member of the Committee until May 28, 2015
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CONTENTS
STATUTORY FINANCIAL STATEMENTS
9131718193437414445495053565657
1. REPORT ON OPERATIONS
1.1 Macroeconomic Scenario and Markets 1.2 Regulatory Developments1.3 Reale Group Strategy1.4 Sustainability Reporting1.5 Summary of Results1.6 Investment Management1.7 Risk Management1.8 Human Resources1.9 Information Technology1.10 Sales, Marketing and Communication1.11 Litigation1.12 Other Information1.13 Relationships with Subsidiary and Associated Companies 1.14 Main Events in Early 20161.15 Business Outlook1.16 Audit1.17 Motions on the Profit for the Year 58
602. BALANCE SHEET AND INCOME STATEMENTBalance Sheet Income Statement 72
8390
3. NOTES TO THE FINANCIAL STATEMENTSPart A: Valuation CriteriaPart B: Commentary on the Balance Sheet and Income Statement Part C: Other Information 127
4. SOLVENCY MARGIN STATEMENT
5. SCHEDULES OF ASSETS ASSIGNED TO COVER THE TECHNICAL PROVISIONS
6. ANNEXES TO THE NOTES
7. OTHER ANNEXES
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137
149
181
247
CONSOLIDATED FINANCIAL STATEMENTS
THE GROUP
Consolidation area 255
259
291
294
298
300
301
1. REPORT ON OPERATIONS
1.1 Macroeconomic Scenario and Markets
1.2 Regulatory Developments
1.3 Reale Group Strategy
1.4 Summary of Results
1.5 Investment Management
1.6 Human Resources
1.7 Sales, Marketing and Communication
1.8 Litigation
1.9 Other Information
1.10 Main Events in Early 2016
1.11 Business Outlook
1.12 Audit 302
304
306
307
308
2. CONSOLIDATED ACCOUNTING SCHEDULES
Balance Sheet
Income Statement
Statement of Comprehensive Income
Statement of Changes in Equity
Cashflow Statement 309
312
328
330
356
363
379
3. NOTES TO THE FINANCIAL STATEMENTS
General Accounting Principles - Part A
Consolidation Area - Part B
Information regarding the Balance Sheet - Part C
Information regarding the Income Statement - Part D
Segment reporting - Part E
Information regarding risks - Part F
Information regarding Business with Related Parties - Part H
Other Information - Part I 380
4. ANNEXES TO THE FINANCIAL STATEMENTS 383
5. GROUP SOLVENCY MARGIN 401
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366
266
271
270
288
302
BILANCIO REALE MUTUA 2015.indd 4BILANCIO REALE MUTUA 2015.indd 4 14/04/16 16:0214/04/16 16:02
REPORTS AND ACCOUNTS 2015
187th year from foundation Meeting of Delegates of April 30, 2016
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BILANCIO REALE MUTUA 2015.indd 6BILANCIO REALE MUTUA 2015.indd 6 14/04/16 16:0214/04/16 16:02
REPORT ON OPERATIONS
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9
1.1 MACROECONOMIC SCENARIO AND MARKETS
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1.1.1 MACROECONOMIC SCENARIO
2015 was a year of moderate growth in the world economy.
According to the latest estimates by the International Monetary Fund (IMF), world GDP grew by 3.1% in 2015, compared to 3.4% in 2014.
Growth was modest and weaker than expected in some countries, especially in emerging and developing markets, whereas the advanced economies experienced more constant expansion.
Inflation pressures continued to be subdued in advanced economies, held in check by the sharp downturn in oil prices. From the beginning of 2015 the price of Brent crude plummeted from 57 to 37 dollars a barrel. The slump in oil prices was due to increased supply and weak demand. Inflation therefore remained very low. Estimated annual inflation for 2015 stands at 0.1% in the US, 0.2% in the euro area and 0.7% in Japan.
Again according to the latest estimates by the IMF, the US economy grew by 2.5% in 2015 compared to 2.4% in 2014. The increase in GDP was mainly driven by private consumption, and this enabled the American economy to mitigate the negative effects of weak global growth as well as those associated with the strength of the dollar.
Japan experienced positive growth of 0.6%, but trends in prices forced its central bank to further bolster its aggressive stimulus measures.
China's economy grew by 6.9%, confirming the government's target and proving that concerns over the stability of the economy may have been exaggerated.
There was widespread recovery across the euro area with an increasing number of countries reporting positive growth, albeit more fragile and lagging behind the US and the UK. GDP in the area rose by 1.5%, a marked improvement on the 0.9% growth recorded in 2014.
In Italy economic recovery continued, albeit gradually, and GDP increased by 0.8% in 2015.
Growth was buoyed less by foreign trade and more by domestic demand, especially private consumption. Investment conditions were affected by uncertainties over foreign demand. The growth of bank loans to business enterprises was positive for the first time since 2011, at 1.5%.
Annual inflation, as measured by the harmonised index of consumer prices (HICP), was + 0.2% in November and then fell to 0.1% in December, reflecting another drop in the prices of energy products and persistently low use of production capacity.
The unemployment rate in December stood at 11.4%, its lowest since the end of 2012. This was mainly due to a decline in the number of young people out of work, which is still at a record level.
10 REPORTS AND ACCOUNTS 2015
1.1.2 FINANCIAL MARKETS
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In 2015 the financial markets were affected by the economic climate characterised by moderate recovery in the world economy, as outlined previously, the political crisis in Greece and concerns over the threat of renewed terror attacks.
The improvement in US labour market conditions prompted the Federal Reserve to raise its official interest rates by 25 bps in December, opening the door for further possible hikes in future.
In Europe, as well as being actively involved in the management of the Greek crisis, the European Central Bank was faced with the persistent decline in inflation expectations and, as a result, price stability, which is its primary objective. To pursue that objective, the ECB's Governing Council introduced a package of non‐standard monetary policy measures, which included directly purchasing government bonds and, most importantly and for the first time, introducing a negative interest rate of ‐ 0.3% on the deposit facility, as an effective method for lowering real rates in the context of negative inflation.
Persistent deflationary pressures and fears of prolonged economic stagnation influenced the performance of the government bond market in the advanced economies which were once again characterised by low yields.
In Europe, the ECB's decisions to cut interest rates and expand the asset purchase programme affected short‐term yields, which turned negative on several occasions, especially in Germany and other core countries.
Confidence in peripheral countries strengthened and was reflected in a narrowing of spreads between German bunds and bonds issued by these countries.
Short‐term rates thus fell and those of up to one year turned negative. Euribor 6 months moved from 0.17% at the beginning of the year to ‐ 0.04% at the end of December.
Yields on ten‐year Italian government bonds fell from 1.89% at the end of December 2014 to 1.6% at the end of December 2015. The spread compared with ten‐year German bunds fell from 135 basis points at the end of 2014 to 97 at the end of December 2015. During the same period, yields on ten‐year German bunds moved from 0.54% to 0.62%.
Ten‐year government bond yields GERMANY ‐ ITALY ‐ SPAIN (source: Bloomberg)
11
2015 was a tough year for corporate bonds, with rising yields and widening spreads with debt instruments deemed more secure, especially European investment grade securities.
Equity markets were affected by the sharp decline in prices of raw materials, the Greek debt crisis, speculation over the Fed's first interest rate hike and the weakness of the global economy
In the US, the Dow Jones closed the year down 2.23%. European share indices closed the year in positive territory; the Euro Stoxx index moved up 3.85% and the Italian index by 12.66%.Prices on the Italian FTSE MIB index in 2015 (source: Bloomberg)
On exchange markets, the euro depreciated by 11% against the US dollar, hitting a low of 1.0458 euros to the dollar in April. Emerging market currencies were extremely weak owing to competitive imbalances.
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1.1.3 THE INSURANCE MARKET
According to the latest data provided by ANIA for the last quarter of 2015, on the Italian insurance market (Italian companies and representative offices of non-EU insurers) there was a 2.5% year-on-year increase in premium income, reflecting positive performance of the Life business and a negative trend in the Non-life sector.
Non‐life insurance business
In the last quarter there was a 2.4% year‐on‐year decrease in Non‐life business, which accounted for 21.8% of overall premium income (22.9% in 2014).
There was a 5.3% reduction in premium income in the Motor sector: premium income in the TPL land vehicles and TPL marine, lake and river craft businesses fell by 6.5%, whereas Hulls land vehicles went in the opposite direction, with a 2.9% increase. These lines accounted for 52.1% of total Non‐life premiums (53.7% in 2014).
Premium income in the Non‐motor sector increased by 0.8%; among the businesses with the highest premium income were Health (+ 4.2%) and Non‐motor TPL (+ 1.4%), whereas decreases were posted by the Accident business (‐ 0.4%), Fire and natural forces (‐ 0.2%) and Other property damage (‐ 1.7%). The premium income generated by Non‐motor classes accounted for 47.9% of total Non‐life premium income (46.3% in 2014).
12 REPORTS AND ACCOUNTS 2015
Life insurance businessIn the last quarter there was a 4.0% year-on-year increase in Life business, which accounted for 78.2% of overall premium income (77.1% in 2014).
In particular, class III (Insurance with benefits linked directly to the value of UCITS or of internal funds or to indices or other benchmarks) increased by 45.8%, and accounted for 27.7% of total Life premiums (19.8% in 2014). Class I (Insurance on the duration of human life) decreased by 5.7% and class V (Operations of capital redemption) decreased by 24.1%. These classes accounted, respectively, for 67.7% and 3.1% of total Life premiums (74.6% and 4.2% respectively in the same period of 2014).
Class VI premiums (Pension funds), which accounted for 1.4% of total premiums in the sector (1.3% in 2014), increased by 16.9%.
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13
1.2 REGULATORY DEVELOPMENTS The main regulatory measures issued by IVASS during the year are outlined below:
IVASS Regulation No.8 of March 3, 2015The Regulation describes the simplified procedures and compliance obligations applying to contractual relations between enterprises, intermediaries and customers.The intent of this Regulation is to foster technological innovation, by reducing paperwork and encouraging the use of digital technology in relations between enterprises, intermediaries and customers.
"Competition Bill" dated February 20, 2015 The bill implements the annual provisions for markets and competition, which had previously not been applied. It includes the obligation to offer significant premium discounts on Motor TPL policies where the policyholder agrees to contract clauses designed to curb costs and combat fraud, such as the installation of black box or alcohol-detection devices, prior inspection of the vehicle and compensation through approved body shops. Other measures include the obligation, for claims involving property damage only, to identify witnesses at the moment the claim is filed, the possibility of cancelling accessory coverage upon expiry of the main policy, and granting IVASS the authority to control and monitor implementation of the new rules.
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IVASS Regulation No. 9 of May 19, 2015 This Regulation establishes the rules applicable to the risk certificate database and to the certification of risks. It completes the first phase of the project to introduce "dematerialised attestation of risk status" for Motor TPL policies. The second phase of dematerialisation envisages the transition from "static" risk attestation (a snapshot of the current situation) to "dynamic" attestation, i.e. constant and automatic updating by the system, to make it more effective against evasion of insurance obligations and more closely in line with practice in other EU countries. The Regulation takes effect for Motor TPL policies expiring from July 1, 2015. Pursuant to art. 3 of this Regulation, until IVASS issues a specific measure, the risk category conversion table drawn up by ISVAP in Annex 2 to Regulation No. 4/2006 will continue to apply.
IVASS Measure No. 30 of March 24, 2015 These rules amend ISVAP Regulation No. 24/2008 concerning the procedure for submitting complaints to the Supervisory Authority and the handling of such complaints by insurance undertakings. For insurance undertakings with their registered office in Italy the deadline for implementing the new regulatory provisions was 30 June 2015. In detail, the order introduces a clear definition of "complaint" and "complainant" and requires all complaints to the Supervisory Authority to be submitted in writing and include full details of the grievance. One important innovation is the obligation for insurance undertakings authorised in Italy to adopt a complaint handling policy, to be approved and revised at least once a year by the governing body, that ensures equal treatment for insureds, contracting parties, beneficiaries and damaged parties and is aimed at guaranteeing the fair and prompt handling of complaints.
Letter to the Market dated March 20, 2015 The letter concerns the use of certified e‐mail for the exchange of correspondence with IVASS. It establishes the certified e‐mail system as the preferred channel for communication between IVASS and insurance undertakings. Pursuant to the Digital Administration Code (art. 5‐bis of Legislative Decree No. 82 of March 7, 2005 as amended) information and communication technology must be used for all communications between public offices and business undertakings, including for the exchange of data in fulfilment of any legal and regulatory requirements.
Joint letter by IVASS and Banca d'Italia issued on August 26, 2015. The letter, addressed to insurers and insurance intermediaries registered in Section D of the RUI (Register of Insurance and Reinsurance Intermediaries, including banks), aims to increase the level of protection of customers who purchase insurance policies paired with mortgage and other loans (PPI ‐ Payment Protection Insurance).
The legislative provisions that had the greatest impact in the sector in 2015 are outlined below:
14 REPORTS AND ACCOUNTS 2015
The bill also reformulates articles 138 and 139 of the Code of Private Insurance by introducing tables for evaluating non-economic damages that include both "physical" and "moral" damages.As regards pension funds, the bill includes measures to allow workers full pension portability, eliminating the possibility for national agreements to include limitations and conditions on the portion payable by the employer. Pension funds are no longer required to seek subscribers exclusively from within the specific professional category.
Decree enacting Law No. 183/2014 (the "Jobs Acts”) Notable aspects of the Jobs Act include:- the introduction of new contract types:
• fixed-term,• staff leasing,• part time,• collaboration
- new rules governing duties: employers have greater flexibility in changing their employees' duties and
- reconciliation of work-life requirements: the legislative decree also includes changes, on an experimentalbasis, to the consolidated law on maternity and paternity leave (Legislative Decree. No. 151/2001), by introducing measures to support parental care and protect working mothers.
Decree No.108 issued by the Ministry for Economic Development on May 11, 2015The Decree (published in the Official Journal of the Italian Republic on July 15, 2015 and which came into force on July 30, 2015), establishes the rules governing the Integrated Antifraud Database (Archivio Integrato Antifrode, AIA), which will be used by IVASS to alert insurance companies and help them to identify and prevent cases of motor vehicle insurance fraud. The Decree came into effect on July 30, 2015. The database will be consulted for every motor liability claim, which will be given a score indicating its degree of anomaly.The database may only be accessed by insurance companies, law enforcement bodies, the courts and government bodies engaged in action against insurance fraud.
Decreee Law No.83 of June 27, 2015 introducing “urgent measures concerning bankruptcy, civil law and civil procedural law and the organisation and functioning of judicial administration”
Decree No. 83/2015 introduced changes to the rules applicable to banks and insurance undertakings for deducting write-downs and losses on receivables.Specifically, art. 106(3) of Presidential Decree No. 917/1986 (Consolidated Law on Income Tax) and articles 6(1)(c-bis) and 7(1)(b-bis) of Legislative Decree No. 446/1997 have been amended as follows for the purposes of IRES and IRAP: - Credit and financial institutions and insurance undertakings will be allowed to fully deduct write-downs
and losses on receivables and losses arising from disposals for consideration in the year they are recorded in the financial statements (instead of over a five-year period as envisaged under the previous system).
- Write-downs and losses other than those arising from disposal for consideration are considered net ofthe revaluation of receivables as recorded in the financial statements.
- The new provisions are applicable starting from the current tax year as at December 31, 2015.- A transitory regime has been introduced: for the first period of application, i.e. 2015, the write downs
and losses other than losses arising from disposals for consideration will be deductible for up to 75% of their total amount. The remainder will be deductible in equal instalments over a period of 10 years.
Decree No. 95/2014 issued by the Ministry of Economy and FinanceThe Decree regulates matters concerning the prevention of fraud pursuant to art. 30-ter of Legislative Decree No. 141/2010. In detail, it envisages the creation of a public fraud prevention system in the sector of consumer credit and deferred or instalment payment schemes, with specific reference to identity theft. The prevention system is based on a central computerised database held by the Ministry of Economy and Finance and managed by CONSAP.
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roles;
15
Insurance undertakings are among the participants in the fraud prevention system, as direct members. Under the legislation in question, the provisions concerning insurance companies became applicable twelve months after the date on which the Decree came into force, and thus from July 16, 2015. From that date, such undertakings have registered by submitting a form via the specific portal maintained by CONSAP.
Law No. 208 of December 28, 2015 (the so called “2016 Stability Law”This Law came into force on January 1, 2016 and includes "Provisions for the preparation of the annual and multi-year state budget" (published in No. 302 of the Official Journal of the Italian Republic on December 30, 2015). The main changes introduced by the Law are outlined below:
- The corporate income tax (IRES) rate will be reduced from 27.5% to 24% with effect from tax year 2017.
- An IRES surcharge of 3.5 percentage points has been introduced for banks and financial institutions and the non-deductibility of 4% of interest expense incurred has been abolished.
- VAT rates will not be increased in 2016. However, unless other measures are implemented that would guarantee positive effects on public spending, the reduced VAT rate of 10% will be increased to 13% from January 1, 2017 and the current standard rate of 22% will be increased to 24% from January 1, 2017 and to 25% in 2018.
- An extra 40% depreciation deduction for IRES tax purposes will be available for operating assets. The measure is applicable to new capital goods purchased or leased between October 15, 2015 and December 31, 2016. The allowance is only applicable for the purposes of calculating the rate of depreciation and lease payments. The deduction relating to the share of increased depreciation operates outside of the accounts and the asset and related depreciation are therefore entered in the accounts in accordance with the normal rules, i.e., only from the date on which the asset, purchased in the relevant period, is put into use, applying the depreciation rate reduced by 50% for the first year. If the asset is sold, the allowance ceases to apply.
- As regards the revaluation of capital assets, the possibility of recording in the 2015 accounts the higher value of tangible assets and equity investments included in the financial statements as at December 31, 2014 has been extended for one year. The revaluation surplus can be freed, in whole or in part, through payment of a 10% substitute tax in place of IRES or IRAP or any applicable surcharge. The higher value attributed to company assets will be recognised for the purposes of IRES and IRAP as from 2018 but an additional substitute tax will be levied at the rate of 16% on depreciable assets and of 12% on non-depreciable assets. For taxpayers that prepare their financial statements according to IAS, the amount corresponding to the increased values to be realigned must be allocated to a reserve fund for suspension of tax, that may be freed through payment of the substitute tax.
- The Stability Law provides for a 40% tax break on social security contributions for up to two years for private sector employers hiring with permanent contracts in 2016.
- The reform introduces a new sanctions regime, specifically in the field of administrative and tax sanctions, and changes to the terms for tax assessments.
- The so-called ”art bonus” (tax credit for cultural donations), initially only introduced for the three-year period from 2014-2016, has now been made permanent..
***
The definition of the regulatory framework in connection with the new Solvency II system, which will come into effect on January 1, 2016, is reviewed below.
Legislative Decree No. 74 of May 12, 2015 Legislative Decree No. 74 of May 12, 2015 implementing the provisions of Directive 2009/138/EC (Solvency II) on the taking-up and pursuit of the business of insurance and reinsurance and amending the Code ofPrivate Insurance, was published in No. 136 of the Official Journal of the Italian Republic on June 15, 2015. The Directive introduces a new prudential supervisory regime, for the purpose of providing a regulatory framework to ensure the maximum protection of the users of insurance services and creating a new system that gives the supervisory authorities the appropriate instruments for assessing the overall solvency of insurance undertakings.
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16 REPORTS AND ACCOUNTS 2015
IVASS will now have to enact several regulations to implement the new rules, which will take effect as from January 1, 2016. The transposition of Solvency II is a fundamental step in the transition to the new regulatory framework for the insurance industry. The Directive will change the entire system, replacing existing Life and Non-life directives (with the exception of those concerning the Motor business) and introducing a new prudential supervisory regime to protect customers and the stability of markets. In detail, the Directive, as subsequently amended by Directive No. 2014/51/EC (the Omnibus II Directive) introduces new rules on capital requirements essentially centred on the risks assumed by the insurer (or by the group of insurance undertakings) aimed at improving the corporate governance structure and establishing a system of so-called "internal" controls that will in future be implemented by four main functions (risk management, compliance, internal auditing, actuarial) with ultimate responsibility lying with the company's administrative body.Legislative Decree No. 74/2015 amends and repeals several articles of the Code of Private Insurance, and introduces some new provisions.Specifically, Chapter I of Title III (Pursuit of insurance business) has been supplemented with rules on governance; Chapter II of Title III now includes new rules for calculating technical provisions; Chapter IV of Title III now contains provisions governing so-called "own funds" (and not the solvency margin); the new Chapter IV bis sets out the capital requirements for solvency purposes, the most innovative aspect of the Code of Private Insurance; Title XV (Supervision of groups) has been redrafted to include the rules governing the control of groups.The Level 1 framework (Solvency II 2009/138/EC Directive) has been integrated at Level 2 with the delegated acts and technical standards issued by the European Commission, which are directly applicable in Italy, and at Level 3 with the technical standards of EIOPA, which must be implemented in Italy through specific IVASS regulations.
The delegated acts, containing detailed implementing measures, were published in the Official Journal of the European Union on January 17, 2015 and will be directly applicable as from January 1, 2016 without any specific measures for implementation into the Italian system.
The technical standards issued by EIOPA in 2015, which are also directly applicable in the Member States, included the "implementing technical standards on the templates for the supervisory authorities" and the "implementing technical standards on the templates for public disclosure", regarding the qualitative and quantitative information to be included in Pillar III disclosures to be drafted by insurance companies and submitted to the national and European supervisory authority as from January 1, 2016.
Lastly, IVASS issued implementing regulations for the EIOPA guidelines (level 3 framework), which will come into effect on January 1, 2016. Some of these are still in the public consultation stage.
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17
1.3 REALE GROUP STRATEGYIn 2015 Reale Group reached the end of its Strategic Plan for 2013 - 2015, marked by the achievement of important goals, including:
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- growth in Group premium income, which has risen by 8.7% from € 3,537 million to € 3,846 million;
- significant profits, amounting to a total of € 429 million in the three‐year period;
- increase in the capital held by the Group, with a solvency ratio that has increased from 218.7% to 250.5%;
- investment in a very broad range of strategic projects: Group brand, multi‐channel platforms, agency models (digitalisation, light agencies, service centre), member‐customer centrality, welfare, motor vehicles, HR and asset management;
- ongoing development of corporate social responsibility, with numerous initiatives aimed at enhancing the Group's mutualistic nature and commitment towards the outside world;
- evolution of the Group governance model, in order to create a modern organisation ready to meet the challenges of the future and capable of fostering knowledge and financial synergies.
The new 2016 ‐ 2018 Strategic Plan will come into effect in 2016 and will mainly be organised along the following lines:
- further expansion of the Group, also through international growth and cooperation;
- confirmation of profitability, financial soundness and social responsibility as core objectives for the Group;
- adoption of an improvement‐oriented approach in order to fully exploit the strategic projects developed over the previous three years;
- selection of some additional strategic projects in order to seize opportunities as they arise in the near future (in the field of Big Data, for example).
18 REPORTS AND ACCOUNTS 2015
1.4 SUSTAINABILITY REPORTING The Company first began voluntarily reporting on its social performance more than ten years ago, as a means of recording, divulging and monitoring the social and environmental aspects of its activities. This activity is part of a process of continuous improvement in the dissemination and development of a culture and system of corporate social responsibility.
The first Sustainability Reports were prepared separately and presented after the financial statements; since 2013 they have become an integral part of the Annual Report and are presented together.
Attached to this Report you will therefore also find the Sustainability Report. This document provides a quantitative and qualitative summary of the main environmentally, socially and economically sustainable strategies undertaken by the Company in 2015, and describes the most significant actions aimed at fostering the involvement of and communications with its stakeholders. In order to facilitate their comprehension, the Report on Operations and Sustainability Report both include specific links and cross-references to corresponding sections in the other document. These are indicated by a symbol at the end of the section concerned. ( )
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19
1.5 SUMMARY OF RESULTS The Company's operating results for 2015, with comparative figures for the previous year, are set out below
The balance on the Non-life insurance technical account was positive for € 49,764 thousand; though lower than the € 98,470 thousand recorded in 2014, the positive trend continued, confirming the good performance of core business. Net of the allocated investment return, which contributed for € 47,643 thousand (€ 38,895 thousand in the previous year), the result of the technical account was € 2,121 thousand (compared to € 59,575 thousand at December 31, 2014).
The loss ratio for Non-life business stood at 64.8%, 3 percentage points higher than in 2014. The main contributor to the worsening of this ratio was the Motor business, as a consequence of a market-wide decrease in average premiums and an increase in high claims compared to the recent past.
The expenses ratio for Non-life business rose slightly, from 30.8% in 2014 to 31.0% in 2015.
The combined ratio for Non-life business (equal to the sum of the two previous ratios) increased from 92.6% in 2014 to 95.8% in 2015; the combined operating ratio for Non-life business (which includes the result of reinsurance and other technical items) increased by 4.2 percentage points, moving from 95.6% in 2014 to 99.8% in 2015.
The balance on the Life insurance technical account was negative for € 19,088 thousand, compared with a loss of € 9,774 thousand in 2014. This was mainly due to the negative balance of value re-adjustments on investments for € 8,658 thousand in 2015, compared with a positive change of € 1,121 thousand in 2014.
Claims paid for direct business and inward reinsurance during the year, including claim settlement costs, amounted to € 1,464,862 thousand (€ 1,403,136 thousand in 2014), with an increase of 4.4% in relation to 2014, of which € 989,266 thousand for Non-Life business, with a decrease of 0.5%, and € 475,596 thousand referring to Life business, with an increase of 16.4%.
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Further information is provided in the table below
(in thousands of euro)
2015 2014 Change
Balance on the technical account for Non-life business 49,764 98,470 -48,706
Balance on the technical account for Life business -19,088 -9,774 -9,314 Total 30,676 88,696 -58,020 Net income from investments in Non-life business 75,289 60,247 15,042 (minus allocated investment return transferred to the technical account) -47,643 -38,895 -8,748 Allocated investment return transferred from the Life technical account 17,842 19,182 -1,340 Balance of other income and charges 9,389 -41,258 50,647 Income from ordinary operations 85,553 87,971 -2,418 Balance of extraordinary income and charges -2,802 39,703 -42,505
Profit before taxes 82,751 127,674 -44,923
Income taxes for the year -23,340 -28,910 5,570 Operating Result 59,411 98,764 -39,353
2015 2014 Change
Loss Ratio 64.8% 61.8% 3.0 Combined ratio for the year 95.8% 92.6% 3.2 Solvency ratio 458.4% 454.6% 3.8
20 REPORTS AND ACCOUNTS 2015
Total Non-Life and Life production costs amounted to € 389,096 thousand (€ 390,263 thousand in 2014), with a ratio to premiums earned of 17.6%, compared with 17.9% in the previous year. In particular, the ratio for Non-life business was equal to 25.8%, compared with 26.3% in 2014 while, for Life business, it corresponded to 3.6%, unchanged with respect to the previous year.
Non-life and Life business personnel costs and other administrative expenses, prior to allocation to the specific items of the accounts, totalled € 210,481 thousand, net of recoveries from third parties. Gross of recoveries, this item amounted to € 245,380 thousand (€ 236,823 thousand in 2014) representing 11% of premiums earned, in line with 2014. At € 117,149 thousand, personnel costs fell by 10.0% in relation to the previous year with a ratio to premiums earned of 5.3%, compared with 6.0% in 2014. The decrease was mainly due to the transfer of 177 employees from Reale Mutua to Reale Ites EEIG on January 1, 2015 as part of the transfer of the IT business unit to Reale Ites EEIG. Costs for personnel transferred as a result of this operation amounted to € 13,647 thousand.
Other administrative expenses totalled € 128,231 thousand, compared with € 106,634 thousand for the previous year, with a ratio to premiums earned that increased from 4.9% to 5.8%. This amount includes the fees charged by Reale Ites EEIG to its members for IT services provided during the year. The item in question therefore increased with respect to the previous year, owing to the chargeback of the cost of transferred staff incurred as mentioned above, and to the share of amortisation of intangible fixed assets which, prior to the transfer, were booked under “other charges” and in 2015 amounted to € 16,134 thousand.
The balance of other income and charges was positive for € 9,389 thousand, compared to a negative balance of € 41,258 thousand in 2014. The change was mainly due to the amortisation of intangible fixed assets which were recorded under "other charges" in 2014 but included in the costs charged by Reale Ites EEIG in 2015 and so recognised under other administrative expenses.
Ordinary operations, Non-life plus Life, returned a positive result of € 85,553 thousand, compared with a profit of € 87.971 thousand in 2014.
Extraordinary operations reflected a negative balance of € 2,802 thousand in relation to a positive balance of € 39,703 thousand in 2014. The result for 2014 included extraordinary income for € 26,605 thousand due to the refund of sanctions and interest pursuant to the settlement agreement between the Company and the Turin Tax Office referring to a tax dispute related to tax year 2006.
Income taxes for the year amounted to € 23,340 thousand, compared with € 28,910 thousand in 2014. This result includes extraordinary charges for € 10.2 million as a result of the re-calculation of assets and liabilities for deferred taxes following the reduction in the IRES tax rate (from 27.5% to 24%) which will come into effect on January 1, 2017 under the provisions of the 2016 Stability Law.
Financial 2015 closed with a profit of € 59,411 thousand, compared with € 98,764 thousand in 2014, determined by a positive result of € 3,546 thousand for Life business and of € 55,865 thousand for Non-life business.
* * *
The main balance sheet data for 2015, with 2014 comparables, are set forth in the table below.
Investments reached € 7,283,557 thousand (a 7.0% increase with respect to December 31, 2014). Of these, € 44,469 thousand were real estate investments, € 1,659,929 thousand were equity investments in subsidiaries, affiliates and joint ventures, € 5.573.953 thousand were other financial investments and € 5,206 thousand were investments in deposits with ceding companies.
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(in thousands of euro) 31.12.2015 31.12.2014 Change
Investments 7,283,557 6,809,594 7.0% Technical provisions, net 6,148,847 5,740,008 7.1% Shareholders’ equity 1,849,221 1,789,809 3.3%
21
Net technical provisions amounted to € 6,148,847 million compared with € 5,740,008 million in the previous year (+7.1%).
Shareholders’ equity amounted to € 1,849.221 thousand at December 31, 2015 compared with € 1,789,809 thousand at the end of 2014 (+3.3%).
The solvency margin, Non-life plus Life, required according to art. 28(2) of ISVAP Regulation No. 19 of March 14, 2008, amounted to € 399,623 thousand. The sum of the components forming the Company's solvency margin was equal to € 1,831,820 thousand. Therefore, at December 31, 2015, there was an excess of € 1,432,797 thousand in relation to the aforementioned margin, compared with € 1,324,265 thousand in 2014.
The solvency ratio therefore stood at 458.4% (454.6% in 2014).
* * *
In 2015, members received mutuality benefits for € 10,163 thousand, of which € 5,068 thousand in the Non-life business and € 5,095 thousand in the Life business.
FURTHER INFORMATION ABOUT MUTUALITY BENEFITS IS PROVIDED IN CHAPTER 3 "ECONOMIC MANAGEMENT" IN THE ECONOMIC DIMENSION OF THE SUSTAINABILITY REPORT.
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2015 2014 (in thousands of euro)
Change
Direct business - Non-Life 1,413,636 1,388,580 1.8% Direct business - Life 813,448 806,036 0.9% Total direct business 2,227,084 2,194,616 1.5% Inward reinsurance 3,513 3,272 7.4% Grand total 2,230,597 2,197,888 1.5% of which: Non-life business 1,416,838 1,391,847 1.8% Life business 813,759 806,041 1.0%
Gross premiums written in 2015 totalled € 2,230,597 thousand, increasing by 1.5% compared with 2014, when they amounted to € 2,197,888 thousand.Direct premium income amounted to € 2,227,084 thousand, with a year-on-year increase of 1.5%.A summary of production in 2015 is provided in the following table:
***
22 REPORTS AND ACCOUNTS 2015
1.5.1 NON-LIFE INSURANCE OPERATIONS
Gross premiums written in 2015, with 2014 comparables, are detailed below:
Direct premium income increased by 1.8% in relation to the previous year, in contrast to negative growth in the Italian market as a whole. The smaller reduction in premiums in the Motor sector contributed to this result.
* * *
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2015 2014 amounts composition amounts composition Change
Accident 93,622 6.6% 90,569 6.5% 3.4% Health 89,988 6.4% 84,660 6.1% 6.3% Hulls land vehicles 102,459 7.2% 94,677 6.8% 8.2% Hulls railway rolling stock 5 0.0% 6 0.0% -16.7% Hulls aircraft 8 0.0% 6 0.0% 33.3% Hulls marine, lake, river craft 2,607 0.2% 2,351 0.2% 10.9% Goods transported 4,092 0.3% 4,106 0.3% -0.3% Fire and other natural forces 172,589 12.2% 167,322 12.0% 3.1% Other property damage 205,265 14.5% 202,132 14.6% 1.5% TPL land vehicles 474,841 33.6% 488,993 35.2% -2.9% TPL aviation 51 0.0% 52 0.0% -1.9% TPL marine, river, lake craft 1,248 0.1% 1,263 0.1% -1.2% Non-motor TPL 209,229 14.8% 197,195 14.2% 6.1% Credit 1 0.0% 1 0.0% 0.0% Suretyship 29,497 2.1% 28,605 2.1% 3.1% Sundry pecuniary losses 2,292 0.2% 3,115 0.2% -26.4% Legal fees 11,825 0.8% 11,090 0.8% 6.6% Assistance 14,017 1.0% 12,437 0.9% 12.7% Total direct business 1,413,636 100.0% 1,388,580 100.0% 1.8% Inward reinsurance 3,202 3,267 -2.0% Total Non-life business 1,416,838 1,391,847 1.8%
23
Referring to direct business only, the claims experience during the year, in terms of sums paid, number of claims reported and the ratio of claims to premiums earned, is illustrated in the table below.
ASPECTS CONCERNING THE “IMMEDIATE SETTLEMENT” SERVICE ARE DEALT WITH IN CHAPTER 5 "MEMBER-POLICYHOLDERS" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT’”.
The ratio of claims to premiums earned, at 64.8%, worsened with respect to the previous year, when it stood at 61.8%.
Regarding the Motor business, the ratio of claims to premiums earned and the loss ratio of the current year both increased in relation to 2014 moving, respectively, from 60.9% to 67.9% and from 67.9% to 75.6%. This trend can be attributed to the decrease in the average price of premiums and to an increase in the claims rate in this sector
Non-motor TPL business reported a ratio of claims to premiums earned of 62.6%, substantially unchanged with respect to 2014 (62.5%). The run-off of reserves for prior year claims was extremely favourable, albeit lower than in 2014, and the loss ratio for the current year improved for the Health, Goods transported, Fire, Other property damage, Non-motor TPL and Suretyship businesses.
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Claims paid (in thousands of euro) Claims reported (number) (*) Loss ratio 2015 2014 change 2015 2014 change
Accident 52,985 48,694 8.8% 15,729 17,241 -8.8% 59.3% Health 70,007 66,992 4.5% 166,783 244,342 -31.7% 79.1% Hulls land vehicles 62,904 60,697 3.6% 44,226 42,414 4.3% 62.1% Hulls railway rolling stock 0 3 -100.0% 2 8 -75.0% -208.0% Hulls aircraft 111 1 9340.6% 0 0 0.0% -112.4%
2,115 2,112 0.1% 253 212 19.3% 90.8% Hulls marine, lake, river craft Goods Transported 1,482 1,626 -8.8% 479 397 20.7% 28.2% Fire and other natural forces 119,201 136,102 -12.4% 23,604 25,220 -6.4% 61.4% Other Property Damage 147,181 146,968 0.1% 94,042 104,281 -9.8% 70.0% TPL land vehicles 363,859 353,123 3.0% 81,665 75,533 8.1% 69.4% TPL Aircraft 326 6 5021.7% 2 1 100.0% -37.6% TPL marine, lake, river craft 1,322 863 53.1% 164 159 3.1% -64.4% Non-motor TPL 136,346 140,457 -2.9% 28,992 28,898 0.3% 53.4% Credit 61 0 an. 0 0 0.0% n.aSuretyship 18,158 25,107 -27.7% 453 510 -11.2% 65.2% Sundry pecuniary losses 520 826 -37.0% 58 317 -81.7% 50.1% Legal fees 2,687 2,603 3.2% 2,108 1,985 6.2% 21.0% Assistance 7,758 5,868 32.2% 24,869 20,403 21.9% 59.8% Total 987,023 992,050 -0.5% 483,429 561,921 -14.0% 64.8% (*) late claims are included
24 REPORTS AND ACCOUNTS 2015
For the main business lines, claim settlement speed, net of claims without follow-up, was as follows:
FURTHER INFORMATION ABOUT CLAIM SETTLEMENT TIMES IS PROVIDED IN CHAPTER 5 "MEMBER-POLICYHOLDERS" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT’”.
* * *
Provisions for unearned premiums and outstanding claims in Non-life business, before the reinsurers’ share, amounted, respectively, to € 645,119 thousand, with a y/y increase of 3.5%, and € 1,778,039 thousand, with a y/y decrease of 2.5%.
The ratio between technical provisions and premiums written moved from 175.5% in 2014 to 170.7% in 2015. This decrease reflected the rise in premiums written and an absolute decrease in provisions of around € 24,539 thousand, to which faster settlement of claims in all the main businesses contributed.
* * *
The solvency margin, required according to art. 28(2) of ISVAP Regulation No. 19 of March 14, 2008, amounted to € 219,085 thousand. The sum of the components forming the solvency margin for Non-life business was equal to € 1,346,884 thousand. Therefore, at December 31, 2015, there was an excess of € 1,127,799 thousand in relation to the aforementioned margin, compared with € 1,009,771 thousand in 2014
The Non-life business therefore reported a solvency ratio of 614.8% (577.7% in 2014).
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* * *
The main aspects of the underwriting performance of each business are discussed below:
Accident
Direct premium income amounted to € 93,622 thousand, with a y/y increase of 3.4%, reflecting notable expansion in the corporate sector (7.7%) and moderate growth in the retail sector (+ 1.5%). the latter was helped by a marked increase in the motor sector (+ 8.6%). The drop in the number of claims reported (‐ 8.8%) was driven by the corporate sector (‐ 9.3%), especially among public authorities (‐ 16.1%), and by the retail area (‐ 8.3%). The ratio of claims to premiums earned, which corresponded to 59.3%, worsened in relation to the previous year (53.2%). This result reflects a notable increase in the number of major claims and a slightly negative run‐off of reserves for prior year claims, compared to moderate savings in the previous year. The technical result, net of reinsurance, produced a profit of € 2,607 thousand.
25
Health
In this business line direct premium income moved up by 6.3% to € 89,988 thousand. There was a marked increase in premium income in both the retail sector (+ 5.2%) and the corporate area (+ 6.9%) in which although a number of contracts were not renewed, some major new contracts were underwritten.The decrease in the number of claims reported (- 31.7%) was mainly determined by the disposal in December 2013 of an important contract delegated by third parties in the corporate segment. The ratio of claims to premiums earned corresponded to 79.1%, worsening in relation to 2014 (78.2%). In particular, this reflected a positive though slightly lower run-off of reserves for prior year claims and a slight improvement in underwriting performance. The technical result, net of reinsurance, was a loss of € 4,937 thousand.
Hulls land vehicles
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This business line reported an 8.2% upswing in direct business income for a total of € 102,459 thousand. This increase, significantly higher than on the market as a whole, reflected the acquisition of some new fleet policies, as well as the continuing success of initiatives to promote the sale of HLV insurance cover and recovery of the car industry; with more new vehicles on the road, there was renewed demand for insurance cover in the Motor sector. Presumably owing to the current socio‐economic context, there was a particularly marked increase in demand for retail products, especially cover for natural events, fully comprehensive cover and windscreen insurance. The ratio of claims to premiums earned, at 62.1%, was practically unchanged with respect to 2014 (61.7%). There was a slight increase in the "acts of vandalism and malicious acts" component but there were no particularly severe natural events during the year. The technical result, net of reinsurance, closed with a profit of € 6,735 thousand.
Goods transported
Direct premium income, equal to € 4,092 thousand, moved down 0.3% in relation to 2014. The ratio of claims to premiums earned corresponded to 28.2%. This was an improvement on 2014 (30.9%) and reflected an appreciable reduction in major claims. The technical result, net of reinsurance, closed with a profit of € 850 thousand.
Fire and other natural forces
Direct premium income amounted to € 172,589 thousand, with a y/y increase of 3.1%. The ratio of claims to premiums earned corresponded to 61.4%, a slight improvement in relation to 2014 (62.6%). This result reflected a marked improvement in the loss ratio of the current year, which was affected in 2014 by a particularly large claim; the run‐off of reserves for prior year claims was positive, but less favourable than in 2014. The technical result, net of reinsurance, was a loss of € 10,724 thousand.
Other property damage
Total direct business income amounted to € 205,265 thousand, with a slight y/y increase of 1.5% despite a reduction in premiums in the Hail insurance sector (‐ 15.6%). The ratio of claims to premiums earned corresponded to 70.0%, an improvement on 2014 (71.3%). The Hail business reported a ratio of claims to premiums earned of 87.3%, worsening in relation to the previous year (79.6%). The ratio of claims to premiums earned for the Theft portfolio, which corresponded to 55.1%, was essentially in line with that of 2014 (55.9%). For risks other than Theft and Hail the loss ratio stood at 71.1%, an improvement on the previous year (74.2%). This was mainly due to a particularly favourable run‐off of reserves for prior year claims. The technical result, net of reinsurance, was a loss of € 20,380 thousand.
26 REPORTS AND ACCOUNTS 2015
TPL land vehicles
Non-motor TPL
Suretyship
Premium income for 2015, equal to € 29,497 thousand, was up by 3.1% on the previous year. This was an extremely positive result when you consider that as a consequence of new legislation introduced at the end of 2014, guarantees linked to VAT refunds, which accounted for some 12% of premium income, were no longer included in the assets of this business.The loss ratio of the current year improved significantly compared to the previous year, falling from 96.0% to 59.5%. This result was primarily due to a marked reduction (- 32%) in the value of claims for the current year. This reduction reflected a notable drop in the number of claims reported in the year (- 11.2%) and in the respective average cost (- 27%), as well as a decrease in the number of large claims.
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TPL land vehicles business posted total direct business income of € 474,841 thousand, with a y/y decrease of 2.9%. From a technical/commercial perspective, this result was mainly due to: - price interventions in August 2014, February 2015 and August 2015 which, in view of good results achieved in this sector, led to further though less significant reductions in Motor insurance premiums in more profitable areas of the country and risk segments; - a fall in the average price of premiums in the portfolio as a consequence of the price interventions mentioned above and in response to tougher competition; - the acquisition of some major new fleet policies, for which the premiums were recorded in the first half of this year, and the opening of new agencies in Italy, which contributed to partially offsetting the contraction in premiums. It is worth pointing out that the dematerialisation rules came into effect in 2015 (in July for risk attestation and October for windshield stickers). The measures will prevent the falsification of printed documents and significantly reduce the risk of fraud at the time of quoting prices and issuing Motor TPL insurance policies. According to management indicators, the frequency of claims increased and the average cost of claims rose slightly. There was also a sharp rise in serious claims in 2015. The loss ratio of the current year corresponded to 78.2%, worse than in the previous year (69.2%). The ratio of claims to premiums earned corresponded to 69.4%, also worsening in relation to 2014 (60.9%). As regards litigation, at year-end 4,860 lawsuits were pending (10.2% of claims pending), falling by 0.6 percentage points compared with the 5,271 outstanding at year-end 2014 (10.8% of claims pending). The number of summons received by the Company fell by 20.4%, from 6,845 to 5,446. The technical result, net of reinsurance, closed with a profit of € 51,628 thousand.
In financial 2015, total direct premium income amounted to € 209,229 thousand, with a y/y increase of 6.1%. This was a consequence of a marked increase in the Corporate sector (+ 8.1%). The ratio of claims to premiums earned, which corresponded to 53.4%, was a further improvement in relation to 2014 (54.2%). This reflected a positive run-off of reserves for prior year claims, albeit less favourable than that recorded in 2014, a reduction in the average cost of claims reported and in the magnitude of large claims recorded in the year. The technical result, net of reinsurance, closed with a profit of € 24,980 thousand.
These significant reductions are the consequence of comparison with the exceptionally unfavourable result of 2014. The ratio of claims to premiums earned, at 65.2%, was an improvement on 2014 (73.8%) even though the run-off of reserves for prior year claims, especially the part delegated by third parties, was less favourable than in 2014.The reserves still include a number of claims in connection with the contributions under Law No. 488 on loans to business enterprises, pending a solution to the ongoing dispute between insurance companies and the Authority regarding the correct interpretation of policy conditions.The technical result, net of reinsurance, was a loss of € 6,129 thousand.
27
Sundry pecuniary losses
This business line, which comprises covers such as damage caused by interruption of business, withdrawal of products and of driving licence, reported total direct business income of € 2,292 thousand, a decrease of 26.4% compared with 2014. The ratio of claims to premiums earned of 50.1% worsened compared with the previous year (15.4%) owing to a number of large claims, especially in relation to policies covering "damage caused by interruption of business".The technical result, net of reinsurance, closed with a profit of € 424 thousand.
Legal fees
Direct premium income moved up 6.6% in relation to the previous year, to € 11,825 thousand, spread fairly evenly across the Motor and Non-motor businesses (+ 6.1% and + 7.0%, respectively).Although the ratio of claims to premiums earned, at 21.0%, worsened slightly with respect to the previous year (17.4%), profitability remained high. The technical result, net of reinsurance, closed with a profit of € 3,429 thousand.
Assistance
Direct premium income increased by an appreciable 12.7%, to € 14,017 thousand, mainly attributable to the Motor sector (+ 13.7%). The ratio of claims to premiums earned, at 59.8%, was worse than in 2014 (53.8%) owing to an increase in the number of claims reported (+ 21.9%) and to a higher estimation of the provisions for late claims. The technical result, net of reinsurance, closed with a profit of € 336 thousand.
* * *
Research and development - New products As regards the product catalogue, the Company confirmed its policy of developing products that offer a good quality-to-price ratio, putting members-policyholders first, right from the time of stipulating the contract.
The study and development of new products therefore continued along the lines of previous years, despite persistent difficulties in the insurance market.
Following on from previous years, further improvements were made to the product catalogue in 2015, aimed at preventing any loss of competitiveness and offering insurance solutions that will allow us to continue to grow more than the market, especially in areas of business that are most profitable and strategic for Reale Mutua.
One important area of activity was the restyling of the mainstream "Globale Fabbricati" civil buildings product. This was overhauled and a new tariff system, calculated entirely on the basis of actuarial criteria, was developed, similar to that used for professional TPL cover.
In the Non-motor TPL sector, the Company overhauled the regulatory, tariff and IT framework of the Industry, craft and services TPL product (in March 2015).
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28 REPORTS AND ACCOUNTS 2015
A new version of the All Risks product was made available to the sales network In July (mainly geared to medium and large-sized companies, it offers cover for direct and indirect loss, theft, breakdown of machinery and catastrophic guarantees).
In light of the changing market context, new versions of the "Leasing Reale Strumentale" and "Leasing Reale Immobiliare" products were launched in October.
In order to more effectively respond to new needs in the professional indemnity insurance sector and continue to strengthen the Company's position in this area, a new version of the "Professionista Reale 2015" product was launched in November. The tariff scheme has been reformulated and several changes made to the contractual terms and conditions.
Carrying on from the previous year, when the "Per Te Salute Reale" health insurance policy was revised and improvements made to make the policy clearer, the "Unica Reale" multi-risk product underwent a number of improvements in the first half of 2015. The new version of this product has been designed to be more competitive in the retail accident insurance sector.
The personal protection and health insurance offering was augmented in the first half of the year with the launch of the "Family Care" product, the first to be released under the strategic Family Welfare project: the package includes a first range of Non-life (Family care Pro) and Life (Family Care Life) insurance covers against serious events that could undermine continuity of income, health and wealth.
The "income continuity" section covers loss of income in case of illness or accidents resulting in permanent severe disability (66% or more) or premature death of the insured. The "health" section offers Dread Disease cover, which pays a benefit in the event of the insured contracting certain particularly serious health conditions. The "asset" section protects families' assets against events that could damage their home, including earthquakes, and covers the home owner's liability for damage to third parties. Each of the three sections also comprises a package of innovative service and assistance offerings which are always operative for policies taken out in the respective section.
Two new products developed as part of the Family Welfare strategic project were included in the catalogue in the second half of 2015: “RealmenteInSalute” and “Salute Facile Wellness”.
The “RealmenteInSalute” offering was conceived as a supplementary welfare product providing cover against accidents or ill-health of varying significance. The offering is highly diversified and modular and features four different formulas, each of which responds to specific health needs of Italian families. Solutions range from products that integrate the State welfare service to a more complete form of cover for those who want to be able to deal with health issues immediately and with maximum peace of mind, free to decide whether to use a private or public service.
“Salute Facile Wellness” pays a benefit to insureds who undergo surgery or a daily allowance in the event of hospitalisation without surgery.
“RealmenteInSalute” and “Salute Facile Wellness” encourage member-policyholders to adopt a healthy and active lifestyle by granting discounts to those who are in good health.
The following products were launched in the Motor sector in 2015:
- The "Cristalli" windscreen insurance policy was revised in February, with the inclusion of new contractual clauses designed to encourage the use of approved repair shops, which are not widely used at present, and so achieve savings on settlement costs.
- The Company signed a partnership agreement with a new supplier of "black boxes" with a view to broadening the offer with latest-generation electronic devices, in a segment that has good potential for growth and for building customer loyalty. The agreement came into effect in April 2015.
- The policy terms and tariff structure of the “Contachilometri Reale” product were also revised and the
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possibility of linking the premium paid to the way a person drives was also introduced. “Contachilometri Reale” is thus a highly innovative product on the Italian Motor TPL market.
29
Fraud prevention activities
As envisaged under art. 30(2) of Law No. 27 of March 24, 2012 and in accordance with the instructions issued by IVASS in its letter to the market published on March 11, 2014 concerning fraud prevention activities, the Company estimates that the cost of claims was reduced by around € 7 million (€ 6.1 million in 2014) as a result of systematic monitoring and suppression. This estimation considers the savings achieved in respect of claims found to be the result of fraudulent activities that were closed without follow-up during the year by the Company’s Anti-Fraud and Special Investigations departments, with the support of the settlement network.
FURTHER INFORMATION ABOUT FRAUD PREVENTION ACTIVITIES IS PROVIDED IN CHAPTER 5 "MEMBER-POLICYHOLDERS" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT’”.
1.5.2 LIFE INSURANCE OPERATIONS
2015 gross premiums written in Life business are shown below, with 2014 comparables:
Gross premiums written for direct business in 2015 amounted to € 813,448 thousand, with a y/y increase of 0.9%.
There was a 1.9% rise in premium income through the “agency” channel and a 4.6% increase through that of the “subsidiary agencies”. In 2015 this channel benefited from an increase in premiums in the Corporate and Private sectors.
Premium income through the "special" sales channel decreased (-19.0%). This was mainly due to the removal from the catalogue of single-premium products linked to separately managed funds, since premium income from these products was only partially offset by income from class III products.
The main trends for each class are provided below:
Class I (Insurance on the duration of human life) decreased by 3.9%. Total premiums amounted to € 610,962 thousand; the downturn is a consequence of measures to contain production of new single-premium policies linked to separately managed funds in order to reduce the risks associated with exceptionally low interest rates on government securities.
Class III (Insurance linked to investment funds) generated total premiums of € 92,944 thousand, an upswing of 117.5%. The increase was due to the redirection of new products from Class I to unit-linked policies.
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2015 Composition 2014 Composition (in thousands of euro)
Change
610,962 75.1% 635,520 78.8% -3.9% I - Insurance on the duration of human life III - Insurance linked to investment funds 92,944 11.4% 42,731 5.3% 117.5% IV - Health insurance 158 0.0% 145 0.0% 9.0% V - Operations of capital redemption 86,113 10.6% 105,974 13.1% -18.7% VI - Operations relating to administration of pension funds 23,271 2.9% 21,666 2.7% 7.4% Total direct business 813,448 100.0% 806,036 100.0% 0.9% Inward reinsurance 311 5 6120.0% Total Life business 813,759 806,041 1.0%
30 REPORTS AND ACCOUNTS 2015
Class V (Operations of capital redemption) reported a drop of -18.7%, due to the redirection of new products towards class III policies, as mentioned above.
Class VI (Insurance linked to the administration of pension funds) posted an increase of 7.4% compared with the previous year, mainly attributable to income from new products. The total premiums of this class amounted to € 23,271 thousand in 2015.
* * *
The breakdown of sums paid in 2015, referring to direct business only, is as follows::
Total sums paid increased by 16.3% compared with the previous year.
The change was mainly due to the increase in payments of principle and annuities matured (+37.1%) and for claims (+212.7%). The increase in sums paid for claims was mainly attributable to one major claim (for around € 33 million) on a unit-linked policy. The increase net of this payment was 48.9%. There was a 12.0% reduction in partial and total redemptions.
The change in sums to be paid was positive for € 23.508 thousand. At the end of 2015 sums payable amounted to € 72,507 thousand, an increase of 48% compared with the previous year, owing to the large number of policies that expired at the end of the year and had not yet been paid.
* * *
Technical provisions, before the reinsurers’ share, amounted to € 4,539,874 thousand increasing by € 465,810 thousand, equal to 11.4% in relation to the previous year.
* * * The solvency margin, calculated according to the criteria established by art. 28(1) of ISVAP Regulation No.19 of March 14, 2008, was equal to € 180,538 thousand, against which the Company has shareholders’ equity for the Life section of € 484,936 thousand, with a surplus of € 304,398 thousand, in relation to € 314,494 thousand in 2014.The Life business therefore reported a solvency ratio of 268.6% (294.0% in 2014). The contraction reflects the increase in Life business technical provisions as a consequence of the increase in policies in the portfolio.
* * *
Research and development - New products
As regards the study and implementation of new products, in the first quarter of 2015 the Company started to gradually phase-out its conventional revaluable single-premium policies, in order to limit its exposure and that of its policyholders to the risks associated with the sharp drop in interest rates on government securities. These were replaced with new unit-linked policies.
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2015 2014 (in thousands of euro)
Change
Claims 63,001 20,146 212.7% Principle and annuities matured 196,123 143,018 37.1% Surrenders 214,851 244,145 -12.0% Claim settlement costs 1,017 1,209 -15.9% Total sums paid 474,992 408,518 16.3% Change in the provisions for claims to be paid 23,508 1,118 2002.7% Total charges for claims 498,500 409,636 21.7% of which: I - Insurance on the duration of human life 343,620 295,786 16.2% III - Insurance linked to investment funds 89,370 57,036 56.7% IV - Health insurance 20 11 86.6% V - Operations of capital redemption 56,781 50,986 11.4% VI - Operations relating to administration of pension funds 8,709 5,818 49.7%
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The new products launched and specially developed products sold in 2015 are discussed below.
“Vantaggio Reale”, a single-premium with-profits whole life policy with benefits guaranteed directly by Reale Mutua and returns linked to the “Reale Uno” fund. All or part of the revalued capital can be redeemed at any time from just three months after the starting date. The product was re-launched in January 2015, having proved extremely successful for the previous three years.
The “RisparMio Reale Serie Opportunità” mixed insurance contract was launched on February 12, 2015. It is a single recurrent-premium with-profits product, with performance pegged to the "Valuta Reale" fund. It rewards the loyalty of member-policyholders by paying a loyalty bonus at the end of the fifth year to policyholders who have paid all the amounts due according to the payment schedule.
The “RisparMio Reale PU” product was launched on March 16, 2015. Offered exclusively to member-policyholders who had reinvested policies coming to maturity at the end of the year in the "Caveau" deposit account with Banca Reale, it gave them the opportunity to invest capital already set aside in the Valuta Reale fund, one of Reale Mutua's best performing separately managed funds. “RisparMio Reale PU” is a single-premium with-profits investment solution with a duration of between 10 and 15 years; it envisages the payment of a bonus at the end of the fifth year from the starting date, provided the contract is still in force and no part of the capital has already been redeemed.
As interest rates continue to fall, and in continuing to adopt a prudent approach towards separately managed accounts, Reale Mutua also reviewed the main features of its best-selling products ("Crescita Reale" and "Riserva Reale") to foster the inclusion of a large number of equity positions in its separately managed funds while keeping premiums lower.
The new edition of the “Crescita Reale” product, launched on May 12, 2015, features certain limitations on maximum premiums and additional payments with respect to the previous version. The product was removed from the catalogue on January 1, 2016.
The new version of the “Riserva Reale” product, dedicated exclusively to reinvestment of capital from policies coming to maturity, was launched on May 12, 2015. In this new version, the maximum premium is equal to the amount stated in the policy contract due to expire.
“Reale Quota Protetta” is a specially developed product that was sold from May 18 to June 29, 2015. It is a single premium unit-linked product, with the possibility of additional payments. Benefits are linked to a new Reale Consolida internal fund which adds an innovative feature to our offering; it envisages protection of at least 80% of the fund's maximum quota value during the term of the contract, which is 7 years. Cover is provided by Société Générale.
The new “Reale Quota Attiva” product was launched on July 27, 2015. This is a single premium unit-linked whole life investment solution, with the possibility of additional payments. Benefits are linked to the internal Reale Linea Mercato Globale and Reale Linea Controllata funds currently underlying the unit-linked product in the catalogue.
Management commissions for the two funds have been reduced, to maximise their financial performance and make the product more competitive.
The "Reale Quota Attiva Premi Ricorrenti” product was added to the unit-linked catalogue on October 22, 2015, to enrich the offering of unit-linked products for member-policyholders.This is a recurrent premium unit-linked mixed investment solution, with the possibility of additional payments and benefits linked to internal funds: Reale Linea Controllata, Linea Bilanciata Attiva and Reale Linea Mercato Globale.With the “Reale Quota Attiva Premi Ricorrenti” product, contracting parties who take out a savings policy can also pay an initial single premium with attractive tariff conditions. This offers members a single product in which to invest not only a savings policy, but also capital from a previous policy coming to maturity or other amounts already set aside.
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32 REPORTS AND ACCOUNTS 2015
Three new products developed as part of the Family Welfare strategic project were included in the catalogue starting from November 9, 2015: “RealmenteInSalute”, “Salute Facile Wellness” and “Valore Vita Wellness”.All fall within the framework of the RealementeWellness scheme that rewards policyholders who are in good health and maintain a healthy and active lifestyle. Reale Mutua offers two different discounts: a health discount and a movement discount.
Valore Vita Wellness is a constant capital and premium term life insurance policy. The contract has a fixed term of 5 years. The modular tariff structure is based on the policyholder's state of health.
1.5.3 REINSURANCE
Outward reinsurance
Pursuant to IVASS Circular No. 574/D of December 23, 2005 regarding outward reinsurance, the Company has drawn up the plan of reinsurance cessions for financial 2015; this document, approved by the Board of Directors at the meeting of February 26, 2015, sets forth the main characteristics of each reinsurance cover in accordance with the related guidelines resolved by the Board.
At the aforesaid Board Meeting, some changes were made to the Group outline resolution on outward reinsurance, already approved during the course of a previous Board Meeting, to take into account changes to the Deputy Management structure and to update the net risk to be retained by the Italiana Assicurazioni subsidiary in the TPL land vehicle sector.
In 2015, the reinsurance structure of the Non-life business envisaged proportional forms of coverage for most business ceded. Non-proportional forms of coverage are applied for risks retained by the organisation in Fire and Technological risks (including the risks of natural disasters), Theft, Suretyship and Hail business. Accident, Transport, TPL land vehicles, Hulls land vehicles, Health, Non-motor TPL and Aviation (Accidents, Aircraft TPL and Hulls aircraft) business lines are protected exclusively with non-proportional covers.
A new Group treaty called "Aggregate XL" has been drawn up to protect the retained portfolio of ceding companies in the Fire/Technological risk and Hulls land vehicles businesses.
Life business reinsurance consists of proportional treaties for single risks, for group policies, for “directors, executives, employees and groups” conventions and for Accident complementary guarantees. The Life business retained portfolio is protected by excess of loss catastrophic claims coverage.
The Company's main reinsurers are listed in the table below, which also shows their rating, as assigned by Standard & Poor’s.
In 2015 reinsurance ceded generated a cost of € 24,833 thousand, distributed as follows: € 23.954 thousand in the Non-life business and € 879 thousand in the Life business.
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Reinsurer Rating 2015 MÜNCHENER RÜCK AA-
SWISS RE AA-
SCOR AA-
ARAG ASSICURAZIONI NR
MAPFRE A
HANNOVER RE AA-
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As regards inward reinsurance, risks retained generated a profit of € 621 thousand, distributed as follows: € 605 thousand in the Non-life business and € 16 thousand in the Life business.
1.5.4 FOREIGN OPERATIONS
In 2015 premium income from activities carried out abroad in a regime of freedom of service amounted to € 2,577 thousand, in relation to € 1,862 thousand in the previous year, increasing by around 38.4%.
Activities were carried out in 23 member states of the European Economic Area.
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Inward reinsurance
Inward reinsurance of Reale Mutua consisted in the discretionary acceptance of ad hoc risks, participation in various schemes of the Italiana Assicurazioni subsidiary (proportional treaties covering art exhibitions and collections, technological risks, transport and accidents relating to the production of an agency specialised in such sectors) and in market pools.
34 REPORTS AND ACCOUNTS 2015
1.6 INVESTMENT MANAGEMENT At the end of 2015, the carrying value of Class C investments on the Balance Sheet amounted to € 7,283,557 thousand of which € 7,239,088 thousand of equities and € 44,469 thousand of real estate. The overall situation of these investments, with 2014 comparables, is detailed below.
As in the past, real estate transactions were mainly directed towards management of Company-owned real estate assets consisting of instrumental buildings used as offices and to house accessory parts of the corporate structure, and of buildings in Paris rented to third parties.
Maintenance was carried out during the year both to guarantee routine upkeep of the buildings and also to maintain suitable quality levels of the assets. The Company purchased a plot of land suitable for building in Via Serpi/Corso Giovanni Agnelli in Turin for a total of € 1,786 thousand.
As at December 31, 2015, investments in real estate totalled € 44,469 thousand, against a market value of around € 109,992 thousand, based on an appraisal performed by independent experts in accordance with ISVAP Regulation No. 22/2008. Those properties for which there was a significant difference between the value at December 31, 2015 and that at the end of the previous year were re-valued at current market conditions. In that context, the property that houses the Company's headquarters was appraised and valued for a total of € 56,954 thousand. The plot of land in Corso Agnelli, Turin, purchased at the end of the year, was also appraised and valued at € 1,811 thousand.
At the end of 2015 the Company owned real estate covering an area of approximately 33,000 square metres.
The Company managed its investment activities according to the usual criteria of prudence, adopting an approach that succeeded in achieving gains while limiting financial risks and bearing up to the volatility of the markets.
In the bonds compartment, Reale Mutua pursued a strategy aimed at achieving a balance between the soundness of investments and portfolio profitability, by ensuring adequate diversification of issuers. Overall portfolio risk remained consistent with the Company’s overall risk profile.
The percentage of Italian bonds in the portfolio was maintained at around 56%. Exposure in corporate bonds amounted to 20% of the investment portfolio. The quota of foreign currency investments represented approximately 1% of the securities portfolio.
The transactions entered into generated an increase, over the year, in the duration of the bond portfolio from 4.8 to 5. In the Non-life segment, duration remained unchanged at 2.8, consistent with the risk profile of liabilities, while in the Life segment, in which financial duration is determined also according to cash flow matching techniques in order to match assets with commitments towards subscribers, it moved from 5.5 to 5.8.
The credit rating of debt security investments was maintained at investment grade. Around 32% of the bonds portfolio consists of upper investment grade securities (Aaa to A3 according to Moody’s), lower investment grade securities (Baa1 to Baa3) account for about 67%. Non-investment grade securities (less than Baa3) account for around 1% of the bonds portfolio.
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31.12.2015 Composition 31.12.2014 Composition (in thousands of euro)
Change
Real estate 44,469 0.6% 42,954 0.6% 3.5% 5,280,419 72.4% 4,725,582 69.5% 11.7% Bonds and other fixed-income securities
Equity investments 1,659,929 22.8% 1,583,589 23.3% 4.8% Shares and interests 79,139 1.1% 121,956 1.8% -35.1% Other financial investments 178,684 2.5% 282,358 4.1% -36.7% Loans and mortgages 31,443 0.4% 37,371 0.5% -15.9% Deposits with credit institutions 4,267 0.1% 10,025 0.1% -57.4% Active reinsurance deposits 5,207 0.1% 5,758 0.1% -9.6% Total class c investments 7,283,557 100.0% 6,809,594 100.0% 7.0%
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As far as equities are concerned, in view of persistent market volatility, the portfolio size continued to be limited to around 1.5% of the total securities investment portfolio.
* * *
Class D investments on the Balance Sheet (investments for the benefit of Life policyholders who bear the risk and those deriving from the administration of pension funds) amounted to € 649,263 thousand, compared with € 611,218 thousand in 2014.
In financial 2015 Class D investments generated a positive balance of € 21,855 thousand, compared with a positive balance of € 34,665 thousand in 2014.
FURTHER INFORMATION ABOUT INVESTMENT CHOICES IS PROVIDED IN CHAPTER 5 "MEMBER-POLICYHOLDERS" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT’”.
1.6.1 INCOME AND EXPENSE ON INVESTMENTSResults for income on investments, including income generated by land and buildings, are set out in the table below:
Overall, in 2015, the bonds portfolio, excluding Class D securities, generated average returns, in terms of flows of ordinary income, of 2.77% compared with 3.19% in 2014. This average return, also taking into account the contribution of profits and losses on trading and value re-adjustments, moved to 3.15% (3.61% in 2014).
Value re-adjustments on securities, for € 11,031 thousand, were due to fluctuations in prices. Gains on trading amounted to € 29,721 thousand.
As far as equities are concerned, the Company operated mainly on European markets, selecting securities with favourable earnings prospects and reduced volatility. Gains on trading amounted to € 27,991 thousand, while value re-adjustments amounted to € 1,778 thousand.
Shares in common investment funds generated positive trading results for € 1.448 thousand, while value re-adjustments amounted to € 3,143 thousand.
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2015 2014 Change
Net income on investments 181,593 182,393 -800 Net value re-adjustments on investments -16,604 -2,673 -13,931 Net income from the disposal of investments 58,981 24,319 34,662 Total 223,970 204,039 19,931
(in thousands of euro)
The Company uses derivative and structured financial instruments for hedging purposes, to limit the investment risk, and also to enhance its portfolio management and achieve its investment goals more quickly, more easily, more economically or more flexibly than would be possible using the underlying assets
The notional value of derivative instruments amounted to € 94,190 thousand (of which € 26,255 in Class D investments) and structured financial instruments had a carrying value of € 568,071 thousand (of which € 8,661 in Class D investments).
All investment activities, also with regard to structured securities and derivatives, are regulated by specific resolutions of the Board of Directors in accordance with the strategic guidelines and the financial situation of the Company. The competent bodies verify these activities at regular intervals, on the basis of financial risk measurement parameters, and submit periodical reports on their findings to the Board.
Use of derivative and structured instruments did not generate any significant losses or potential risks in 2015.
36 REPORTS AND ACCOUNTS 2015
1.6.2 STRATEGIC INVESTMENTS
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As regards strategic investments, the main transactions undertaken in 2015, as reported below, were directed towards strengthening and expanding Reale Group on both the Italian and Spanish insurance markets.
On 1 January Reale Mutua and Reale Seguros Generales transferred their respective IT business units to Reale Ites EEIG, established in 2014 as part of the project to reorganise the information technology services of Reale Group. With the transfer of the aforesaid business units, the EEIG became fully operational.
On May 28, 2015, Italiana Assicurazioni established Italnext S.r.l., a company set up for the purpose of insurance mediation and development of new distribution channels. Italiana Assicurazioni paid € 50 thousand to the capital of the new company and will made additional contributions to its capital in future, up to a maximum of € 2 million. This company is a point of reference for small agencies that work with Reale Group companies or might work with them in future, including for the provision of administrative services. At December 31, 2015 its share capital amounted to € 50 thousand and share capital contributions amounted to € 600 thousand.
On November 27, 2015 Reale Mutua and Banca Sella Holding S.p.A. signed the contract for the sale by Reale Mutua of its 3.44% interest in the CBA Vita S.p.A. insurance undertaking, in which Banca Sella already held an 84.5% share. The sale, for the price of € 2,133 thousand,, which is equal to the carrying value, will be finalised by the end of January 2016.
In December 2014 the Company signed a letter of intent with a view to becoming a member of EURAPCO (European Alliance Partners Company), an alliance of independent insurance companies that have decided to join forces in order to exchange business skills and best practices and foster their growth, create more value and implement their strategic plans better and more quickly. At the time, the Alliance consisted of seven leading mutual insurance companies, each from a different country ( France, Netherlands, Germany, Spain, Sweden, Switzerland, Finland). Combined, they have achieved a gross written premium of € 50 billion; the Alliance operates through a Swiss service company called Eurapco AG, headquartered in Zurich, in which each Eurapco partner holds an equal interest. A 12‐month trial period started on January 1, 2015, during which Reale Mutua prepared to join the Alliance as a fully‐fledged member by the end of 2015. Becoming a partner is subject to the Company acquiring a share in Eurapco AG not later than January 1, 2016.
Following the resolution passed by the Board of Directors at the meeting of July 14, 2015 on the Company's membership of the Alliance, on September 23, 2015 Reale Mutua applied to become a permanent member. On October 9, 2015, the Chairman of Eurapco wrote to Reale Mutua, informing the Company that the Board of Eurapco AG had approved its accession, once the trial period had ended, and that its membership would commence on January 1, 2016.
Membership of the Alliance is conditional upon acquiring a 12.50% interest in Eurapco AG; on January 4, 2016 Reale Mutua paid the amount of CHF 1,254,722.44 (€ 1,150,804.75) in proportion to each of the other partners, to purchase the share in question. All Reale Group companies will be able to benefit from the services of Eurapco.
Thus, as from January 1, 2016, the Alliance is made up of eight leading companies, namely Achmea (Netherlands), Covea (France), Gothaer (Germany), Caser (Spain), Lansforsakringar (Sweden), Swiss Mobiliar (Switzerland), Local Tapiola (Finland) and Reale Mutua Assicurazioni (Italy), that operate in 18 countries across Europe. The Eurapco Partners combined insure over 40 million Europeans and employ more than 66,000 people.
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1.7 RISK MANAGEMENT Reale Mutua Assicurazioni’s risk management system is directed towards identifying, assessing and monitoring the most significant risks to which it is exposed, maintaining these at an acceptable level consistent with its assets.
Risk management roles and responsibilities involving corporate boards and functions have been defined for the company.
In particular, the Board of Directors is responsible for issuing risk management directives, for defining the risk appetite and risk tolerance thresholds and for checking correct application of the risk management system, which is the responsibility of senior management. The Board of Directors is assisted by the Group Internal Control Committee within the scope of its responsibilities.
The Chief Risk Officer (CRO) guarantees the soundness of overall risk management by the Company and by the Group in Italy, within the framework of the system of internal controls.
The Risk Management function carries out risk assessment, measurement and control analyses to assist the Board of Directors and top management in carrying out their duties.
The Compliance function is responsible for assessing the adequacy of corporate organisation and procedures with regard to preventing the risk of judicial or administrative sanctions, capital losses and reputation damage deriving from infringement of regulations.
The Anti-money laundering function is responsible for controlling, preventing and countering money laundering and funding of terrorist activities.
The Internal Audit function is responsible for verifying and assessing risk management system effectiveness and efficiency.
Each competent function is responsible for operational risk management according to their area of responsibility in the business processes controlled.
The Board of Directors is assisted by specific bodies, set up within its sphere of competence, such as the Committee, the Group Investments Commission and the Group Internal Control Committee responsible for verifying particular aspects of corporate performance, including those tied to risk management.
Top Management resorts to joint work groups, set up at Group level, that investigate and analyse specific aspects; these include, in particular, the Investment Management Committee, the Life Risk Committee, the Motor Insurance Committee and the Non-life Technical Committee. Within the framework of the risk management system and in accordance with regulatory provisions, the Board of Directors has formulated risk identification, measurement, management and control criteria in the “Risk management policies" document.
In 2015 Reale Mutua continued its efforts, under Group-wide projects launched in 2010, to adapt to the new Solvency II regime, which comes into force on January 1, 2016. Particular attention was paid to establishing new principles of evaluation in decision-making and policy processes. The new evaluation criteria have been incorporated into the following processes:
evaluation of new products;
investment choices;
evaluation of strategic operations;
definition of the risk appetite framework;
strategic planning.
Moreover, the Company has started the pre-application process in order to obtain the Supervisory Authority's regulatory approval for the internal model applicable at Group level. The Company continued to assess prospective risks (ORSA) in 2015, and submitted its report to the Supervisory Authority in June 2015. It undertook a review of its risk management policies and of its actions to improve the governance of its risk management system.
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38 REPORTS AND ACCOUNTS 2015
In working to fulfil the new Pillar III reporting requirements, the Company continued to implement the systems for producing the qualitative and quantitative disclosures envisaged under EIOPA guidelines. Specifically, the Company prepared and submitted its annual report with data as at December 31, 2014 and its report for the first quarter of 2015 as required by the interim measures. The Parent sent its annual report to IVASS by June 3, 2015 and its quarterly report by November 25, 2015. The respective reports with data for the Group were submitted on July 15, 2015 and January 6, 2016.
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Some aspects of the main risks to which the Company is exposed are discussed below.
In assessing market risk, reference is made to all risks that result in downgrading of financial or real estate investments due to adverse changes in major market variables such as share prices, interest rates, the value of real estate, exchange rates, credit ratings and the liquidity situation. In managing such risks, the Company adopts policies that establish limits, guidelines and management strategies. The limits on investments are constantly verified and monitored by the competent corporate functions, and the results of the controls are notified periodically to the Group Investment Commission.
The Company’s financial activities are managed according to a prudent approach based, as regards interest rate risk, on joint management of assets and liabilities on the basis of forecast cash flows by adopting ALM (Asset Liability Management) techniques. The total duration of the bond portfolio is around 5.8 years for life business and 2.8 years for non‐life business.
With regard to share price risk, the equity component represents around 1.4% of the entire investment portfolio and is mainly directed towards the Finance and Banking and Consumables sectors. Average annual volatility of the equity component during 2015 was equal to 27.1%.
In respect of exchange rate risk, investments in foreign currency amounted to 0.3% of the investment portfolio.
As far as real estate is concerned, the Company adopts the strategic guidelines formulated by the Group Investment Commission.
Credit risk is tied to the insolvency of issuers of financial instruments and worsening of their credit ratings; restrictions and guidelines are applied to manage this risk factor which is constantly monitored, reporting periodically to the Group Investment Commission. The average rating of debt securities in the portfolio is Baa1, according to Moody’s. Non‐investment grade instruments account for less than 1.6% of the entire portfolio.
Pursuant to the framework resolution on investments according to ISVAP Regulation No. 36/2011, the Company adopted limitations on the use of financial assets in order to constantly monitor the portfolio liquidity risk. Liquidity risk is also constantly monitored according to run‐off of reserves for Non‐life business and the projected maturity commitments for Life business.
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Bonds, according to maturity, are set forth in the table below
The expected run-off coefficients of Motor TPL and Non-motor TPL provisions are set forth in the table below.
The expected run-off coefficients of Motor TPL and Non-motor TPL provisions are set forth in the table below.
Default risk is tied to insolvency of counterparties (reinsurers, banks, insureds, intermediaries and agents). As far as reinsurance counterparties are concerned, the Group has defined policies for the management and control of this risk in terms of guidelines and restrictions. Exposure to reinsurance counterparties rated A or higher by Standard&Poor’s is equal to 92.5%.
Life business underwriting risks are mainly tied to demographic factors, surrender trends and costs. With reference to demographic risks, mortality statistics are updated periodically, while the evolution of other risk factors is monitored also through benchmarking with the corresponding market data. Catastrophic risks are covered by specific non-proportional reinsurance treaties.
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(in thousands of euro) Expiry Government Corporate Total
< = 1 year 1,032,759 52,477 1,085,236 >1 <=3 years 773,411 192,462 965,873 >3 <=5 years 653,998 274,650 928,648 >5 <=7 years 481,748 199,542 681,290 >7 <=10 years 678,175 328,343 1,006,518 >10 years 973,055 147,010 1,120,065 Total 4,593,146 1,194,484 5,787,630
(in thousands of euro) Year Reserve by expiry
2016 258,432 2017 168,978 2018 195,295 2019 177,573 2020 247,511 2021 113,250 2022 261,012 2023 266,762 after 2024 2,706,419 Total 4,395,234
Year Motor TPL Non-motor TPL
2016 48.6% 24.3% 2017 20.6% 18.6% 2018 11.3% 14.7% 2019 7.2% 12.3% 2020 5.1% 10.0% 2021 2.9% 7.9% 2022 2.0% 5.5% after 2022 2.3% 6.9% Total 100.0% 100.0%
40 REPORTS AND ACCOUNTS 2015
Non-life underwriting risks are determined by the underwriting policies of the business and retention policies relating to the acquired portfolio. To address tariff risks, the Company has drawn up an Underwriting Rules Manual which provides technical guidance regarding underwriting policy, with particular reference to non-standard products.
Risk assessments are performed to evaluate operational risks, legal and regulatory risks, strategic risks, reputational risk and Group membership risks. A qualitative approach is adopted based on self-assessment of risks and controls tied to Company processes and on definition of the high level company risk profile. Reale Mutua has drawn up a Contingency Plan to safeguard persons and assets and guarantee continuity of business; the plan includes a Disaster Recovery Plan designed to minimise loss of information and recovery times in particularly critical situations.
The Company adopts risk mitigation instruments in order to reduce its exposure to the risks underwritten, through recourse to reinsurance, and adopting hedge derivatives to restrict possible impairments of assets.
Reinsurance strategies have been selected on the basis of quantitative assessments intended to establish the estimated claims rate according to portfolio historic data.
Use of derivatives is limited and restricted to hedging transactions and operations to ensure efficient management; the counterparties in such transactions are those envisaged by ISVAP Regulation No. 36/2011 and are appropriately diversified.
* * *
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1.8 HUMAN RESOURCES At December 31, 2015, the Company workforce consisted of 1,145 persons. The breakdown of personnel according to qualification with 2014 comparables is provided in the table below:
Reale Ites EEIG became operational on January 1, 2015. The integrated IT service company serving the whole of Reale Group was established following the transfer by Reale Mutua and Reale Seguros of their respective IT business units. The transfer by Reale Mutua involved 177 employees, of whom 149 office staff, 26 middle managers and 2 senior managers.
Under the trade union agreements signed on December 2, 2014 and December 12, 2014, pursuant to art. 2112 of the Italian Civil Code, the existing office staff and senior management-level contracts of all those who had previously worked at Reale Mutua di Assicurazioni remained in force, all employees have maintained their rights existing at the time of the transfer and all are based at the Turin office of the EEIG.
Furthermore, all of the above employees received assurance of their immediate return to Società Reale Mutua di Assicurazioni in the following cases:
- winding-up of Reale Ites EEIG;
- departure of Società Reale Mutua di Assicurazioni as a shareholder of Reale Ites EEIG;
- cessation of business activities by Reale Ites EEIG;
- changes in business activities and/or downsizing and/or changes to the place of work, such as tojeopardise jobs.
On January 16, 2015 Società Reale Mutua di Assicurazioni, in its capacity as Parent, and trade union representatives from Reale Mutua and Reale Immobili signed an agreement to overhaul the organisational structure and optimise the processes of Reale Immobili. The project was completed in September 2015. The aim of the project, which involves Reale Immobili and some areas of Reale Mutua, is to improve the efficiency and efficacy of company functions from a Group-wide perspective and enhance the focus of Reale Immobili's core structures and processes at a particularly challenging time for the property market. Under the agreement, the 54 employees of Reale Immobili and 2 employees of Reale Mutua affected by the project will remain at their current place of work. No workers will be asked to move to a different place of work without their permission. The reorganisation resulted in some changes to duties and employees therefore received training, in the form of direct instruction, at the offices of the Parent.
On June 8, 2015 Società Reale Mutua di Assicurazioni, in its capacity as Parent, and trade union representatives from Reale Mutua and Italiana Assicurazioni signed an agreement to overhaul the organisational structure and optimise the settlement network of the Group Claims Handling department.In line with the framework agreement entered into on September 15, 2004 and subsequent enabling agreements, the project is aimed at improving the efficiency and efficacy of the Claims Settlement offices in Italy and thus improve settlement times and relations with the agencies. Four small offices (in Lecco, Modena, Salerno and Reggio Calabria) will be closed and their workload spread across the other Claims Settlement offices nearest to them. The project had no repercussions on current employment levels.
* * *
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2015 2014
Top management 42 42 Middle management 259 269 Office staff 844 996 Total 1,145 1,307
42 REPORTS AND ACCOUNTS 2015
Negotiations for the renewal of the national collective employment contract for office staff in the insurance sector, which expired on June 30, 2013, commenced in April 2015. Talks are ongoing.
* * *
The agreement concerning the functions of the new company ID card was signed on November 9, 2015. The new cards will ensure better security and safety for employees and for company property and enable the use of new technologies at work. One feature, which will become operational in November 2016, is a physical access control system with electro-mechanical devices installed at entrances. Access will be granted based on presentation of the specific company ID card, without which access will be refused. This access control system will also help the Company keep a better check on operational risks, by monitoring the exact number of people inside the building.
* * *
Academy, the corporate university for Reale Group employees overhauled its organisational structure in 2015. The Training (now Learning Centre) and Social Collaboration functions have been incorporated into Internal Communication and Professional and Managerial Development. The aim was to offer a more people-oriented service, since people are regarded as being central to the Group's success.
Academy's mission is to accelerate the pace of cultural change and support the Group's strategies, developing the skill base of employees through formal and informal learning activities and personal engagement.
In supporting the changes taking place within the Group, the Learning Centre has developed courses designed to improve the ability of managers to delegate powers. It also promoted a training plan funded by the inter-professional fund for continuing education in the credit and insurance sector - Fondo Banche Assicurazioni (FBA), aimed at integrating the skills of younger workers and the expertise of older employees. It also continued to provide language courses in view of the increasing importance of being able to communicate with colleagues in Spain and with the international organisations (Eurapco) in which the Group operates.
FURTHER INFORMATION ABOUT STAFF TRAINING IS PROVIDED IN CHAPTER 4 "EMPLOYEES" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT”.
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Pursuant to art. 2428 of the Italian Civil Code, in 2015 there were no cases of death or serious injury at work among employees on the Company’s payroll; the Company did not receive any claims in connection with occupational diseases among its employees or former employees or episodes of mobbing.
Every company within the Group is committed to pursuing improvements in occupational health and safety, and to making sure they provide all the necessary human and financial resources and instruments to protect all aspects of the health and safety of all those who work for them. In accordance with Legislative Decree No. 81/08 and subsequent amendments on occupational health and safety, in 2010 all Reale Group companies implemented an Occupational Health and Safety management system that meets the requirements of BS OHSAS 18001:2007.
In 2015 Reale Group continued to monitor employees’ health through a specialist firm with a nationwide network of medical staff.
Defibrillators were installed at the head office in Via Corte d'Appello 11 and at the offices in the Pier della Francesca complex.
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In February 2015 Reale Group received "Top Employers Italia" certification for the second year running, although this was the first time it included all of the Group's Italian companies. It is awarded each year to companies that achieve the highest standards of excellence in employee conditions.
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Participation in the certification programme allows companies to position themselves alongside an exclusive group of leading multinationals and industry front-runners that set the employer benchmark. The evaluation process includes careful scrutiny of various aspects of HR management: payment policies, working conditions and employee benefits, corporate culture, training and advancement, career opportunities.
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The Top Employers Institute, which is based in Amsterdam, carries out objective assessments of the organisation's employee conditions and certifies more than 900 undertakings in 92 countries.
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1.9 INFORMATION TECHNOLOGY
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Reale Ites EEIG, the information technology service provider for Reale Group, became fully operational on January 1.
The role of Reale Ites EEIG is to guarantee the routine operation of IT services, gearing to changes in business requirements and those in connection with the design of new insurance products. It plans activities aimed at optimising and improving the overall IT system, with a view to substantially improving the service and reducing costs.
2015 was focused on managing the technology issues of the business plans of each Group company. These plans are based on the development of the multi‐channel platform and the subsequent introduction of a new operational model. This will require the definition of a multi‐channel strategy, new operating processes and a web/mobile strategy to upgrade the corporate website and create new alternative digital channels (social media, mobile apps, aggregators). A multi‐channel (front‐end) IT platform is currently being developed to meet these requirements and will be used by both Italiana Assicurazioni and Reale Mutua. The platform was released for use by a small pilot group of agencies in June 2015. Improvements were also made to the system architecture of the aggregator channel (web launch) for the partnership with Facile.it, for Motor insurance only.
The digitalisation process continued, with an overhaul of the agency business model and the introduction of new digital tools and services ("Digital Agency" project). The aim is to increase operational efficiency by creating a paperless environment and to leverage mobile tools to improve sales force effectiveness. With the new POQ premium payment form, starting from the first half of 2015 the digital signature and innovative payment systems were made available to a group of pilot agencies.
Another mobile sales project envisages the integration of information about member‐policyholders contained in the CRM (Customer Relationship Management) database with data in the CCW (Customer Contact Workflow) database. This project is also closely synchronised with the multi‐channel project. It was released for use in pilot agencies in June.
2015 also saw continued expansion and use of the new Business Intelligence (BI) platform to monitor Key Performance Indicators (KPI) in line with business requirements. The information content was improved during the year and the data will be ready for use from the beginning of next year.
As part of the Solvency II project, the IT platform for generating the reports that European insurance companies will be required to produce under the new Solvency regime was developed in the first half of 2015. Group companies in Italy and Spain will share the same platform.
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1.10 SALES, MARKETING AND COMMUNICATION 1.10.1 DISTRIBUTION CHANNELS
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Reale Mutua has developed its distribution channels over the years to establish a network of agencies that, as at December 31, 2015, included 344 agencies under contract and 562 insurance agents/brokers.
In addition to these, it has five subsidiary agencies and one for employees.
At the end of 2015, the Company had 24 standing distribution agreements with banks and/or leasing firms, through its agencies under contract and subsidiary agencies, for the sale of both Life and Non‐life policies.
1.10.2 COMMERCIAL/TRAINING ACTIVITIES
There were some important changes on the commercial front in 2015, made on the basis of market trends, to improve the Company's performance and also with a view to innovation.
In detail, owing to the sharp drop in market rates and the need to reduce the production of policies linked to separately managed accounts, changes were made to the product mix and new unit‐linked products were introduced in order to ensure sustainability in terms of capital absorption and overall risk.
In the Motor insurance sector there were the first signs of an end to the positive cycle of the last few years (decrease in the average price of premiums and a renewed rise in claims, including major claims). 2015 was also a year of aggressive and uncontrolled competition. To deal with this new scenario, the Company overhauled the procedures for managing its agencies' commercial flexibility.
The Motor insurance catalogue was enriched with a new black box offering: while maintaining its existing provider, the Company also appointed a new supplier with a view to offering new economically and technologically competitive devices.
Lastly, the Realmente Welfare product was launched in 2015, as part of the Family Welfare project. This includes the new range of Family Care major risk insurance solutions, and RealmenteInSalute, the new health insurance offering with some highly innovative features, designed to integrate/supplement the services provided by the National Health System. The RealmenteWellness programme that rewards policyholders who are in good health and adopt a healthy and active lifestyle was also launched.
Work on developing the operational model for the Multi‐channel strategic project continued. The aim of the project is to set up and expand a multi‐channel sales strategy centred around the customer and which caters to new consumption patterns linked to digital technology and the increasing use of mobile devices.
The first outcomes of the project, in early 2015, regarded lead management, i.e. the process by which new contacts via websites are transformed into sales opportunities for our agencies. Agents can now use modern software to manage consumers who use the website quote engine and request an appointment with the agency for further information and to purchase policies. The Company therefore amplified its digital advertising on search engines and social media to capture more new qualified leads. This strategy resulted in the generation of more than 387,000 quotes.
The operational stage of the Digitalisation project also began in 2015. The first pilot agencies were set up and training was provided in preparation for roll‐out. In practice the first enabling components were developed and implemented, such as the electronic hand‐written signature (AES) and digital data storage systems. 16 classroom training sessions were held to "launch" the project; these were an opportunity for agency staff to obtain detailed information about operational aspects and to understand the advantages of the system in terms of time saving and improved quality of service for members. By the end of the year 84% of agencies had adhered to the project and the transition to a paperless agency environment (elimination of printed records in favour of electronic document management) was well underway. This transition was fundamental in order to move on to the next step towards a completely digitalised system using electronic hand‐written signatures on contracts. Contracts can now be signed digitally, using tablets and Wacom signature pads, eliminating the need for printed documents. In the second half of the year, 24 training sessions were held on the subject of electronic hand‐written signatures and on completing the transition to a paperless agency environment; this will gradually be extended to all Group agencies. At present 288 of Reale Mutua's agencies have reached this stage of the process. Specific training meetings were also held for the external business network.
46 REPORTS AND ACCOUNTS 2015
The Digit project will continue in 2016, when it will be extended to the remaining agencies.
* * *
* * *
IIn line with the provisions issued by the insurance supervisory authority with Regulation No. 5/2006 and Measure No. 2743/2009, the Sales department prepared the annual report for financial 2014 on the control of sales network activities.
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The next stage of the project was also launched in the second half of the year. This envisages the use of mobile connectivity (the network app) to consult customers' profiles, quote prices and issue contracts. The first 40 agencies are already involved in this stage. Activities included one‐to‐one meetings with agency staff and co‐workers held at the agencies by members of the project team, area managers and specialists. Apps were installed on 268 IOS and Android tablets.
The Group Business Training unit was set up on January 1, 2015 at the Parent Company, to manage the agency training activities of both Reale Mutua Assicurazioni and Italiana Assicurazioni. This led to a series of activities to harmonise existing processes, in order to maximise office efficiency, strengthen synergies in the use of training companies and providers, and standardise training methods across the Group.
The unit organised 28 classroom courses for Reale Mutua Assicurazioni, for a total of more than 240 editions, and 24 virtual classroom lessons, for a total of over 360 editions. 27 courses were developed at Group level, ten of which were held in the conventional classroom environment. There were over 200 online courses, followed by at least one intermediary.
More than 12,000 people attended classroom courses, of whom over 6,000 in the virtual classroom environment. Over 36,000 courses were attended online. More than 4,700 intermediates benefited from the training schemes provided by the Group (and took part in at least one of the available courses).
IVASS Regulation No. 6/2014, which came into effect on January 1, 2015, introduced some significant changes to the rules concerning professional training and refresher courses for insurance intermediaries. The number of hours of refresher training has been increased from 30 to 60 every two years, with at least 15 of the total hours in a year; classroom and distance learning techniques are now considered on a par.
This resulted in significant changes to how training courses are planned and the methods used to monitor compliance with requirements as regards professional qualifications of the sales network. Under the new rules established by IVASS No. 6/2014, the e‐learning platform was completely overhauled; the publication of courses entailed not only meeting standard requirements but also a thorough review of the content.
In detail:
- traditional classroom lessons continue to play a crucial role and are mainly used for advanced managerial and technical training courses, as well as being the preferred channel for training on strategic projects;
- the virtual classroom environment is mainly used for courses on operational aspects of Company processes, and for providing further information about issues dealt with in classroom lessons;
- the online channel continues to be mainly used for product training purposes.
TRAINING FOR AGENTS IS DISCUSSED IN CHAPTER 6 "AGENTS" IN THE SOCIAL DIMENSION OF THE "SUSTAINABILITY REPORT".
47
The document, examined by the Board of Directors at the meeting of February 26, 2015, analyses the composition of the sales network, according to each distribution channel, vocational training and refresher schemes and the implementation thereof; it also describes the methods used to monitor training schemes and, more generally, the rules of conduct that must be observed by the sales network. The report was then sent to the Authority, together with the observations of the head of the Internal Audit department and the considerations of the Board on the latter.
1.10.3 MARKETING
The “Young VIPs” scheme, launched in the last quarter of 2015, was an innovative way for the Company to demonstrate its closeness to policyholders.
From September 7, policyholders were able to request a free medical fitness check-up, eye-test or dental examination for their children or grandchildren aged between 5 and 14 years.
The initiative proved extremely popular with members, and by December 31, when the scheme ended, the Company had distributed more than 32,000 specialist medical examinations.
* * *
Continuing along the lines of the “Young VIPs” initiative that ran in 2015 and to bolster the Group's positioning in the field of preventive care and personal well-being, at the meeting of November 24, 2015 the Board of Directors approved the “Mynet.blue” initiative, which was submitted to the Meeting of Delegates for approval on December 5, 2015.
The € 1,7 million scheme for policyholders of Reale Mutua envisages free access to the network of dental care services, outpatient clinics and nursing homes managed by Blue Assistance and its approved physiotherapy providers.
1.10.4 COMMUNICATION
In the field of communication, the Group brand project was launched at the end of April 2015.
Between January and April, activities were focused on preparing for the launch of the new Reale Group image, starting with the inclusion of branding elements in and personalisation of the workplace, explanatory videos, replacement of signs at the head offices and distribution of the brand book setting out the values and philosophy.
The project was launched in June 2015, on completion of the tender process, and involved some 1,808 sites including agencies, sub-agencies and branches of Banca Reale. All existing signage should be replaced between 2015 and 2017.
The launch of the new Group brand and logo also included a restyling of the Parent's website and those of its subsidiaries, which are now all consistent with the new brand identity, and the creation of the new www.realegroup.eu website with all Reale Group's institutional content.
The Social Media communication strategy became fully operational in 2015. It uses the three best known platforms: Facebook, Twitter and LinkedIn. Pursuing the three main objectives of listening, social caring and attraction, the Company has developed a detailed editorial plan that features the use of 13 different pages to engage and interact with more than 26,000 likers and followers.
As for corporate and brand communication activities, in the second half of the year Reale Mutua launched a communication campaign to support its "Young VIPs" scheme. The press campaign, implemented jointly by Reale Mutua and Italiana Assicurazioni but using different creative concepts, ran in December 2015.
In keeping with its values, the Company sponsored social initiatives in 2015. These included its sponsorship of the Italy Protection Forum on developments in insurance cover (April 2015) and renewal of its long-standing support for Sportabili, specifically for the athlete Francesca Fenocchio as she prepares for the 2016 Olympic Games in Rio.
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In addition to sponsoring the Italian Rugby Federation for the Six Nations Tournament in February 2015, Reale Mutua also sponsored Dinamo Sassari, which won the "Lega A" championship, the "Supercoppa" and "Italian Cup", an extraordinary achievement that gave the Company enormous visibility.
In September Reale Mutua sponsored the "Festa dello Sport", a sports festival organised by Turin city council to celebrate the city's nomination as European Capital of Sport.
* * *
In 2015 corporate communication was directed towards establishing new contacts and fostering relations with various regional and national cultural and social organisations. The Company continued to establish its credentials among leading journalists from newspapers and general and sector-specific magazines by participating in interviews, conferences and workshops. The Company maintained constant, regular relations with the mass media in order to guarantee the utmost efficiency in the dissemination of corporate news and enhance its visibility.
As regards relations with the media, special emphasis was placed on internal and external communication projects to publicise the new visual image of Reale Group. Reale Mutua hosted a press conference on the eighth floor of its headquarters to launch the new brand. Senior executives from the Parent and from the Group presented the rebranding project and gave the numerous journalists who were attending some insight into their future business strategies.
Reale Mutua's partnerships and sponsorship schemes also reflected its support for the community. Besides its traditional support for local cultural and social organisations, such as the "CasaOz" non-profit organisation, the Consulta per la Valorizzazione dei Beni Artistici e Culturali di Torino (Association for the development of the artistic and cultural heritage of Turin), the "A Come Ambiente" Museum, the "De Sono" Music Association, the Fondazione Teatro Regio di Torino and the Congress Centre of the Employers’ Association of Turin, the Company also sponsored "The Marriage of Figaro" by Wolfgang Amadeus Mozart, staged at the Teatro Regio in Turin in February and supported the Associazione Lingotto Musica for the concert seasons.
The Company also sustained numerous international events hosted by the City of Turin in 2015, including the fourth edition of the "Biennale Democrazia" cultural event and the Third Global Forum on Local Development, by directly promoting in-depth discussions and debates on matters of common interest.
After re-opening to the public in 2014, the Reale Mutua Historical Museum organised numerous activities. The number of visitors increased and the total number since it first opened now stands at more than 7,600. This is also thanks to the guided tours specifically designed for primary and middle school pupils, launched in October 2014 and which continued throughout the 2015-2016 school year.
To arouse children's interest in museums, the Company took part in the “National Family at the Museum Day – F@MU 2015”. Changes were made to the overall layout, to accommodate their needs and there were a host of games and attractions to welcome them. Lastly, during the Exposition of the Holy Shroud, the Museum opened each weekend in May.
In June the Company hosted the presentation of the book written by the journalist Luca Ponzi entitled "Reale è a nostra storia", recounting Reale Mutua's almost 200-year history.
In October, in partnership with the Associazione Amici dell’Università di Torino (Friends of Turin University Association), Reale Mutua sponsored a cycle of conferences open to the public on the subjects of preventive health care and welfare. These topics are central to the Company's business strategies in its commitment to promoting a culture of prevention and to the protection of families and individuals.
CORPORATE COMMUNICATION ACTIVITIES ARE DISCUSSED IN CHAPTER 8 "SOCIETY" IN THE SOCIAL DIMENSION OF THE "SUSTAINABILITY REPORT".
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1.11 LITIGATION In addition to cases involving insurance issues, litigation is in course with former employees of the Company and a number of former agents. Provisions for risks and charges, which amounted to around € 2,805 thousand at December 31, 2015, are sufficient to cover the charges deriving from lawsuits in course.
The Company is involved in tax disputes following assessments relating to tax periods from 2003 to 2010.
The disputes referring to IRES (Corporate Income Tax) and IRAP (Regional Tax on Production Activities) mainly concern provisions for outstanding claims. Those relating to VAT regard coinsurance assignments and certain intra-group operations.
In the cases concerning provisions for outstanding claims, which mainly refer to the correct recognition of the relevant expense and revenue items, the Company is convinced that it has always operated correctly and in accordance with the law, namely with the applicable tax regulations and with normal accounting practice. The correctness of the Company’s actions was also confirmed by a recent sentence of the Italian Court of Cassation (cf. Court of Cassation, Tax Law Chamber, sentence No. 16332 of September 26, 2012) which, with reference to a set of circumstances identical to those at issue, ruled the opinion of the Tax Authority to be unfounded.The VAT issues merely regard the interpretation of tax regulations governing the application of VAT to coinsurance assignments, on which there is ample case law supporting the approach applied by insurance companies. Although in a few isolated cases the court has handed down an unfavourable ruling, two of which against Reale Mutua and two against the Italiana Assicurazioni S.p.A. subsidiary, the Company is firmly convinced that the dispute will be settled in its favour.
No funds have been set aside in connection with the aforesaid issues.
In March the Turin Finance Police concluded their audit in connection with the recording of "cancellations of premiums" as a reduction in "premiums for the year" in the financial statements. As mentioned above, the audit regarded the tax periods from 2009 up to 2013 and the investigators had already issued an Official Tax Audit Report for 2009 in October 2014.
The Finance Police continued their assessment relating to the subsequent years (specifically 2010-2013), at the end of which they issued a second Official Tax Audit Report on March 16, 2015.
This final Report is in line with the forecasts made at the end of 2014 and thus confirms the provision amounting to € 3,200 that was set aside. The amount reflects the impact of the audit on the income statement and refers for € 1,100 thousand to sanctions and for € 2,100 thousand to tax.
On March 31, 2015 the Company notified the Tax Office and the Finance Police of its decision to adhere to the Official Tax Audit Report. The procedure was concluded with payment of the amount due in June 2015.
The objection raised by the investigators was linked to a significant extent to issues pertaining to certain types of adjustments, with the result that part of the contested amount will be recovered in the years after 2027.That is also one of the reasons why the Company decided to adhere to the aforesaid Official Tax Audit Reports.
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50 REPORTS AND ACCOUNTS 2015
1.12 OTHER INFORMATION
In accordance with art. 28.2 of ISVAP Regulation No. 20/2008, as subsequently amended by ISVAP Directive No. 3020/2012 and IVASS Measure No. 17 of April 15, 2014, together with the financial statements, the Company sent IVASS the documentation requested thereby, referring to December 31, 2014. This documentation consisted of a report on the system of internal controls and risk management, illustrating the actions undertaken in the previous year and any changes to the system during the year, the internal audits performed, any highlighted faults and the corrective measures adopted. It also contained information on the organisational structure of the undertaking, including the results of the annual assessment of the size, composition and functioning of the administrative body. Documents referring to the organisational chart and system of delegating powers were attached to the report. According to the same Regulation, the Board of Directors of the Company has approved the action plans drawn up for 2015 by the internal audit, risk management and compliance functions. At the Meeting of November 24, 2015, the Board approved the revised Strategic Plan on Information and Communication Technology for 2016-2018, as required under art. 14(2)(a) of the Regulation. The aim of the document is to ensure the existence and maintenance of a highly integrated overall systems architecture in terms of both applications and technology, that is adequate to meet the needs of the undertaking.
Regulation No. 20/2008 contains provisions concerning the role of the Board of Directors, including the requirement to define numerous policies on specific topics specified by IVASS. The Board had already approved these documents during the Meeting of October 23, 2014. In accordance with art. 5(2)(d) of the Regulation, these policies must be reviewed at least once a year, to verify the adequacy of the system of internal controls defined by the Board in respect of developments in business activities and changes in external factors. Therefore, at the Meeting of October 22, 2015, the Board of Reale Mutua approved the texts of all the policies it had examined and reviewed, on the basis of changes to the organisational structure and business practices that had taken place during the year, as well as input received at various levels and updates to the regulatory framework.
Furthermore, in accordance with art. 28 bis (1) of ISVAP Regulation No. 20/2008, as introduced by IVASS Measure No. 17/2014 (repealing art. 6.5 of ISVAP Regulation No. 15/2008 on the same subject), together with its financial statements, Reale Mutua in its capacity as the Parent responsible for management and coordination of the Group, sent the Supervisory Authority a report containing the following information:
a) instructions given to Group companies within the scope of its management and coordination activities;
b) the mechanisms in place to ensure coordination between the corporate bodies and the Group's RiskManagement, Compliance and Internal Audit functions and between the latter and the respective bodies and functions of each insurance company in the Group;
c) the systems of internal controls and risk management procedures, initially adopted pursuant to art. 87 ofLegislative Decree No. 209/2005 and subsequently pursuant to art. 1 of Legislative Decree No. 74/2015, the related internal control and risk management implementing provisions, including the results of assessments undertaken by Group companies;
d) the measures adopted to implement the provisions issued by IVASS regarding insurance groups;
e) the outcome of the assessments to monitor compliance by each company in the insurance group with
the requirements established by IVASS;
f) the mechanisms in place to ensure that the systems of internal control, risk management and internal
and external reporting procedures are implemented consistently by all group companies and how these procedures relate to the flow of information from companies included in the area of supplementary supervision.
As regards complaints management, in accordance with ISVAP Regulation No. 24/2008, as amended by IVASS Measure No. 30 issued on March 24, the Company handled 1,399 complaints in 2015, in line with the number received in the previous year. The average response time was 18.88 days, slightly longer than in 2014.
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FURTHER INFORMATION ABOUT COMPLAINTS MANAGEMENT IS PROVIDED IN CHAPTER 5 "MEMBER-POLICYHOLDERS" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT’”.
In accordance with ISVAP Regulation No. 25/2008, the Board resolved on the adoption of guidelines relating to transactions between the Company and intra-group counterparties and the corresponding annual operations envisaged for 2015.
In accordance with ISVAP Regulation No. 36/2011, at the Meeting on July 14, the Board also performed the annual review of the Company’s framework resolution of investments, which defines, by reason of the dimension, nature and complexity of the activity pursued, investment policies regarding all of its assets consistent with the risk profile of its liabilities, so as to continuously have suitable and sufficient assets available to cover its liabilities.
As required by ISVAP Regulation No. 39/2011, the Board of Directors revised its remuneration policies for corporate bodies and employees, extending the scope of the staff and top management positions to which they refer, in light of the increasing role of guidance and coordination exercised by certain functions at Group level. The aforesaid document, approved by the Meeting of Delegates on April 20, 2015, was therefore incorporated and its contents were confirmed the following year. The Board also prepared the annual report on this subject. These documents were then submitted to the Meeting of Delegates for approval, together with the outcome of the assessments carried out by the control functions (Compliance, Risk Management and Internal Audit) on April 28, 2015.
Pursuant to art. 6(1)(f) of ISVAP Regulation No. 41/2012, the Board of Directors examined the annual report detailing the actions undertaken by the head of anti-money laundering procedures.
The Board approved the report drawn up pursuant to art. 30 of Decree Law No. 1/2012, converted into Law No. 27/2012, using the template prescribed by ISVAP Regulation No. 44/2012 on the fight against fraud. The report contained detailed information about the number of claims subject to specific analysis in relation to the risk of fraud, the number of complaints or reports filed with the courts, the outcome of subsequent criminal proceedings, and the internal organisational measures adopted or promoted in order to counter fraud.
Pursuant to CONSOB Resolution No. 17297/2010 setting out provisions relating to the duty of disclosure of information and the transmission of records and documents by supervised parties, the Company prepared and submitted the requested documents relating to financial 2014 to the Commission by the deadline of March 31, 2015.
With reference to the Joint letter by IVASS and Banca d'Italia issued on August 26, 2015, at the Meeting of November 24, 2015, the Board of Reale Mutua approved a "Plan of actions regarding PPI (payment protection insurance) policies", which the Company must implement within 90 days from the date of the Meeting, and a document setting out the "Policy for the settlement of claims and handling of complaints related to PPI policies". Having confirmed its receipt of said Plan and Policy, the Board of Auditors expressed a favourable opinion on the aforesaid documents.
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Concerning the administrative liability of legal entities pursuant to Legislative Decree No. 231/2001, in 2004 the Company implemented an organisation, management and control model as required by said law and, at the same time, set up its Supervisory Board.
Legislative Decree No. 231/2001 was affected by the following legislation that came into force in 2015.
Law No. 68 of May 22, 2015, “Provisions on crimes against the environment”, (published in No. 122 of the Official Journal of the Italian Republic on May 28), which came into force on June 1, 2015, introduced a new Title on crimes against the environment (Title VI-bis) into the Italian Penal Code. The Title sets out twelve new offences against the environment. This law also amends the so-called "Environmental Code (Legislative Decree No. 152 of April 3, 2006). This law also introduced a new article to Legislative Decree No. 231 of June 8, 2001 (art. 25-undecies), extending the liability of legal entities found guilty of the new crimes of environmental pollution, environmental disaster, involuntary offences against the environment, offences against the environment committed under aggravating circumstances (conspiracy or organised crime) and traffic and abandonment of highly radioactive material.
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Law No. 69 of May 27, 2015, “Provisions on crimes against the public administration, organised crime and false accounting”, (published in No. 124 of the Official Journal of the Italian Republic on May 30) also affects the administrative liability of entities in connection with the offences envisaged by art. 25-ter of Legislative Decree No. 231/2001. Some amendments have been made to this article. The most significant are those concerning the crime of false accounting.
Meanwhile, the Company completed its revision of the organisation, management and control model required by Legislative Decree No. 231/2001, as proposed by the Board of Directors.
The new version also takes into account all changes to the regulatory framework in force as at January 15, 2016 and the related risk assessments.
The latest edition of the model was approved by the Board of Directors during the Meeting on January 28, 2016.
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In March and December 2015 Fitch Ratings confirmed the IFS (Insurer Financial Strength) rating for Reale Mutua and Reale Seguros Generales of "BBB+" with a stable outlook.
The "BBB+" rating with stable outlook assigned to the Company by Fitch Ratings is the same as that assigned by the same rating agency to the Italian State.
In its assessment, Fitch Ratings underlined the positive contribution by Reale Seguros to the profitability and diversification of the Group.
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Turning to environmental issues, on September 17, 2015, the Board of Reale Mutua approved the Group Environmental Policy, which was subsequently submitted to each Group company for their approval.
So far, Banca Reale, Italiana Assicurazioni and Blue Assistance have obtained certification to UNI EN ISO 14001 and, after three years, Reale Mutua has renewed its certificate.
Reale Immobili has started the certification process, which it expects to complete by May 2016, after which all the other Group companies will gradually obtain the same certification.
FURTHER INFORMATION ABOUT ENVIRONMENTAL ASPECTS IS PROVIDED IN CHAPTER 2 “RESPONSIBLE MANAGEMENT” AND CHAPTER 9 “ENVIRONMENT” OF THE “SUSTAINABILITY REPORT’”.
Aware of the importance of environmental issues, the Company continued to encourage employees to use low environmental impact forms of transport instead of cars to commute to work.
FURTHER INFORMATION ABOUT ASPECTS OF ENVIRONMENTAL RESPONSIBILITY IN RELATION TO EMPLOYEES IS PROVIDED IN CHAPTER 4 "EMPLOYEES" IN THE SOCIAL DIMENSION OF THE “SUSTAINABILITY REPORT”.
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53
1.13 RELATIONSHIPS WITH SUBSIDIARY AND ASSOCIATED COMPANIES The Company is the Parent of the Reale Mutua Insurance Group, registered under number 006 in the Register of insurance companies set up by ISVAP with Regulation No. 15 of February 20, 2008.
The Company is not subject to the management and coordination of third parties pursuant to art. 2497 et seq. of the Italian Civil Code; it manages and coordinates its subsidiaries in accordance with the aforementioned provision.
A) Italian Subsidiaries
Activities and services common to the various Italian companies of Reale Group have been concentrated in accordance with a Group strategy based on synergy, coordination and control.
In particular, for the Italian subsidiaries, Reale Mutua has concentrated management of settlement activities, general services, services relating to administrative activities (such as general and financial accounting, preparation of the financial statements, payroll and contributions, legal, fiscal and labour law assistance and consulting), commercial services and various technical services within its own departments. The Parent also manages Risk Management, Compliance and Anti-money laundering activities for the Italian subsidiaries.
During 2015, these services generated total revenues for the Company of € 31,068 thousand.
At the same time, Reale Mutua received services relating mainly to financial and asset management, real estate and logistics, agency accounting and call centre activities for a total amount of € 48,227 thousand.
As regards the furnishing of Group services and coordination, at December 31, 2015, 22 employees of Reale Mutua, including five senior managers, were seconded to subsidiary companies. On the same date, 224 employees of Group companies, including two senior managers, were seconded to the Company.
* * * The main data for each Italian subsidiary at December 31, 2015 are set forth below.
IItaliana Assicurazioni S.p.A. - Milan
At December 31, 2015 the Company reported premium income from direct business and inward reinsurance of € 803,499 thousand, in relation to € 816,442 thousand in 2014, with a decrease of 1.6%, of which € 529,277 thousand for Non-life business, with a reduction of 1.4%, and € 274,222 thousand for Life business, with a decrease of 1.9%.The year closed with a net profit of € 23,419 thousand in relation to € 44,574 thousand in 2014. In particular, Non-life business recorded a profit of € 19,269 thousand, compared with € 39,115 thousand in 2014, and Life business recorded a profit of € 4,150 thousand, compared with € 5,459 thousand in 2014. The proposal to be submitted to the Meeting envisages the distribution of a dividend of € 9,918 thousand to the shareholder.
Banca Reale S.p.A. - Turin
The Company prepares its financial statements in accordance with IAS/IFRS.Total customer deposits moved up 14.6% over the previous year to a total of € 10,277,627 thousand at December 31, 2015, while loans to customers amounted to € 245,760 thousand at the end of the year, an increase of 24.7% over 2014.
The income statement for 2015 closed with a net profit of € 2,091 thousand compared with € 4,609 thousand in the previous year. According to the proposal to be submitted to the Meeting, after making the required allocations to the legal and extraordinary reserves, the amount of € 600 thousand will be distributed to shareholders and the remaining € 1,177 thousand will be carried forward.
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54 REPORTS AND ACCOUNTS 2015
Reale Immobili S.p.A. – Turin
The Company prepares its financial statements in accordance with IAS/IFRS.At December 31, 2015 rents from real estate amounted to € 64,370 thousand, down € 69 thousand compared with December 31, 2014. Gains arising from the sale of real estate amounted to € 21,279 thousand compared with € 914 thousand in the previous year. This amount includes the profit amounting to € 19,701 thousand made on the sale of the property in Via Boncompagni in Rome. The year closed with a profit of € 35,823 thousand compared with € 5,160 thousand in 2014. Taxes showed a positive balance of € 1,775 thousand: this result includes the effects of the re-calculation of deferred tax assets and liabilities following the reduction in the IRES tax rate (from 27.5% to 24%) which will come into effect on January 1, 2017 under the provisions of the 2016 Stability Law. The re-calculation of the items in question resulted in the recognition in the income statement of extraordinary income for € 17.4 million in 2015. The proposal to be submitted to the Meeting envisages the allocation of 5% of net income, equal to € 1,791 thousand, to the legal reserve, € 17,063 thousand to the extraordinary reserve and the distribution of dividends for the remaining € 16,969 thousand.
Blue Assistance S.p.A. – Turin
The Company prepares its financial statements in accordance with IAS/IFRS.Net production revenues amounted to € 27,069 thousand, 18.1% up on 2014.
The year closed with a net profit of € 457 thousand compared with a profit of € 195 thousand in 2014.As proposed to the Meeting, 5% of the profit will be allocated to the legal reserve and the remainder will be carried forward
Reale Ites EEIG - Turin
Reale Mutua's interest in the European Economic Interest Grouping amounts to € 76,390 thousand.Revenues from services amounted to € 96,251 thousand and referred to fees for IT services supplied to Group companies that are members of the Grouping. At year-end investments in hardware and software amounted to € 98,414 thousand.Reale Ites EEIG broke even at the end of 2015.
ITALNEXT S.r.l.
Italnext is wholly owned by Italiana Assicurazioni.At the end of its first year of business, and thus its startup year, the Company reported a loss of € 311 thousand.As proposed to the Meeting, the loss will be covered through the use of shareholders' capital contributions.
B) Foreign Subsidiaries
The main data for each foreign subsidiary at December 31, 2015 are set forth below.
Reale Mutua undertakes Risk Management activities concerning the development and management of the internal model on behalf of its Spanish subsidiary Reale Seguros Generales.
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At December 31, 2015 one senior manager and three employees from Reale Seguros Generales were partially seconded to Reale Mutua.
During 2015, these services generated total revenues for the Company of € 140 thousand, and costs for € 255 thousand.
55
Reale Seguros Generales S.A. – Madrid
In financial 2015, the company reported a volume of premiums of € 785,142 thousand (€ 752,393 thousand in 2014), with a y/y increase of 4.4%.The year closed with a net profit of € 30,913 thousand, compared with € 24,794 thousand in the previous year.The proposal to be presented to the Meeting envisages allocation of the net profit to reserves for € 15,913 thousand and payment of dividends for € 15,000 thousand.
Reale Vida y Pensiones S.A. – Madrid
In 2015 the Spanish subsidiary of Reale Seguros Generales reported a volume of premiums of € 30,429 thousand, compared with € 25,492 thousand in 2014.At the end of the year it reported a profit of € 52 thousand compared with a negative result of € 1,047 thousand in 2014.
Inmobiliaria Grupo Asegurador Reale S.A. – Madrid
In 2015 revenues amounted to € 3,835 thousand, compared with € 3,850 thousand in 2014, with a year-on-year decrease of 0.4%.Financial 2015 closed with a net profit of € 1,697 thousand in relation to € 1,615 thousand in the previous year.According to the proposed allocation of the net profit for the year, a dividend of € 1,500 thousand will be distributed after making the required appropriations to the reserves.
C) Associated Companies
Sara Assicurazioni S.p.A. - Rome
Reale Mutua owns a 31.43% stake in the share capital of this Non-life company.Total premiums for the year amounted to € 572,434 thousand, compared with € 595,845 thousand in 2014.Financial 2015 closed with a positive result of € 80,144 thousand, compared with a profit of € 69,410 thousand in 2014.The result for 2015 was mainly due to the further improvement in the technical balance for direct business compared with 2014.According to the proposed allocation of the net profit for the year, a dividend of around € 40,000 thousand will be distributed after making the required appropriations to the reserves.
Credemassicurazioni S.p.A. – Reggio Emilia
This Non-life company is owned on an equal basis by Reale Mutua and the Credem banking group. In financial 2015 Credemassicurazioni garnered premium income for around € 31,390 thousand, compared with € 31,731 thousand in 2014, decreasing by 1.1% in relation to the previous year.Financial 2015 closed with a profit of some € 6,511 thousand compared with € 3,970 thousand in the previous year. The proposal to be submitted to the Meeting envisages the distribution of a dividend of € 4,000 thousand.
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The main data for each associated company at 31 December 2015 are set forth below.
56 REPORTS AND ACCOUNTS 2015
1.14 MAIN EVENTS IN EARLY 2016 On January 4, 2016 the Company formalised its purchase of the 12.5% interest in Eurapco AG, for a total of CHF 1,255 thousand, equal to € 1,150,804.75 at the exchange rate on December 31, 2015.
On January 26, 2016 the sale of the interest in CBA Vita S.p.A. to Banca Sella Holding S.p.A. was finalised, for a total of € 2,133 thousand.
No further significant events have occurred after the closure of the accounts that could have a significant effect on the information provided in the balance sheet or income statement.
1.15 BUSINESS OUTLOOK The outlook for the euro area is for a faster pace of GDP growth, despite increased risks. According to estimates by the International Monetary Fund, growth is forecast to stand at 1.7% in 2016. This growth is expected to be driven by an upswing in domestic demand, sustained by expansionary monetary policies, the increase in disposable income of households, an upturn in investments and improvements in the labour market.
According to the latest IMF estimates, Italian GDP is expected to grow by 1.3% in 2016. This is based on the assumption that the lack of impetus from foreign trade as a consequence of the slowdown in the world economy, will be offset by an upswing in demand from within Italy and other euro area countries. The credit market is also expected to continue to benefit from expansionary monetary policies and gradual economic recovery.
There have been improvements on the labour market following the recent introduction of new legislation and unemployment looks set to fall to 11.1%.
Inflation, measured on the basis of the harmonised index of consumer prices, is forecast to rise very gradually, from 0.1% in 2015 to 0.3% in 2016.
* * *
In this context, indications regarding the Company’s insurance business confirm the projections of positive performance examined during the Meeting of Delegates of December 5, 2015.
In the Life sector, Reale Mutua will continue to overhaul the product catalogue as in previous years, and to study new LTC (Long-Term Care) products as part of the Family Welfare project. A new multi-line product will also be launched in 2016, making it possible to diversify the offering in this sector.
* * *
According to the guidelines for 2016, the Company will continue to improve its underwriting performance and develop premiums in the Non-life Non-motor sector: systematic monitoring of underwriting results and compliance of sales network activities with Company criteria will continue to be one of the main tools used in order to achieve the declared objectives.
Some changes will be made in 2016 to update and improve the product catalogue, in order to make the offering even more competitive.
In the Motor sector, activities will continue to improve portfolio profitability in the TPL land vehicles business, in view of the continual fall in the average price of premiums and a renewed increase in claims frequency. Adjustments will also be necessary in view of some significant changes to the law introduced by the "Competition bill", currently being examined by Parliament, which will have a major impact on the sector.
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57
1.16 AUDIT
Pursuant to art. 102 of Legislative Decree No. 209 of September 7, 2005, and art. 14-16 of Legislative Decree No. 39 of January 27, 2010, the annual accounts at December 31, 2015 have been audited by Reconta Ernst & Young S.p.A.
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58 REPORTS AND ACCOUNTS 2015
1.17 MOTIONS ON THE PROFIT FOR THE YEAR To the Delegates,We submit to your approval the accounts herewith presented which closed with a total profit of € 59,411,407.80, of which € 3,546,518.28 for Life business and € 55,864,889.52 for Non-life business.
We propose that the result for the year be allocated as indicated below, with separate assignment to the Life and Non-life segments according to the operating and financial performance of each type of business:
Pursuant to art. 5 of ISVAP Regulation No. 17 of March 11, 2008 as amended, all elements of shareholders' equity reported in the Company's Articles of Association must be updated at least every three years.
Since this document was last revised in 2013, the part of art. 6 of the Articles of Association regarding the amounts of the elements of shareholders' equity must be updated in accordance with this Regulation, also taking into account the above proposal for the allocation of profit.
Said adjustments are to be examined and approved by the Meeting of Delegates.
* * *
The approval of the financial statements for 2015 marks the end of the three-year term of office of the Board of Statutory Auditors. The Meeting will therefore be asked to appoint the members thereof for the next three-year period.
* * *The Board of Directors wishes to thank the management, all members of staff and agents for their unfailing co-operation and commitment during the year.
THE BOARD OF DIRECTORS
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Net income for 2015 € 59,411,407.80
Life business:
Allocation of 5% to the legal reserve € 177,325.91
Allocation to the ordinary reserve € 3,369,192.37
€ 2,793,244.48
Non-life business:
Allocation of 5% to the legal reserve
Allocation to the ordinary reserve € 53,071,645.04
Remaining net income for the year € 0.00
BALANCE SHEET AND INCOME STATEMENT
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60 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET
ASSETS
Values of the year
A. SUBSCRIBED CAPITAL UNPAID 1 0
of which called-up capital 2 0
B. INTANGIBLE ASSETS
1. Deferred acquisition commissionsa) Life business 3 0
b) Non-life business 4 0 5 0
2. Other acquisition costs 6 0
3. Start-up and expansion costs 7 0
4. Goodwill 8 0
5. Other multi-year costs 9 71,736 10 71,736
C. INVESTMENTS
I - Land and buildings1. Property used in company operations 11 15,595,330
2. Property rented to third parties 12 28,874,452
3. Other properties 13 0
Other property rights 14 0
5. Construction in progress and advance 15 0 16 44,469,782
II - Investments in Group companies and other shareholdings1. Shares and interests in
a) controlling companies 17 0
b) subsidiary companies 18 1,620,110,278
c) affiliated companies 19 0
d) associated companies 20 36,754,313
e) other companies 21 3,064,500 22 1,659,929,091
2. Bonds issued by:a) controlling companies 23 0
b) subsidiary companies 24 0
c) affiliated companies 25 0
d) associated companies 26 0
e) other companies 27 0 28 0
3. Loans to:a) controlling companies 29 0
b) subsidiary companies 30 0
c) affiliated companies 31 0
d) associated companies 32 0
e) other companies 33 0 34 0 35 1,659,929,091
to be carried forward 71,736
61
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Values of the previous year
181 0
182 0
183 0
184 0 185 0
186 0
187 0
188 0
189 72,817,517 190 72,817,517
191 15,995,001
192 26,958,713
193 0
194 0
195 0 196 42,953,714
197 0
198 1,543,770,524
199 0
200 36,754,313
201 3,064,500 202 1,583,589,337
203 0
204 0
205 0
206 0
207 0 208 0
209 0
210 0
211 0
212 0
213 0 214 0 215 1,583,589,337
to be carried forward 72,817,517
62 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET
ASSETS
Values of the year
carried forward 71,736
C. INVESTMENTS (continued)
III - Other financial investments1. Shares and interests
a) Listed shares 36 58,991,491
b) Unlisted shares 37 7,551,027
c) Interests 38 12,596,710 39 79,139,228
2. Shares in common investment funds 40 178,683,343
3. Bonds and other fixed-income securitiesa) listed 41 5,259,181,016
b) unlisted 42 21,238,260
c) convertible debentures 43 0 44 5,280,419,276
4. Loansa) loans secured by mortgage 45 27,339,291
b) loans on policies 46 2,612,880
c) other loans 47 1,491,106 48 31,443,277
5. Participation in investments pools 49 0
6. Deposits with credit institutions 50 4,266,755
7. Miscellaneous financial investments 51 1,099 52 5,573,952,978
IV - Deposits with ceding undertakings 53 5,206,524 54 7,283,558,375
D. INVESTMENTS FOR THE BENEFIT OF LIFE POLICYHOLDERS WHO BEAR THE INVESTMENT RISK AND RELATING TO THE ADMINISTRATION OF PENSION FUNDS
55 473,189,400I - Investments relating to contracts linked to investment funds and market indexesII - Investments relating to the administration of pension funds 56 176,073,730 57 649,263,130
D bis. REINSURERS' SHARE OF TECHNICAL PROVISIONS
I - NON-LIFE BUSINESS
1. Provisions for unearned premiums 58 32,168,905
2. Provisions for claims outstanding 59 138,455,455
3. Provisions for profit-sharing and premium refunds 60 0
4. Other technical provisions 61 0 62 170,624,360
II - LIFE BUSINESS
1. Provisions for policy liabilities 63 2,984,301
2. Unearned premium provision for supplementary coverage 64 0
3. Provision for sums to be paid 65 760,429
4. Provisions for profit-sharing and premium refunds 66 0
5. Other technical provisions 67 0
6. Technical provisions where the investments risk is borne by the policyholders and relating to the administration of pension funds 68 0 69 3,744,730 70 174,369,090
to be carried forward 8,107,262,331
63
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Values of the previous year
carried forward 0
216 105,091,421
217 2,641,825
218 14,223,101 219 121,956,347
220 282,338,122
221 4,692,535,334
222 33,047,076
223 0 224 4,725,582,410
225 32,011,199
226 3,468,924
227 1,891,412 228 37,371,535
229 0
230 10,024,507
231 20,000 232 5,177,292,921
233 5,758,343 234 6,809,594,315
235 455,391,235
236 155,827,027 237 611,218,262
238 30,966,823
239 143,869,956
240 0
241 0 242 174,836,779
243 3,534,619
244 0
245 720,429
246 0
247 0
248 0 249 4,255,048 250 179,091,827
to be carried forward 7,672,721,921
64 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET
ASSETS
Values of the year
carried forward 8,107,262,331
E. DEBTORS
I - Debtors arising out of direct insurance operations:1. Policyholders
a) for premiums current year 71 168,626,593
b) for premiums previous years 72 20,190,431 73 188,817,024
2. Reinsurance intermediaries 74 208,846,904
3. Current accounts with Insurance companies 75 23,232,718
4. Policyholders and third parties for recoveries 76 54,167,857 77 475,064,503
II - Debtors arising out of reinsurance operations: 1. Insurance and Reinsurance companies 78 59,167,474
79 858,774 80 60,026,248 2.Reinsurance intermediaries
III - Other debtors 81 171,642,983 82 706,733,734
F. OTHER ASSETS
I - Tangible assets and stocks:1. Furniture, office machines and internal transport vehicles 83 4,286,053
2. Vehicles listed in public registers 84 0
3. Machinery and equipment 85 8,926,292
4. Stocks and other goods 86 0 87 13,212,345
II - Cash at bank and in hand1. Bank and Postal accounts 88 88,028,399
2. Cheques and cash on hand 89 2,739 90 88,031,138
91 0III - Own shares or equity interests
IV - Other1. Deferred reinsurance items 92 2,027
2. Miscellaneous assets 93 160,410,077 94 160,412,104 95 261,655,587
G. PREPAYMENTS AND ACCRUED INCOME
1. Accrued interest 96 52,134,315
2. Rents 97 0
3. Other prepayments and accrued income 98 34,613 99 52,168,928
TOTAL ASSETS 100 9,127,820,580
65
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Values of the previous year
carried forward 7,672,721,921
251 177,282,354
252 14,486,514 253 191,768,868
254 205,301,885
255 36,727,929
256 49,640,615 257 483,439,297
258 88,509,346
259 1,374,249 260 89,883,595
261 179,763,836 262 753,086,728
263 5,651,726
264 4,734
265 10,682,027
266 0 267 16,338,487
268 59,643,231
269 2,739 270 59,645,970
271 0
272 2,027
273 169,172,943 274 169,174,970 275 245,159,427
276 53,230,351
277 0
278 484,791 279 53,715,142
280 8,724,683,218
66 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
A. SHAREHOLDERS' EQUITY
101 60,000,000I - Subscribed capital or equivalent fund
II - Share premium reserve 102 0
103 136,222,768III - Revaluation reserves
IV - Legal reserve 104 207,536,505
105 0V - Statutory reserves
VI - Reserves for own shares and shares of the controlling company 106 0
107 1,386,049,960VII - Other reserves
VIII - Net profit (loss) brought forward 108 0
IX - Net profit (loss) for the year 109 59,411,408 110 1,849,220,641
B. SUBORDINATED LIABILITIES 111 0
C. TECHNICAL PROVISIONS
I - NON-LIFE BUSINESS
1. Provisions for unearned premiums 112 645,119,322
2. Provisions for claims outstanding 113 1,778,039,319
3. Provisions for profit-sharing and premium refunds 114 0
4. Other technical provisions 115 749,362
5. Equalisation provision 116 10,534,825 117 2,434,442,828
II - LIFE INSURANCE BUSINESS
1. Provisions for policy liabilities 118 3,805,354,552
2. Unearned premium provision for supplementary coverage 119 170,909
3. Provision for sums to be paid 120 72,514,432
4. Provisions for profit-sharing and premium refunds 121 0
5. Other technical provisions 122 10,733,558 123 3,888,773,451 124 6,323,216,279
D. TECHNICAL PROVISIONS WHERE THE INVESTMENT RISK IS BORNEBY THE POLICYHOLDERS AND RELATING TO THE ADMINISTRATION OF PENSION FUNDS
I - Provisions relating to contracts linked to investment funds and market indexes 125 475,034,865
II - Provisions relating to the administration of pension funds 126 176,065,247 127 651,100,112
to be carried forward 8,823,537,032
67
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Values of the previous year
281 60,000,000
282 0
283 136,222,768
284 202,598,321
285 0
286 0
287 1,292,224,472
288 0
289 98,763,671 290 1,789,809,232
291 0
292 623,471,259
293 1,824,504,296
294 0
295 638,720
296 9,255,587 297 2,457,869,862
298 3,400,473,670
299 148,099
300 49,000,119
301 0
302 11,608,527 303 3,461,230,415 304 5,919,100,277
305 457,011,027
306 155,822,207 307 612,833,234
to be carried forward 8,321,742,743
68 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
carried forward 8,823,537,032
E. PROVISIONS FOR OTHER RISKS AND CHARGES
1. Provisions for pensions and similar obligations 128 32,055,356
2. Provisions for taxation 129 406,839
3. Other provisions 130 49,759,560 131 82,221,755
F. DEPOSITS RECEIVED FROM REINSURERS 132 3,715,574
G. CREDITORS AND OTHER LIABILITIES
I - Creditors arising out of direct insurance operations: 1. Insurance intermediaries 133 50,874,096
2. Current accounts with Insurance companies 134 6,943,735
3. Premium deposits and premiums due to policyholders 135 12,741,904
4. Guarantee funds in favour of policyholders 136 0 137 70,559,735
II - Creditors arising out of reinsurance operations:1. Insurance and Reinsurance companies 138 1,111,136
2. Reinsurance intermediaries 139 3,066,002 140 4,177,138
141 0III - Debenture loans
IV - Amounts owed to banks and credit institutions 142 0
143 0V - Loans guaranteed by mortgages
VI - Miscellaneous loans and other financial liabilities 144 0
145 9,592,528VII - Provisions for employee termination indemnities
VIII - Other creditors1. Premium taxes 146 30,133,910
2. Other tax liabilities 147 3,082,705
3. Social security 148 5,168,471
4. Miscellaneous creditors 149 44,233,353 150 82,618,439
IX - Other liabilities1. Deferred reinsurance items 151 0
2. Commissions for premiums in course of collection 152 42,525,166
3. Miscellaneous liabilities 153 6,780,622 154 49,305,788 155 216,253,628
to be carried forward 9,125,727,989
69
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Values of the previous year
carried forward 8,321,742,743
308 32,994,208
309 3,606,839
310 59,530,267 311 96,131,314
312 4,199,845
313 81,420,906
314 6,675,428
315 13,414,935
316 0 317 101,511,269
318 821,537
319 4,634,431 320 5,455,968
321 0
322 0
323 0
324 0
325 11,425,554
326 29,141,581
327 30,564,549
328 5,646,092
329 62,393,551 330 127,745,773
331 0
332 42,059,660
333 12,426,672 334 54,486,332 335 300,624,896
to be carried forward 8,722,698,798
70 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
carried forward 9,125,727,989
H. ACCRUALS AND DEFERRED INCOME
1. Accrued interest 156 1,225,685
2. Rents 157 866,906
3. Other prepayments and accrued income 158 0 159 2,092,591
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 160 9,127,820,580
BALANCE SHEET
GUARANTEES, COMMITMENTS AND OTHER MEMORANDUM ACCOUNTS
Values of the year
GUARANTEES, COMMITMENTS AND OTHER MEMORANDUM ACCOUNTS
I - Guarantees given
1. Sureties 161 0
2. Endorsements 162 0
3. Other personal guarantees 163 0
4. Guarantees secured by mortgages 164 0
II - Guarantees received
1. Sureties 165 25,951,247
2. Endorsements 166 0
3. Other personal guarantees 167 0
4. Guarantees secured by mortgages 168 27,339,291
169 39,025,027III - Guarantees issued by third parties in the interest of the Company
IV - Commitments 170 94,189,994
171 0V - Third party assets
VI - Assets relating to pension funds managed in the name and on behalf of third parties 172 0
173 6,236,851,304VII - Securities deposited with third parties
VIII - Other memorandum accounts 174 0
71
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Values of the previous year
carried forward 8,722,698,798
336 1,298,574
337 685,846
338 0 339 1,984,420
340 8,724,683,218
Values of the previous year
341 0
342 0
343 0
344 0
345 26,404,425
346 0
347 0
348 31,851,199
349 31,032,519
350 98,172,485
351 0
352 0
353 5,790,815,505
354 0
72 REPORTS AND ACCOUNTS 2015
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INCOME STATEMENT
Values of the year
I. TECHNICAL ACCOUNT – NON-LIFE INSURANCE BUSINESS
1. PREMIUMS EARNED, NET OF REINSURANCE:
a) Gross premiums written 1 1,416,838,477
b) (-) Outward reinsurance premiums 2 138,123,680
c) Change in the gross provision for unearned premiums 3 21,623,090
d) Change in the provision for unearned premiums, reinsurers’ share 4 1,807,895 5 1,258,899,602
2. (+) ALLOCATED INVESTMENT RETURN TRANSFERRED TO THE NON-TECHNICAL ACCOUNT (Item III. 6) 6 47,643,112
3. OTHER TECHNICAL INCOME, NET OF REINSURANCE 7 19,528,775
4. CLAIMS INCURRED, NET OF RECOVERIES AND REINSURANCE
a)
8 989,265,755
Claims paid
aa) Gross amount
bb) (-) reinsurers’ share 9 88,265,966 10 900,999,789
b)
11 38,420,739
Change in recoveries, net of reinsurance
aa) Gross amount
bb) (-) reinsurers’ share 12 0 13 38,420,739
c)
14 -46,460,433
Change in the provisions for outstanding claims
aa) Gross amount
bb) (-) reinsurers’ share 15 2,737,412 16 -49,197,845 17 813,381,205
5. CHANGE IN OTHER TECHNICAL PROVISIONS NET OF REINSURANCE 18 110,642
6. PREMIUMS REFUNDS AND PROFIT-SHARING, NET OF REINSURANCE 19 0
7. OPERATING EXPENSES:
a) Acquisition commissions 20 187,300,039
b) Other acquisition costs 21 72,792,506
c) Change in commissions and other acquisition coststo be amortised 22 0
d) Collecting commissions 23 100,112,925
e) Other administrative expenses 24 71,604,861
f) (-) Reinsurance commissions and profit-sharing 25 21,516,378 26 410,293,953
8. OTHER TECHNICAL CHARGES, NET OF REINSURANCE 27 51,242,209
9. CHANGE IN THE EQUALISATION PROVISION 28 1,279,238
10. BALANCE ON THE TECHNICAL ACCOUNT FOR NON-LIFE INSURANCE BUSINESS (Item III. 1) 29 49,764,242
73
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Values of the previous year
111 1,391,846,657
112 158,341,644
113 18,669,745
114 1,010,125 115 1,215,845,393
116 38,895,149
117 16,884,134
118 994,604,782
119 116,724,529 120 877,880,253
121 47,079,521
122 0 123 47,079,521
124 -98,669,342
125 -11,848,030 126 -86,821,312 127 743,979,420
128 -641,097
129 0
130 197,534,172
131 67,859,986
132 0
133 95,494,697
134 61,078,611
135 28,305,781 136 393,661,685
137 34,827,045
138 1,327,416
139 98,470,207
74 REPORTS AND ACCOUNTS 2015
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INCOME STATEMENT
Values of the year
II. TECHNICAL ACCOUNT - LIFE INSURANCE BUSINESS
1. PREMIUMS EARNED, NET OF REINSURANCE:
a) Gross premiums written 30 813,758,844
b) (-) Outward reinsurance premiums 31 3,777,105 32 809,981,739
2. INVESTMENT INCOME:
a) From shares and interests 33 23,211,643
(of which: from Group companies 34 18,251,153 )
b)
35 0
From other investments:
aa) income from land and buildings
bb) income from other investments 134,887,859 37 134,887,85936
(of which: from Group companies 38 2,879 )
c) Value re-adjustments on investments 39 318,570
d) Gains on the disposal of investments 40 14,196,958
(of which: from Group companies 41 0 ) 42 172,615,030
3. INCOME AND UNREALISED GAINS ON INVESTMENTS TO THE BENEFIT OF POLICYHOLDERSWHO BEAR THE INVESTMENT RISK AND RELATING TO THE ADMINISTRATION OF PENSION FUNDS 43 53,788,998
4. OTHER TECHNICAL INCOME, NET OF REINSURANCE 44 7,772,311
5. CLAIMS INCURRED, NET OF REINSURANCE:
a)
45 475,596,254
Claims paid
aa) Gross amount
bb) (-) Reinsurers' share 46 2,574,844 47 473,021,410
b)
48 23,514,313
Change in the provisions for claims to be paid
aa) Gross amount
bb) (-) Reinsurers' share 49 247,252 50 23,267,061 51 496,288,471
6. CHANGE IN PROVISIONS FOR POLICY LIABILITIES AND IN OTHER TECHNICAL
PROVISIONS, NET OF REINSURANCE
a)
52 405,693,906
Provisions for policy liabilities:
aa) Gross amount
bb) (-) Reinsurers' share 53 -547,417 54 406,241,323
b)
55 22,810
Unearned premium provision for supplementary coverage:
aa) Gross amount
bb) (-) Reinsurers' share 56 0 57 22,810
c)
58 -874,968
Other technical provisionsaa) Gross amount
bb) (-) Reinsurers' share 59 0 60 -874,968
d)
61 38,266,878
Provisions for policies where the investment risk is borne by the
policyholders and relating to the administration of pension funds
aa) Gross amount
bb) (-) Reinsurers' share 62 0 63 38,266,878 64 443,656,043
75
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Values of the previous year
140 806,040,740
141 3,691,672 142 802,349,068
143 11,711,069
(of which: from Group companies 144 10,456,390 )
145 0
134,207,820 147 134,207,820146
(of which: from Group companies 148 3,154 )
149 1,610,294
150 10,489,274
(of which: from Group companies 151 0 ) 152 158,018,457
153 56,077,635
154 7,196,649
155 408,531,037
156 545,852 157 407,985,185
158 1,116,035
159 43,462 160 1,072,573 161 409,057,758
162 484,221,526
163 -82,977 164 484,304,503
165 13,620
166 0 167 13,620
168 2,180,823
169 0 170 2,180,823
171 37,719,947
172 0 173 37,719,947 174 524,218,893
76 REPORTS AND ACCOUNTS 2015
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INCOME STATEMENT
Values of the year
7. PREMIUMS REFUNDS AND PROFIT-SHARING, NET OF REINSURANCE 65 0
8. OPERATING EXPENSES:
a) Acquisition commissions 66 17,955,117
b) Other acquisition costs 67 9,636,888
c) Change in commissions and other acquisition costs
to be amortised 68 0
d) Collecting commissions 69 1,298,780
e) Other administrative expenses 70 15,407,574
(-) Reinsurance commissions and profit-sharing 71 250,187 72 44,048,172
9. INVESTMENT MANAGEMENT AND FINANCIAL CHARGES:
a) Investment management charges, including interest 73 14,688,521
b) Value adjustments on investments 74 8,976,948
c) Losses on the disposal of investments 75 269,109 76 23,934,578
10. EXPENSES AND UNREALISED LOSSES ON INVESTMENTS TO THE BENEFIT OF POLICYHOLDERS
WHO BEAR THE INVESTMENT RISK AND RELATING TO THE ADMINISTRATION
OF PENSION FUNDS 77 31,934,325
11. OTHER TECHNICAL CHARGES, NET OF REINSURANCE 78 5,542,991
12. (-) ALLOCATED INVESTMENT RETURN TRANSFERRED TO THE NON-TECHNICAL ACCOUNT (Item III. 4) 79 17,841,654
13. BALANCE ON THE TECHNICAL ACCOUNT FOR LIFE BUSINESS (Item III. 2) 80 -19,088,156
III. NON TECHNICAL ACCOUNT
1. BALANCE ON THE TECHNICAL ACCOUNT FOR NON-LIFE INSURANCE BUSINESS (Item I.10) 81 49,764,242
2. BALANCE ON THE TECHNICAL ACCOUNT FOR LIFE BUSINESS (Item II. 13) 82 -19,088,156
3. NON-LIFE INVESTMENT INCOME:
a) From shares and interests 83 23,095,866
(of which: from Group companies 84 19,582,076 )
b)
85 3,542,280
From other investments:
aa) income from land and buildings
bb) income from other investments 20,141,356 87 23,683,63686
(of which: from Group companies 88 614 )
c) Value re-adjustments on investments 89 56,985
d) Gains on the disposal of investments 90 50,678,644
(of which: from Group companies 91 0 ) 92 97,515,131
77
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Values of the previous year
175 0
176 18,535,053
177 8,330,201
178 0
179 2,509,346
180 11,884,700
181 674,253 182 40,585,047
183 13,367,108
184 488,983
185 369,309 186 14,225,400
187 21,412,964
188 4,734,066
189 19,181,994
190 -9,774,313
191 98,470,207
192 -9,774,313
193 31,500,301
(of which: from Group companies 194 26,385,852 )
195 3,171,101
23,402,638 197 26,573,739196
(of which: from Group companies 198 734 )
199 2,655,477
200 15,935,590
(of which: from Group companies 201 0 ) 202 76,665,107
78 REPORTS AND ACCOUNTS 2015
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INCOME STATEMENT
Values of the year
4. (+) ALLOCATED INVESTMENT RETURN TRANSFERRED FROM THE
TECHNICAL ACCOUNT FOR LIFE BUSINESS (Item II. 12) 93 17,841,654
5. INVESTMENT MANAGEMENT AND FINANCIAL CHARGES NON-LIFE BUSINESS:
a) Investment management charges, including interest 94 8,597,009
b) Value adjustments on investments 95 8,002,652
c) Losses on the disposal of investments 96 5,626,102 97 22,225,763
6. (-) ALLOCATED INVESTMENT RETURN TRANSFERRED TO THE NON-LIFE INSURANCE BUSINESS TECHNICAL ACCOUNT (Item I. 2) 98 47,643,112
7. OTHER INCOME 99 61,946,518
8. OTHER CHARGES 100 52,557,378
9. INCOME FROM ORDINARY OPERATIONS 101 85,553,136
10. EXTRAORDINARY INCOME 102 10,661,657
11. EXTRAORDINARY CHARGES 103 13,463,385
12. EXTRAORDINARY PROFIT OR LOSS 104 -2,801,728
13. PROFIT BEFORE TAXES 105 82,751,408
14. INCOME TAXES 106 23,340,000
15. NET PROFIT (LOSS) FOR THE YEAR 107 59,411,408
79
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Values of the previous year
203 19,181,994
204 8,232,910
205 6,448,787
206 1,736,897 207 16,418,594
208 38,895,149
209 72,251,249
210 113,509,728
211 87,970,773
212 48,615,775
213 8,912,877
214 39,702,898
215 127,673,671
216 28,910,000
217 98,763,671
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NOTES TO THE FINANCIAL STATEMENTS
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82 REPORTS AND ACCOUNTS 2015
FOREWORD
The Financial Statements at December 31, 2015:
• have been prepared according to the general provisions on the financial statements of insurancecompanies established by the Insurance Code (Legislative Decree No. 209/2005) and by the applicablearticles of Legislative Decree No. 173/97;
• comply with the provisions and schedules established by ISVAP Regulation No. 22/2008;
•
• in accordance with art. 2423 of the Italian Civil Code, the Financial Statements comprise the BalanceSheet, Income Statement and these Notes to the Financial Statements; they are accompanied by theReport on Operations.
The Notes to the Financial Statements set forth:
Part A: Valuation criteria
Part B: Information concerning the Balance Sheet and Income Statement (22 sections)
Part C: Other information
***
In financial 2015, as in previous years, no recourse was made to anti-crisis measures. The Company did not take advantage of the option, of an exceptional and transitory nature, permitted by ISVAP Regulation No. 43 of July 12, 2012 (issued in enactment of the provisions of Decree-Law No. 216 of December 29, 2011 converted by Law No. 14 of February 24, 2012), for valuation of debt instruments issued or guaranteed by EU states not intended to be held for the longer term.
***
In compliance with art. 95 of Legislative Decree No. 209/2005 and art. 19 of ISVAP Regulation No. 7 of July 13, 2007 as amended and supplemented by IVASS Measure No. 29 of January 27, 2015, the Company has prepared the consolidated financial statements at December 31, 2015 in compliance with the international accounting standards introduced by EU Regulation No. 1606 of July 19, 2002. As required, Reale Mutua has prepared the separate financial statements according to Italian GAAP and the formats required by ISVAP Regulation No. 22 of April 4, 2008.
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comply with the provisions applicable to statutory financial statements set forth in other ISVAPRegulations;
83
PART A: VALUATION CRITERIA
Accounting principles
The valuation criteria adopted comply with current regulatory provisions and refer to the principles issued by the Italian Accounting Board.The criteria adopted in preparing the 2015 financial statements are the same as those adopted in the previous year.
Business continuity
The accounts have been prepared considering continuation of company business in the next twelve months, taking into account its high net worth, which amply exceeds the minimum solvency requirements established by current regulations, and its industrial plans that forecast positive results in the next few years.
Presentation currencyThe accounts have been prepared using the euro as presentation currency; all amounts stated in the schedules and in the related Notes are rounded to the nearest thousand.
Items in foreign currency
Items denominated in foreign currency have been translated into euro at the exchange rates prevailing at year-end. The effects of such transactions, and also of those carried out on the basis of the exchange rates prevailing on the dates of the individual transactions, are recognised directly in the income statement.
OUTLINE OF THE MAIN VALUATION CRITERIA
Intangible assets
“Other multi-year expenses” reflect costs incurred for the purchase of application software. These items are booked at purchase cost including any additional charges and are amortised systematically according to their remaining possibilities of use and in any case, in a maximum period of five years.
Goodwill acquired for a valuable consideration is booked under assets and amortised systematically over a period of five years, considered consistent with presumable useful life.
Land and buildings
These items are entered at purchase or construction cost plus any incidental and financial charges.
In particular, the buildings include expenses incurred for restructuring and improvements that have effectively increased their value; the book values also include revaluations made according to the law.
Real estate rented to third parties is not depreciated in view of the Company’s policy of attentive, continuous upkeep which maintains the value of the property in time.
Property used in business operations is valued using the depreciated cost model. Depreciation is charged on a straight-line basis over the estimated residual useful life of the property at a fixed rate of 3% per year and is only applicable to the building, not to the land.
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84 REPORTS AND ACCOUNTS 2015
Long-term financial investments
In accordance with art. 15 of Legislative Decree No. 173/97 and the outline resolution of the Board of Directors in 2011 and subsequent amendments, also in compliance with ISVAP Regulation No. 36 of January 31, 2011, securities with the following characteristics have been included in this category:
• Euro-denominated bonds, listed or unlisted, that will be held to maturity or which have been acquiredfor the purpose of long-term investment, consistently with the operating-financial performance of theundertaking, including securities purchased to cover specific insurance products;
• Strategic investments;• Shares in other listed or unlisted companies (including convertible debentures), in the case of
investments useful to achieve or further Company purposes, regardless of the quota interest and/orwhich the Company intends to hold for the longer term in the case of written agreements or not.
• Securities or property funds, including closed-end and reserved funds, acquired for the purpose oflong-term investment or that will be held to maturity.
These items are booked at purchase cost, including any incidental charges, calculated according to the continuous weighted average method. For bonds, the purchase cost is adjusted by the difference between the cost of the securities and their redemption value, amortised according to the straight-line method in the period between the date of purchase and date of maturity. This value is written down in the case of permanent impairment of value. Any write-downs are reversed in subsequent years if the underlying assumptions are no longer correct.
Short-term investments
These items are carried at the lower of purchase cost, calculated according to the continuous weighted average method, and presumed realisable value according to market trends. The original cost is restored in subsequent years in the case in which the underlying reasons for the write-downs are no longer correct.
For bonds, the purchase cost is adjusted by the difference between the issue price and the redemption value, amortised according to the straight-line method in the period between the date of purchase and date of maturity.
The fair value of such investments coincides with the price recorded on the last day of trading of the year for instruments traded on an active market. In the absence of an active market, the fair value is represented by the price of recent transactions or of similar instruments or, alternatively, the values resulting from application of commonly used valuation models, that take into account the correlated risk factors and are based on market observables (e.g. cash flow discount).
Investments for the benefit of Life policyholders who bear the investment risk and relating to the
administration of pension funds
These items are stated at current value according to the following methods:
• for securities traded on regulated markets, according to the market value recorded on the last day oftrading of the year;
• for securities traded on non-regulated markets, according to the average price at which suchinvestments were traded on the last day of trading of the year or according to the value determinedby the issuer at year-end.
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85
Options on securities
Derivative contracts on hand at year-end are entered consistently with the underlying asset. In particular, premiums on options referring to securities not held as long-term investments are stated at the lower of purchase cost and the price that can be assumed according to market trends. Premiums collected or paid for options on securities of macro-class C are stated respectively under items G.VI "Miscellaneous loans and other financial liabilities" and C.III.7 "Miscellaneous financial investments". Gains or losses on trading in options are recognised in the income statement of the year in which the related sales contracts are performed.
Technical provisions of business ceded These include reinsurers' shares of technical provisions determined according to contractual reinsurance agreements, on the basis of the gross amounts of technical provisions.
ReceivablesThese items are booked at presumed realisable value in accordance with art. 16(9) of Legislative Decree No. 173/1997.
Tangible assets and stocks
Tangible assets, carried at purchase cost, are written down according to their remaining possibility of use; the following depreciation rates are applied:
from 10% to 12% for furniture and fittings;
40% for EDP equipment and peripherals, electro-mechanical and electronic office machines;
25% for cars, motor vehicles and internal handling equipment;
25% for telephone and telecommunication systems, alarm and remote control systems;
from 7.5% to 15% for lifting systems and equipment, conditioners, fittings and sundry equipment.
For purchases during the year, the rates are reduced by half to take into account their coming on stream
during the year.
Stocks are expensed during the year.
Technical provisions – Life section
The technical provisions are determined according to ISVAP Regulation No. 21 of March 28, 2008.
The provisions for policy liabilities relating to direct Life insurance risks are calculated separately for each contract according to commitments and referring to the actuarial assumptions used to calculate the premiums of existing contracts.
The mathematical provisions are never less than the surrender values.
Technical provisions include: the provision for premiums carried forward, which takes into account the fractions of pure annual premiums pertaining to the following year, the provision for health and professional additional premiums, the unearned premium provision for supplementary coverage, the provision for operating expenses determined according to the loadings for operating expenses present in the tariff rate, the additional provision.
The provision for demographic basis alignment is calculated individually using the most recent technical bases and annuity preference coefficients available at the reporting date.
The mathematical provisions also reflect the actuarial principles adopted to calculate the additional provisions on contracts with revaluable returns.
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86 REPORTS AND ACCOUNTS 2015
The provision for sums to be paid is set aside at the end of each year in a measure equal to the total amount of the sums necessary to pay principle and annuities matured, surrenders and claims to be paid.
Provisions for policies where the investment risk is borne by the policyholders and relating to the administration of pension funds
The technical provisions included in this category are determined according to the investments for which the policyholder bears the risk. For the valuation criteria of the latter, reference should be made to the section on investments.
Technical provisions – Non-life business
Provision for unearned premiums
The provision for unearned premiums comprises:
Provision for premium instalments: this is calculated for all classes of business according to the pro rata temporis method, based on gross premiums booked less acquisition commissions and other directly ascribable acquisition costs. For the risks of suretyship, hail, damages caused by natural disasters such as earthquakes, seaquakes, volcanic eruptions and related phenomena, as well as damages caused by atomic energy, the provision for premium instalments has been integrated according to the criteria defined by ISVAP Regulation No. 16/2008.
In accordance with the recent ISVAP clarification regarding the additional provision for insurance to cover damage caused by hail and other natural disasters issued on February 21, 2011, as from financial 2011 the Company only sets aside the additional provision with reference to Hail business products characterised by cover that does not expire on or before December 31 of that year.
Provision for unexpired risks: this component of the provision for unearned premiums is intended to hedge risks arising after the end of the financial year, in order to provide for all claims in connection with insurance contracts that have originated the provision for premium instalments, to the extent that the amount exceeds that of the provision for premium instalments and the premiums that will be payable on the basis of such contracts. Such provision has been calculated according to the empirical method based on projection of the forecast claims rate as established by art. 11 of ISVAP Regulation No. 16/2008.
Other technical provisions
These consist exclusively of the provision for increasing age set aside for multi-year or annual Health business contracts with the obligation of renewal on expiry, whose premiums are determined, for the entire period of coverage, according to the age of the insureds at the time of stipulating the contract. The provision for increasing age is determined analytically according to actuarial methods pursuant to art. 47 of ISVAP Regulation No. 16/2008.
Equalisation provisionThis includes provisions for the risks of natural disasters determined in accordance with Section III of ISVAP Regulation No. 16/2008.
Provision for claims outstanding
The provision for claims outstanding has been determined on the basis of a prudent estimate of loss in order to cover payment of claims incurred and not yet settled, entirely or in part, at the end of the year and related direct and claim settlement costs. The assessment was also based on projected charges to the company without taking into account the correlated financial aspects.
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87
The analytical provision for claims outstanding, taken as the basis for ultimate cost actuarial estimates, has been determined by the Group Claims Handling settlement structures referring to the investigation documents on hand at December 31 of the year, quantifying the presumable future cost of each claim through application of uniform criteria for assessment of the loss, including interest and revaluations accrued and legal expenses – in and out of court – and CTU – court-appointed technical consultants.Projections using different actuarial techniques have been made considering claims experience historical data (amounts and numbers) for each class of business and year of occurrence. In particular, the conditions of applicability of these and compliance with hypotheses regarding the business context of the company were verified beforehand. The methods adopted are well-known and widely-used in actuarial practice: Chain Ladder Paid, Chain Ladder Incurred, Inflation-adjusted Chain Ladder Paid, Bornhuetter-Ferguson Paid, Bornhuetter-Ferguson Incurred and Average Paid.While the Chain Ladder and Bornhuetter-Ferguson methods consider the process of inflation to be implicit in the historical evolution of claims data, those based on Average Paid and Inflation-Adjusted Chain Ladder Paid refer to a claims database adjusted for inflation. For TPL land vehicles and Non-motor TPL the inflation hypothesis is increased in relation to other ‘Short Tail’ classes.
The inventory provisions have been integrated in order to take into account the indications of actuarial estimates of ultimate cost, obtained using the above methods, when such estimates indicate a value greater than the inventory value.
A provision has been made for claims incurred but not reported on the reporting date (IBNR) according to the claims experience of previous years, taking into account the frequency (Chain Ladder methods on number of claims) and the average costs of late claims and the average cost of claims reported during the year.This provision reflects the ultimate cost component due to such claims (IBNR).
Inward reinsurance technical provisionsThese are stated according to communications from the Ceding companies and the adequacy of such provisions in relation to commitments assumed is also assessed.
Provisions for other risks and chargesReserves for risks and charges are intended to cover losses or specific liabilities, the existence of which is certain or probable but the amount or date of occurrence of which could not be determined at the end of the year.
PayablesThese items are booked at face value.
Employee termination indemnities
The provision for employee termination indemnities reflects the liability matured at December 31, 2006 and is calculated according to legal provisions.
Following the reform of supplementary pension funds introduced by Law No. 296/06, as of January 1, 2007, severance indemnities accruing are, as selected by each employee, paid to supplementary pension funds or transferred to the special fund set up at the INPS, stated on an accruals basis.
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88 REPORTS AND ACCOUNTS 2015
Accruals and deferrals Accruals and deferrals are stated to reflect timing differences in the respective expense and revenue items.
Guarantees, commitments and other memorandum accounts
Gross premiums written
Pursuant to art. 45 of Legislative Decree No. 173/1997, this item includes amounts maturing during the year for insurance contracts, regardless of whether these amounts have been collected or refer entirely or in part to subsequent years.
Claim settlement costs
These include all direct and common costs relating to the ascertainment, assessment, payment and management of damages charged entirely or partly to the Company. Professional consultants' fees are allocated directly to each class of business, while common expenses are allocated according to analytical accounting records.
DividendsDividends are booked in the year in which they are collected according to the related date of payment thereof.
Tax
Income taxes are determined according to the forecast tax liability for the year, in compliance with pertinent laws.
Accounting principle No. 25 of the Italian Accounting Board regarding the accounting treatment of income taxes establishes that deferred and advance taxes on the total amount of temporary differences between the value attributed to assets and liabilities according to statutory criteria and the values attributed to the same assets and liabilities for tax purposes must be stated.
Advance tax assets and benefits stemming from fiscal losses are recognised if there is a reasonable certainty of the existence of a taxable income against which the deductible temporary differences and losses that can be carried forward can be used.
Deferred tax liabilities are not recorded in the case of limited possibility that the related charge will occur.
Allocation of common Non-life and Life costs and revenues
Economic items common to both segments mainly regard personnel costs, general expenses and contributions paid to intermediaries not ascribed to a specific section. In accordance with ISVAP Regulation No. 17 of March 11, 2008, these costs are initially posted to suspense accounts, referring to the entire company management, which identify the type of cost incurred; they are then attributed, in accordance with the terms of art. 8 and art. 9 of said Regulation, to the respective Life or Non-life operating expense items and the suspense accounts are reduced to zero. Costs common to the two types of business are allocated via the analytical accounting system which permits attribution of costs according to assets on the balance sheet and by individual type of Life or Non-life business.
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These items are booked at the equivalent value of the commitments assumed or guarantees given or received.
89
Analytical accounting is based on associating each cost movement recorded in general accounting with a cost centre code indicating the entity that benefits from the expense and a “census” that records the activities carried out by such entity in relation to the Life and Non-life segments and to the destinations established by the insurance plan of accounts (settlement, acquisition, management of securities, management of real estate and other administrative expenses).
The costs are allocated to the two segments according to specific parameters for each asset on the balance sheet that reflect the measure to which each segment contributes to determining the various types of common cost and which can be summed up as follows:
other acquisition costs: allocation based on the percentage ratio of premiums written in each class to total premiums written, by applying weighting to Life premiums;
securities management: allocation based on the percentage ratio of technical provisions, Non-life and Life, to total technical provisions;
other administrative costs: allocation based on the percentage ratio of premiums written in each class to total premiums written, by applying weighting to Life premiums.
Any revenues common to the two segments are allocated according to the relationship with assets that have generated these or with the correlated costs.
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90 REPORTS AND ACCOUNTS 2015
PART B: COMMENTARY ON THE BALANCE SHEET AND INCOME STATEMENT
BALANCE SHEET ASSETS
Section 1 – Intangible assets (item B)
Intangible assets, which are made up entirely of other multi-year costs, decreased by € 72,746 thousand compared with December 31, 2014 following the transfer of the IT business unit to Reale Ites EEIG.
Changes in this item are reported in Annex 4.
Section 2 – Investments (item C)
Land and buildings
The value of land and buildings, net of accumulated depreciation, amounted to € 44,469 thousand, € 1,515 thousand more than at December 31, 2014.The types of land and buildings are listed in the table below.
Changes during the year are set forth in the table below:
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31.12.2015 31.12.2014 (in thousands of euro)
Change
Real estate used in company operations 15,595 15,995 -400 Property rented to third parties 28,874 26,959 1,915 Total 44,469 42,954 1,515 Current value 109,992 100,083 9,909
(in thousands of euro) 31.12.2015 31.12.2014
Gross initial balance (+) 54,610 51,949 Increases for purchases and upkeep expenses (+) 2,149 2,841 Decreases due to disposals (-) 180 Gross final balance (a) 56,759 54,610
Accumulated depreciation: Initial balance (+) 11,656 11,074 Depreciation for the year (+) 634 618 Decreases due to disposals (-) 36 Final balance of accumulated depreciation (b) 12,290 11,656
Carrying value (a-b) 44,469 42,954
91
The gross increases refer to the purchase of the land in Via Sarpi/Corso Agnelli in Turin for € 1,786 thousand and upkeep expenses on the Company HQ in Turin and the property in Rue de Berry in Paris for € 363 thousand.
The current value of land and buildings, set forth in Annex 4, in the amount of € 109,992 thousand, has been determined on the basis of appraisals of the buildings and land by independent professional experts in accordance with the criteria defined by art. 20 of ISVAP Regulation No. 22 as at December 31, 2013. Where for any reason the value was significantly different from that of the previous year, this was updated as at December 31, 2015 .
The market value was calculated using the equity method, based on the intrinsic and extrinsic features of the assets and their profitability. Company-specific factors not economically relevant for the market are not taken into account.
Overall, the current value of the buildings is € 65,523 thousand higher than their book value.
Investments in Group companies and other shareholdings
Shares and interests in Group companies and other shareholdings, all referring to the long-term investment portfolio, amounted to € 1,659,929 thousand with a year-on-year increase of € 76,340 thousand. The change refers entirely to the increased participation in Reale Ites EEIG through the transfer on January 1, 2015 of the IT business unit.
Annexes 5, 6 and 7 provide information regarding the investee companies and the analytical statement of changes, respectively.
The highlights of subsidiary and associated companies and other companies in which an interest is held are set forth below.
Reale Mutua holds an 85.92% interest in Reale Immobili for a book value of € 935 million. The pro-quota shareholders' equity amounts to € 740 million and is thus about € 195 million lower than the book value of the shareholding. The difference mainly arose in 2007, the year in which Reale Immobili adopted international accounting standards (IAS/IFRS) for the first time to prepare its financial statements.
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(in thousands of euro)
Type Company name Registered office
Shareholders'equity
of which profit (+) or
loss (-) for the year
Direct interest %
Pro-quota shareholders'
equity Book value
subsid. BANCA REALE SPA TURIN 61,836 2,091 95.00 58,744 40,119 subsid. BLUE ASSISTANCE SPA TURIN 4,080 457 100.00 4,080 2,511 subsid. IGAR S.A. MADRID 40,362 1,697 95.00 38,344 31,555 subsid. ITALIANA ASSICURAZIONI SPA MILAN 422,915 23,419 100.00 422,915 281,592 subsid. REALE IMMOBILI SPA TURIN 860,926 35,823 85.92 739,708 934,591 subsid. REALE ITES EEIG RMA TURIN 93,267 0 79.96 74,576 76,390
subsid. REALE SEGUROS GENERALES S.A. MADRID 490,550 30,913 95.00 466,023 252,743
subsid. REALE VIDA Y PENSIONES S.A. MADRID 8,139 52 5.00 407 610
assoc. CREDEMASSICURAZIONI SPA REGGIO EMILIA 27,687 6,511 50.00 13,844 22,136
assoc. SARA SPA ORD. ROME 542,756 80,144 27.94 151,646 12,370 assoc. SARA SPA PRIV. ROME 542,756 80,144 3.49 18,942 2,248 other CEDACRI SPA COLECCHIO 2.01 0 1,948 other SYNKRONOS ITALIA S.r.l. MILAN 19.65 0 716 other Welfare Italia Servizi Srl MILAN 2.22 0 400 Total 1,659,929
92 REPORTS AND ACCOUNTS 2015
The difference between the pro-quota shareholders' equity and the book value did not generate a reduction in the value of the shareholding in the financial statements of Reale Mutua because it was lower than the overall value of the latent gains in the values of the property owned by the subsidiary.
As far as the interest in CredemAssicurazioni is concerned, the difference between the value of the investment and the pro-quota shareholders' equity is due to the expected earnings on such investment, deriving from the industrial plan approved by the Company's Board of Directors.
Other financial investments
Other financial investments amounted to a total of € 5,573,953 thousand with a y/y increase of € 396,661 thousand.The breakdown is provided in the schedule below.
The composition of other financial investments and also the breakdown into long-term and short-term investments are provided in Annex 8. Changes in the long-term portfolio are set forth in Annex 9.
Shares and interests: amounted to € 79.139 thousand with a y/y decrease of € 42,817 thousand.
The detail of this item is as follows:
There was a y/y decrease of € 41,100 thousand in short-term shares and interests; this amount is inclusive of write-backs for € 28 thousand and value re-adjustments for € 1,806 thousand.
Long-term shares and interests decreased by € 1,717 thousand; this was due to the definition of the liquidation procedure concerning the interest in Sofigea S.r.l. for € 1,626 thousand and to the sale of the interest in CQOP SOA S.p.A. for € 91 thousand which garnered gains of € 180 thousand.
The current value at year-end was € 83,197 thousand.
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31.12.2015 31.12.2014 (in thousands of euro)
Change
Shares and interests 79,139 121,956 -42,817 Shares in common investment funds 178,684 282,338 -103,654 Bonds and other fixed-income securities 5,280,419 4,725,582 554,837 Loans 31,443 37,371 -5,928 Deposits with credit institutions 4,267 10,025 -5,758 Other financial investments 1 20 -19 Total 5,573,953 5,177,292 396,661
31.12.2015 31.12.2014 (in thousands of euro)
Change
Listed shares 58,991 105,091 -46,100 Unlisted shares 7,551 2,642 4,909 Share 12,597 14,223 -1,626 Total 79,139 121,956 -42,817 of which: Long-term portfolio 8,610 10,327 -1,717 Short-term portfolio 70,529 111,629 -41,100 Total 79,139 121,956 -42,817
93
Shares in common investment funds: amounted to € 178,684 thousand with a y/y decrease of € 103,654 thousand, entirely due to transactions in the short-term portfolio.
The current value at year-end was € 184,360 thousand.
Bonds and other fixed-income securities: amounted to € 5,280,419 thousand with an increase of € 554,837 thousand in relation to the previous year.
There was a € 495,233 thousand increase in the short-term portfolio; this was inclusive of write-backs for € 316 thousand, valuation losses for € 11,346 thousand, positive issue spreads for € 5,364 thousand and negative issue spreads for € 1,159 thousand.
The changes during the year and comparison between the carrying value and the current value of the investments in bonds and other fixed-income securities are detailed below.
Bonds and other fixed-income securities held as long-term investments reflect a y/y increase of € 59,604 thousand. The change mainly reflects the subscription of bonds to cover separately managed accounts for an equivalent value of € 59,659 thousand and the reimbursement of bonds reaching maturity for € 1,692 thousand. Other items include positive issue spreads for € 3,055 thousand, negative issue spreads for € 50 thousand, positive trading differences for € 41 thousand and negative trading differences for € 1,409 thousand.
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31.12.2015 31.12.2014 (in thousands of euro)
Change
Listed 5,259,181 4,692,535 566,646 Unlisted 21,238 33,047 -11,809 Convertible debentures 0 0 0 Total 5,280,419 4,725,582 554,837 of which: Long-term portfolio 246,028 186,424 59,604 Short-term portfolio 5,034,391 4,539,158 495,233 Total 5,280,419 4,725,582 554,837
Long-term Short-term (in thousands of euro)
Total
Initial balance 186,424 4,539,158 4,725,582 Purchases and subscriptions 59,659 3,289,043 3,348,702 Sales 0 -1,937,720 -1,937,720 Repayments -1,692 -847,494 -849,186 Reversals of write-downs 0 316 316 Value re-adjustments 0 -11,346 -11,346 Positive issue spreads 3,055 5,364 8,419 Negative issue spreads -50 -1,159 -1,209 Positive trading differences 41 20 61 Negative trading differences -1,409 -2,839 -4,248 Other changes 0 1,047 1,047 Final balance 246,028 5,034,391 5,280,419
Market value 330,236 5,457,394 5,787,630
94 REPORTS AND ACCOUNTS 2015
The most significant items according to issuer are as follows:
Loans: amounted to € 31,443 thousand and are detailed below.
Loans secured by mortgages reflect loans to employees for the purchase of housing, while the other loans include loans to employees for € 1,384 thousand, and loans to agencies for € 88 thousand. The changes during the year are set forth in Annex 10.
Deposits with credit institutions: amounted to € 4,267 thousand and consist of a number of bank passbooks opened to settle claims awaiting legal definition.
Miscellaneous financial investments: amounted to € 1 thousand (€ 20 thousand at December 31, 2014). As regards the breakdown and possible changes, reference should be made to the section entitled “Operations on derivatives and structured financial instruments”.
Deposits with ceding undertakings
The item amounted to € 5,206 thousand and the detail is as follows:
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(in thousands of euro) Issuing institute 31.12.2015 State - Italy 2,967,285 State - Germany 483,446 state - France 208,222 State - The Netherlands 140,898 State - Spain 131,863 State - Belgium 56,003 Intesa Sanpaolo 43,633 International organisations 38,211 State - Ireland 35,771 Dexia SA 34,148 Commerzbank 28,885 Unicredit 27,437 Enel 27,010
31.12.2015 31.12.2014 (in thousands of euro)
Change
Loans secured by mortgages 27,339 32,011 -4,672 Loans on policies 2,613 3,469 -856 Other loans 1,491 1,891 -400 Total 31,443 37,371 -5,928
31.12.2015 31.12.2014 (in thousands of euro)
Change
Subsidiary companies 71 86 -15 Affiliates 22 21 1 Other companies 5,113 5,651 -538 Total 5,206 5,758 -552
95
Section 3 - Investments for the benefit of Life policyholders who bear the investment risk and relating to the administration of pension funds (item D)
Investments for the benefit of Life policyholders who bear the investment risk amounted to € 473,189 thousand (€ 455,391 thousand at year-end 2014). The detail of the assets can be found in Annex 11, while Annexes 11/1, 11/2, 11/3 provide a breakdown of the assets by each type of product.
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The changes during the year according to category of assets as regards the investments of points D-I and D-II are provided in the tables below.
(in thousands of euro)
D-I
Shares in common
investment funds
Shares Bonds Other
financial inv.
Other assets/liabilities
Total
Initial balance 198,379 68,215 164,394 719 23,684 455,391
Increases during the year 254,565 31,735 149,793 867 0 436,960
ofwhich: purchases and subscriptions 247,231 26,232 149,014 689 0 423,166
upward adjustments of value and revaluations 5,709 5,093 560 66 0 11,428 other changes 1,625 410 219 112 0 2,366
Decreases during the year 227,358 31,224 146,898 927 12,755 419,162
ofwhich: sales and reimbursements 225,791 27,786 144,232 635 0 398,444
write-downs 1,550 2,628 2,643 201 0 7,022 other changes 17 810 23 91 12,755 13,696
Carrying value 225,586 68,726 167,289 659 10,929 473,189
(in thousands of euro)
D-II Shares Bonds Other
financial inv.
Other assets/liabilities Total
Initial balance 52,477 98,417 4 4,929 155,827
Increases during the year 23,188 60,843 9 748 84,788 of which: purchases and subscriptions 16,647 60,449 0 0 77,096
upward adjustments of value and revaluations 6,141 269 7 0 6,417 other changes 400 125 2 748 1,275
Decreases during the year 18,004 46,535 2 0 64,541 of which: sales and reimbursements 15,010 44,466 1 0 59,477
write-downs 2,593 2,055 0 0 4,648 other changes 401 14 1 0 416
Carrying value 57,661 112,725 11 5,677 176,074
Investments relating to the administration of pension funds amounted to € 176,074 thousand (€ 155,827 thousand at 31 December, 2014). Details of these assets can be found in annex 12 while annexes 12/1, 12/2, 12/3 and 12/4 refer to the individual pension lines.
96 REPORTS AND ACCOUNTS 2015
The assets resulting from the administration of pension funds by business line are listed in the table below:
Section 4 – Reinsurers’ share of technical provisions (item D bis)
This item amounted to € 174,368 thousand with a decrease of € 4,724 thousand in relation to the previous year, as indicated in the table below:
Section 5 – Receivables (item E)
Receivables totalled € 706,735 thousand with a decrease of € 46,352 thousand in relation to the previous year.
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(in thousands of euro) TESEO Pension Fund
Prudenziale etica
Business lines Bilanciata
etica Sviluppo
etica Garantita
etica Total
Shares and interests 0 18,586 39,075 0 57,661 Bonds and fixed-income securities 38,024 27,648 3,601 43,451 112,724 Other financial investments 0 3 8 0 11 Other assets 685 521 26 478 1,710 Cash at bank and in hand 1,359 1,253 1,228 1,744 5,584 Other liabilities -108 -526 -862 -121 -1,617 Total 39,960 47,485 43,076 45,553 176,074
31.12.2015 31.12.2014 (in thousands of euro)
Change Non-life business Provision for unearned premiums 32,169 30,967 1,202 Provision for claims outstanding 138,455 143,870 -5,415 Other 0 0 0 Total 170,624 174,837 -4,213 Life business: Provisions for policy liabilities 2,984 3,535 -551 Provision for sums to be paid 760 720 40 Technical provisions where the investment risk is borne by the policyholders and relating to the administration of pension funds 0 0 0 Other 0 0 0 Total 3,744 4,255 -511
Total technical provisions 174,368 179,092 -4,724
31.12.2015 31.12.2014 (in thousands of euro)
Change
Receivables arising out of direct insurance operations 475,065 483,440 -8,375 Receivables arising out of reinsurance operations 60,027 89,883 -29,856 Other receivables 171,643 179,764 -8,121 Total 706,735 753,087 -46,352
97
Receivables arising out of direct insurance operations
Receivables arising out of reinsurance operations
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31.12.2015 31.12.2014 (in thousands of euro)
Change
Premiums receivable from policyholders 188,817 191,769 -2,952 Insurance intermediaries 208,847 205,302 3,545 C/a with companies 23,233 36,728 -13,495 Policyholders and third parties for recoveries 54,168 49,641 4,527 Total 475,065 483,440 -8,375
Receivables from policyholders for premiums amounted to € 188,817 thousand (of which € 148,986 thousand relating to Non-life business and € 39,831 thousand to Life business). These items are shown net of the allowance for doubtful accounts of € 16,167 thousand (€ 15,971 thousand relating to Non-life business and € 196 thousand relating to Life operations). The write-down was determined according to the ratio of cancellations for non-collection to total receivables and represents estimated future losses for cancellations of receivables from policyholders.
The allowance for doubtful accounts mainly refers to Accident business for € 1,754 thousand, Health for € 577 thousand, Fire for € 2,381 thousand, Other property damage for € 1,949 thousand, TPL land vehicles for € 726 thousand, Non-motor TPL for € 3,455 thousand and Suretyship for € 4,804 thousand.
Receivables collected in the first two months of the current year amounted to € 102,748 thousand.
With the entry into force of the so-called "Decreto Sviluppo-bis", converted into Law on December 31, 2012, which abolished tacit renewal clauses in Motor TPL policies, receivables in the Motor sector consist exclusively of premium instalments due but not yet paid as at December 31.
The Insurance intermediaries item amounted to € 208,847 thousand, with a y/y increase of € 3,545 thousand.
Current accounts with insurance companies, net of the related allowance, amounted to € 23,233 thousand, with a y/y decrease of € 13,495 thousand. This entry mainly comprises receivables linked to co-insurance contracts, positive entries relating to the CARD convention and invoices for amounts due for services rendered. The allowance for doubtful accounts amounted to € 1,667 thousand and is stated as adjusting receivables from companies in compulsory receivership deriving from co-insurance relationships.
Insured and third parties for recoveries amounted to € 54,168 thousand (referring entirely to Non-life business) compared with € 49,641 thousand in the previous year.
31.12.2015 31.12.2014 (in thousands of euro)
Change
Insurance and Reinsurance companies 59,168 88,509 -29,341 Reinsurance intermediaries 859 1,374 -515 Total 60,027 89,883 -29,856
The gross value of receivables arising out of reinsurance operations, equal to € 60,821 thousand, has been prudently adjusted by the amount of € 794 thousand, taken to the allowance for doubtful accounts to cover losses relating to certain reinsurers.
98 REPORTS AND ACCOUNTS 2015
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The decrease in receivables from insurance and reinsurance companies was mainly due to the reduction in the Fire reinsurance treaty (from 25% to 15%), which generated a reduction in receivables linked to the contractual application of the portfolio withdrawal. Also at December 31, 2014 there was one credit item linked to a major claim in the Fire business.
Other receivables
The detail of other receivables is set forth in the table below:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Receivables from Tax Authorities 131,116 146,333 -15,217 Receivables from claims paid in the name and on behalf 6,414 8,342 -1,928 Receivables from personnel management 1,104 1,001 103 Subsidiaries 5,598 7,265 -1,667 Miscellaneous receivables 27,411 16,823 10,588 Total 171,643 179,764 -8,121
Receivables from Tax Authorities include receivables for withholding tax, advance taxes on mathematical provisions, advance premium taxes in the Non-life business and tax credits for which reimbursement has been requested with the related interest accrued on such amounts. Note that the decrease in this item mainly reflects the partial reimbursement of the credit amount recorded following the agreement between Reale Mutua and the Tax Office in Turin in connection with the objections raised concerning the 2006 tax year.
Receivables from subsidiaries fell by € 1,667 thousand and mainly refer to revenues from services furnished to Group companies and receivables under the Group fiscal consolidation scheme.
Section 6 – Other assets (item F)
31.12.2015 31.12.2014 (in thousands of euro)
Change
Tangible assets and stocks 13,212 16,339 -3,127 Cash at bank and in hand 88,031 59,646 28,385 Other assets 160,412 169,175 -8,763 Total 261,655 245,160 16,495
Other assets totalled € 261,655 thousand with a y/y increase of € 16,495 thousand.
99
At year-end, the connection account showed a Life business credit balance of € 50 thousand. The amount is booked for the same amount under “other liabilities” of Non-life business. Deferred tax assets are stated considering the reasonable certainty of future recovery.
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Tangible assets and stocks
This item amounted to € 13,212 thousand, net of the related accumulated depreciation. A breakdown of movements on this item is provided in the table below.
(in thousands of euro) Furniture, office
machines and internal
transport vehicles
Vehicles listed in public registers
Machinery and
equipment Total
Gross initial balance (+) 63,823 38 47,824 111,685 Increases during the year (+) 1,025 0 1,522 2,547 Decreases due to disposals (-) 32,327 38 0 32,365 Gross final balance (a) 32,521 0 49,346 81,867
Accumulated depreciation: Initial balance (+) 58,172 33 37,142 95,347 Depreciation for the year (+) 978 0 3,278 4,256 Decreases due to disposals (-) 30,915 33 0 30,948 Final balance of accumulated depreciation (b) 28,235 0 40,420 68,655
Carrying value (a-b) 4,286 0 8,926 13,212
Cash at bank and in hand
This item amounted to € 88,031 thousand compared with € 59,646 thousand in 2014 and consists of bank and postal accounts for € 88,028 thousand and cash on hand for € 3 thousand.
31.12.2015 31.12.2014 (in thousands of euro)
Change
Bank and Postal accounts 88,028 59,643 28,385 Cheques and cash on hand 3 3 0 Total 88,031 59,646 28,385
Other assets
This item amounted to € 160,412 thousand with a decrease of € 8,763 thousand in relation to the previous year. The breakdown of this item is as follows:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Payment of premiums to be collected in subsequent years 48,164 46,021 2,143 Non-life/Life connection account 50 23 27 Deferred tax assets 88,509 96,765 -8,256 Claims paid to be combined 962 852 110 Other assets 22,727 25,514 -2,787 Total 160,412 169,175 -8,763
Other assets comprise payments to the financial counterparty by way of guarantee on value variations on interest rate swap contracts with the latter for € 17,330 thousand and mandate discontinuation indemnities paid while awaiting debiting to incoming agents for € 4,951 thousand.
100 REPORTS AND ACCOUNTS 2015
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Section 7 – Prepayments and accrued income (item G)
Prepayments and accrued income amounted to € 52,169 thousand with a decrease of € 1,546 thousand in relation to the previous year. The breakdown of this item is as follows:
Accrued interest refers mainly to interest matured on the coupons of debt securities. The deferred payments refer mostly to various invoices payable. The duration of all prepayments and accrued income is less than one year.
Assets: subordination clauses For the detail of assets characterised by subordination clauses, reference should be made to the section concerning operations on derivatives and structured financial instruments – Part C.
31.12.2015 31.12.2014
(in thousands of euro) Change
Accrued interest 52,134 53,230 -1,096 Other prepayments and accrued income 35 485 -450 Total 52,169 53,715 -1,546
101
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BALANCE SHEET - LIABILITIES AND SHAREHOLDERS' EQUITY
Section 8 – Shareholders’ equity (item A)
Company shareholders’ funds amounted to € 1,849,221 thousand compared with € 1,789,810 thousand in the previous year.
31.12.2015 31.12.2014 (in thousands of euro)
Change
Share capital or Guarantee fund 60,000 60,000 0 Revaluation reserves 136,223 136,223 0 Legal reserve 207,537 202,599 4,938 Other reserves 1,386,050 1,292,224 93,826 Net profit (loss) for the year 59,411 98,764 -39,353 Total 1,849,221 1,789,810 59,411
The schedule illustrating changes in shareholders’ funds for the years ended December 31, 2014 and 2015 are set forth below.
(in thousands of euro)
Guarantee fund
Revaluation reserves
Legal reserve
Other reserves
Net profit (loss) for the
year
Total shareholders' equity
Balances at 1/1/2014 60,000 136,223 198,186 1,208,383 88,254 1,691,046
Allocation of 2013 net profit as resolved by the Meeting of April 29, 2014
0 0 4,413 83,841 -88,254 0
Result for the year 0 0 0 0 98,764 98,764 Balances at 31/12/2014 60,000 136,223 202,599 1,292,224 98,764 1,789,810
Allocation of 2014 net profit as resolved by the Meeting of April 28, 2015
0 0 4,938 93,826 -98,764 0
Result for the year 0 0 0 0 59,411 59,411 Balances at 31/12/2015 60,000 136,223 207,537 1,386,050 59,411 1,849,221
Guarantee fund
The guarantee fund amounted to € 60,000 thousand.
102 REPORTS AND ACCOUNTS 2015
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Revaluation reserves
Revaluation reserves amounted to € 136,223 thousand. The detail is as follows:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Revaluation reserve under Law No. 576 of Dec. 2, 1975 51,700 51,700 0 Revaluation reserve under Law No. 413 of Dec. 30, 1991 82,958 82,958 0 Integration Fund under art. 36 of Law No. 295 of June 10, 1978 1,565 1,565 0 Total 136,223 136,223 0
Other reserves
Other reserves amounted to € 1,386,050 thousand. The detail is as follows:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Ordinary reserve fund 1,377,405 1,283,579 93,826 Extraordinary reserve 1,931 1,931 0 Money accounts adjustment fund 6,714 6,714 0 Total 1,386,050 1,292,224 93,826
Schedule of availability and utilisation of shareholders’ equity items pursuant to art. 2427 of the Italian Civil Code
(in thousands of euro) Utilisations in the previous three
years
31.12.2015 Possibility
of utilisation
Available portion
to cover losses for other reasons
Guarantee fund 60,000 0 0 0 Revaluation reserve 136,223 A,B 136,223 0 0 Legal reserve 207,537 B 0 0 0 Other reserves: - Ordinary reserve fund 1,377,405 A,B 1,377,405 0 0 - Extraordinary reserve 1,931 A,B 1,931 0 0 - Reserve fund for alignment of numeric values 6,714 A,B 6,714 0 0 Total other reserves 1,386,050 1,386,050 Total 1,789,810 1,522,273 LEGEND: A: for share capital increase B: to cover losses C: for distribution to shareholders
Section 9 – Subordinated liabilities (item B)
No liabilities are stated in this section.
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Section 10 – Technical provisions (item C.I – Non-life business and C.II – Life business)
31.12.2015 31.12.2014 (in thousands of euro)
Change
Provision for unearned premiums 645,119 623,471 21,648 Provision for claims outstanding 1,778,039 1,824,504 -46,465 Other technical provisions 749 639 110 Equalisation provision 10,535 9,256 1,279 Total Non-life business 2,434,442 2,457,870 -23,428 Provisions for policy liabilities 3,805,355 3,400,474 404,881 Unearned premium prov. for suppl. coverage 171 148 23 Provision for sums to be paid 72,514 49,000 23,514 Provisions for profit-sharing and premium refunds 0 0 0 Other technical provisions 10,734 11,609 -875 Total Life business 3,888,774 3,461,231 427,543 Total technical provisions 6,323,216 5,919,101 404,115
Non-life business
Non-life business technical provisions amounted to € 2,434,442 thousand with a y/y decrease of € 23,428 thousand.
The provision for unearned premiums amounted to a total of € 645,119 thousand. The provision for unearned premiums of direct business only amounted to € 644,775 thousand and comprises the provision for premium instalments, equal to € 644,668 thousand, and the provision for unexpired risks of € 107 thousand.
(in thousands of euro)
Inward reinsurance Direct business Prov. for prem. instalments and
prov. for cat. risks
Unexpired risks
Provision for premium
instalments Unexpired
risks
Total
Accident 65,688 0 0 0 65,688 Health 51,395 0 0 5 51,400 Hulls land vehicles 33,319 0 0 0 33,319 Hulls railway rolling stock 3 1 0 0 4 Hulls aircraft 1 0 0 0 1 Hulls marine, lake, river craft 988 106 1 0 1,095 Goods transported 1,405 0 6 3 1,414 Fire and natural forces 93,037 0 0 103 93,140 Other property damage 106,376 0 26 0 106,402 TPL land vehicles 149,773 0 4 0 149,777 TPL aircraft 20 0 0 0 20 TPL marine, lake, river craft 515 0 0 0 515 Non-motor TPL 90,347 0 98 0 90,445 Credit 4 0 0 0 4 Surety 41,813 0 98 0 41,911 Sundry pecuniary losses 1,182 0 0 0 1,182 Legal fees 4,432 0 0 0 4,432 Assistance 4,370 0 0 0 4,370 Total 644,668 107 233 111 645,119
Annex 13 shows the change in the provision for unearned premiums in relation to the previous year.
104 REPORTS AND ACCOUNTS 2015
The provision for outstanding claims amounts to € 1,778,039 thousand and in addition to the provision for reimbursements also includes the provision for direct expenses, the provision for claim settlement costs and the provision for claims incurred and not notified.The various components of the provision for unearned premiums and the provision for outstanding claims are set forth in Annex 13.With regard to the methods used to determine the provision for outstanding claims, reference should be made to the valuation criteria illustrated in Part A of these Notes.A breakdown of this item and also of the changes in relation to 2014 is provided in Annex 13. Other technical provisions amounted to € 749 thousand with a year-on-year increase of € 110thousand. These include only the Health business provision for increasing age set up in accordance with ISVAP Regulation No. 16/2008 according to technical-actuarial methods pursuant to art. 47 of this Regulation.
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The provision for premium instalments has been calculated according to the pro-rata temporis method and comprises the further provisions established by ISVAP Regulation No. 16/2008 for the risks of suretyship, hail, damages caused by natural disasters such as earthquakes, seaquakes, volcanic eruptions and related phenomena and damages caused by atomic energy. As described in the valuation criteria, an assessment has been made of the need to accrue provisions for risks in course, comparing the aggregate consisting of the provision for premium instalments and premiums that will fall due on contracts stipulated before the end of the year and the expected charge for reimbursements and expenses arising on such contracts. In quantifying this liability, reference was made to the calculation model based on the ratio of claims to premiums earned for the year of current generation only, adjusted if necessary in the case of exceptional and therefore statistically distorting events, according to the general approach suggested by the Supervisory Authority. According to the results of the model adjusted as above, the provision for claims outstanding has been integrated for a total amount of € 1 thousand for the Hulls railway rolling stock and Hulls marine, lake and river craft businesses. In the other sectors of Non-life business, the positive trend of current generation claims confirms the adequacy of the provision made with the pro-rata component only of the provision for unearned premiums.
The values for each class of business are set forth below: (in thousands of euro)
Forecast claims %* Forecast claims amount
Provision for premium
instalments + instalments due
Surplus / insufficiency of
reserve
Accident 66.1% 29,107 44,051 14,944 Health 88.3% 49,327 55,855 6,528 Hulls land vehicles 76.9% 32,711 42,536 9,825 Hulls railway rolling stock 133.8% 5 3 -1 Hulls aircraft 0.0% 0 3 3 Hulls marine, lake, river craft 110.4% 1,124 1,018 -106 Goods transported 54.8% 1,035 1,888 853 Fire and natural forces 71.5% 70,437 98,468 28,031 Other property damage 80.1% 77,911 97,286 19,375 TPL land vehicles 88.3% 180,585 204,550 23,964 TPL aircraft 46.2% 10 21 11 TPL marine, lake, river craft 88.9% 459 516 57 Non-motor TPL 76.4% 79,379 103,849 24,470 Suretyship 59.6% 14,312 23,997 9,686 Sundry pecuniary losses 41.2% 599 1,455 855 Legal fees 56.1% 2,898 5,168 2,270 Assistance 73.1% 4,025 5,503 1,478 Total 80.0% 543,923 686,165 142,242 * equal to the ratio of claims to premiums of the current year calculated net of acquisition costs
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Equalisation provisions amounted to € 10,535 thousand with a year-on-year increase of € 1,279 thousand. These are determined in accordance with section III of ISVAP Regulation No. 16/2008; the table below provides the detail by type of business of the provisions and related allocations.
31.12.2015 31.12.2014 (in thousands of euro)
Change
Accident 938 877 61 Hulls land vehicles 2,467 2,265 202 Goods transported 284 272 12 Fire and natural forces 1,201 822 379 Other property damage 5,527 4,909 618 Other business 118 111 7 Total 10,535 9,256 1,279
Life business
Life business technical provisions amounted to € 3,888,774 thousand with a y/y increase of € 427,543 thousand.
Mathematical provisions, in the amount of € 3,805,355 thousand, comprise the provision for pure premiums of € 3,738,224 thousand, the fractions of premiums relating to contracts with annual payment of the premiums for € 11,270 thousand, integration provisions for € 47,599 thousand and the additional provisions for mortality risk relating to index-linked or pension fund contracts of € 8,262 thousand. The integration provisions comprise provisions for demographic risk for € 25,524 thousand and additional provisions for financial risk for € 22,075 thousand. The latter comprise additional provisions for guaranteed interest rate risks for € 19,495 thousand, calculated in accordance with ISVAP Regulation No. 21 of March 28, 2008 using Method B “Additional provision for single level of financial guarantee – offsetting between annual periods” described in Annex 2 to the Regulation. The breakdown and changes in this item are detailed in Annex 14.
The unearned premium provision for supplementary coverage amounted to € 171 thousand.
The provision for sums to be paid amounted to € 72,514 thousand with a y/y increase of € 23,514 thousand.
Other technical provisions amounted to € 10,734 thousand, decreasing by € 875 thousand in relation to 2014. These consist entirely of the provision for future charges, determined according to art. 31 of ISVAP Regulation No. 21 of March 28, 2008. In particular, for contracts where the representative assets of the technical provisions are valued according to purchase price, the provisions for future charges are calculated according to art. 34 of the aforesaid Regulation. The detail by class is set forth in the table below.
31.12.2015 31.12.2014 (in thousands of euro)
Change
Class I 4,798 5,512 -714 Class IV 3 2 1 Class V 5,912 6,095 -183 Total 10,734 11,609 -875
106 REPORTS AND ACCOUNTS 2015
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Section 11 – Provisions for policies where the investment risk is borne by the policyholders and relating to the administration of pension funds (item D)
Provisions relating to contracts linked to investment funds and market indices
These amounted to € 457,035 thousand and are detailed below:
Products 31.12.2015 31.12.2014 (in thousands of euro)
Change
Contracts linked to the value of shares of internal funds 473,184 455,186 17,998 Contracts linked to share indices or other reference values 0 0 0 Inward reinsurance 1,851 1,826 25 Total 475,035 457,012 18,023
Provisions relating to the administration of pension funds
This item amounted to € 176,065 thousand and refers entirely to the Teseo open pension fund which comprises four investment lines.
Fund lines 31.12.2015 31.12.2014 (in thousands of euro)
Change
Linea prudenziale 39,959 34,931 5,029 Linea bilanciata 47,483 42,836 4,647 Linea sviluppo 43,073 38,534 4,539 Linea garantita 45,549 39,521 6,029 Total 176,065 155,822 20,243
With regard to the personal pension funds established by art. 13(1)(a) and (b) of Legislative Decree No. 252 of December 5, 2005, no new products were created during the year.
Section 12 – Provisions for other risks and charges (item E)
The detail of provisions for other risks and charges and of the changes in relation to the previous year are set forth in the schedule below and analytically in Annex 15.
31.12.2015 31.12.2014 (in thousands of euro)
Change
Provisions for pensions and similar obligations 32,056 32,994 -938 Provisions for taxation 407 3,607 -3,200 Other provisions 49,760 59,531 -9,771 Total 82,223 96,132 -13,909
The provision for pensions and similar obligations consisted for € 17,343 thousand of the Office Staff and Executives Company Supplementary Pension Fund and for € 14,713 thousand of the provision for payment of indemnities on discontinuation of the agency relationship and for the part not subject to recoveries.
The provision for taxation, in the amount of € 407 thousand, reflects the provision to cover tax assessments relating to tax period 2005.
107
Other provisions amounted to € 49,760 thousand and comprise the following:
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The provision under art. 7 of Legislative Decree No. 576 of September 26, 1978 was used in full following the definition of the liquidation procedure concerning the interest in Sofigea S.r.l.
The provisions for future risks and charges amounted to € 49,760 thousand. The changes reflected utilisations for € 22,942 thousand and allocations for € 15,436 thousand. The allocations mainly refer to expenses relating to employees for € 9,162 thousand; the latter are almost entirely in connection with the renewal of the National Collective Bargaining Agreement and charges in connection with the Company's incentive scheme. This item also includes allocations in connection with litigation with intermediaries for € 955 thousand and in connection with the "My Net. Blue" scheme, as referred to in the Report on Operations, for € 1,700 thousand.
Deposits received from reinsurers (item F)
These items amounted to € 3,716 thousand and represent liabilities for deposits held by the Company against outward reinsurance treaties. There was a decrease in this item during the year of € 484 thousand.
Section 13 – Payables and other liabilities (item G)
Payables and other liabilities totalled € 216,253 thousand compared with € 300,626 thousand in 2014.
(in thousands of euro) 31.12.2015 31.12.2014 Change
Payables arising out of direct insurance operations 70,560 101,511 -30,951 Payables arising out of reinsurance operations 4,177 5,456 -1,279 Provisions for employee termination indemnities 9,592 11,426 -1,834 Other payables 82,618 127,746 -45,128 Other liabilities 49,306 54,487 -5,181 Total 216,253 300,626 -84,373
Payables arising out of direct insurance operations
Payables arising out of direct insurance operations comprise the following items:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Insurance intermediaries 50,874 81,421 -30,547 Current accounts with Insurance companies 6,944 6,675 269 Premium deposits and premiums due to policyholders 12,742 13,415 -673 Total 70,560 101,511 -30,951
31.12.2015 31.12.2014 (in thousands of euro)
Change
0 1,626 -1,626 Provision under art. 7 Legislative Decree No. 576 of Sept. 26, 1978 Provision for future risks and charges 49,760 57,905 -8,145 Total 49,760 59,531 -9,771
108 REPORTS AND ACCOUNTS 2015
Payables arising out of reinsurance operations
Miscellaneous liabilities include deferred tax liabilities for € 3,813 thousand.
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31.12.2015 31.12.2014 Change
Insurance and Reinsurance companies 1,111 822 289 Reinsurance intermediaries 3,066 4,634 -1,568 Total 4,177 5,456 -1,279
Provisions for employee termination indemnities
This item amounted to € 9,592 thousand at December 31, 2015. Changes during the year are detailed in Annex 15.
Other payables
This item amounted to € 82,618 thousand compared with € 127,746 thousand at December 31, 2014 and is detailed as follows:
(in thousands of euro)
31.12.2015 31.12.2014 (in thousands of euro)
Change
Premium taxes 30,134 29,141 993 Payables for miscellaneous taxes 3,083 30,565 -27,482 Social security 5,168 5,646 -478 Miscellaneous payables 44,233 62,394 -18,161 Total 82,618 127,746 -45,128
Other tax liabilities moved from € 30,565 thousand in the previous year to € 3,083 thousand. Payables for income tax for the year were almost entirely offset by advance tax payments during the year. Miscellaneous payables amounted to € 44,233 thousand and comprise:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Payables to suppliers 14,956 29,484 -14,528 Payables relating to personnel management 10,868 10,629 239 Payables to subsidiaries 4,577 4,676 -99 Other payables 13,832 17,605 -3,773 Total 44,233 62,394 -18,161
The Subsidiaries item mainly reflects intra-group services.
Other liabilities
31.12.2015 31.12.2014 (in thousands of euro)
Change
Commissions for premiums in course of collection 42,525 42,060 465 Miscellaneous liabilities 6,781 12,427 -5,646 Total 49,306 54,487 -5,181
109
Section 14 – Accruals and deferred income (item H)
Accruals and deferred income amounted to € 2,093 thousand and mainly refer to cash flows on two interest rate swap contacts for a total amount of € 1,226 thousand and prepayments on lease fees.
Further details are provided in "Operations on derivative and structured financial instruments”.
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Section 15 – Assets and liabilities relating to Group companies and other shareholdings
The main intra-group relationships, excluding equity investments, are set forth in the table below.
For more complete information, reference should be made to Annex 16 which illustrates assets and liabilities relating to Group companies and other shareholdings.
Assets Subsidiaries Affiliated companies
Other related parties
(in thousands of euro)
Total
Deposits with ceding undertakings 71 22 0 93 Investments relating to contracts linked to investment funds and market indices 11,554 0 0 11,554 Receivables arising out of direct insurance operations 0 501 0 501 Receivables arising out of reinsurance operations 8 0 0 8 Other receivables 5,598 19 0 5,617 Bank and Postal accounts 63,099 0 0 63,099 Total 80,330 542 0 80,872
Investments relating to contracts linked to investment funds and market indices mainly refer to current accounts at the Banca Reale S.p.A. subsidiary.
Other receivables, amounting to € 5,598 thousand, refer to receivables under the fiscal consolidation scheme from the Reale Immobili subsidiary for € 1,082 thousand and from Blue Assistance for € 141 thousand, and receivables from Group companies for services for € 4,372 thousand.
Liabilities Subsidiaries Affiliated companies
Other related parties
(in thousands of euro)
Total
Payables arising out of direct insurance operations 1,663 0 0 1,663 Payables arising out of reinsurance operations 280 397 0 677 Miscellaneous payables 4,577 0 1 4,578 Miscellaneous liabilities 0 4 0 4 Total 6,520 401 1 6,918
Miscellaneous payables refer to payables under the fiscal consolidation scheme to the Italiana Assicurazioni subsidiary for € 703 thousand and to Banca Reale for € 1,070 thousand, to amounts due for services provided by Italiana Assicurazioni for € 7 thousand, Banca Reale for € 350 thousand, Blue Assistance for € 1,091 thousand, Reale Immobili for € 883 thousand and Reale Ites EEIG for € 474 thousand.
In 2015 there were no assets relating to other related parties. Liabilities relating to other related parties regarded bills to be paid to members of the Board of Auditors for € 1 thousand.
110 REPORTS AND ACCOUNTS 2015
Section 16 – Payables and receivables
Section 17 - Guarantees, commitments and other memorandum accounts
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These items are stated under items C and E of assets and under items F and G of liabilities and fall due as follows:
(in thousands of euro) above 12 months of which above 5 years
Investments 27,571 17,798 Receivables 80,994 33,016
Payables and other liabilities 8,359 1,398 Total 116,924 52,212
Investments falling due above 12 months mainly refer to loans granted to employees for the purchase of housing and to loans on life policies. Receivables mainly consist of claims towards agents and receivables from the Tax Authority.
Payables and other liabilities mainly comprise liabilities for deferred taxes.
31.12.2015 31.12.2014 Change
Guarantees given: - sureties given to subsidiaries and associated companies 0 0 0 Guarantees received: - guarantees secured by mortgages 27,339 31,851 -4,512 - sureties given by third parties 25,951 26,404 -453 Guarantees issued by third parties in the interest of the Company: 0 - CARD/SISCO consortium and third party sureties 39,025 31,033 7,992 Commitments 0 - derivative products 94,190 98,172 -3,982
Securities deposited with third parties 6,236,851 5,790,815 446,036
Total 6,423,356 445,081
Guarantees received, for € 53,290 thousand, comprise bank guarantees given by agents and guarantees secured by mortgages on housing loans granted to employees.
Guarantees issued by third parties in the interest of the company, for € 39,025 thousand, include bank guarantees issued to Consap and ANIA in relation to the interest of Reale Mutua in the CARD and SISCO Consortiums and bank guarantees issued to public authorities for participation in tenders.
Commitments, in the amount of € 94,190 thousand, refer to derivative contracts as discussed in more detail in the specific section “Operations on derivatives and structured financial instruments”.
(in thousands of euro)
5,978,275
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Company securities deposited with third parties totalled € 6,236,851 thousand compared with € 5,790,815 thousand in 2014, and are divided as follows according to the entity with which they are deposited:
31.12.2015 31.12.2014 (in thousands of euro)
Change
Subsidiary credit institutions 5,943,780 5,525,645 418,135 Other credit institutions 207,424 216,068 -8,644 Associated companies 36,754 36,754 0 Other companies 48,893 12,348 36,545 Total 6,236,851 5,790,815 446,036
112 REPORTS AND ACCOUNTS 2015
INCOME STATEMENT
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Section 18 – Information relating to the technical account of Non-life insurance business (I)
Premiums earned, net of reinsurance
Gross premiums earned amounted to € 1,250,787 thousand and are divided as follows:
2015 2014 (in thousands of euro)
Change
Direct business income 1,413,636 1,388,580 25,056 Inward reinsurance income 3,202 3,267 -65 Gross premiums written 1,416,838 1,391,847 24,991 Premiums ceded and retroceded in reinsurance -138,124 -158,342 20,218 Change in the gross provision for unearned premiums -21,623 -18,670 -2,953
1,808 1,010 798 Change in the provision for unearned premiums, reinsurers' share Total premiums earned 1,258,899 1,215,845 43,054
The detail of gross premiums written by class of business is provided in the Report on Operations.
Allocated investment return transferred from the non-technical accountThe allocated investment return transferred from the non-technical account, in the amount of € 47,643 thousand, has been calculated according to the method determined by ISVAP with a specific measure.
The breakdown of the amount to be transferred is shown in the table below: (in thousands of euro)
2015
Income from investments – Non-life business 1 97,515 Investment management and financial charges – Non-life business 2 22,226 NET PROFIT FROM INVESTMENTS 3=1-2 75,289 Technical provisions of the Non-life business year N-1 4 2,457,870 Reinsurers' share of Non-life technical provisions year N-1 5 174,837 Technical provisions of the Non-life business year N 6 2,434,443 Reinsurers' share of Non-life technical provisions year N 7 170,624 HALF-SUM OF THE TECHNICAL PROVISIONS 8=((4-5)+(6-7))/2 2,273,426 Shareholders’ equity year N-1 9 1,291,090 Shareholders’ equity year N 10 1,346,955 HALF-SUM OF SHAREHOLDERS’ EQUITIES 11=(9+10)/2 1,319,022 RATIO BETWEEN SHAREHOLDERS' EQUITIES AND HALF-SUM OF TECHNICAL PROVISIONS + SHAREHOLDERS' EQUITIES 12=8/(8+11) 63.3% ALLOCATED INVESTMENT RETURN TO BE TRANSFERRED TO THE TECHNICAL ACCOUNT 13=12*3 47,643
Other technical income net of reinsurance
Other technical income of € 19,529 thousand reflects commissions and discounts relating to prior year premiums cancelled during the year for € 6,022 thousand, utilisation of the allowance for doubtful accounts receivable from policyholders for € 13,035 thousand, and miscellaneous technical items for € 472 thousand.
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Claims incurred, net of recoveries and reinsurance
Claims for the year amounted to € 813,382 thousand and are divided as follows:
2015 2014 (in thousands of euro)
Change
Gross claims paid 989,266 994,605 -5,339 Reinsurers' share -88,265 -116,724 28,459 Change in refunds: gross amount -38,421 -47,080 8,659 Change in the gross provision for outstanding claims -46,461 -98,670 52,209 Reinsurers' share -2,737 11,848 -14,585 Total 813,382 743,979 69,403
Gross claims paid decreased by 0.54% from € 994,605 thousand to € 989,266 thousand and are divided as follows:
2015 2014 (in thousands of euro)
Change
Compensation 861,810 874,979 -13,169 Direct expenses 19,654 18,045 1,609 Claim settlement costs 96,501 89,973 6,528 Road Victims Fund 11,301 11,608 -307 Total 989,266 994,605 -5,339
The development of claims for previous years generated a positive balance of € 84.327 thousand, equal to around 4.6% of the initial reserves, as a result of the prudent quantification required by law. As regards performance of the individual classes of business, the Other property damage, TPL land vehicles and Non-motor TPL lines posted a significant surplus, due to the particularly favourable run-off of technical reserves during the year, to be ascribed to good savings on payments, a considerable amount reserved for claims without follow-up and the lower number of claims re-opened.
Change in other technical provisions net of reinsurance
The change of € 111 thousand refers entirely to the provision for increasing age pursuant to art. 25 of Legislative Decree 175/95.
Management costs
Management costs amounted to € 410,295 thousand and are detailed as follows:
2015 2014 (in thousands of euro)
Change
Acquisition commissions 187,300 197,534 -10,234 Other acquisition costs 72,793 67,860 4,933 Collecting commissions 100,113 95,495 4,618 Other administrative expenses 71,605 61,079 10,526 Reinsurance commissions and profit-sharing -21,516 -28,306 6,790 Total 410,295 393,662 16,633
Other administrative expenses comprise the payments made to Reale Ites EEIG to enable it to carry out its IT activities starting from January 1, 2015. The increase is due to the component of said payments regarding the share of amortisation of intangible assets previously booked under "other charges".
114 REPORTS AND ACCOUNTS 2015
Reinsurance commissions and profit-sharing in the amount of € 21,516 thousand refer entirely to commissions paid to reinsurers.
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Other technical charges, net of reinsurance
Other technical charges amounted to € 51,242 thousand and mainly reflect cancellations of prior year premiums for € 29,186 thousand, accrual to the allowance for doubtful accounts receivable from policyholders for € 13,933 thousand, and miscellaneous technical items for € 6,498 thousand.
Change in the equalisation provision
The € 1,279 thousand change reflects the provision established pursuant to art. 44 of ISVAP Regulation No. 16 of March 4, 2008. The components per business line of the provision and related allocations are set forth in section 10.
For information on the Non-life business technical account, please see Annexes 19, 25, 26 and 29.
115
Section 19 - Information regarding the technical account of Life insurance business (II)
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Premiums earned, net of reinsurance
Premiums earned amounted to € 809,982 thousand. A breakdown is provided below:
2015 2014 (in thousands of euro)
Change
Direct business income 813,448 806,036 7,412 Inward reinsurance income 311 5 306 Gross premiums written 813,759 806,041 7,718 Premiums ceded and retroceded in reinsurance -3,777 -3,692 -85 Total premiums for the year 809,982 802,349 7,633
The amount of gross premiums by class of business is indicated in the Report on Operations.
The composition of direct business and inward reinsurance premiums is detailed in Annex 20.
Investment income
Income on investments amounted to € 172,616 thousand. A breakdown is provided below:
(in thousands of euro) 2015 2014 Change
Income from shares and interests 23,212 11,711 11,501 Income from other investments 134,888 134,208 680 Value re-adjustments on investments 319 1,610 -1,291 Income from disposal of investments 14,197 10,489 3,708 Total 172,616 158,018 14,598
Income from other investments mainly comprises income from bonds and other fixed-income securities for a total of € 134,353 thousand.
Value re-adjustments on investments mainly comprise € 287 thousand relating to the write-up of fixed-income securities.
Income from the disposal of investments mainly comprises gains on trading in bonds and other fixed-income securities, for € 12,306 thousand.
Income from investments is detailed in Annex 21.
116 REPORTS AND ACCOUNTS 2015
Income and unrealised gains on investments for the benefit of policyholders who bear the investment risk and relating to the administration of pension funds
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Income on investments for the benefit of policyholders amounted to € 39,219 thousand. A breakdown is provided below:
2015 2014 (in thousands of euro)
Change
Ordinary income 7,557 7,361 196 Income from disposal of investments 20,236 11,350 8,886 Unrealised gains 11,426 23,551 -12,125 Total 39,219 42,262 -3,043
Income from the administration of pension funds amounted to € 14,570 thousand, as detailed below: (in thousands of euro)
2015 2014 Change
Ordinary income 5,235 4,688 547 Income from disposal of investments 2,918 709 2,209 Unrealised gains 6,417 8,419 -2,002 Total 14,570 13,816 754
Details of the above income can be found in Annex 22.
Other technical income net of reinsurance
Other technical income amounted to € 7,772 thousand compared with € 7,197 thousand in 2014 and consisted mainly of commissions on management of the assets of internal funds and management commissions retroceded by external fund management companies.
Charges for claims, net of reinsurance
Charges for claims amounted to € 496,288 thousand. A breakdown is provided below:
2015 2014 (in thousands of euro)
Change
Gross claims paid 475,596 408,531 67,065 Reinsurers' share -2,575 -546 -2,029 Gross change in the provision for claims outstanding 23,514 1,116 22,398 Reinsurers' share -247 -43 -204 Total 496,288 409,058 87,230
117
Gross claims paid are detailed as follows:
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2015 2014 (in thousands of euro)
Change
Claims 63,001 20,146 42,855 Policies matured 194,392 140,267 54,125 Surrenders 214,851 244,145 -29,294 Perpetual annuities 2,335 2,764 -429 Claim settlement costs 1,017 1,209 -192 Total 475,596 408,531 67,065
It should be noted that the difference between the amount of the provision for claims outstanding existing at the start of the year and sums paid to the beneficiaries of the contracts during the year for claims incurred in previous years, and also the amount of the related provisions at the end of the year is not significant.
Change in mathematical provisions and in other technical provisions, net of reinsurance
The positive change in Life business provisions amounted to € 443,656 thousand.
For details, refer to the commentary on the balance sheet.
Management costs
Management costs amounted to € 44,049 thousand and are detailed as follows:
2015 2014 (in thousands of euro)
Change
Acquisition commissions 17,955 18,535 -580 Other acquisition costs 9,637 8,330 1,307 Collecting commissions 1,299 2,509 -1,210 Other administrative expenses 15,408 11,885 3,523 Reinsurance commissions and profit-sharing -250 -674 424 Total 44,049 40,585 3,464
Reinsurance commissions and profit-sharing amounted to € 250 thousand and consist exclusively of commissions received from reinsurers.
Investment management and financial charges
Investment management and financial charges amounted to € 23,935 thousand. A breakdown is provided below:
2015 2014 (in thousands of euro)
Change
Investment management charges, including interest: 14,689 13,367 1,322 Value re-adjustments on investments 8,977 489 8,488 Losses on the disposal of investments 269 369 -100 Total 23,935 14,225 9,710
Investment management charges and interest expense also comprise charges relating to derivative financial instruments, as reported in Part C (Operations on derivatives and structured financial instruments).
118 REPORTS AND ACCOUNTS 2015
Value re-adjustments on investments mainly comprise € 8,912 thousand relating to the write-up of fixed-income securities. Annex 23 provides the analytical schedule of investment management and financial charges.
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Investment management and financial charges and unrealised losses on investments for the benefit of policyholders who bear the risk and those deriving from the administration of pension funds
Charges on investments for the benefit of policyholders amounted to € 23,291 thousand. A breakdown is provided below:
2015 2014 (in thousands of euro)
Change
Investment management charges 7,565 7,120 445 Losses on the disposal of investments 8,705 2,940 5,765 Unrealised losses 7,021 5,760 1,261 Total 23,291 15,820 7,471
Charges on investments relating to the administration of pension funds amounted to € 8,643 thousand and are detailed as follows:
2015 2014 (in thousands of euro)
Change
Investment management charges 3,153 2,477 676 Losses on the disposal of investments 842 695 147 Unrealised losses 4,648 2,421 2,227 Total 8,643 5,593 3,050
Annex 24 provides details of the above charges.
Other technical charges, net of reinsurance
Other technical charges amounted to € 5,543 thousand compared with € 4,734 thousand in the previous year.
The item comprises delegation commissions paid to co-insurers for € 1,167 thousand, maintenance commissions for € 3,318 thousand, fund management commissions for € 1,054 thousand and miscellaneous technical items for € 4 thousand
Allocated investment return transferred to the non-technical account
The allocated investment return to be transferred to the non-technical account, in the amount of € 17,842 thousand has been calculated according to the method determined by the Supervisory Authority with a specific measure.
119
The breakdown of the amount to be transferred is shown in the table below:
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(in thousands of euro) 2015
Income from investments – Life business 1 172,615 Investment management and financial charges – Life business 2 23,935 NET PROFIT FROM INVESTMENTS 3=1-2 148,680 Technical provisions of the Life branches year N-1 4 3,461,230 Reinsurers’ share of Life technical provisions, year N-1 5 4,255 Technical provisions of the Life branches year N 6 3,888,773 Reinsurers' share of Life technical provisions year N 7 3,745 HALF-SUM OF THE TECHNICAL PROVISIONS 8=((4-5)+(6-7))/2 3,671,002 Shareholders’ equity year N-1 9 498,720 Shareholders’ equity year N 10 502,266 HALF-SUM OF SHAREHOLDERS’ EQUITIES 11=(9+10)/2 500,493 RATIO BETWEEN SHAREHOLDERS’ EQUITIES AND HALF-SUM OF TECHNICAL PROVISIONS + SHAREHOLDERS’ EQUITIES 12=11/(8+11) 12.0% THEORETICAL ALLOCATED INVESTMENT RETURN TO BE TRANSFERRED TO THE NON TECHNICAL ACCOUNT 13=12*3 17,842 THEORETICAL ALLOCATED INVESTMENT RETURN POSTED TO THE TECHNICAL ACCOUNT 14= 3 -13 130,839 TECHNICAL INTEREST PAID BY CONTRACT TO POLICYHOLDERS 15 121,658 ALLOCATED INVESTMENT RETURN EFFECTIVELY TO BE TRANSFERRED 16 17,842
ALLOCATED INVESTMENT RETURN TO BE TRANSFERRED EFFECTIVELY TO THE TECHNICAL ACCOUNT 17=3-16 130,839
For information regarding the technical account of the main Life business lines, refer to Annexes 27 and 28.
Section 20 – Changes in branch technical items
Non-life and Life business
The Company has adopted the analytical accounting procedure to allocate operating expenses (costs of personnel and general expenses) to the specific items of the accounts. The application made it possible to allocate the costs, recorded and classified by the general accounting system, to the items of the accounts. The criteria adopted to post items common to several business lines to each individual business line used, as parameters, the number of claims handled, configured differently according to the type of cost to be allocated and the percentage composition of the premiums written.
All the information required by this section is set forth in Annexes 25, 26, 27, 28 and 29. As regards the commentary on the trends of the various business lines, reference should be made to the Report on Operations.
Section 21 – Information regarding the non technical account (III)
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Income from investments – Non-life business
Net investment income of Non-life business amounted to € 97,515 thousand and is detailed as follows:
(in thousands of euro) 2015 2014 Change
Income from shares and interests 23,096 31,500 -8,404 Income from investments in land and buildings 3,542 3,171 371 Income from other investments 20,141 23,403 -3,262 Value re-adjustments on investments 57 2,655 -2,598 Income from disposal of investments 50,679 15,936 34,743 Total 97,515 76,665 20,850
Income on shares and interests refers to dividends collected during the year, of which € 19,582 thousand from subsidiaries.
Income on other investments mainly reflects investments in fixed-income securities.
Note that value re-adjustments on investments comprise € 29 thousand relating to the write-up of fixed-income securities and € 28 thousand relating to the write-up of equity investments.
Income from the disposal of investments amounts to € 50,679 thousand and comprises gains on fixed-income securities for € 19,055 thousand, gains on shares and interests for € 27,887 thousand and gains on common investment funds for € 3,737 thousand.
The analytical schedule of investment income is provided in Annex 21.
Allocated investment return transferred from the non-technical account – Life business
Refer to the specific section of the Life business technical account.
Investment management and financial charges – Non-life business
Investment management and financial charges amounted to € 22,226 thousand and are detailed as follows:
2015 2014 (in thousands of euro)
Change
Investment management charges, including interest: 8,597 8,233 364 Value re-adjustments on investments 8,003 6,449 1,554 Losses on the disposal of investments 5,626 1,737 3,889 Total 22,226 16,419 5,807
Value re-adjustments on investments amounted to € 8,003 thousand and mainly comprise shares of common investment funds for € 3,110 thousand and fixed-income securities for € 2,434.
Losses on the disposal of investments amounted to € 5,626 thousand and mainly comprise € 4,134 thousand on trading of common investment funds and € 1,372 thousand on trading of fixed-income securities.
Annex 23 provides the analytical schedule of Investment management and financial charges of Non-life business.
120 REPORTS AND ACCOUNTS 2015
121
Allocated investment return transferred to the Non-life insurance business technical account
Refer to the specific section of the Non-life insurance business technical account.
Other income
Other income amounted to € 61,947 thousand. The breadown is as follows:
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2015 2014 (in thousands of euro)
Change
34,899 52,248 -17,349 Refunds from third parties of administration expenses and charges Other income and refunds 749 632 117 Interest on receivables 1,564 915 649 Interest on bank deposits 227 423 -196 Withdrawals from funds 24,508 18,033 6,475 Total 61,947 72,251 -10,304
As regards utilisation of reserves for future risks and charges, refer to the commentary in Section 12 of the Balance Sheet.
Other charges
Other charges amounted to € 52,558 thousand. The breakdown is as follows:
2015 2014 (in thousands of euro)
Change
Administrative costs and expenses on behalf of third parties 34,899 52,248 -17,349 Interest expense and bank expenses 839 941 -102 Accrual to the provisions for pensions 1,039 1,193 -154 Accrual to the provisions for taxation 0 3,200 -3,200 Other provisions 15,525 31,173 -15,648 Amortisation of intangible assets 5 23,316 -23,311 Miscellaneous charges 251 1,438 -1,187 Total 52,558 113,509 -60,951
Extraordinary income
Extraordinary income amounted to € 10,661 thousand. The detail is as follows:
2015 2014 (in thousands of euro)
Change
Taxes for previous years 1,620 5,657 -4,037 Gains on the disposal of real estate 0 346 -346 Exchange rate differences 5,429 6,688 -1,259 Income on long-term investments 180 3,972 -3,792 Tax disputes 335 26,605 -26,270 Other out-of-period income 3,097 5,347 -2,250 Total 10,661 48,615 -37,954
122 REPORTS AND ACCOUNTS 2015
In 2014 the tax disputes item included extraordinary income for € 26,605 thousand referring to the refund of sanctions and interest pursuant to the settlement agreement between the Company and the Tax Office concerning tax disputes related to tax year 2006.
Extraordinary charges
Extraordinary charges amounted to € 13,463 thousand. The breakdown is as follows:
BILANCIO REALE MUTUA 2015.indd 122BILANCIO REALE MUTUA 2015.indd 122 14/04/16 16:0314/04/16 16:03
2015 2014 (in thousands of euro)
Change
Exchange rate differences 47 16 31 Taxes for previous years 7,194 1,749 5,445 Out-of-period expenses and other extraordinary charges 6,222 7,147 -925 Total 13,463 8,912 4,551
Taxes for previous years include sanctions and additional taxes paid as a consequence of the audit by the Turin Tax Office discussed earlier. This led to the recognition of deferred tax assets for around € 4,000 that will be recovered in future years. Reference should be made to the "Litigation" section of the Report on Operations.
Income taxes for the year
Income taxes for the year show a negative balance of € 23,340 thousand and are the result of the following items:
IRES IRAP (in thousands of euro)
Total
Taxes on the result of the period 12,605 3,448 16,053 Change in prepaid taxes 9,040 -1,197 7,843 Change in deferred taxes -556 0 -556 Total 21,089 2,251 23,340
Starting from the 2004 tax period, the Company has decided to participate in the national consolidation scheme as consolidating entity.
Taxes on the result for the period amounted to a cost of € 16,053 thousand. The breakdown is shown below:
• € 12,605 thousand for current IRES levied at the rate of 27.5%;
• € 3,448 thousand for current IRAP levied at the rate of 6.82%.
The net value of production for the purposes of IRAP was determined taking into account the substantial change introduced by Law No. 190/2014 (2015 Stability Law) whereby personnel costs paid under permanent employment contracts are fully deductible from the taxable base.
Pursuant to art. 11 of Legislative Decree No. 240/1991, according to the principle of fiscal transparency, the IRES and IRAP taxable base of the Company includes the Company's share of the taxable income generated during the year by Reale Ites EEIG, amounting to € 652 thousand for IRES and to € 3,710 thousand for IRAP. With regard to said shareholding, the Company also recognised the prepaid IRES taxes on the temporary differences recorded thereby.
Prepaid IRES and IRAP reflect ordinary temporary differences between the value attributed according to statutory criteria and for tax purposes (mainly comprising write-downs and losses on receivables and accruals to provisions).
123
Deferred tax assets and liabilities for IRES have been adjusted in view of the reduction of the tax rate to 24% as from 2017 (art. 1(61) of the 2016 Stability Law); this adjustment led to the recording of a total cost of € 10,199 thousand for the year.
Prepaid tax assets have been stated considering the reasonable certainty of future recovery.
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124 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 124BILANCIO REALE MUTUA 2015.indd 124 14/04/16 16:0314/04/16 16:03
Reco
gniti
on o
f def
erre
d ta
x as
sets
and
liab
ilitie
s for
IRES
and
rela
ted
effe
cts:
(in
thou
sand
s of e
uro)
Situ
atio
n at
201
4 D
ecre
ases
D
ecre
ases
for
adju
stm
ent t
o ne
w
IRES
rate
In
crea
ses
Situ
atio
n at
201
5
Prep
aid
taxe
s:
taxa
ble
inco
me
tax
taxa
ble
inco
me
tax
tax
taxa
ble
inco
me
tax
taxa
ble
inco
me
tax
Chan
ge in
pro
visio
ns fo
r out
stan
ding
cla
ims
116,
296
31,
981
10
,949
3,
011
3,
304
0
0
10
5,34
7
25,6
66
Writ
e-do
wn
of e
quity
inve
stm
ents
1,
472
40
5
1,07
2
295
69
1,
582
43
5
1,98
2
476
Pr
ovisi
ons t
o re
serv
es fo
r risk
s and
cha
rges
71
,331
19
,616
22
,897
6,
297
1,
667
14
,838
4,
080
63
,272
15
,733
10
6,84
9 2
9,38
3
0
0
3,80
7
7,64
5
2,10
2
114,
494
27
,678
W
rite-
dow
n of
rece
ivab
les f
rom
pol
icyh
olde
rs fo
r pre
miu
ms
Writ
e-do
wn
of o
ther
rece
ivab
les
3,06
4
843
25
7
10
9
88
24
3,12
7
751
Lo
sses
on
rece
ivab
les f
rom
pol
icyh
olde
rs fo
r pre
miu
ms
37,4
17
10,2
90
0
0
1,71
4
14,1
22
3,88
4
51,5
39
12,4
60
Amor
tisat
ion
and
depr
ecia
tion
1,87
7
516
1,
027
28
2
28
11
3
861
20
9
Tota
l 33
8,30
6 9
3,03
4
35,9
70
9,89
2
10,6
98
38,2
86
10,5
29
340,
622
82
,973
Prep
aid
taxe
s Rea
le It
es E
EIG
: Pr
ovisi
ons t
o re
serv
es fo
r risk
s and
cha
rges
0
0 51
9 14
2 28
21
31
586
1,61
2
416
Am
ortis
atio
n an
d de
prec
iatio
n 0
0 0
0 29
82
1 22
6 82
1
197
Di
rect
ors'
fees
not
pai
d 13
4
13
4 0
0 0
0
0
Tota
l 13
4
53
2
146
57
2,
952
81
2
2,43
3
613
Def
erre
d ta
xes:
De
prec
iatio
n of
real
est
ate
4,21
2
1,15
9
0
0
147
0
0
4,
212
1,
012
Re
valu
atio
ns o
f equ
ity in
vest
men
ts
11,6
75
3,21
1
0
0
409
0
0
11
,675
2,
802
To
tal
15,8
87
4,37
0
0
0
556
0
0
15
,887
3,
814
125
BILANCIO REALE MUTUA 2015.indd 125BILANCIO REALE MUTUA 2015.indd 125 14/04/16 16:0314/04/16 16:03
Reco
gniti
on o
f def
erre
d ta
x as
sets
and
liab
ilitie
s for
IRAP
and
rela
ted
effe
cts:
(in
thou
sand
s of e
uro)
Situ
atio
n at
201
4 D
ecre
ases
In
crea
ses
Situ
atio
n at
201
5
Prep
aid
taxe
s:
taxa
ble
inco
me
tax
taxa
ble
inco
me
tax
taxa
ble
inco
me
tax
taxa
ble
inco
me
tax
Loss
es o
n re
ceiv
able
s fro
m p
olic
yhol
ders
for
prem
ium
s 35
,477
2,
556
0 0
14,1
23
963
49,6
00
3,51
9 W
rite-
dow
n of
rece
ivab
les f
rom
pol
icyh
olde
rs fo
r pr
emiu
ms
16,5
78
1,13
1 0
0 3,
498
239
20,0
76
1,37
0 Am
ortis
atio
n of
goo
dwill
59
2 40
74
5
0 0
518
35
Tota
l 52
,647
3,
727
74
5 17
,621
1,
202
70,1
94
4,92
4
126 REPORTS AND ACCOUNTS 2015
Section 22 – Various information regarding the income statement
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The detail of income and charges relating to Group companies and other shareholdings is provided in Annex 30.
A summary of the total amounts is provided below:
Subsidiaries Affiliated companies
Other related parties
(in thousands of euro)
Total
Income 70,475 248 3,346 74,069 Charges 40,464 248 1,824 42,536
Income and charges relating to subsidiaries mainly refer to the costs charged by Reale Mutua to supply the services under the contracts in force and the chargeback of costs relating to seconded personnel for € 31,208 thousand.
They also include income for dividends on shares and interests for € 37,833 thousand and charges for financial management services paid to Banca Reale S.p.A. for € 7,827 thousand.
Income from other related parties refers mainly to collection of insurance premiums for € 3,364 thousand.
Charges relating to other related parties refer to compensation paid on policies for € 218 thousand and fees paid during the year to Directors and Auditors for € 1,606 thousand.
A summary of direct business premiums written is provided in Annex 31, while Annex 32 illustrates personnel costs, Directors’ and Auditors’ fees.
127
PART C: OTHER INFORMATION
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1. Transactions on derivative and structured financial instruments
2. Solvency margin
3. Technical provisions to be matched at the end of the year
4. Shareholders’ equity
5. Fees for auditing and for services other than auditing
6. Cash flow statement
This section provides the following additional information:
128 REPORTS AND ACCOUNTS 2015
1. OPERATIONS ON DERIVATIVES AND STRUCTURED FINANCIAL INSTRUMENTS
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Derivatives and structured financial instruments are acquired in accordance with the Company's strategic plan established with a Board resolution of July 14, 2015 and ISVAP Regulation No. 36 of January 31, 2011 and comply with the requirements established by the system of control of the securities portfolio.
Derivatives and structured financial instruments are used for hedging purposes only, to mitigate the risk profile of the assets/liabilities hedged or to optimise the yield risk profile.
A) STRUCTURED FINANCIAL INSTRUMENTS
Open positions in structured debt securities at year-end were as follows:
in the Non-life portfolio, a total carrying value of € 211,957 thousand;
in the Life portfolio, a total carrying value of € 347,453 thousand, of which € 295,630 thousandincluded in the assets of separately managed accounts;
in the Life portfolio under art. 41 of Legislative Decree No. 209/05 a total carrying value of € 4,096thousand in unit-linked policies;
in the Teseo open-ended pension fund portfolio, a total carrying value of € 4,565 thousand.
Operations and results for the year on transactions in derivatives are set forth below: (in thousands of euro)
Carrying value Market Value Income/Expense
2015 2014 2015 2014 Ordinary Trading Valuation
Non-life portfolio Callable/puttable 76,760 73,039 80,233 78,291 1,618 321 -45 Cms/floor 0 7,566 0 7,575 76 -43 0 Subordinate 21,859 2,881 21,897 2,881 103 11 -132 Pegged to inflation or other basket 108,381 110,832 114,620 118,461 2,733 3,158 -1 Covered 4,957 2,483 4,971 2,825 71 302 -8 TOTAL 211,957 196,801 221,721 210,033 4,601 3,749 -186
Life portfolio Callable/puttable 176,334 69,589 177,662 71,501 2,165 -150 -3,558 Cms/floor 75,147 79,140 120,393 135,279 14,298 0 212 Subordinate 75,155 22,519 76,153 23,576 1,723 0 -1,544 Pegged to inflation or other basket 14,814 18,373 15,098 18,445 304 0 3 Covered 6,003 7,005 6,153 7,421 262 0 0 TOTAL 347,453 196,626 395,459 256,222 18,752 -150 -4,887
Life portfolio under art. 41 of Legislative Decree No. 209/05 Callable/puttable 239 36 239 36 17 -14 0 Subordinate 33 2,176 33 2,176 67 73 -1 Pegged to inflation or other basket 3,824 9,715 3,824 9,715 151 41 47 TOTAL 4,096 11,927 4,096 11,927 235 100 46
Teseo open-ended pension fund portfolio Pegged to inflation or other basket 4,565 2,121 4,565 2,121 52 -10 -11 TOTAL 4,565 2,121 4,565 2,121 52 -10 -11
129
During the year transactions in the Non-life portfolio generated ordinary income for € 4,601 thousand, gains from trading for € 3,749 thousand and valuation losses for € 186 thousand.
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Transactions in the Life portfolio generated ordinary income for € 18,752 thousand, losses from trading for € 150 thousand and valuation losses for € 4,887 thousand.
The increase in callable/puttable instruments stemmed from the higher exposure in corporate bonds with buy-back options, currently very popular on the market. The aim of such investments is to maintain a good level of portfolio profitability.
The reason for the increased exposure to subordinated instruments, in both the Non-life and Life portfolios, is to maintain a good level of profitability despite persistently low interest rates. However, exposure to such instruments is only marginal and within the limits established by the framework resolution on investments.
Transactions in the Life portfolio under art. 41 of Legislative Decree No. 209/05 generated ordinary income for € 235 thousand, gains from trading for € 100 thousand and valuation gains for € 46 thousand.
The Teseo open-ended pension fund portfolio generated ordinary income for € 52 thousand, gains from trading for € 10 thousand and valuation losses for € 11 thousand.
The assets with subordination clauses, indicated according to the internationally adopted level of subordination, are listed below.
(in thousands of euro)
ISIN code Issuing institute Carrying value
Currency Type of interest rate
Date of maturity
Advance repayment
clause
Level of subordination
3,072 EUR Yes Tier II 8,150 EUR Yes Tier II 4,585 EUR Yes Tier II
6 EUR Yes Tier II 12 EUR Yes Tier II
2,909 EUR No Tier II
XS1253955469 Abn Amro Bank NV XS1061711575 Aegon NV DE000A14J9N8 Allianz Se-Reg XS1325125158 Allied Irish Banks PLC XS1311440082 Assicurazioni Generali XS0267827169 Bank of America Corp XS1288858548 Banque Fed Du Credit Mutuel 5,058 EUR No Tier II
2,984 EUR Yes Tier II 19,440 EUR No Tier II
XS1319647068 Barclays PLC XS1190632999 BNP Paribas XS1325645825 BNP Paribas 2,970 EUR No Tier II
5,004 EUR Yes Tier II 16 EUR Yes Tier I
8,603 EUR No Tier II 986 EUR Yes Tier II
6,065 EUR Yes Tier II 2,933 EUR Yes Tier II 4,957 EUR Yes Tier II 9,924 EUR No Tier II 4,796 EUR No Tier II 3,579 EUR No Tier II
FR0013063385 BPCE SA XS1044811591 Enbw Energie Baden - Wuerttemb XS1254428896 Hsbc Holdings PLC XS0243399556 Intesa Sanpaolo S.p.A. XS0365303675 Intesa Sanpaolo S.p.A. XS1072249045 LBBW XS1317439559 Nordea Bank AB NL0000122505 Royal Bank of Scotland NV XS1195574881 Societe Generale SA XS0322918565 Unicredit S.p.A. XS0618847775 Unicredit S.p.A. 998 EUR
Fix to Floater 30/06/2025 Fix to Floater 25/04/1944 Fix to Floater 07/07/1945 Fix to Floater 26/11/2025 Fix to Floater 27/10/1947
Indexed 14/09/2018 Fixed 11/09/2025
Fix to Floater 11/11/2025 Fixed 17/02/2025 Fixed 27/01/2026
Fix to Floater 30/11/2027 Fix to Floater 02/04/1976
Fixed 30/06/2025 Indexed 20/02/2018
Fix to Floater 28/05/2018 Fix to Floater 27/05/2026 Fix to Floater 10/11/2025
Fix to CMS 10/06/2019 Fixed 27/02/2025 Fixed 26/09/2017 Fixed 19/04/2021 No Tier II
Total 97,047
130 REPORTS AND ACCOUNTS 2015
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The main derivatives on hand at the end of the year were as follows:
In the Non-life portfolio, with the relative nominal value recorded in the memorandum accounts:
a contract stipulated with Credito Emiliano S.p.A. (expiring in 2018) that, within the framework of thejoint interest in Credemassicurazioni S.p.A., envisages granting of put options to Reale Mutua and ofcall options to Credito Emiliano S.p.A. on the entire interest held by Reale Mutua inCredemassicurazioni (862,500 shares, equal to 50% of the share capital) that can be exercised inspecific contractually-defined cases.
In the Life portfolio, with the relative nominal value recorded in the memorandum accounts:
B) DERIVATIVES
around 1,254 thousand Put options issued by Credito Emiliano on the same number of quotas ofinternal funds underlying unit-linked products with guaranteed capital, for the purpose of hedging thefinancial guarantees of the invested capital for a notional value of around € 18,814 thousand. Thepremiums paid for these options, calculated as a percentage of the notional value of the fund of eachweek, are recognised in the income statement in the year to which they refer.
Four swap contracts: two with Royal Bank of Scotland Group Plc for a total notional value of € 7,120thousand and two with Société Générale for a total notional value of € 6,000 thousand to hedgeinterest rate risk on the Crediop 2.1% 01/09/2025 (XS0104009617) structured bond; The contractsenvisage swapping of interest, proportionally to the notional value stipulated maturing on theXS0104009617 Crediop 2.1% 01/09/2025 bond. This bond is carried in the Company's securitiesportfolio for a total nominal value exceeding the notional value of the interest swap and currentlyenvisages a high annual optional coupon determined with a floor option and leverage tied to a definedamortisation plan: the commitments entered into have therefore been covered.
In the Life portfolio under art. 41 of Legislative Decree No. 209/05, with the positions disclosed at fair value and the relative nominal value recorded in the memorandum accounts:
two puttable interest rate swap contracts stipulated with Credito Emiliano and included in the“Dinamica Protetta” (starting date 27/08/2003 – closing date 01/07/2017) and “Dinamica Protetta 2”(starting date 27/08/2003 – closing date 07/01/2018) internal insurance funds, to hedge interest ratevolatility of internal insurance funds. The total notional value of reference for the variable rate is €26,240 thousand and that of the fixed rate € 17,650 thousand.
There was also marginal exposure in rights and warrants on shares in the various portfolios for a carrying value of € 16 thousand.
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There was also marginal exposure in rights and warrants on shares in the various portfolios for a carrying value of € 16 thousand.
Operations closed: Sale of 3,170,000.00 USD at term – 20/01/2015 Life Deutsche Bank A 2,542 0 2,632 Purchase of 3,170,000.00 USD at term – 20/01/2015 Life Citibank A 2,724 0 -2,724
Sale of 2,840,000.00 SGD at term – 18/06/2015 Life Citibank A 1,876 0 1876
Purchase of 2,840,000.00 SGD at term – 18/06/2015 Life Citibank A 1,884 0 -1,881
Total operations closed 9,026 0 -97
Operations in course: Put options on Linea Dinamica Protetta – 01/07/2017 Life Credem BBB- 13,834 0 -43
Put options on Linea Dinamica Protetta 2– 07/01/2018 Life Credem BBB- 4,980 0 -15
Puttable interest rate swap Linea Dinamica Protetta – 01/07/2017 (variable rate-pay leg on € 20,500,000.00 notional to fixed rate receive leg on € 14,000,000.00 notional)
Life Credem BBB- 20,500 816 113
Puttable interest rate swap Linea dinamica Protetta 2 – 07/01/2018 (variable rate-pay leg on € 5,740,000.00 notional to fixed rate receive leg on € 3,650,000.00 notional)
Life Credem BBB- 5,740 -160 37
Swap Crediop - 01/09/2025 Life Royal Bank of Scotland Group BBB+ 7,120 -8,072 -2,054
Swap Crediop - 01/09/2025 Life Société Générale A 6,000 -7,369 -1,822 Put option on Credemassicurazioni S.p.A. shares - 29/09/2008-31/10/2018 Non-life Credito Emiliano BBB- 18,000 N.A. 0
Call option on Credemassicurazioni S.p.A. shares - 29/09/2008-31/10/2018 Non-life Credito Emiliano BBB- 18,000 N.A. 0
Warrant on shares Non-life IVS Group SA BB- 1 1 -19
Warrant on shares Life Various counterparties N.R. 15 15 3
Total operations in course 94,190 -14,769 -3,800
(in thousands of euro) Category of contracts Portfolio Counterparty Rating Notional Fair Income /
S&P value value Charges
In the Non-life portfolio there were no operations on derivative financial instruments.
In the Life portfolio under art. 41 of Legislative Decree No. 209/05 forward currency purchase/sale transactions were carried out during the year, in order to hedge the exchange rate risk in the “Real Mida 1” and “Real Mida 2” internal insurance funds.
In the Life portfolio and in the portfolio of the Teseo Open Pension Fund no transactions were carried out on such derivative instruments.
Lastly, it is stated that, during the year, company assets included general rights on operations on capital relating to equities in the portfolio; such instruments were exercised or not exercised or sold always by the expiry date of the operation.
132 REPORTS AND ACCOUNTS 2015
2. SOLVENCY MARGIN
At the end of the year, the solvency margin to be formed and the total elements of the margin, separately for Non-life and Life business, comprised the following amounts:
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Non-life Life (in thousands of euro)
Total
Solvency margin required 219,085 180,538 399,623 Elements forming the solvency margin 1,346,884 484,936 1,831,820 Excess 1,127,799 304,398 1,432,197 Solvency ratio 614.8% 268.6% 458.4%
3.. TECHNICAL PROVISIONS TO BE COVERED AT THE END OF THE YEAR AND RELATED MATCHING ASSETS
At the end of the year, technical provisions to be covered and related matching assets, indicated separately for Non-life and Life business, comprised the following amounts:
Non-life Life (in thousands of euro)
Total
Total Assets assigned for cover 2,496,877 4,687,725 7,184,602 Reserve at December 31 2,424,848 4,534,973 6,959,821 Percentage of cover 103.0% 103.4% 103.2%
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4. SHAREHOLDERS' EQUITY
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The breakdown of shareholders’ equity resulting from the proposed allocation of the result for the year is set forth in the tables below for Non-life and Life business respectively:
Shareholders’ equity for Non-life business 31.12.2015
Allocation proposed to
Meeting
(in thousands of euro)
Updated shareholders’ equity
Share capital or Guarantee fund 45,000 0 45,000 Revaluation reserves 111,817 0 111,817 Legal reserve 160,441 2,793 163,234 Other reserves 973,834 53,072 1,026,906 Net profit (loss) for the year 55,865 -55,865 0 Total 1,346,956 0 1,346,956
Shareholders’ equity for Life business 31.12.2015
Allocation proposed to
Meeting
(in thousands of euro)
Updated shareholders’ equity
Share capital or Guarantee fund 15,000 0 15,000 Revaluation reserves 24,406 0 24,406 Legal reserve 47,096 177 47,273 Other reserves 412,217 3,369 415,586 Net profit (loss) for the year 3,546 -3,546 0 Total 502,265 0 502,265
134 REPORTS AND ACCOUNTS 2015
5. AUDIT FEES AND FOR SERVICES OTHER THAN AUDITING
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Disclosure of auditing fees and for services other than auditing (art. 149.12 of the CONSOB Issuers Regulation)
Type of service Supplier of the service Recipient Fees (in thousands of euro)
Auditing (*) Reconta Ernst & Young S.p.A. Società Reale Mutua di Assicurazioni
153
Certification (**) Reconta Ernst & Young S.p.A. Società Reale Mutua di Assicurazioni
57
Other services Ernst & Young Network
Reconta Ernst & Young S.p.A.
Società Reale Mutua di Assicurazioni
68
(*) NB: this type of services does not include the services of the actuary auditor, engaged by the auditors to perform the actuarial evaluation of the technical provisions. Fees paid for these services amounted to € 21,283.44. (**) NB: this item comprises fees for auditing of: Separately Managed Accounts, Internal Insurance Funds and Pension fund.
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(in thousands of euro)
2015 2014 I. CASH FLOW FROM BUSINESS OPERATIONS
1. PRE-TAX PROFIT FOR THE YEAR 1 82,752 31 127,673
2. CHANGES IN NON-CASH ITEMS a) Change in technical provisions - Non-life business 2 (19,215) 32 27,673 b) Change in technical provisions - Life business 3 466,320 33 525,025 c) Change in accumulated depreciation 4 (24,197) 34 5,288
d) Change in termination benefits and employee funds 5 (2,771) 35 (1,378) e) Change in other provisions 6 (12,971) 36 15,812
f) Non-monetary income and expenses deriving from investments 7 9,555 37 (7,429) g) Gains and losses on disposal of investments 8 (69,992) 38 (36,015)
Total 9 346,729 39 528,976
3. CHANGE IN RECEIVABLES AND PAYABLES GENERATED BY OPERATIONSa) Change in receivables and payables arising from direct operations 10 (22,576) 40 (29,048) b) Change in receivables and payables arising from reinsurance operations 11 28,578 41 (76,248)
c) Change in other receivables and payables 12 (1,358) 42 (17,998)
d) Change in other assets and liabilities 13 (2,948) 43 (16,399) Total 14 1,696 44 (139,693)
4. TAX PAID 15 (51,291) 45 (19,572)
5. TOTAL NET CASH FLOW ARISING FROM BUSINESS OPERATIONS 16 379,886 46 497,384
II. CASH FLOW FROM INVESTMENT ACTIVITIES
1. NET CASH FLOW GENERATED/ABSORBED BY INVESTMENTSa) Land and buildings 17 (1,531) 47 (1,936) b) Equity investments in subsidiaries, associates, other equity investments 18 (76,339) 48 (50)
c) Bonds, shares and interests, shares of collective investment funds 19 (359,203) 49 (465,151) d) Loans 20 5,928 50 (426) e) Other financial investments 21 6,329 51 (79) f) Investments for the benefit of Life policyholders who bear the 22 (26,771) 52 (24,438)
investment risk and relating to the administration of pension funds
Total 23 (451,587) 53 (492,080)
2. NET CASH FLOW GENERATED/ABSORBED BY OTHER ITEMSa) Intangible assets 24 96,058 54 (13,367) b) Tangible assets 25 4,028 55 (4,079)
Total 26 100,086 56 (17,446)
3. TOTAL NET CASH FLOW ARISING FROM INVESTMENT ACTIVITIES 27 (351,501) 57 (509,526)
III. CHANGE IN CASH AND CASH EQUIVALENTS
1. Cash and cash equivalents at the beginning of the year 28 59,646 58 71,788
2. Cash and cash equivalents at the end of the year 29 88,031 59 59,646
3. CHANGE IN CASH AND CASH EQUIVALENTS IN THE YEAR 30 28,385 60 (12,142)
5. CASH FLOW STATEMENT
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SOLVENCY MARGIN STATEMENT
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138 REPORTS AND ACCOUNTS 2015
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Company SOCIETA' REALE MUTUA DI ASS.NI
Financial 2015
I. - Life insurance ........................................................................................................................ XII. - Marriage and birth insurance.............................................................................................
III. - Insurance as per points I and II linked to investment funds............................................... XIV. - Permanent Health insurance Article 1 Section 1, sub. d) of
EEC Directive 79/267 of March 5, 1979 ..................................................................................... XV. - Capital redemption operations as per Article 2, Section 1, point V of the Insurance Code XVI. - Management of group pension funds for the provision of services in
the event of death, survival, relinquishment or reduction of gainful employment X
Complementary insurance (personal injury risks)......................................……………............. X
Annex I
SOLVENCY MARGIN STATEMENT(Art. 28, section 1 of the Regulation)
(in thousands of euro)
Business lines for which the solvency margin has been determined
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(1) Subscribed capital unpaid……………………………..………......... (equal to item 1) ................................................. (2) Deferred acquisition commissions.......................…....................…................ (equal to item 3) ................................................ (3) Other intangible assets...........................................................................................… (equal to items 6, 7, 8 and 9) ………………………………….. (4) Shares or equity interests in controlling companies....................................... (equal to item 17) ...............................................
(5) Own shares or equity interests..............................................................................................(equal to item 91) ...............................................
(6) Subscribed share capital or equivalent fund .........................................................................(equal to item 101) .............................................. 15,000 (7) Additional paid-in capital ......................….....………………...... (equal to item 102) ............................
(8) Revaluation reserves (included in item 103) .........……... 24,406 (9) Legal reserve ......................................................................................................... (equal to item 104) ............................ 47,096
(10) Statutory reserves ............................…........................….....................................................(equal to item 105) ............................
(11) Reserves for own shares and shares of the controlling company (equal to item 106) ............................
(12) Other reserves: (1) ...........................................................................................................................................................………. 412,217 (13) Losses brought forward.............................................................. (equal to item 108) (*) ) ..................................
(14) Loss for the year...............…………………...................................................……..............(equal to item 109) (*) ) ..................................
(15) Profit brought forward............................................ (equal to item 108) .............................................
(16) Profit for the year ..................................................... (equal to item 109) ............................................. 3,547 (17) Total cumulative preference shares (2)………………………………………………………………………………………………………………………
(18) Subordinated liabilities (3) ..................................................................................................(included in item 111) .........……...
(19) Operating surplus year N (4)............................................................................... ................................................................................................................................................
(20) Operating surplus year N - 1: (4).......................................................................... ........................................................................................................................................................................ If used for the
(21) Operating surplus year N - 2: (4)........................................................................................................................................................................................ solvency margin
(22) Operating surplus year N - 3: (4).......................................................................... ................................................................................................ as per Art. 23,
(23) Operating surplus year N - 4: (4)............................................................................................................................................................................................................................................... section 1, sub. a),
(24) Estimated annual profit: (5)………………………………………………………………………… of Regulation
(25) Mean residual duration of contracts at the end of year N .............................. (26) Actuarial reserve calculated on the basis of pure premiums ................................................................ If used for the
(27) Actuarial reserve calculated on the basis of pure premiums referring to risks ceded ........................... solvency margin
(28) Actuarial reserve calculated on the basis of pure premiums only increased by the amortisation quota as per Art. 23,
of acquisition cost as set out in the rate premiums..............................................…..……......................... section 1, sub b),
(29) Actuarial reserve as per point (28) referring to risks ceded.....................………………………….......... of Regulation
(30) Sum of the differences between "Life" capital amounts and mathematical reserves for all contracts on which premiums are still being paid...........................................................................……………………......... If used for the
(31) Latent gains arising out of the valuation of total company investments, in so far as such latent gains are not solvency margin
of an exceptional nature.............................................. as per Art. 23,
(32) Losses resulting from the valuation of total company investments...................................... section 1, sub. c),
(33) Foreseeable commitments towards member-policyholders (6)..................................................................................... of Regulation
GENERAL NOTICE: all the items referring to inward reinsurance relationships do not include the amounts attributed to CONSAP for legal cessions
(1) State the other provision as set forth in item 107 excluding, for the first three years, the fund set up cover initial formation expenses, specifying the detail thereof below
403,5721,9316,714
(2) State cumulative preference shares as indicated in Art. 44, Section 3, sub a) and b) of the Insurance Code specifying: cumulative preference shares as indicated in Art. 44, Section 3, sub a) cumulative preference shares as indicated in Art. 44, Section 3, sub b)
(3) State subordinated liabilities specifying loans with fixed maturity
loans without fixed maturity securities of undetermined duration and other financial instruments
(4) Indicate earnings realised in the last five financial years on business activities in classes I, II, III and IV as set forth in Art. 2, Section 1 and in the supplementary coverages as set forth in Art. 2, Section 2, of the Insurance Code.
(5) Indicate the value specified in the actuary's report taking into account the possibility of use of this item until expiry of the transitory period
(6) Indicate the value specified in the actuary’s report..................................................................................................................................................................................
*indicate the amount in absolute value
I – BASIS OF CALCULATION OF THE SOLVENCY MARGIN FOR YEAR N TAKEN FROM THE FINANCIAL STATEMENTS
Items of the balance sheet - Life business
ORDINARY RESERVE FUNDEXTRAORDINARY RESERVEOTHER EQUITY RESERVES
140 REPORTS AND ACCOUNTS 2015
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I/II - Life, marriage and birth insurance (34) Reserves relating to direct business..............................…..................................................................... 2,971,253
Reserve relating to inward reinsurance ...................................................................……………............ 2,782Reserve relating to reinsurance cessions................................................................………….................. 2,763Non-negative risk capital charged to the company ....................................................……………......... 10,169,056Non-negative risk capital remaining charged to the company after cession and retrocession…........................................................... 8,711,565
(35) (36) (37) (38) (39) Non-negative risk capital charged to the company for term insurance policies
with a maximum duration of three years................................................................................................................ 3,276,016 (40) Non-negative risk capital charged to the company for term insurance policies
with a duration of more than three years but less than or equal to five years................………………………..................................... 400,066
Complementary insurance - Personal injury risks
(41) Gross premiums written ...................................................................................................….................. 241Claims paid in year N: gross amount ............................................................................................. 99Claims paid in year N: reinsurers' share……………………………………………………………………………………………………….. 22Change in the provisions for outstanding claims in year N: gross amount (equal to item 16 of annex 1) .....................................................................................
Change in the provisions for outstanding claims in year N: reinsurers' share
Claims paid in year N - 1: Gross amount ............................................................................................. 420Claims paid in year N - 1: Reinsurers' share…………………………………………………………………………………… 164Change in the provisions for outstanding claims in year N -1: gross amount (equal to item 17 of annex 1) ............................................................................................................
Change in the provisions for outstanding claims in year N -1: Reinsurers' share
Claims paid in year N - 2: Gross amount ............................................................................................. 1,029Claims paid in year N - 2: Reinsurers' share……………………………………………………………………………………………………………………………. 628Change in the provisions for outstanding claims in year N -2: gross amount (equal to item 18 of annex 1) .................................................................................
(42)
(43)
(44)
(45)
(46)
(47)
(48)
(49)
(50)
(51)
(52)
(53) Change in the provisions for outstanding claims in year N -2: Reinsurers' share………………………………………………………..
IV - Health insurance (54) Reserves relating to direct business..............................…..................................................................... 176 (55) Reserve relating to inward reinsurance ...................................................................……………............ 261 (56) Reserve relating to outward reinsurance................................................................………….................. 221 (57) Gross premiums written ...................................................................................................….................. 158 (58) Claims paid in year N: Gross amount ............................................................................................. 6 (59) Claims paid in year N: Reinsurers' share……………………………………………………………………………………………………
(60) Change in the provisions for outstanding claims in year N: gross amount (equal to item 16 of Annex 2)............................
(61) Change in the provisions for outstanding claims in year N: Reinsurers' share……………………………………………………………………………………………….
(62) Claims paid in year N - 1: Gross amount................................................................... 12 (63) Claims paid in year N - 1: Reinsurers' share……………………………………………………………………………………………
(64) Change in the provisions for outstanding claims in year N -1: gross amount (equal to item 17 of Annex 2) ............................
(65) Change in the provisions for outstanding claims in year N -1: Reinsurers' share………………………………………………………………………………………………………………….
(66) Claims paid in year N - 2: Gross amount ............................................................................................. 21 (67) Claims paid in year N - 2: Reinsurers' share…………………………………………………………………………………………..
(68) Change in the provisions for outstanding claims in year N -2: gross amount (equal to item 18 of Annex 2) ............................
(69) Change in the provisions for outstanding claims in year N -2: Reinsurers' share……………………………………………………………………………………………….
V - Capital redemption operations.
(70) Provisions for policy liabilities relating to direct business ..............................................………….............................. 822,620Reserve relating to inward reinsurance ...................................................................……………............ (71)
(72) Reserve relating to outward reinsurance................................................................…………..................
III/VI - Insurance linked to unit trust funds and administration of pension funds.
With assumption of the investment risk: (73) Reserves relating to direct business..............................…..................................................................... 65,865 (74) Reserve relating to inward reinsurance................................................................………….................. 1,851 (75) Reserve relating to outward reinsurance................................................................…………..................
Without assumption of the investment risk and provided that the contracts determine the amount of the operating expenses for a period exceeding five years:
(76) Reserves relating to direct business..............................…..................................................................... 461,131 (77) Business relating to pension funds managed in the name and on behalf of third parties..................… 130,516
Without assumption of the investment risk and provided that the contracts determine the amount of the operating expenses for a period not exceeding five years:
(78) Net administrative costs in the last year (relating to insurance linked to investment funds)..(8)
(79) Net administrative costs in the last year (relating to insurance linked to pension fund administration operations)…(9)With assumption of the mortality risk:
(80) Non-negative risk capital charged to the company .......................................................................................................... 19,209 (81) Non-negative risk capital remaining charged to the company after cession and retrocession….................................................................................................... 19,209
(8) Indicate the amount specified on line c) of schedule 2 as set forth in Annex 3 to the solvency margin evidence schedule relating to class III
(9) Indicate the amount specified on line c) of schedule 2 as set forth in Annex 3 to the solvency margin evidence schedule relating to class VI
cont’d: I – BASIS OF CALCULATION OF THE SOLVENCY MARGIN FOR YEAR N TAKEN FROM THE FINANCIAL STATEMENTS
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Elements A)Subscribed share capital or equivalent fund ................................................................................................................ 15,000Reserves not assigned to cover specific commitments or to adjust items on the assets side:
Legal reserve ................................................................................................................ 47,096 (84) Free reserves ............................................................................................................... 436,623
Profit brought forward: (85) profit brought forward not distributed (*) ........................................................................................................................ (86) profit for the year not distributed (*) ........................................................................................................................................... 3,547 (87) Total cumulative preference shares and subordinated liabilities within the limit established by Art. 44, Section 3
of the Insurance Codeof which:
(88) subordinate loans with fixed expiry or cumulative preference shares with specified duration (for an amount not exceeding 25% of the lower of the amount of line 169 and that of line 168)..........................
(89) loans without fixed due date.............………………….………….... (90) securities with undetermined duration and other financial instruments, including
cumulative preference shares other than those indicated in Art. 44Section 3, sub. a) of the Insurance Code........................................
(90bis ) Elements of subsidiary/shareholding companies.......................... (90ter) Other items (91) Total from (82) to ( 90bis)................................................................ 502,266 (92) Acquisition commissions to be amortised, as set forth in Art. 12, Section 2, of Regulation
Other intangible assets ...........................................................................................................Own shares or equity interests and those in controlling companies......................................……....Loss for the year and losses brought forward...........................................................…..........
(95bis) Other deductions................................................................................................................................ 17,330 (96) Total from (92) to (95bis) ............................................................... 17,330 (97) Total elements A) = (91) - (96) ......................................................................................................... 484,936
Elements B)
(98) 50% of future surpluses………………………………........................................................... (99) Difference between the amount of the mathematical reserve determined
according to the pure premiums stated in the Financial Statements, reduced by the amountof the same reserve relating to risks ceded…………………………………………………………………………………. and the amount of the corresponding mathematical reserve determinedaccording to the pure premiums increased by the portion of amortisation of thepurchase costs contained in the rate premiums.............................................................................................. (within the limits set forth in Article 23 Section 1, sub b), of Regulation)
(100) Unrealised gains, net of losses and forseeable commitments towards policyholders resulting from the valuation of all company investments...........................................................................................................
(101)
or subscribed fund has been paid................................................................................................. (102) (103) Amount of the available solvency margin
(of which elements B..............%) Total elements A) and B) = (97) + (102) ...............................................................… 484,936
(*) Only the amounts that according to the resolution of the Meeting of members effectively remain in the assets of the company must be indicated.
(84) = (7) + (8) + (10) + (11) + (12)
(87) = (88) + (89) + (90) provided that (87) <= 0,5 * [the lower of (168) and (169)](90bis ) = total columns h - i - a - b of Annex 4
(92) = (2) - [ (26) - (27) - (28) + (29) ] provided this is positive(98)= 0,5 * [(24)* (25)] - [(31)-(32)-(33)] ; provided that (98) < = 0,25 * [(the lower of (168) and (169)] and that (24) < = [(19)+(20)+(21)+(22)+(23)]/5; and (25) <= 6
< [3,5 / 100] x (30) (99) = [ (26) - (27) - (28) + (29) ] - (2) provided that this is positive and that [ (26) - (27) - (28) + (29) ]
(100)= [(31)-(32)-(33)] provided that [(31)-(32)-(33)] < = 0,10 * [the lower of (168) and (169)]
(101) = 0,5 * (1) if (82) >= (6)/2 provided that (101) <= 0,5 * [the lower of (168) and (169)]; (101) =0 if (82) < (6)/2
II – COMPONENTS OF THE AVAILABLE SOLVENCY MARGIN
(82) = (6) - (1)
(95) = (13) + (14)
Half of the portion of share capital not paid or of the equivalent fund subscribed provided that at least 50% of the share capital
Total elements B) = (98)+(99)+(100)+(101)..............................…
(83) = (9)
(93) = (3) (94) = (4) + (5)
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A) ife, marriage and birth insurance.
(104) 4/100 mathematical provisions referring to direct business and inward reinsurance......................................................................... (105) conservation ratio relating to said reserves (minimum 0.85) ....... (106) (104) x (105) ...... 118,842
Non-negative risk capital contracts (excluding term insurance contracts indicated below):
(107) 0.3/100 of risk capital……………...................................................................... 19,479Non-negative risk capital contracts (term insurance contracts with maximum duration of three years):
(108) 0.1/100 of risk capital……………...................................................................... 3,276
Non-negative risk capital contracts (term insurance contracts with a duration of more than three years but less than or equal to five years):
(109) 0.15/100 of risk capital……………...................................................................... 600
(110) Total (107) + (108) + (109) ............... 23,355 (111) Conservation ratio of risk capital (minimum 0.50) ............................................................. (112) (110) x (111) ...... 20,015
(113) 138,858
B) Complementary insurance of personal injury risks (Art. 2, Section 2 of Insurance Code)
b1) Calculation in relation to the annual amount of premiums and contributionsGross premiums written …………….................................................................
(115) EURO = x 0.18 = ........... (116)
to be allocated:portion less or equal to 61,300,000portion exceeding 61,300,000 EURO = x 0.16 = ...........
(117) Total (115) + (116).........................
(118) Conservation ratio in relation to claims of the year remaining with thecompany following reinsurance cessions (minimum 0,50).......…...
(119) Solvency margin required b1, (117) x (118)...................................................... 22
b2) Calculation in relation to the average charge of claims in the last 3 years
(120) Claims paid in the reference period: Gross amount .............................................................................................Change in the provision for outstanding claims in the reference period: Gross amount…………………………………
Charges for claims.......................................…………………........................... (121) (122) (123) Annual average: 1/3 of(122) ................................................…….....................
(124) EURO = x 0.26 = ........... (125)
to be allocated:portion less or equal to 42,900,000portion exceeding 42,900,000 EURO = x 0.23 = ...........
(126) Total (124) + (125).........................
(127) Solvency margin required b2, (126) x (118)...................................................... 67
(128) (129) Solvency margin required B) Financial N - 1............ (130) Solvency margin required B) ………………………….. .........………. 68
C) Health insurance.
(131) 4/100 provisions for policy liabilities relating to direct business and inward reinsurance (132) Conservation ratio relating to said reserves (minimum 0.85) ....... (133) (131) x (132) ...... 15
c1) Calculation in relation to the annual amount of premiums and contributionsGross premiums written …………….................................................................
(135) x (0.18)/3 = ............................. (136)
to be allocated:portion less or equal to 61,300,000portion exceeding 61.300.000 x (0.16)/3 = .............................
(137) Total (135) + (136)......................... (138) Conservation ratio in relation to claims of the year remaining with the
company following reinsurance cessions (minimum 0,50).......…... (139) 9
c2) Calculation in relation to the average charge of claims in the last 3 years (140) Claims paid in the reference period: Gross amount .............................................................................................
Change in the provision for outstanding claims in the reference period: Gross amount…………………………………Charges for claims.......................................…………………...........................
(141) (142) (143) Annual average: 1/3 of(142) ................................................…….....................
(144) x (0.26)/3 = ............................. (145)
to be allocated:portion less or equal to 42,900,000portion exceeding 42,900,000 x (0.23)/3 = .............................
(146) Total (144) + (145).........................
(147) 1
(148)
(149)
(150) (151)
Solvency margin required Financial N ……..Solvency margin required C) (133)+(150)………… 24
9
1
Solvency margin required c2, (146) x (138)......................................................
Higher result of (139) and (147) .....................…….…............ 9
Solvency margin required Financial N-1.............................. 3
EURO = 13 1EURO =
Solvency margin required c1, (137) x (138)......................................................
39
3913
EURO =
9
1.000
0.850
(134) = (57) 158
EURO = 158 9
134
Solvency margin required B): higher result of (119) and (127) .....................…….…............ 67
68
17
1,548
516
516 134
43
0.500
1,548
(114) = (41) 241
241 43
III – AMOUNT OF THE SOLVENCY MARGIN REQUIRED
118,9610.999
0.857
Solvency margin required A): (106) + (112)………………..
143
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D) Capital redemption operations.
(152) 4/100 mathematical provisions referring to direct business and inward reinsurance
(153) conservation ratio relating to said reserves (minimum 0.85) ....... (154) 32,905
E) Insurance linked to unit trust funds and administration of pension funds.
With assumption of an investment risk (155) 4/100 reserves referring to direct business and inward reinsurance............................................................. (156) Conservation ratio relating to said reserves (minimum 0.85) ....... (157) (155) x (156) ............................. 2,709
Without assumption of an investment risk provided that the contracts determinethe amount of operating expenses for a period exceeding five years
(158) 1/100 gross reserves of direct business....................................................................................................................................... 5,916
(159)
Without assumption of an investment risk provided that the contracts determinethe amount of operating expenses for a period not exceeding five years25/100 of the Net administrative costs of the last year …………………………………..
With assumption of a mortality risk (160) 0.3/100 of non-negative risk capital………….......................................................... (161) Conservation ratio of risk capital (minimum 0.50) (162) (160) x (161) ...... 58 (163) Solvency margin required E): (157) + (158) + (159) + (162) ..................................................................... 8,683
(164) Total solvency margin required (113) + (130) + (151) + (154) + (163).................................(164bis ) Capital requirements required by subsidiary/shareholding companies................................................................................
(164ter ) Amount of the solvency margin required....................................................................................................(164quater) Amount of the solvency margin required according to item 70, Annex 5 in Regulation No. 33 (164quinquies) Amount of the total solvency margin required (16ter) + (16quater)
Guarantee quota: 1/3 di (164 quinquies) (165) (166) Minimum guarantee quota pursuant to Article 46, Section 2, of the decree-law.
Guarantee amount [higher result of (165) and (166)] ...................................... (167)
(168) Amount of the solvency margin required:[the higher result of (164quinquies) and (167)] .................................................................... 180,538
(169) = (103) Amount of the available solvency margin 484,936 (170) = (169) - (168) Excess (deficit) ................................................................................................................... 304,398
(104) = [4 / 100] x [ (34) + (35) ] (105) = [ (34) + (35) - (36) ] / [ (34) + (35) ] (107) = [0,3 / 100] x [ (37) - (39) - (40) ] (108) = [0.1 / 100] x (39) (109) = [0.15 / 100] x (40) (111) = (38) / (37) (118)= 1-[(43)+(47)+(51)+(45)+(49)+(53)]/[(42)+(46)+(50)+(44)+(48)+(52)] (120) = (42) + (46) + (50) (121) = [(44)+(48)+(52)] (122) = (120) + (121) (130) = if (128) < (129) then (130) = (129)*[Mathematical reserve N (item (2) - Annex1)] / [Mathematical reserve N - 1 (item (2) - Annex1)] said relationship cannot be > of 1; if 128 >= 129 then 130 = 128 (131) = [4 / 100] x [ (54) + (55) ] (132) = [ (54) + (55) - (56) ] / [ (54) + (55) ] (138)= [(58+62+66)-(59+63+67)+(60+64+68)-(61+65+69)]/[(58+62+66)+(60+64+68)] (140) = (58)+(62)+(66) (141) = [(60)+(64)+(68)] (142) = (140) + (141) (149) = (150) margin schedule financial N-1 (150) = if (148) >= (149) then (150) = (148)
if (148) < (149) then (150) = (149)*[Provision for claims N (item (2) - Annex2)] / [Provision for claims N - 1 (item (2) - Annex2)] said relationship cannot be > 1. In any case (150)>=(148) (152) = [4 / 100] x [ (70) + (71) ] (153) = [ (70) + (71) - (72) ] / [ (70) + (71) ] (155) = [4 / 100] x [ (73) + (74) ] (156) = [ (73) + (74) - (75) ] / [ (73) + (74) ] (158) = [1 / 100] x [ (76) + (77) ] (159) = (25/100) * [(78) + (79)] (160) = [0,3 / 100] x (80) (161) = (81) / (80) (164bis ) = total column g of Annex 4 (164ter ) = (164) + (164bis )
1.000
581.000
cont’d: III – AMOUNT OF THE SOLVENCY MARGIN REQUIRED
32,9051.000
Solvency margin required D): (152) x (153) ......
2,709
60,1793,700
60,179
Situation of the solvency margin and of the guarantee quota180,538
180,538
180,538
144 REPORTS AND ACCOUNTS 2015
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Company SOCIETA' REALE MUTUA DI ASS.NI
Financial 2015
TPL motor, aircraft, marine, lake and river craft, non-motor; credit; suretyship .................................................. XAccident; Health; Hulls land vehicles, Hulls of railway rolling stock, Aircraft, Marine, Lake and River craft; Goods transported; Fire and Natural Forces; Sundry Pecuniary Losses; Assistance............................................. X
Other property Damage;Legal Fees....................................................................................................................... X
Annex II
SOLVENCY MARGIN STATEMENT (Art. 28, section 2, of the Regulation)
(in thousands of euro)
Classes of business undertaken
145
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(1) Subscribed capital unpaid................................................................................................................(equal to item 1) ....................................................................... (2) Acquisition commissions to be amortised and other acquisition costs.....................................(equal to items 4 and 6) ............................ (3) Other intangible assets ...........................................................................................................(equal to items 7, 8 and 9) ............................ (4) Shares and interests in controlling companies.......................……………………...................(equal to item 17) ............................ (5) Own shares or interests...............................................................................................................(equal to item 91) ............................ (6) (7) Additional paid-in capital ......................….....………………............................ (equal to item 102) ....................................................................................................................... (8) (9) (10) Statutory reserves ............................…........................…...............................................................(equal to item 105) ....................................................................................................................... (11) Reserve for own shares and shares of the controlling company............................................................(equal to item 106) ....................................................................................................................... (12) Other reserves(1) ..................................................................................................................................................…………… (13) Losses brought forward..................................................................................................................(equal to item 108 (*) ) ................................... (14) Loss for the year...............…………………...................................................……........................(equal to item 109 (*) ) ................................... (15) Operating surplus brought forward......................................................................................................(equal to item 108) ...................................................................................................... (16) Operating surplus for the year .....................................................................................................................................................................................(equal to item 109) ...................................................................................................... (17) Cumulative preference shares (2) …………………………………………………………………………………………….. (18) Subordinated liabilities (3) .............................................................. (included in item 111) ........................................................................................................If used for the (19) Unrealised gains resulting from valuation of all company investments, provided not solvency margin, as per
of an exceptional nature ………………………………………………………………………………………………. as per Art. 23, Sec. 1, of the
(20) Losses resulting from valuation of all company investments.................................................................... Regulation
Items of the Income Statement of the year N
(21) (22) Gross premiums written of classes 11, 12 and 13...................................................................................................….................. (see annex 2) ..........…....................... (23) Claims paid: Gross amount ............................................................................................. (24) Claims paid of classes 11, 12 and 13: Gross amount ............................................................................................. (see annex 2) ..........…....................... (25) (26)
Claims paid Reinsurers' shareClaims paid of classes 11, 12 and 13: Reinsurers' share (see annex 2) ..........….......................
(27) (28) Change in refunds of classes 11, 12 and 13: Gross amount ............................................................................................. (see annex 2) ..........…....................... (29) (equal to item 12) ............................................................................. (30)
Change in refunds: Reinsurers' shareChange in refunds of classes 11, 12 and 13: Reinsurers' share (see annex 2) ..........….......................
(31) (32) Change in the provision for outstanding claims of classes 11, 12 and 13: Gross amount (see annex 2) ..........…....................... (33) Change in the provision for outstanding claims Reinsurers' share (34) Change in the provision for outstanding claims of classes 11, 12 and 13: Reinsurers' share……………………….................…….(see annex 2) ..........….....................
(1) Insert the other provision as set forth in item 107 excluding, for the first three years, the fund set up to cover initial formation expenses, specifying the detail thereof below
(2) insert cumulative preference shares as indicated in Art. 44, Section 3, sub a) and b) of the Insurance Code specifying:
cumulative preference shares as indicated in Art. 44, Section 3, sub a)
cumulative preference shares as indicated in Art. 44, Section 3, sub b)
(3) Insert subordinated liabilities specifying:- loans with fixed matu....................................................................................................................................................................……….
- loans without fixed maturity .............................................................................................................................................................- securities of undetermined duration and other financial instruments .............................................................................................................................................................
Items of balance sheet - Non-life business
72
I – BASIS OF CALCULATION OF THE SOLVENCY MARGIN FOR YEAR N TAKEN FROM THE FINANCIAL STATEMENTS
973,833
55,865
Subscribed share capital or equivalent fund ....................................................................................................................(equal to item 101) ..................................................................................................................... 45,000
Revaluation reserves ........................................................…...............................................................................................................................................................................................................(equal to item 103) ....................................................................................................................... 111,817
Legal reserve ................................................................................................................ (equal to item 104) ............................................................................................................................. 160,441
138,136
(equal to item 9) ..................................................................................................88,266
1,873
Change in refunds: Gross amount ............................................................................................. (equal to item 11) .................................................................................................38,421
9,881
Gross premiums written ...................................................................................................….................. (equal to item 1) ............................................................................. 1,416,838
210,850
equal to item 8) .............................................................................. 989,266
ORDINARY RESERVE FUND
EXTRAORDINARY RESERVE
OTHER EQUITY RESERVES
Change in the provision for outstanding claims Gross amount ............................................................................................. (from annex 1) ............................................................................................................................... -54,101
-21,258
(equal to item 15) ........................................................................................ 2,737
-3,109
973,833
(*) Indicate the amount of the loss in absolute value
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Items of the Income Statement of years prior to N (35) Claims paid in year N - 1: Gross amount................................................................... (equal to item 8 ) .................................. (36) Claims paid of classes 11, 12 and 13 in year N - 1: Gross amount................................................................... (see annex 2) ..........…................... (37) Claims paid in year N - 1: Reinsurers' share……………………….................…….……………………. (equal to item 9) .............................. (38) Change in refunds in year N -1: Gross amount................................................................... (equal to item 11) .................................... (39) Change in refunds of classes 11, 12 and 13 in year N - 1: Gross amount ..........................................................................(see annex 2) ..........…................... (40) Change in refunds in year N -1: reinsurers' share……………………….................……. (equal to item 12) .................................. (41) Change in the provisions for outstanding claims in year N -1: Gross amount...................................................................(from annex 1)....................................... (42) Change in the provisions for outstanding claims of classes 11, 12 and 13 in year N - 1: gross amount............................................................…(see annex 2) ..........…................... (43) Change in the provisions for outstanding claims in year N -1: Reinsurers' share……………………….................…….(equal to item 15) .............................. (44) Claims paid in year N - 2: Gross amount................................................................... (equal to item 8) .................................... (45) Claims paid of classes 11, 12 and 13 in year N - 2: Gross amount .............................................................................................(see annex 2) ..........…................... (46) Claims paid in year N - 2: reinsurers' share……………………….................……. (equal to item 9) .............................. (47) Change in refunds in year N -2: Gross amount................................................................... (equal to item 11) .................................... (48) Change in refunds of classes 11, 12 and 13 in year N - 2: Gross amount .....................................................................…(see annex 2) ..........…................... (49) Change in refunds in year N -2: reinsurers' share……………………….................……. (equal to item 12) .................................. (50) Change in the provisions for outstanding claims in year N -2: Gross amount...................................................................(from annex 1)....................................... (51) Change in the provisions for outstanding claims of classes 11, 12 and 13 in year N - 2: Gross amount...................................................................(from annex 2)....................................... (52) Change in the provisions for outstanding claims in year N -2: Reinsurers' share……………………….................…….(equal to item 15) ..............................
Items to be compiled only by companies engaged exclusively or mainly in “special risks” (**):
(53) Claims paid in year N - 3: Gross amount................................................................... (equal to item 8) .................................... (54) Change in the provisions for outstanding claims in year N -3: Gross amount...................................................................(from annex 1)........................................ (55) Claims paid in year N - 4: Gross amount ............................................................................................. (equal to item 8) .................................... (56) Change in the provisions for outstanding claims in year N -4: Gross amount...................................................................(from annex 1)........................................ (57) Claims paid in year N - 5: Gross amount................................................................................ (equal to item 8) .................................... (58) Change in the provisions for outstanding claims in year N -5: Gross amount...................................................................(from annex 1)......................................... (59) Claims paid in year N - 6: Gross amount................................................................... (equal to item 8) .................................... (60) Change in the provisions for outstanding claims in year N -6: Gross amount...................................................................(from annex 1).........................................
(**) Whereby “Special risks” mean credit, storm, hail and frost risks
cont’d: : I – BASIS OF CALCULATION OF THE SOLVENCY MARGIN FOR YEAR N TAKEN FROM THE FINANCIAL STATEMENTS
994,605141,818
-11,848998,538131,286158,30721,60322,387
116,72547,08010,245
-98,669-26,083
-60,03152,388
-73,849
II – COMPONENTS OF THE AVAILABLE SOLVENCY MARGIN
Elements A) (61) = (6) - (1) Subscribed share capital or equivalent fund ................................................................................................................
Reserves not assigned to cover specific commitments or to adjust items on the assets side: (62) = (9) Legal reserve ..................................................................................................................................................... (63) Free reserves ....................................................................................................................................................
Surpluses brought forward: (64) surplus brought forward not distributed ...................................................................................................... (65) surplus for the year not distributed ..................................................................................................... (66) Total cumulative preference shares and subordinated liabilities within the limit established by Art. 44, Section 3,
of the Insurance Code
(67) (68)
(69)(69bis ) Elements of subsidiary/shareholding ....................................................................................................................................... (69ter) Other elements...................................................................................................................................................… (70)
(71) Acquisition commissions to be amortised and other acquisition costs.......................…....................…........................ (72) = (3) Other intangible assets ......................................................................................................................................... (73) = (4) + (5) Own shares or equity interests and those in controlling companies......................................……......................... (74) = (13) + (14) Loss for the year and losses brought forward........................................................................................................ (74bis) Other deductions................................................................................................................................
(75)
(76)
Elements B) (77) Unrealised gains net of losses resulting from valuation of all the
investments of the company................................................................................................................. (78) Half of the portion of share capital not paid or of the equivalent fund subscribed
provided that at least 50% of the share capital or subscribed fundhas been paid..................................................................................................................................................
(79) (80) Amount of the available solvency margin available
(of which elements B.........%)
(63)= (7) + (8) + (10) + (11) + (12)(66) = (67) + (68) + (69) provided that (66) <= 0,5 * [lower of (105) and (104)](69bis) = total columns h - i - a - b of annex 3(71) = 0,4 * (2)
(77) = [(19) + (20)[ provided that [(19)- (20)] <= 0,20 * [lower of (105) and (104)]
(78) = 0,5 * (1) if (61) >= (6)/2 provided that (78) <= 0,5 * [lower of (105) and (104)]; (78) =0 if (61) < (6)/2(***) Only the amounts that according to the resolution of the Meeting of members effectively remain in the assets of the company must be indicated.
(***) 55,865
of which:subordinated loans with fixed expiry or cumulative preference share with specified duration (for an amount not exceeding 25% of the lower of
45,000
160,441
1,085,650
(***)
sub. A) of the Insurance Code........................................
Total from (61) to (69bis) and (69 ter)....................................................................................................... 1,346,956
of the amount of line (105) and that of line (104) ...................... loans without fixed maturity ............................... securities of undetermined duration and other financial instruments, includingcumulative preference shares other than those indicated in Art. 44, Section 3,
Total elements B) = (77)+(78)..............................…
Total elements A) and B) = (76)+(79)..............................… 1,346,884
72
Total from (71) to ( 74bis ) ............................................................................................................... 72
Total elements A) = (70) - (75) .........................................................................................................1,346,884
147
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(81) Amount of gross premiums written of the last year................................................to be allocated:
(82) portion less or equal to 61,300,000 EURO = x 0.18 = (83) portion exceeding 61,300,000 EURO = x 0.16 =
(84) Total a), (82) + (83) ............................................….......…................... (85)
(minimum 0,500) (86) Solvency margin required a) x g), (84) x (85) ......................................
(B) Calculation in relation to the average charge for claims in the last 3 years or in the last 7 years for companies operating primarily or exclusively in "special risks" (87) Claims paid in the reference period: Gross amount...................................................................
Change in the provision for outstanding claims in the reference period: Gross amount................................................................... Change in refunds during the reference period: Gross amount...................................................................Charges for claims.......................................…………………..................................................
(88) (89) (90) (91)
(92)
Annual average: 1/3 or 1/7 of (90) *to be allocated:portion less or equal to 42,900,000 EURO = x 0.26 =
(93) portion exceeding 42,900,000 EURO = x 0.23 =
(94) Total b), (92) + (93) ..............................................…......…............... (95) Solvency margin required b) x g), (94) x (85) ...............................
(96) = (86) Amount of the solvency margin required in relation to the annual amount premiums or contributions......................................................................................
(97) = (95) Amount of the solvency margin in relation to the average charge for claims........... (98) Higher result of (96) and (97) .....................…….…............
(98bis ) Capital requirements required by subsidiary/shareholding companies............................................................................................................... (98ter ) Amount of the solvency margin required....................................................................................................
(99) Guarantee quota: 1/3 of (98ter ) ........................................................................................................................................................................
(100) Minimum guarantee quota pursuant to Article 46, Section 3 of Insurance Code.......................(101) Guarantee quota [higher amount of (99) and (100)] ….........(102) Amount of the solvency margin required for year N
[higher result of (98ter) and (101)] ............................................................................................
(103) Amount of the solvency margin required for year N - 1(104) Amount of the solvency margin required......................................
(105) = (80) Amount of the solvency margin available......................................
(106) = (105) - (104) Excess (deficit)...............................................……...................
(81) = (21) + [(0,5) * (22)] (85) = 1-{[(25)+(37)+(46)]-[(29)+(40)+(49)]+[(33)+(43)+(52)]}/{[(23)+(35)+(44)]-[(27)+(38)+(47)]+[(31)+(41)+(50)]} (**)
(87) = (23) + (35) + (44) +(0,5) * [(24) + (36) + (45)] ; for companies that exercise “special risks”, also add the terms: (53) + (55) + (57) + (59) (88) = (31) + (41) + (50) +(0,5) * [(32) + (42) + (51)] ; for companies that exercise “special risks”, also add the terms: (54) + (56) + (58) + (60) (89) = (27) + (38) + (47) + (0,5) * [(28) + (39) + (48)] (90) = (87) + (88) - (89) (98bis ) = total column g of Annex 3(98ter ) = (98) + (98bis )(104)= (103) * [(113) - (59) of annex 1 of the Note] / [(293) - (239) of annex 1 of the Note], this ratio cannot be higher than 1; if (102) < (103). If (102) > = (103): (104) =(102). (*) For companies that have been operating for less than 3 (7) years, the average must be calculated according to the effective years of operation.
1,460,963 233,754244,788
Conservation ratio (g) in relation to claims of the year remainingwith the company following reinsurance cessions
0.895219,085
III – AMOUNT OF THE SOLVENCY MARGIN REQUIRED
(A) Calculation in relation to the annual amount of premiums or contributions1,522,263
61,300 11,034
906,897 208,586219,740196,668
Situation of the solvency margin and of the guarantee quota
219,085
3,188,029-210,277128,361
2,849,391949,797
42,900 11,154
73,028
219,085
211,382219,085
1,346,884
1,127,799
196,668219,085
219,08573,0283,700
148 REPORTS AND ACCOUNTS 2015
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Company: SOCIETA' REALE MUTUA DI ASS.NI
Financial 2015
SOLVENCY MARGIN LAYOUT EVIDENCEOF COMPANIES ENGAGED JOINTLY
IN LIFE AND NON-LIFE INSURANCE BUSINESS(Art. 29 of Regulation)
(in thousands of euro)
Life Non-lifeReference items of the models of the solvency marginLife business and Non-life business insurance insurance
Amount of the solvency margin required: Life business (168 ); Non-life business (104) 1 180,538 11 219,085 21 399,623
Elements forming the solvency margin available 2 484,936 12 1,346,884 22 1,831,820 3 13 23
Total elements forming the solvency margin available 4 484,936 14 1,346,884 24 1,831,820
Surplus/deficit of the elements forming the solvency margin available in relation to the amount of the solvencymargin to be formed 5 304,398 15 1,127,799 25 1,432,197
Utilisation pursuant to Art. 348, section 3 of Insurance Codeof the explicit elements of the solvencymargin still available as set forth in Art. 44, section 2, sub. a), b), c) of the Insurance Code 6 16 26
7 304,398 17 1,127,799 27 1,432,197
N.B. (e) always < (d) (e) always < (b)
(b) total elements A): Life business (97); Non-life business (76) total elements B): Life business (102); Non-life business (79) (c)
(b + c)
d = [ (b+c) - a]
(e)
f = (d + e)
Annex III
Total
(a)
SCHEDULES OF ASSETS ASSIGNED
TO COVER THE TECHNICAL PROVISIONS
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151
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MODEL 1
Società Reale Mutua di Ass.ni
ANNUAL SCHEDULE OF ASSETS ASSIGNED TO COVER THE TECHNICAL PROVISIONS
PURSUANT TO ARTICLES 36 AND 41, SECTION 4, OF LEGISLATIVE DECREE NO.209/05
Financial 2015
152 REPORTS AND ACCOUNTS 2015
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(values in Euro)
9 10
A INVESTMENTS
A.1 Debt securities and similar
A.1.1a Securities issued or guaranteed by Member States of European Union or belonging to OCDE, or issued by localinstitutions or public institutions of Member States or by international organisations of which one or more of theaforesaid States are members, traded on a regulated market;
13
3,166,273,643
14
81.48
15
3,054,988,510
16
88.35
A.1.1b Securities issued or guaranteed by Member States of European Union or belonging to OCDE, or issued by localinstitutions or public institutions of Member States or by international organisations of which one or more of theaforesaid States are members, not traded on a regulated market;
17
0
18
0.00
19
0
20
0.00
A.1.2a Bonds or other similar securities traded on a regulated market; 21 695,153,569 22 17.89 23 373,173,738 24 10.79
A.1.2b Bonds or other similar securities not traded on a regulated market, issued by companies or credit institutions withregistered offices in a Member States of European Union or belonging to OCDE, whose Financial Statements havebeen certified by a duly authorised audit company; 25
0
26
0.00
27
10,000,000
28
0.29
A.1.2c Bonds and other debt securities issued pursuant to article 157, section 1 of Legislative Decree 163/2006 by projectcompanies pursuant to article 156, by companies that operate under public-private partnership agreements pursuant toarticle 3, section 15-ter of the same Decree, by companies awarding public works contracts for the construction andmanagement of road, rail, port, airport, hospital and telecoms infrastructure and for the production and transportation ofenergy and energy sources, and by companies pursuant to article 157, section 4 of Legislative Decree 163/2006 whosefinancial statements must be certified by a duly authorised audit company. This class comprises bonds and other debtsecurities guaranteed pursuant to article 157, section 3 of Legislative Decree 163/206;
3%
513
0
514
0.00
515
0
516
0.00
A.1.2d Bonds, finance bills and other securities pursuant to Art. 32, section 26-bis, of Italian Decree Law No. 83 of June 22,2012, even if not intended to be traded on a regulated market or in multilateral trading systems and even if unrated. 3%
517
0
518
0.00
519
0
520
0.00
of which securities not traded 521 0 522 0.00 523 0 524 0.00
A.1.3 Other bonds or similar securities, other than those indicated in the points above, provided with a remaining duration ofless than one year; 29
030
0.0031
032
0.00
A.1.4 Shares of Italian and UE OICVMs (UCITS); 33 3,697,813 34 0.10 35 3,697,813 36 0.11
A.1.5 Repo agreements with obligation of re-purchase and deposit of the securities; 20% 37 0 38 0.00 39 0 40 0.00
A.1.8 Accrued income on securities suitable for coverage of technical provisions; 53 42,198,845 54 1.09 55 41,394,327 56 1.20
A.1.9 Debt securities referring to factoring transactions even if not intended to be traded in a regulated market or inmultilateral trading systems and even if unrated. [A.1.9 = A.1.9a) + A.1.9b) + A.1.9c)] 5%
525
0
526
0.00
527
0
528
0.00
A.1.9a) Debt securities referring to credit factoring transactions as set forth in Art. 1, section 1, of Italian Law No. 130 of April30, 1999 lacking the rating requirement as specified in macro-class A1 533
0
534
0.00
535
0
536
0.00
A.1.9b) Debt securities referring to factoring transactions carried out through the subscription or purchase of bonds and similarsecurities, i.e. finance bills, excluding securities representing share capital, hybrid and convertible securities asspecified in Art. 1, section 1-bis, of Italian Law No. 130 of April 30, 1999.
537
0
538
0.00
539
0
540
0.00
A.1.9c) Debt securities referring to factoring transactions involving loans granted by factoring companies to parties other thanindividuals and microenterprises pursuant to Art. 1, section 1-ter, of Italian Law No. 130 of April 30, 1999.
541
0
542
0.00
543
0
544
0.00
of which securities not traded 529 0 530 0.00 531 0 532 0.00
Total A.1 57 3,907,323,870 58 100.56 59 3,483,254,388 60 100.74
of which structured securities (a) 501 351,535,158 502 9.05 503 184,231,452 504 5.33
of which factoring (b) 505 0 506 0.00 507 0 508 0.00
Total (a) + (b) 509 351,535,158 510 9.05 511 184,231,452 512 5.33
A.2 Loans 20% 545 0 546 0.00 547 0 548 0.00
A.2.1 Interest-bearing loans and advances guaranteed by mortgages or by bank and insurance guarantees or by other suitableguarantees given by the state or territorial local authorities; 20% 61
062
0.0063
064
0.00
A.2.2 Direct loans not guaranteed granted to parties other than individuals and microenterprises. [A.2.2 = A.2.2a) + A.2.2b)+ A.2.2c) + A.2.2d)] 5% 549
0550
0.00551
0552
0.00
A2.2a) Direct loans selected by a bank or financial intermediary and meeting all requirements as regards borrower's quality andrelations with the intermediary. 5%
553
0554
0.00555
0556
0.00
A2.2b) Direct loans selected by a bank or financial intermediary not meeting requirements as regards the borrower.2.5% 557
0558
0.00559
0560
0.00
A2.2c) Direct loans selected by a bank or financial intermediary not meeting requirements as regards the borrower andrelations with the intermediary. 1% 561
0562
0.00563
0564
0.00
A2.2d) Direct loans not selected by a bank or financial intermediary. ** 565 0 566 0.00 567 0 568 0.00
A.3 Capital securities and other similar securities
A.3.1a Shares traded on a regulated market; 65 0 66 0.00 67 30,940 68 0.00
A.3.1b Banca d'Italia equity interests, interests in co-operative societies and limited companies and shares not traded on aregulated market, issued by companies with registered offices in a Member State of European Union or belonging toOECD, whose Financial Statements have been certified by a duly authorised audit company;
69
0
70
0.00
71
0
72
0.00
A.3.3 Shares of Italian and EU OICVMs (UCITS); 77 85,159,779 78 2.19 79 69,174,756 80 2.00
A.3.4 Shares of closed-end AIFs traded on a regulated market. 5% 81 0 82 0.00 83 0 84 0.00
Total A.3 85 85,159,779 86 2.19 87 69,205,696 88 2.00
A.4 Real estate compartment
A.4.1 Land, buildings and realty rights for quotas free of mortgages; 89 0 90 0.00 91 0 92 0.00
A.4.2 Real property leased; 10% 93 0 94 0.00 95 0 96 0.00
A.4.3 Equity investments in real property companies in which the company holds the majority of the share capital, pursuant toArt. 72, section 1 of Decree Law and intended solely for the construction or management of real property forresidential, not luxury housing or for industrial or commercial use or for agricultural activities, for the amount stated inthe Financial Statements within the limit of the economic value of the real property assumed in proportion to theportion of share capital held and net of total liabilities stated in the Financial Statements of the real estate company forthe share corresponding to value of the equity investment held.
97
31,153,026
98
0.80
99
31,153,026
100
0.90
to be carried forward 4,023,636,675 103.55 3,583,613,110 103.64
TECHNICAL PROVISIONSAt the end of
financial 2015At the end of
financial 2014
Technical provisions to be covered 3,885,723,494 3,457,638,447
ASSET DESCRIPTION MaximumLimits
Balance at the end of financial 2015
Balance at the end of financial 2014
Values % Values %
153
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carried forward 4,023,636,675 103.55 3,583,613,110 103.64A.4.4 Shares of Italian real property AIFs. 10% 101 13,520,084 102 0.35 103 15,000,000 104 0.43
Total A.4 40% 109 44,673,110 110 1.15 111 46,153,026 112 1.33
A.5 Alternative investments
A.5.1a Shares of Italian and EU open-ended AIFs investing mainly in the bonds compartment. 301 0 302 0.00 303 0 304 0.00
A.5.1b Shares of Italian and EU open-ended AIFs investing mainly in the equity compartment. 305 0 306 0.00 307 0 308 0.00
A.5.2a Shares of Italian and EU closed-end AIFs not traded on a regulated market and of reserved Italian AIFs309
0310
0.00311
0312
0.00
A.5.2b Shares of Italian and EU AIFs other than the previous classes. 313 0 314 0.00 315 0 316 0.00
Sub-total A.5.2a+A.5.2.b 5% 317 0 318 0.00 319 0 320 0.00
Total A.5 10% 321 0 322 0.00 323 0 324 0.00
Sub-total A.3+A.5.1.b+A.5.2a+A.5.2.b 35% 325 85,159,779 326 2.19 327 69,205,696 328 2.00
TOTAL A 113 4,037,156,759 114 103.90 115 3,598,613,110 116 104.08
B RECEIVABLES
B.1 Receivables from reinsurers net of debit items, including the reinsurers' share of technical provisions, duly documented,up to 90% of their amount; 117
0118
0.00119
0120
0.00
B.2 Deposits and amounts receivable net of debit items with ceding companies, duly documented, up to 90% of theiramount; 121
0122
0.00123
0124
0.00
B.3.1 Debtors receivable from policyholders net of debit items, arising out of direct insurance operations, to the extent towhich these are effectively collectable since at least 3 months; 125
0126
0.00127
0128
0.00
B.3.2 Debtors receivable from intermediaries net of debit items, arising out of direct insurance and reinsurance operations tothe extent to which these are effectively collectable since at least 3 months;
129
0
130
0.00
131
0
132
0.00
B.4 Advances on policies; 133 0 134 0.00 135 0 136 0.00
B.5 Tax refunds, definitely ascertained or for which the term prescribed for assessment has elapsed;5% 137
0138
0.00139
0140
0.00
B.6 Amounts receivable from guarantee funds, net of debit items; 5% 141 0 142 0.00 143 0 144 0.00
B.7 Loans arising out of centralised management operations of the Treasury of the Group claimed against the companyresponsible of the management. 5% 401
0402
0.00403
0404
0.00
TOTAL B 145 0 146 0.00 147 0 148 0.00
C OTHER ASSETS
C.1 Tangible fixed assets used in company business, other than land and buildings, within the limit of 30% of the carryingvalue; 149
0150
0.00151
0152
0.00
C.2 Tangible fixed assets not used in company business, other than land and buildings, duly documented, within the limitof 10% of the carrying value; 153
0154
0.00155
0156
0.00
Sub-total C.1+C.2 5% 157 0 158 0.00 159 0 160 0.00
C.3 Acquisition commissions to be amortised within the limit of 90% of their amount; 161 0 162 0.00 163 0 164 0.00
C.4 Accrued income for rents within the limit of 30% of their amount; 165 0 166 0.00 167 0 168 0.00
C.5 Reversible interests; 5% 169 0 170 0.00 171 0 172 0.00
TOTAL C 173 0 174 0.00 175 0 176 0.00
TOTAL B + C - C.3 25% 177 0 178 0.00 179 0 180 0.00
D Deposits with banks, deposits with other credit institutions or any other institutions authorised by the competentcontrolling authorities to receive deposits, net of debit items; 15% 181
1,305,371182
0.03183
316,752184
0.01
E Other categories of assets authorised by ISVAP according to Article 38, Section 4 of Decree Law No. 209/95;185
0186
0.00187
0188
0.00
GRAND TOTALASSETS FOR COVERAGE 189
4,038,462,130190
103.93191
3,598,929,862192
104.09
Sub-total A.1.1b + A.1.2b + A.1.2d* + A.1.3 + A.1.9* + A.3.1b + A.5.2a + A.5.2b 10% 193 0 194 0.00 195 10,000,000 196 0.29
(*) For the purposes of the 10% limit with reference to classes A.1.2d and A.1.9, only securities not traded in a regulated market or multilateral trading systems are considered
(**): said limit is subject to a specific IVASS authorization.
154 REPORTS AND ACCOUNTS 2015
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Annex A to Model 1
(values in Euro)
CURRENCY EXCHANGE RATE (1) TECHNICAL PROVISIONS ASSETS
FOR COVERAGE
European Economic Area
1.000 3,885,723,494 4,034,741,718Euro Danish Krona Swedish Krona Pound Sterling Czech Krona Hungarian Forint Lithuanian Litas Polish Zloty New Leu Romania New Lev Bulgaria Norwegian Krona Iceland Krona Liechtenstein Franc
Non-EU states
1.084 1,574,2371.089 2,146,175
Swiss Franc U. S. Dollar Canadian Dollar Australian Dollar New Zealand Dollar Hong Kong Dollar Japanese Yen Arabian Riyal Turkish Lira
3,885,723,494 4,038,462,130
(1).
(2).
The amounts of technical provisions and assets assigned to cover these have been convertedat the exchange rate prevailing at the end of the reference year in relation to the currency in which the communication was made,including assets acquired after such date.The total technical provisions correspond to the amount of item 9 of the annual scheduleof assets assigned to cover technical provisions.The total of the assets corresponds to item 189 of the same schedule.
List of commitments and related assets for coverage by currency
TOTAL (2)
155
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MODEL 2
EVIDENCE OF ANNUAL SCHEDULE OF ASSETS ASSIGNEDTO COVER TECHNICAL PROVISIONS REFERRING TO
CONTRACTS SPECIFIED IN ARTICLE 41, SECTIONS 1 AND 2 OF DECREE LAW 209/05
Financial 2015
Società Reale Mutua di Ass.ni
156 REPORTS AND ACCOUNTS 2015
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Number of shares owned carrying Number of
shares owned carrying
0 0 0 0 0 01 2 3 4 5 6
TOTAL SECTION I
SECTION I - Contracts linked to the value of shares of an OICVM (UCITS)(values in Euro)
Order number Name of the reference OICVM (UCITS)
At the end of financial 2015
Technical provisions
Financial instruments for coverage
At the end of the previous year
Technical provisions
Financial instruments for coverage
157
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619 FONDO REALE CONSOLIDA 36,164,715 36,168,098 0 0812 REALE LINEA DINAMICA PROTETTA 15,641,910 15,642,058 16,892,064 16,892,440814 REALE LINEA DINAMICA PROTETTA 2 5,501,957 5,502,225 5,835,463 5,835,586816 REALE LINEA PRUDENTE 105,623,449 105,623,449 86,038,572 86,165,752818 REALE LINEA CRESCITA DINAMICA 2,882,761 2,882,958 3,356,926 3,357,049830 REALE CONSERVATIVO 4,145,878 4,146,063 3,674,376 3,674,588831 REALE LINEA CONTROLLATA 7,757,123 7,757,399 1,064,172 1,064,252832 REALE LINEA MERCATO GLOBALE 4,660,117 4,660,407 1,308,330 1,308,631951 REALE IMPRESA ITALIA 242,153 242,177 246,837 246,858952 REALE IMPRESA MONDO 376,185 376,197 385,712 385,717953 REALE IMPRESA EMERGENTE 157,720 157,730 210,022 210,033960 REAL MIDA 1 0 0 31,766,508 31,767,921961 REAL MIDA 2. 3,977,750 3,977,956 3,865,250 3,865,496970 REALE LINEA OBBLIGAZIONARIA 36,966,398 36,966,398 40,898,338 40,949,139971 REALE LINEA BILANCIATA ATTIVA 57,575,465 57,575,465 65,071,724 65,083,573
972 REALE LINEA BILANCIATA AGGRESSIVA 69,038,433 69,038,434 77,782,011 77,786,817
973 REALE LINEA TRASFORMAZIONI 3,734,650 3,734,650 4,068,670 4,068,670976 REALE LINEA EQUILIBRIO 66,763,525 66,763,526 62,510,471 62,515,659977 REALE LINEA FUTURO 43,655,189 43,655,190 41,126,361 41,129,081979 REALE LINEA GARANTITA 8,318,664 8,319,022 9,083,711 9,083,975
473,184,042 473,189,402 455,185,518 455,391,2377 8 9 10
TOTAL SECTION II
SECTION II - Contracts linked to the value of shares of internal funds
Order number Name of Internal Fund
At the end of financial 2015 At the end of the previous year
Technical provisions Financial instruments for coverage(1) Technical provisions Financial instruments for
coverage (1)
158 REPORTS AND ACCOUNTS 2015
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0 0 0 011 12 13 14
473,184,042 473,189,402 455,185,518 455,391,23715 16 17 18
TOTAL SECTION III
GRAND TOTAL(2)
(1) The total amount of assets present in the matching fund management must be indicated.(2) The grand total is the sum of the total values indicated in the three sections.
SECTION III - Contracts linked to share indexes or other references values
Order number Name of Internal Fund
At the end of financial 2015 At the end of the previous year
Technical provisions Financial instruments for coverage (1) Technical provisions Financial instruments for
coverage (1)
159
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MODEL 3
Società Reale Mutua di Assicurazioni
EVIDENCE OF INVESTMENTS DERIVING FROM THE ADMINISTRATIONOF PENSION FUNDS ACCORDING TO CLASS "D.II" OF THE BALANCE SHEET
Financial 2015
160 REPORTS AND ACCOUNTS 2015
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801 TESEO GARANTITA FUND TESEO GARANTITA 801 45,549,490 45,551,880 39,520,865 39,523,135802 TESEO PRUDENZIALE FUND TESEO PRUDENZIALE 802 39,959,433 39,960,217 34,930,768 34,932,484803 TESEO BILANCIATA FUND TESEO BILANCIATA 803 47,483,357 47,485,360 42,836,167 42,836,179804 TESEO SVILUPPO FUND TESEO SVILUPPO 804 43,072,967 43,076,273 38,534,407 38,535,229
176,065,247 176,073,730 155,822,207 155,827,0271 2 3 4
Provisions Investments (3)
TOTAL SECTION I
SECTION I - Open-end pension fundsvalues in Euro
Order number of the fund
Name of the fund Investment line (1) (2).At the end of financial 2015 At the end of the previous year
Provisions Investments (3)
161
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0 0 0 05 6 7 8
176,065,247 176,073,730 155,822,207 155,827,0279 10 11 12
(1) The amount of provisions and of the related assets regarding each investment line must be specified inside each fund.(2) Indicate the order number assigned to each investment line within each fund (to be maintained in subsequent communications).(3) The investments must be indicated net of the liabilities relating to the fund.(4) The grand total consists of the sum of the total values indicated in the two sections.
Provisions Investments (3)
TOTAL SECTION II
GRAND TOTAL (4)
SECTION II – Closed-end pension funds
Order number of the fund
Name of the fund Investment line (1) (2).At the end of financial 2015 At the end of the previous year
Provisions Investments (3)
162 REPORTS AND ACCOUNTS 2015
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Annex 1 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of shares and interests (values in Euro)
State Currency
ISIN Name code
Code (*) (*) Quantity Amount
(1) (2) (3) (4) (5) (6) (7) (8) (9)
803 803 a 2 A5 NR 4 BE0003797140 648 51,082
803 803 a 9 C1 Ba1 4 DE0005785802 1,822 141,624
803 803 a 8 G4 IT0001063210 5,422 20,777
803 803 a 1 G4 Baa1 4 IT0000062072 11,335 191,788
803 803 a 8 E4 Baa1 4 FR0000120644 5,038
803 803 a 1 B7 Aa3 4 DE0008404005 4,607 753,475
803 803 a 8 G4 A3 4 IT0003132476 22,433 309,575
803 803 a 8 G4 Baa3 4 IT0000068525 2,105 15,766
803 803 a 1 E4 A2 4 FR0000120628 21,483 542,016
803 803 a 3 E4 A2 4 FR0000120685 8,690 45,336
803 803 a 8 E4 A+ 5 FR0000120073 3,057 316,858
803 803 a 8 E4 Baa2 4 FR0000125007 4,204 167,529
803 803 a 8 E4 A3 4 FR0000121972 5,007 263,168
803 803 a 8 B7 Baa3 4 DE0007257503 1,424 42,093
803 803 a 8 B7 DE000A1EWWW0 1,671 150,240
803 803 a 8 E4 Baa1 4 FR0000125486 3,947 233,426
803 803 a 8 B7 A2 4 DE0005190003 2,854 278,636
803 803 a 1 C1 Aa3 4 DE0008430026 1,291 238,254
803 803 a 8 B7 A3 4 DE0007100000 8,479 657,801
803 803 a 9 E4 Baa1 4 FR0000120172 5,668 151,052
803 803 a 8 E4 Baa2 4 FR0000130338 688 98,074
803 803 a 8 H7 A1 4 NL0000009355 14,510 581,924
803 803 a 1 H7 A3 4 NL0000303709 11,646 60,909
803 803 a 9 H7 Baa1 4 NL0010273215 3,602 297,345
803 803 a 8 H7 Baa1 4 NL0000009538 8,076 190,271
803 803 a 2 B7 AA 5 DE0005810055 1,609 130,957
803 803 a 3 D7 A3 4 ES0113900J37 118,479 540,027
803 803 a 9 B7 Baa1 4 DE0005557508 26,574 443,520
803 803 a 2 H7 Baa1 4 NL0000303600 39,349 489,895
803 803 a 8 E3 Ba2 4 FI0009005961 4,680 39,265
803 803 a 8 G4 Baa3 4 NL0000226223 5,400 33,831
803 803 a 8 E4 FR0000120321 2,056 319,297
803 803 a 3 D7 Baa1 4 ES0113211835 64,121 432,111
803 803 a 8 E4 Aa1 4 FR0000120271 20,032 826,620
803 803 a 8 E4 Ba3 4 FR0000121501 3,812 61,773
803 803 a 8 E3 Ba1 4 FI0009005987 4,371 75,312
803 803 a 3 E4 A2 4 FR0000130809 8,790 374,190
803 803 a 8 C1 A2 4 DE0007164600 7,925 581,537
803 803 a 9 E4 BBB 5 FR0000125338 1,307 111,879
803 803 a 8 D7 Baa2 4 ES0173516115 8,745 88,499
803 803 a 9 B7 A3 4 DE0005552004 8,105 210,365
803 803 a 8 C4 NL0000240000 2,011 50,506
803 803 a 3 G4 BBB- 5 IT0000062957 4,822 42,843
803 803 a 8 C1 Baa1 4 DE0005439004 889 199,625
803 803 a 2 A5 Baa2 4 BE0003565737 4,452 256,747
803 803 a 8 H7 Baa1 4 NL0000009132 2,086 128,664
803 803 a 8 E4 A2 4 FR0000121667 1,651 189,948
803 803 a 8 E4 Ba1 4 FR0000131906 2,295 212,586
803 803 a 8 A5 Baa2 4 BE0003470755 479 47,148
803 803 a 3 F9 Baa2 4 IE0030606259 226,818 76,664
803 803 a 8 H7 Baa1 4 NL0000395903
GBL
FRESENIUS MEDICAL C
MEDIASET ORD.
GENERALI ASSICURAZIONI SPA
GROUPE DANONE S.A.
ALLIANZ AG.
ENI SPA ORD.
SAIPEM SPA ORD.
AXA-UAP
NATIXIS
AIR LIQUIDE
COMPAGNIE DE SAINT-GOBAIN
SCHNEIDER SA
METRO AG
ADIDAS-SALOMON AG
VINCI
BMW BAYERISCHE MOTOREN WERKE AG
MUENCHENER RUECKVER AG
DAIMLER
CARREFOUR
VALEO
UNILEVER NV-CVA
AEGON NV SHS
ASM LITOGRAPHY HOLDING NV
ROYAL PHILIPS
DEUTSCHE BOERSE AG
BANCO SANTANDER CENTRAL HISP
DEUTSCHE TELEKOM
ING GROEP
STORA ENSO
STMICROELECTRONICS
L'OREAL
BANCO BILBAO VA
TOTAL FINA ELF
PEUGEOT
UPM-KYMMENE OYJ
SOCIETE GENERALE- A
SAP AG
CAP GEMINI
REPSOL YPF
DEUTSCHE POST
QIAGEN NV
MEDIOBANCA
CONTINENTAL
KBC GROUP
AKZO NOBEL NV
ESSILOR INTL
RENAULT
SOLVAY
BANK OF IRELAND
WOLTERS KLUWER 2,486 76,979
Rating Current value
313,767
163
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Annex 1 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of shares and interests (values in Euro)
State Currency
ISIN Name code
Code (*) (*) Quantity Amount
(1) (2) (3) (4) (5) (6) (7) (8) (9)
Rating Current value
803 803 a 8 F9 Baa2 4 IE0001827041 6,732 179,744
803 803 a 8 H7 Baa3 4 NL0000009082 28,217 98,534
803 803 a 8 H7 BBB+ 5 NL0006144495 10,916 169,635
803 803 a 8 E4 A- 5 FR0000121220 783 70,580
803 803 a 3 E4 A2 4 FR0000045072 9,734 105,906
803 803 a 8 E4 NR 4 FR0000124711 833 195,255
803 803 a 8 G4 Baa1 4 IT0003153415 17,897 86,443
803 803 a 8 B7 DE0006231004 9,036 122,031
803 803 a 9 E4 BBB- 5 FR0000120404 1,457 58,287
803 803 a 8 D7 ES0167050915 1,593 43,035
803 803 a 8 G4 A- 5 IT0001479374 1,129 68,192
803 803 a 8 E4 Baa1 4 FR0000120503 1,612 58,911
803 803 a 8 E4 Baa1 4 FR0000124141 4,071 89,012
803 803 a 8 E4 A3 4 FR0000121261 1,572 138,179
803 803 a 9 G4 Ba1 4 IT0003497168 88,957 104,524
803 803 a 8 G4 Baa1 4 IT0003242622 11,218 53,353
803 803 a 8 C2 A2 4 DE0006483001 1,859 248,920
803 803 a 8 C4 Baa3 4 DE0005470405 734 31,327
803 803 a 8 B7 A2 4 DE0006048432 1,487 153,458
803 803 a 8 G4 Baa1 4 IT0003506190 3,422 83,839
803 803 a 3 D7 Ba1 4 ES0113790226 15,778 48,012
803 803 a 3 G4 Baa2 4 IT0003487029 7,535 46,717
803 803 a 8 G4 A- 2 LU0156801721 3,937 43,071
803 803 a 8 D7 ES0132105018 1,068 10,057
803 803 a 8 A5 Baa3 4 BE0003562700 875 78,566
803 803 a 8 D7 ES0125220311 216 17,081
803 803 a 8 C2 Ba1 4 DE0006047004 1,166 88,173
803 803 a 8 A5 BE0003739530 1,045 86,975
803 803 a 8 C4 Ba1 4 DE0008232125 1,982 28,868
803 803 a 8 A1 AT0000937503 901 25,539
803 803 a 8 E4 Baa2 4 FR0000130577 1,640 100,663
803 803 a 8 H7 NL0000360618 1,726 20,125
803 803 a 8 E3 FI0009013403 3,316 129,888
803 803 a 8 H7 Ba2 4 LU0323134006 8,355 32,559
803 803 a 8 B7 DE0005773303 298 17,564
803 803 a 8 D7 NR 4 ES0173093115 901 69,476
803 803 a 8 E4 Baa2 4 FR0000077919 540 19,062
803 803 a 8 A1 A3 4 AT0000743059 1,184 30,938
803 803 a 8 D7 Baa2 4 ES0130960018 1,894 49,244
803 803 a 8 B7 DE000PAH0038 1,213 60,662
803 803 a 8 C2 Ba1 4 DE000KSAG888 1,690 39,918
803 803 a 1 C4 NR 4 DE0008402215 600 63,390
803 803 a 8 D7 NR 4 ES0184933812 1,449 15,620
803 803 a 8 E4 Baa2 4 FR0000120859 285 18,360
803 803 a 8 E4 FR0000120966 213 32,301
803 803 a 9 H7 NL0000379121 1,065 61,269
803 803 a 8 F9 Baa2 4 IE0004906560 1,243 94,853
803 803 a 8 E4 BBB+ 5 FR0000131708 969 44,317
803 803 a 8 D7 Ba2 4 ES0171996012 1,185 50,517
803 803 a 8 G4 IT0004176001 1,624 32,902
803 803 a 8 D7 BBB 5 ES0118900010 3,508 73,159
803 803 a 8 C4 Baa1 4 DE0006599905 1,069 95,750
803 803 a 8 A5 BE0003884047 899 34,760
803 803 a 8 G4 IT0004618465 12,419 23,385
803 803 a 8 H7 NL0009432491 545 21,620
803 803 a 8 E4 A3 4 FR0010613471
CRH PLC
KONINKLIJKE KPN NV
RELX NV
SODEXHO ALLIANCE SA
CREDIT AGRICOLE SA
UNIBAIL
SNAM RETE GAS SPA
INFINEON TECHNOLOGIES
ACCOR SA
ACS SHS
LUXOTTICA
BOUYGUES
VEOLIA ENVIRONNEMENT
MICHELIN
TELECOM ITALIA SPA
TERNA
LINDE AG
LANXESS AG
HENKEL AG & CO KGAA-VORZUG
ATLANTIA SPA
BANCO POPULAR ESPANOL
UBI BANCA
TENARIS
ACERINOX SA
GROUPE DELHAIZE
ACCIONA SA ORD.
HEIDELBERGCEMENT
UCB
DEUTSCHE LUFTHANSA
VOESTALPINE
PUBLICIS GROUPE SA
SBM OFFSHORE
KONE SHS B
ARCELORMITTAL SHS
FRAPORT
RED ELECTRICA ESP
JC DECAUX SA
OMV AG
ENAGAS
PORSCHE AUTOMOBIL HOLDING
K+S
HANNOVER RUECKVERSICHERU-REG
ZARDOYA OTIS SA
IMERYS SA
BIC
RANDSTAD HOLDING NV
KERRY GROUP PLC
TECHNIP
GRIFOLS
PRYSMIAN
FERROVIAL
MERCK KGAA
UMICORE SA
ENEL GREEN POWER SPA
KONINKLIJKE VOPAK
SUEZ ENVIRONNEMENT CO. 2,960 51,090
164 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 182BILANCIO REALE MUTUA 2015.indd 182 14/04/16 16:0314/04/16 16:03
Annex 1 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of shares and interests (values in Euro)
State Currency
ISIN Name code
Code (*) (*) Quantity Amount
(1) (2) (3) (4) (5) (6) (7) (8) (9)
Rating Current value
803 803 a 8 D7 Baa3 4 ES0126775032 5,334 29,038
803 803 a 3 B7 Baa1 4 DE000CBK1001 8,791 84,147
803 803 a 2 D7 Baa2 4 ES0109067019 3,595 146,263
803 803 a 8 C4 Baa3 4 DE0005785604 3,320 219,020
803 803 a 8 E4 A- 5 FR0010307819 2,146 112,021
803 803 a 1 E3 Baa2 4 FI0009003305 6,358 298,826
803 803 a 8 H7 Baa2 4 NL0010672325 7,161 139,460
803 803 a 8 D7 ES0148396007 9,117 288,918
803 803 a 8 A1 AT0000730007 646 29,102
803 803 a 8 E4 A+ 5 FR0010340141 260 27,872
803 803 a 8 C2 DE000A1PHFF7 535 40,981
803 803 a 8 C2 Baa3 4 DE000A1DAHH0 1,243 60,012
803 803 a 8 E4 FR0006174348 2,206 40,568
803 803 a 8 A5 BE0974256852 574 27,233
803 803 a 8 E4 BBB+ 5 FR0010908533 1,647 28,740
803 803 a 8 C2 DE0007472060 927 43,106
803 803 a 8 C2 DE000SYM9999 987 60,533
803 803 a 8 C2 DE0006766504 272 12,777
803 803 a 8 E3 FI0009005318 800 26,480
803 803 a 8 C2 Baa2 4 DE0006602006 1,441 53,893
803 803 a 8 E3 Baa2 4 FI0009007835 1,089 22,542
803 803 a 8 E4 Baa2 4 FR0010533075 4,409 50,527
803 803 a 8 E4 PTGAL0AM0009 3,412 36,577
803 803 a 8 E3 Baa2 4 FI0009007884 1,222 42,513
803 803 a 3 A1 Baa2 4 AT0000652011 2,419 69,933
803 803 a 8 F9 IE0004927939 1,199 29,148
803 803 a 8 F9 Ba1 4 IE00B1RR8406 1,887 44,420
803 803 a 8 G4 B1 4 NL0010877643 9,529 123,115
803 803 a 8 E4 B1 4 FR0011594233 728 24,388
803 803 a 3 D7 Baa3 4 ES0113860A34 39,369 64,368
803 803 a 3 D7 Baa2 4 ES0140609019 19,011 61,101
803 803 a 8 H7 NR 4 NL0011333752 2,838 37,604
803 803 a 8 D7 NR 4 ES0177542018 7,555 62,518
803 803 a 2 F9 BBB+ 5 IE00BYTBXV33 5,261 78,968
18,585,902
18,585,902
804 804 a 2 A5 NR 4 BE0003797140 1,387 109,337
804 804 a 9 C1 Ba1 4 DE0005785802 3,835 298,095
804 804 a 8 G4 IT0001063210 11,651 44,647
804 804 a 1 G4 Baa1 4 IT0000062072 23,944 405,132
804 804 a 8 E4 Baa1 4 FR0000120644 10,485 653,006
804 804 a 1 B7 Aa3 4 DE0008404005 9,700 1,586,435
804 804 a 8 G4 A3 4 IT0003132476 46,920 647,496
804 804 a 8 G4 Baa3 4 IT0000068525 4,601 34,461
804 804 a 1 E4 A2 4 FR0000120628 45,234 1,141,254
804 804 a 3 E4 A2 4 FR0000120685 15,317 79,909
804 804 a 8 E4 A+ 5 FR0000120073 6,455 669,061
804 804 a 8 E4 Baa2 4 FR0000125007 8,797 350,560
804 804 a 8 E4 A3 4 FR0000121972 10,121 531,960
804 804 a 8 B7 Baa3 4 DE0007257503 2,975 87,941
804 804 a 8 B7 DE000A1EWWW0 3,496 314,325
804 804 a 8 E4 Baa1 4 FR0000125486 8,279 489,620
804 804 a 8 B7 A2 4 DE0005190003 5,993 585,097
804 804 a 1 C1 Aa3 4 DE0008430026 2,692 496,809
804 804 a 8 B7 A3 4 DE0007100000 17,822 1,382,631
804 804 a 9 E4 Baa1 4 FR0000120172 12,049 321,106
804 804 a 8 E4 Baa2 4 FR0000130338 1,453 207,125
804 804 a 8 H7 A1 4 NL0000009355
DIA
COMMERZBANK AG
AMADEUS IT HOLDING SA
FRESENIUS SE & Co
LEGRAND SA
SAMPO OYJ-A SHS
KONINKLIJKE AHOLD NV
INDITEX SA
ANDRITZ AG
ADP - AEROPORTS DE PARIS
HUGO BOSS AG -ORD
BRENNTAG AG
BUREAU VERITAS SA
COLRUYT SA
EDENRED
WIRECARD AG
SYMRISE AG
AURUBIS AG
NOKIAN RENKAAT OYJ
GEA GROUP AG
METSO OYJ
GROUPE EUROTUNNEL SA - REGR
GALP ENERGIA SGPS SA
ELISA OYJ
ERSTE GROUP BANK AG
KINGSPAN GROUP PLC
SMURFIT KAPPA GROUP PLC
FIAT CHRYSLER AUTOMOBILES NV
NUMERICABLE-SFR
BANCO DE SABADELL SA
CAIXABANK SA
ALTICE NV - A
INTL CONSOLIDATED AIRLINE-DI
RYANAIR HOLDINGS
TESEO BILANCIATA total
FONDO TESEO BILANCIATA total
GBL
FRESENIUS MEDICAL C
MEDIASET ORD.
GENERALI ASSICURAZIONI SPA
GROUPE DANONE S.A.
ALLIANZ AG.
ENI SPA ORD.
SAIPEM SPA ORD.
AXA-UAP
NATIXIS
AIR LIQUIDE
COMPAGNIE DE SAINT-GOBAIN
SCHNEIDER SA
METRO AG
ADIDAS-SALOMON AG
VINCI
BMW BAYERISCHE MOTOREN WERKE AG
MUENCHENER RUECKVER AG
DAIMLER
CARREFOUR
VALEO
UNILEVER NV-CVA 30,205 1,211,372
165
BILANCIO REALE MUTUA 2015.indd 183BILANCIO REALE MUTUA 2015.indd 183 14/04/16 16:0314/04/16 16:03
Annex 1 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of shares and interests (values in Euro)
State Currency
ISIN Name code
Code (*) (*) Quantity Amount
(1) (2) (3) (4) (5) (6) (7) (8) (9)
Rating Current value
804 804 a 1 H7 A3 4 NL0000303709 24,820 129,809
804 804 a 9 H7 Baa1 4 NL0010273215 7,468 616,483
804 804 a 8 H7 Baa1 4 NL0000009538 16,878 397,646
804 804 a 2 B7 AA 5 DE0005810055 3,353 272,901
804 804 a 3 D7 A3 4 ES0113900J37 250,704 1,142,709
804 804 a 9 B7 Baa1 4 DE0005557508 56,053 935,525
804 804 a 2 H7 Baa1 4 NL0000303600 82,222 1,023,664
804 804 a 8 E3 Ba2 4 FI0009005961 10,117 84,882
804 804 a 8 G4 Baa3 4 NL0000226223 11,499 72,041
804 804 a 8 E4 FR0000120321 4,293 666,703
804 804 a 3 D7 Baa1 4 ES0113211835 135,761 914,893
804 804 a 8 E4 Aa1 4 FR0000120271 42,086 1,736,679
804 804 a 8 E4 Ba3 4 FR0000121501 8,023 130,013
804 804 a 8 E3 Ba1 4 FI0009005987 9,385 161,704
804 804 a 3 E4 A2 4 FR0000130809 18,591 791,419
804 804 a 8 C1 A2 4 DE0007164600 16,667 1,223,024
804 804 a 9 E4 BBB 5 FR0000125338 2,749 235,314
804 804 a 8 D7 Baa2 4 ES0173516115 18,533 187,554
804 804 a 9 B7 A3 4 DE0005552004 17,182 445,959
804 804 a 8 C4 NL0000240000 4,122 103,524
804 804 a 3 G4 BBB- 5 IT0000062957 10,260 91,160
804 804 a 8 C1 Baa1 4 DE0005439004 1,854 416,316
804 804 a 2 A5 Baa2 4 BE0003565737 9,225 532,006
804 804 a 8 H7 Baa1 4 NL0000009132 4,379 270,097
804 804 a 8 E4 A2 4 FR0000121667 3,449 396,807
804 804 a 8 E4 Ba1 4 FR0000131906 4,759 440,826
804 804 a 8 A5 Baa2 4 BE0003470755 1,031 101,481
804 804 a 3 F9 Baa2 4 IE0030606259 488,043 164,959
804 804 a 8 H7 Baa1 4 NL0000395903 5,235 162,102
804 804 a 8 F9 Baa2 4 IE0001827041 14,095 376,337
804 804 a 8 H7 Baa3 4 NL0000009082 59,655 208,315
804 804 a 8 H7 BBB+ 5 NL0006144495 24,355 378,477
804 804 a 8 E4 A- 5 FR0000121220 1,682 151,615
804 804 a 3 E4 A2 4 FR0000045072 20,413 222,093
804 804 a 8 E4 NR 4 FR0000124711 1,770 414,888
804 804 a 8 G4 Baa1 4 IT0003153415 37,779 182,473
804 804 a 8 B7 DE0006231004 19,553 264,063
804 804 a 9 E4 BBB- 5 FR0000120404 3,154 126,176
804 804 a 8 D7 ES0167050915 3,399 91,824
804 804 a 8 G4 A- 5 IT0001479374 2,425 146,470
804 804 a 8 E4 Baa1 4 FR0000120503 3,177 116,103
804 804 a 8 E4 Baa1 4 FR0000124141 8,581 187,624
804 804 a 8 E4 A3 4 FR0000121261 3,300 290,070
804 804 a 9 G4 Ba1 4 IT0003497168 190,558 223,906
804 804 a 8 G4 Baa1 4 IT0003242622 23,977 114,035
804 804 a 8 C2 A2 4 DE0006483001 3,965 530,914
804 804 a 8 C4 Baa3 4 DE0005470405 1,521 64,916
804 804 a 8 B7 A2 4 DE0006048432 3,077 317,546
804 804 a 8 G4 Baa1 4 IT0003506190 7,162 175,469
804 804 a 3 D7 Ba1 4 ES0113790226 34,175 103,995
804 804 a 3 G4 Baa2 4 IT0003487029 15,915 98,673
804 804 a 8 G4 A- 2 LU0156801721 8,314 90,955
804 804 a 8 D7 ES0132105018 2,412 22,714
804 804 a 8 A5 Baa3 4 BE0003562700 1,826 163,957
804 804 a 8 D7 ES0125220311 462 36,535
804 804 a 8 C2 Ba1 4 DE0006047004 2,436 184,210
804 804 a 8 A5 BE0003739530 2,190 182,274
804 804 a 8 C4 Ba1 4 DE0008232125
AEGON NV SHS
ASM LITOGRAPHY HOLDING NV
ROYAL PHILIPS
DEUTSCHE BOERSE AG
BANCO SANTANDER CENTRAL HISP
DEUTSCHE TELEKOM
ING GROEP
STORA ENSO
STMICROELECTRONICS
L'OREAL
BANCO BILBAO VA
TOTAL FINA ELF
PEUGEOT
UPM-KYMMENE OYJ
SOCIETE GENERALE- A
SAP AG
CAP GEMINI
REPSOL YPF
DEUTSCHE POST
QIAGEN NV
MEDIOBANCA
CONTINENTAL
KBC GROUP
AKZO NOBEL NV
ESSILOR INTL
RENAULT
SOLVAY
BANK OF IRELAND
WOLTERS KLUWER
CRH PLC
KONINKLIJKE KPN NV
RELX NV
SODEXHO ALLIANCE SA
CREDIT AGRICOLE SA
UNIBAIL
SNAM RETE GAS SPA
INFINEON TECHNOLOGIES
ACCOR SA
ACS SHS
LUXOTTICA
BOUYGUES
VEOLIA ENVIRONNEMENT
MICHELIN
TELECOM ITALIA SPA
TERNA
LINDE AG
LANXESS AG
HENKEL AG & CO KGAA-VORZUG
ATLANTIA SPA
BANCO POPULAR ESPANOL
UBI BANCA
TENARIS
ACERINOX SA
GROUPE DELHAIZE
ACCIONA SA ORD.
HEIDELBERGCEMENT
UCB
DEUTSCHE LUFTHANSA 3,956 57,619
166 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 184BILANCIO REALE MUTUA 2015.indd 184 14/04/16 16:0314/04/16 16:03
Annex 1 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of shares and interests (values in Euro)
State Currency
ISIN Name code
Code (*) (*) Quantity Amount
(1) (2) (3) (4) (5) (6) (7) (8) (9)
Rating Current value
804 804 a 8 A1 AT0000937503 1,890 53,572
804 804 a 8 E4 Baa2 4 FR0000130577 3,503 215,014
804 804 a 8 H7 NL0000360618 3,429 39,982
804 804 a 8 E3 FI0009013403 7,060 276,540
804 804 a 8 H7 Ba2 4 LU0323134006 17,954 69,967
804 804 a 8 B7 DE0005773303 637 37,545
804 804 a 8 D7 NR 4 ES0173093115 1,912 147,434
804 804 a 8 E4 Baa2 4 FR0000077919 1,130 39,889
804 804 a 8 A1 A3 4 AT0000743059 2,519 65,821
804 804 a 8 D7 Baa2 4 ES0130960018 3,991 103,766
804 804 a 8 B7 DE000PAH0038 2,613 130,676
804 804 a 8 C2 Ba1 4 DE000KSAG888 3,582 84,607
804 804 a 1 C4 NR 4 DE0008402215 1,008 106,495
804 804 a 8 D7 NR 4 ES0184933812 2,946 31,758
804 804 a 8 E4 Baa2 4 FR0000120859 614 39,554
804 804 a 8 E4 FR0000120966 466 70,669
804 804 a 9 H7 NL0000379121 2,220 127,717
804 804 a 8 F9 Baa2 4 IE0004906560 2,602 198,559
804 804 a 8 E4 BBB+ 5 FR0000131708 2,002 91,561
804 804 a 8 D7 Ba2 4 ES0171996012 2,561 109,175
804 804 a 8 G4 IT0004176001 3,501 70,930
804 804 a 8 D7 BBB 5 ES0118900010 7,389 154,098
804 804 a 8 C4 Baa1 4 DE0006599905 2,214 198,308
804 804 a 8 A5 BE0003884047 1,920 74,237
804 804 a 8 G4 IT0004618465 26,951 50,749
804 804 a 8 H7 NL0009432491 1,173 46,533
804 804 a 8 E4 A3 4 FR0010613471 6,234 107,599
804 804 a 8 D7 Baa3 4 ES0126775032 11,153 60,717
804 804 a 3 B7 Baa1 4 DE000CBK1001 18,592 177,963
804 804 a 2 D7 Baa2 4 ES0109067019 7,519 305,911
804 804 a 8 C4 Baa3 4 DE0005785604 6,894 454,797
804 804 a 8 E4 A- 5 FR0010307819 4,625 241,425
804 804 a 1 E3 Baa2 4 FI0009003305 13,337 626,839
804 804 a 8 H7 Baa2 4 NL0010672325 15,502 301,901
804 804 a 8 D7 ES0148396007 18,938 600,145
804 804 a 8 A1 AT0000730007 1,354 60,998
804 804 a 8 E4 A+ 5 FR0010340141 545 58,424
804 804 a 8 C2 DE000A1PHFF7 1,132 86,711
804 804 a 8 C2 Baa3 4 DE000A1DAHH0 2,682 129,487
804 804 a 8 E4 FR0006174348 4,633 85,201
804 804 a 8 A5 BE0974256852 1,208 57,314
804 804 a 8 E4 BBB+ 5 FR0010908533 3,565 62,209
804 804 a 8 C2 DE0007472060 1,900 88,350
804 804 a 8 C2 DE000SYM9999 2,124 130,265
804 804 a 8 C2 DE0006766504 530 24,897
804 804 a 8 E3 FI0009005318 1,603 53,059
804 804 a 8 C2 Baa2 4 DE0006602006 3,084 115,342
804 804 a 8 E3 Baa2 4 FI0009007835 2,286 47,320
804 804 a 8 E4 Baa2 4 FR0010533075 9,493 108,790
804 804 a 8 E4 PTGAL0AM0009 7,144 76,584
804 804 a 8 E3 Baa2 4 FI0009007884 2,614 90,941
804 804 a 3 A1 Baa2 4 AT0000652011 5,218 150,852
804 804 a 8 F9 IE0004927939 2,409 58,563
804 804 a 8 F9 Ba1 4 IE00B1RR8406 3,992 93,972
804 804 a 8 G4 B1 4 NL0010877643 20,164 260,519
804 804 a 8 E4 B1 4 FR0011594233
VOESTALPINE
PUBLICIS GROUPE SA
SBM OFFSHORE
KONE SHS B
ARCELORMITTAL SHS
FRAPORT
RED ELECTRICA ESP
JC DECAUX SA
OMV AG
ENAGAS
PORSCHE AUTOMOBIL HOLDING
K+S
HANNOVER RUECKVERSICHERU-REG
ZARDOYA OTIS SA
IMERYS SA
BIC
RANDSTAD HOLDING NV
KERRY GROUP PLC
TECHNIP
GRIFOLS
PRYSMIAN
FERROVIAL
MERCK KGAA
UMICORE SA
ENEL GREEN POWER SPA
KONINKLIJKE VOPAK
SUEZ ENVIRONNEMENT CO.
DIA
COMMERZBANK AG
AMADEUS IT HOLDING SA
FRESENIUS SE & Co
LEGRAND SA
SAMPO OYJ-A SHS
KONINKLIJKE AHOLD NV
INDITEX SA
ANDRITZ AG
ADP - AEROPORTS DE PARIS
HUGO BOSS AG -ORD
BRENNTAG AG
BUREAU VERITAS SA
COLRUYT SA
EDENRED
WIRECARD AG
SYMRISE AG
AURUBIS AG
NOKIAN RENKAAT OYJ
GEA GROUP AG
METSO OYJ
GROUPE EUROTUNNEL SA - REGR
GALP ENERGIA SGPS SA
ELISA OYJ
ERSTE GROUP BANK AG
KINGSPAN GROUP PLC
SMURFIT KAPPA GROUP PLC
FIAT CHRYSLER AUTOMOBILES NV
NUMERICABLE-SFR 1,538 51,523
167
BILANCIO REALE MUTUA 2015.indd 185BILANCIO REALE MUTUA 2015.indd 185 14/04/16 16:0314/04/16 16:03
Annex 1 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of shares and interests (values in Euro)
State Currency
ISIN Name code
Code (*) (*) Quantity Amount
(1) (2) (3) (4) (5) (6) (7) (8) (9)
Rating Current value
804 804 a 3 D7 Baa3 4 ES0113860A34 84,193 137,656
804 804 a 3 D7 Baa2 4 ES0140609019 40,501 130,170
804 804 a 8 H7 NR 4 NL0011333752 6,192 82,044
804 804 a 8 D7 NR 4 ES0177542018 15,907 131,630
804 804 a 2 F9 BBB+ 5 IE00BYTBXV33 11,326 170,003
39,075,102
39,075,102
BANCO DE SABADELL SA
CAIXABANK SA
ALTICE NV - A
INTL CONSOLIDATED AIRLINE-DI
RYANAIR HOLDINGS
Total TESEO SVILUPPO
FONDO TESEO SVILUPPO total
Grand total 57,661,004
(1) Order number of the fund (5) Market on which listed: according to the coding
(2) Investment line: indicate the order number
of regulated markets as set forth in specific
assets for the computerisation of data
assigned to each investment line within each
fund (to be maintained in subsequent communications) (6) Indicate the rating of the security; otherwise that of the issuer
(3) Type (7) Indicate the rating agency
a = Listed shares of companies not part of the same group
a.1= Listed shares of companies part of the same group
b = Unlisted shares of companies not forming part of the same group
b.1= Unlisted shares of companies forming part of the same group
c = Interests
(4) Business
1 = Duff & Phelps Credit Rating Co.
2 = Fitch Ibca
3 = Italrating
4 = Moody's Investors Service
5 = Standard & Poor's
6 = Thomson BankWatch, Inc.
7 = Other
(8) Code of the State of the issuer (source U.I.C.)
(9) Code of the currency (source U.I.C.)
1 = Insurance company
2 = Finance company
3 = Credit institution
4 = Real property company
8 = Industrial company
9 = Other company or body
(*) The 'State Code', 'Expiry' and 'Currency' columns may not be
compiled if the ISIN code of the security has been indicated
168 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 186BILANCIO REALE MUTUA 2015.indd 186 14/04/16 16:0314/04/16 16:03
Annex 2 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of bonds (values in Euro)
ISIN Name State Expiry Currency Total nominal
code code value Unitary Total
(*) (*) (*)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
801 801 2 Q G8 Baa2 4 IT0004019581 2,650,000 102 2,709,122
801 801 2 Q G8 Baa2 4 IT0003242747 3,750,000 108 4,063,125
801 801 2 Q G8 Baa2 4 IT0003493258 2,000,000 112 2,248,800
801 801 2 Q G8 Baa2 4 IT0003644769 3,070,000 117 3,579,313
801 801 2 Q G8 Baa2 4 IT0004164775 2,300,000 104 2,399,843
801 801 2 Q G8 Baa2 4 IT0004273493 2,000,000 109 2,185,600
801 801 2 Q G8 Baa2 4 IT0004361041 2,100,000 111 2,338,140
801 801 2 Q G8 Baa2 4 IT0004085210 2,200,000 121 2,668,365
801 801 2 Q G8 Baa2 4 IT0004634132 1,750,000 115 2,020,200
801 801 2 Q G8 Baa2 4 IT0004712748 1,600,000 101 1,617,296
801 801 2 Q G8 Baa2 4 IT0004793474 3,700,000 106 3,933,137
801 801 2 Q G8 Baa2 4 IT0004801541 1,300,000 129 1,674,140
801 801 2 Q G8 Baa2 4 IT0004820426 2,350,000 107 2,509,142
801 801 2 Q G8 Baa2 4 IT0004867070 2,850,000 106 3,034,196
801 801 2 Q G8 Baa2 4 IT0004917792 2,400,000 101 2,422,056
801 801 2 Q G8 Baa2 4 IT0004960826 3,950,000 102 4,048,474
43,450,949
43,450,949
802 802 2 Q B1 Aa2 4 FR0010192997 2,080,000 119 2,473,744
802 802 2 Q C2 Aa2 4 FR0010288357 890,000 101 899,790
802 802 2 Q B7 Aaa 4 DE0001135291 320,000 100 319,997
802 802 2 Q C2 Aaa 4 NL0000102317 600,000 151 907,440
802 802 2 Q G8 Baa2 4 IT0004019581 1,400,000 102 1,431,234
802 802 2 Q B7 Aaa 4 DE0001135085 500,000 146 729,550
802 802 2 Q C2 Aa2 4 FR0000571218 760,000 151 1,144,028
802 802 2 Q C2 Aa2 4 FR0010070060 490,000 150 733,824
802 802 2 Q G8 Baa2 4 IT0001444378 890,000 151 1,342,743
802 802 2 Q B7 Aaa 4 FI0001006066 120,000 107 128,520
802 802 2 Q C2 Aaa 4 AT0000A001X2 345,000 119 411,240
802 802 2 Q C2 Aa2 4 FR0010371401 380,000 140 532,038
802 802 2 Q C2 Aaa 4 DE0001135226 300,000 158 474,450
802 802 2 Q G8 Baa2 4 IT0003644769 170,000 117 198,203
802 802 2 Q G8 Baa2 4 IT0003934657 465,000 125 580,971
802 802 2 Q B1 Aa3 4 BE0000309188 280,000 105 294,994
802 802 2 Q B7 Aaa 4 DE0001135325 160,000 157 251,872
802 802 2 Q C2 Aa2 4 FR0010466938 900,000 128 1,153,080
802 802 2 Q B3 Aaa 4 NL0006007239
BTP 3,75% 2006 - 1.8.16 BTP 5 1/4% 2002-1.8.17
BTP FB 01 03/19 4,25
BTP 4,5% FB 04/20
BTP 2006 - 01/02/17 TF 4%
BTPS 4,5 02/01/18
BTP 05/08-01/08/18 TF 4,5%
BTP LKD 2,10% 06/17 €i
BTP 09/10-01/03/21 TF 3,75%
BTP 04/11-15/04/16 TF 3,75%
BTP 02/12-01/05/17 TF 4,75%
BTP 03/12-01/09/22 TF 5,5%
BTP 06/12-01/06/17 TF 4,75%
BTP 11/12-01/11/17 TF 3,50%
BTPS 2,25% 04/13 15/05/16 FIX
BTP 09/13-15/11/16 TF 2,75%
TESEO GARANTITA total
FONDO TESEO GARANTITA total
FRANCE 3,75 % FTB - 2005 25/04/21
FRANCE 3 1/4 % 2006 - 25/04/16
GERMANY 3 1/2% 04/01/16
NETHERLANDS 01/98-15/01/28 5,5%
BTP 3.75% 2006 - 1.8.16
GERMANY 10/98-04/07/28 TF 4,75%
FRANCE 03/98-25/04/29 TF 5,5%
FRANCE 04/04-25/04/35 4,5%
BTP-MG 01 99/31 6%
FINLAND 3,875 % - 15/09/17
AUSTRIA 09/06-15/09/21 TF 3,5%
FRANCE 09/06-25/10/38 TF 4%
GERMANY 01/03-04/07/34 TF 4,75%
BTP 4,5% FB 04/20
BTP 4% 05 01.02.37
BELGIUM 2007 - 28/03/17 TF 4%
GERMANY 01/03-04/07/39 TF 4,25%
FRANCE 5/07-25/10/2023 TF 4,25%
NETHERLANDS GOVT 2007 - 15/07/17 TF 4,5% 340,000 107 365,163
802 802 2 Q C2 Baa2 4 ES00000121A5 880,000 110 968,528
802 802 2 Q C2 Aa2 4 FR0010604983 750,000 110 823,950
802 802 2 Q G8 Baa2 4 IT0004361041
SPAIN 02/08-30/07/18 4,1% FRANCE 04/08-25/04/18 4%
BTP 05/08-01/09/18 TF 4,5% 1,400,000 111 1,558,760
802 802 2 Q C2 Baa2 4 ES00000121G2 1,020,000 125 1,277,856
802 802 2 Q B7 Baa2 4 ES00000120G4 540,000 100 541,183
802 802 2 Q B1 Aa3 4 BE0000315243 600,000 114 681,480
802 802 2 Q G8 Baa2 4 IT0004513641 1,450,000 130 1,887,175
802 802 2 Q B7 Aaa 4 AT0000A0DXC2 340,000 138 470,050
802 802 2 Q C1 Aa2 4 FR0010776161 180,000 115 206,262
802 802 2 Q C2 Aaa 4 AT0000A0GLY4 270,000 104 280,719
802 802 2 Q C2 Aa2 4 FR0010916924 800,000 124 995,120
802 802 2 Q B7 Aaa 4 DE0001030526 600,000 121 725,264
802 802 2 Q C2 Aaa 4 DE0001135424 450,000 113 506,984
802 802 2 Q G8 Baa2 4 IT0004604671 970,000 121 1,171,854
802 802 2 Q G8 Baa2 4 IT0004793474 1,000,000 106 1,063,010
802 802 2 Q C2 Aaa 4 DE0001141620 750,000 101 759,623
802 802 2 Q G8 Baa2 4 IT0004801541 1,500,000 129 1,931,700
802 802 2 Q B3 Baa2 4 ES00000123K0 1,070,000 129 1,375,646
802 802 2 Q G8 Baa2 4 IT0004532559 500,000 143 713,150
802 802 2 Q B1 Aa3 4 BE0000328378 350,000 112 392,910
802 802 2 Q C2 Baa1 4 IE00B8DLLB38 150,000 110 165,285
802 802 2 Q B3 Aa3 4 BE0000331406 130,000 138 178,750
802 802 2 Q C1 Baa1 4 IE00B4S3JD47 250,000 122 305,700
802 802 2 Q B7 Aaa 4 FI4000037635
SPAIN 09/08-31/01/24 TF 4,8%
SPAIN 09/05-31/01/16 TF 3,15%
BELGIUM 01/09 28/03/2019 4%
BTP 07/09-01/03/25 TF 5%
AUSTRIA 06/09-15/03/26 TF 4,85%
FRANCE 07/09-25/10/19 TF 3,75%
AUSTRIA 01/10 - 20/02/17 TF 3,2%
FRANCE 07/10-25/04/26 TF 3,5%
GERMANY 12/09-15/04/20 LKD €i
GERMANY 11/10-04/01/21 TF 2,5%
BTP 04/10-15/09/21 2.1% LKD €i
BTP 02/12-01/05/17 TF 4,75%
GERMANY 01/12-24/02/17 TF 0,75%
BTP 03/12-01/09/22 TF 5,5%
SPAIN 11/11-31/01/22 TF 5,85%
BTPS 09/2009 09/01/40 FIX 5%
BELGIUM KINGDOM 2,25% 06/22/23 FIX
IRELAND 08/12-18/10/17 TF 5,5%
BELGIUM 09/13-22/06/45 TF 3,75%
IRELAND 3,9 % 03/13 20/03/23
FINLAND 2,75% 2012 04/07/28 FIX 125,000 118 147,275
Rating Description of the security Current value
169
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Annex 2 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of bonds (values in Euro)
ISIN Name State Expiry Currency Total nominal
code code value Unitary Total
(*) (*) (*)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
Rating Description of the security Current value
802 802 2 Q B3 Aaa 4 FI4000062625 265,000 107 284,160
802 802 2 Q B7 Aaa 4 AT0000A10683 200,000 114 227,100
802 802 2 Q B1 Aaa 4 NL0009712470 350,000 117 410,270
802 802 2 Q B3 Aa3 4 BE0000326356 630,000 134 841,995
802 802 2 Q B7 Aaa 4 NL0010071189 100,000 118 118,000
802 802 2 Q B3 Aa2 4 FR0011461037 100,000 127 126,620
802 802 2 Q C2 Aaa 4 DE0001102333 370,000 111 410,918
802 802 2 Q B3 Baa2 4 ES0000012932 510,000 123 625,260
802 802 2 Q G8 Baa2 4 IT0004923998 440,000 142 623,876
802 802 2 Q C2 Baa1 4 IE0034074488 70,000 119 82,985
802 802 2 Q B3 Aaa 4 NL0010733424 100,000 112 111,500
802 802 2 Q C2 Aaa 4 DE0001102341 100,000 125 125,190
802 802 2 Q C2 Baa1 4 IE00B4TV0D44 50,000 137 68,515
802 802 2 Q B3 Aaa 4 AT0000A0VRQ6 30,000 131 39,219
802 802 2 Q B1 Baa1 4 IE00BJ38CR43 110,000 109 120,362
802 802 2 Q C2 Baa2 4 ES00000124H4 185,000 142 261,905
802 802 2 Q C2 Aaa 4 NL0009446418 30,000 149 44,733
38,023,723
38,023,723
803 803 2 Q B1 Aa2 4 FR0010192997 1,150,000 119 1,367,695
803 803 2 Q C2 Aa2 4 FR0010288357 710,000 101 717,810
803 803 2 Q B7 Aaa 4 DE0001135291 120,000 100 119,999
803 803 2 Q C2 Aaa 4 NL0000102317 465,000 151 703,266
803 803 2 Q B3 Aaa 4 DE0001135069 100,000 155 154,770
803 803 2 Q G8 Baa2 4 IT0001278511 560,000 139 779,632
803 803 2 Q G8 Baa2 4 IT0004019581 750,000 102 766,733
803 803 2 Q C2 Aa2 4 FR0000571218 630,000 151 948,339
803 803 2 Q C2 Aa2 4 FR0010070060 260,000 150 389,376
803 803 2 Q B3 Aaa 4 AT0000A011T9 210,000 103 216,344
803 803 2 Q C2 Baa2 4 ES0000011868 660,000 143 945,186
803 803 2 Q B7 Aaa 4 FI0001006066 150,000 107 160,650
803 803 2 Q C2 Aaa 4 AT0000383864 120,000 157 188,004
803 803 2 Q G8 Baa2 4 IT0003242747 840,000 108 910,140
803 803 2 Q C2 Aa2 4 FR0010371401 385,000 140 539,039
803 803 2 Q G8 Baa2 4 IT0003644769 600,000 117 699,540
803 803 2 Q G8 Baa2 4 IT0003934657 640,000 125 799,616
803 803 2 Q B7 Aaa 4 DE0001135325 180,000 157 283,356
803 803 2 Q C2 Baa2 4 ES00000120J8 500,000 104 520,450
803 803 2 Q C2 Aa2 4 FR0010466938 1,180,000 128 1,511,816
803 803 2 Q B3 Aaa 4 NL0006007239 300,000 107 322,203
803 803 2 Q C2 Aa2 4 FR0010604983 900,000 110 988,740
803 803 2 Q B7 Aaa 4 DE0001135358 150,000 111 167,175
803 803 2 Q C2 Baa2 4 ES00000121G2 200,000 125 250,560
803 803 2 Q C2 Aaa 4 DE0001135374 535,000 112 599,970
803 803 2 Q B1 Aa3 4 BE0000315243 240,000 114 272,592
803 803 2 Q C2 Aaa 4 NL0009086115 230,000 115 263,925
803 803 2 Q B7 Aaa 4 AT0000A08968 150,000 115 171,750
803 803 2 Q C2 Aaa 4 DE0001135382 480,000 113 542,808
803 803 2 Q G8 Baa2 4 IT0004513641 1,250,000 130 1,626,875
803 803 2 Q C1 Aa2 4 FR0010776161 100,000 115 114,590
803 803 2 Q B1 Aa3 4 BE0000319286 220,000 101 221,562
803 803 2 Q C2 Baa2 4 ES00000122D7 750,000 114 857,850
803 803 2 Q G8 Baa2 4 IT0004695075 1,050,000 122 1,278,060
803 803 2 Q C1 Aaa 4 DE0001135473 200,000 110 220,836
803 803 2 Q B3 Baa2 4 ES00000123K0 700,000 129 899,955
803 803 2 Q G8 Baa2 4 IT0004532559 180,000 143 256,734
803 803 2 Q B1 Aa3 4 BE0000328378 680,000 112 763,368
803 803 2 Q C2 Baa1 4 IE00B8DLLB38 200,000 110 220,380
803 803 2 Q B3 Aa3 4 BE0000331406 160,000 138 220,000
803 803 2 Q G8 Baa2 4 IT0004898034 1,200,000 123 1,481,400
803 803 2 Q B7 Aaa 4 FI4000037635
FINLAND 04/13-15/04/23 TF 1,5%
AUSTRIA 2,4% 04/13 23/5/34 FIX
NETHERLANDS 3,25% 3/11 15/07/21 FIX
BELGIUM 03/12-28/03/32 TF 4%
NETHERLANDS 03/12-15/01/33 TF 2,5%
FRANCE 04/13-25/05/45 TF 3,25%
GERMANY 1,75% 01/14 15/02/24
SPAIN 01/05-31/01/37 TF 4,2%
BTP 05/13-01/09/44 TF 4,75%
IRISH 01/04-18/04/20 TF 4,5%
NETHERLANDS 03/14-15/07/24 TF 2%
GERMANY 02/14-15/08/46 TF 2,5%
IRISH 5,4% 10/09 13/03/25 FIX
AUSTRIA 3,15% 07/12 20/06/44 FIX
IRELAND 11/14-15/05/30 TF 2,4%
SPAIN 10/13-31/10/44 TF 5,15%
NETHERLANDS 05/10-15/01/42 3,75%
TESEO PRUDENZIALE total
FONDO TESEO PRUDENZIALE total
FRANCE 3,75 % FTB - 2005 25/04/21
FRANCE 3 1/4 % 2006 - 25/04/16
GERMANY 3 1/2% 04/01/16
NETHERLANDS 01/98-15/01/28 5,5%
DE-GOV GE 01/1998 - 04/01/2028 TF 5,625%
BTP-NV 01 98/29 5,25
BTP 3,75% 2006 - 1.8.16
FRANCE 03/98-25/04/29 TF 5,5%
FRANCE 04/04-25/04/35 4,75%
AUSTRIA 4% 06 15.09.16
SPAIN 01/98-31/01/29 TF 6%
FINLAND 3,875 % - 15/09/17
AUSTRIA 07/97-15/07/27 TF 6,25%
BTP 5 1/4% 2002-1.8.17
FRANCE 09/06-25/10/38 TF 4%
BTP 4,5% FB 04/20
BTP 4% 05 01.02.37
GERMANY 01/07-04/07/39 TF 4,25%
SPAIN 10/06-31/01/17 TF 3.80%
FRANCE 5/07-25/10/2023 TF 4,25%
NETHERLANDS GOVT 2007 - 15/07/17 TF 4,5%
FRANCE 04/08-25/04/18 4%
GERMANY 05/08-04/07/18 TF 4,25%
SPAIN 09/08-31/01/24 TF 4,8%
GERMANY 11/08-04/01/19 TF 3,75%
BELGIUM 01/09 28/03/2019 4%
NETHERLANDS 02/09-15/07/19 TF 4%
AUSTRIA 01/08-15/03/19 TF 4,35%
GERMANY 05/09-04/07/19 3,5%
BTP 07/09-01/03/25 TF 5%
FRANCE 07/09-25/10/19 TF 3,75%
BELGIUM 03/10-28/03/16 TF 2,75%
SPAIN 01/10-30/04/20 TF 4%
BTP 03/11-01/09/21 TF 4,75%
GERMANY 04/12-04/07/22 TF 1,75%
SPAIN 11/11-31/01/22 TF 5,85%
BTPS 09/2009 09/01/40 FIX 5%
BELGIUM KINGDOM 2,25% 06/22/23 FIX
IRELAND 08/12-18/10/17 TF 5,5%
BELGIUM 09/13-22/06/45 TF 3,75%
BTP 03/13-01/05/23 TF 4,5%
FINLAND 2,75% 2012 04/07/28 FIX 150,000 118 176,730
170 REPORTS AND ACCOUNTS 2015
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Annex 2 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of bonds (values in Euro)
ISIN Name State Expiry Currency Total nominal
code code value Unitary Total
(*) (*) (*)
(1) (2) (3) (4) (5) (6) (7) (8) (9) (10)
Rating Description of the security Current value
803 803 2 Q B3 Aaa 4 FI4000062625 70,000 107 75,061
803 803 2 Q B7 Aaa 4 AT0000A10683 200,000 114 227,100
803 803 2 Q B3 Aaa 4 AT0000A105W3 260,000 109 284,206
803 803 2 Q B3 Aa3 4 BE0000326356
FINLAND 04/13-15/04/23 TF 1,5%
AUSTRIA 2,4% 04/13 23/5/34 FIX
AUSTRIA 04/13-20/10/23 TF 1,75%
BELGIUM 03/12-28/03/32 TF 4% 200,000 134 267,300
803 803 2 Q C1 Baa1 4 IE00B6X95T99 200,000 119 238,280
803 803 2 Q B7 Aaa 4 NL0010071189 200,000 118 236,000
803 803 2 Q B3 Aa2 4 FR0011461037 200,000 127 253,240
803 803 2 Q C2 Aaa 4 DE0001102333
IRLELAND 01/14-18/03/24 TF 3,4%
NETHERLANDS 03/12-15/01/33 TF 2,5%
FRANCE 04/13-25/05/45 TF 3,25%
GERMANY 1,75% 01/14 15/02/24 580,000 111 644,142
803 803 2 Q B3 Baa2 4 ES0000012932 240,000 123 294,240
803 803 2 Q G8 Baa2 4 IT0004923998 100,000 142 141,790
803 803 2 Q C2 Aaa 4 DE0001102341 190,000 125 237,861
803 803 2 Q B1 Baa1 4 IE00BJ38CR43 100,000 109 109,420
27,648,464
27,648,464
804 804 2 Q G8 Baa2 4 IT0005020778 1,200,000 100 1,200,456
804 804 2 Q G8 Baa2 4 IT0005044976 1,200,000 100 1,200,372
804 804 2 Q G8 Baa2 4 IT0005089955 1,200,000 100 1,200,420
3,601,248
3,601,248
SPAIN 01/05-31/01/37 TF 4,2%
BTP 05/13-01/09/44 TF 4,75%
GERMANY 02/14-15/08/46 TF 2,5%
IRELAND 11/14-15/05/30 TF 2,4%
TESEO BILANCIATA total
FONDO TESEO BILANCIATA total
CTZ 04/14-29/04/16 ZC
CTZ 08/14-30/08/16 ZC
CTZ 02/15-27/02/17 ZC
total TESEO SVILUPPO
FONDO TESEO SVILUPPO total
Grand total 112,724,384
(1) Order number of the fund (4) indicate Q for investments traded on regulated (8) For convertible debentures, also indicate
market and NQ for the others the share to be converted
(2) Investment line: indicate the order number
(5) Market on which listed: according to the (9) Code of the State of the issuer (source U.I.C.) assigned to each investment line within each fund
(to be maintained in subsequent
communications)
of regulated markets as set forth in specific
assets for the computerisation of data (10) Code of the currency (source U.I.C.)
(3) Category (6) Indicate the rating of the security; otherwise that of the issuer
1 = Securities issued by companies forming part
(*) The 'State Code', 'Expiry' and 'Currency' columns may not be
compiled if the ISIN code of the security has been indicated
(7) Indicate the rating agency of the same group
2 = Listed Government securities
3 = Other listed securities
4 = Unlisted Government securities
5 = Other unlisted securities
6 = Convertible debentures
7 = Other
1 = Duff & Phelps Credit Rating Co.
2 = Fitch Ibca
3 = Italrating
4 = Moody's Investors Service
5 = Standard & Poor's
6 = Thomson BankWatch, Inc.
7 = Other
171
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Annex 3 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of OICVM (UCITS) units (values in Euro)
ISIN Name State Currency
code code Quantity Value
(*) (*)
(1) (2) (3) (4) (5) (6) (7)
(1) Order number of the fund (5) A = mainly invested in equities or similar instruments
O = mainly invested in bonds or similar instruments
(2) Investment line: indicate the order number assigned to each investment line
within each fund (to be maintained in subsequent communications) (6) Code of the State of the issuer (source U.I.C.)
(3) 1 = Harmonised open-ended UCITS (7) Code of the currency (source U.I.C.)
(*) The 'State Code', 'Expiry' and 'Currency' columns may not be
compiled if the ISIN code of the security has been indicated
2 = Non harmonised open-ended UCITS
3 = Closed-end investment funds
4 = Closed-end property funds
5 = Funds for qualified investors
6 = Other funds
(4) I = under Italian law
E = under the law of an EU member state
T = under the law of another country
Type Current value
172 REPORTS AND ACCOUNTS 2015
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Annex 4 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of remaining assets and liabilities (values in Euro)
Type/description Counterparty/Issuer State Expiry Currency Total nominal
code value Unitary Total
(1) (2) (3) (4) (5) (6) (7)
801 801 UL 13 REPUBLIC OF ITALY 086 242 -48,485 1 -48,485
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/08/16 242 2,650,000 2 41,046
801 801 UL 12 242 -72,366 1 -72,366
801 801 UL 14 242 0 0 -2
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/08/17 242 3,750,000 2 81,318
801 801 UL 11 242 -6,458 1 -6,458
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/02/19 242 2,000,000 2 35,109
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/02/20 242 3,070,000 2 57,062
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/02/17 242 2,300,000 2 38,000
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/02/18 242 2,000,000 2 37,174
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/08/18 242 2,100,000 2 39,033
801 801 Q G8 10 REPUBLIC OF ITALY 086 15/09/17 242 2,200,000 1 15,804
801 801 UL 3A State Street Bank GmbH 094 242 1,750,377 1 1,750,377
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/03/21 242 1,750,000 1 21,815
801 801 Q G8 10 REPUBLIC OF ITALY 086 15/04/16 242 1,600,000 1 12,623
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/05/17 242 3,700,000 1 28,970
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/09/22 242 1,300,000 2 23,768
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/06/17 242 2,350,000 0 9,150
801 801 Q G8 10 REPUBLIC OF ITALY 086 01/11/17 242 2,850,000 1 16,442
801 801 Q G8 10 REPUBLIC OF ITALY 086 15/05/16 242 2,400,000 0 6,824
801 801 Q G8 10 REPUBLIC OF ITALY 086 15/11/16 242 3,950,000 0 13,727
2,100,931
2,100,931
802 802 UL 13 086 242 -43,736 1 -43,736
802 802 Q B1 10 029 25/04/21 242 2,080,000 3 53,279
802 802 Q C2 10 029 25/04/16 242 890,000 2 19,758
802 802 Q B7 10 094 04/01/16 242 320,000 3 11,077
802 802 Q C2 10 050 15/01/28 242 600,000 5 31,644
802 802 Q G8 10 086 01/08/16 242 1,400,000 2 21,685
802 802 Q B7 10 094 04/07/28 242 500,000 2 11,680
802 802 Q C2 10 029 25/04/29 242 760,000 4 28,552
802 802 Q C2 10
REPUBLIC OF ITALY
FRENCH REPUBLIC
FRENCH REPUBLIC
FEDERAL REPUBLIC OF GERMANY
KINGDOM OF THE NETHERLANDS
REPUBLIC OF ITALY
FEDERAL REPUBLIC OF GERMANY
FRENCH REPUBLIC
FRENCH REPUBLIC 029 25/04/35 242 490,000 3 15,898
802 802 UL 12 242 -64,232 1 -64,232
802 802 Q G8 10 REPUBLIC OF ITALY 086 01/05/31 242 890,000 1 8,802
802 802 Q B7 10 REPUBLIC OF FINLAND 028 15/09/17 242 120,000 1 1,359
802 802 UL 14 242 0 0 -5
802 802 Q C2 10 REPUBLIC OF AUSTRIA 008 15/09/21 242 345,000 1 3,530
802 802 Q C2 10 FRENCH REPUBLIC 029 25/10/38 242 380,000 1 2,783
802 802 UL 11 242 -19,568 1 -19,568
802 802 Q C2 10 094 04/07/34 242 300,000 2 7,008
802 802 Q G8 10 086 01/02/20 242 170,000 2 3,160
802 802 Q G8 10 086 01/02/37 242 465,000 2 7,683
802 802 Q B1 10 009 28/03/17 242 280,000 3 8,507
802 802 Q B7 10
FEDERAL REPUBLIC OF GERMANY
REPUBLIC OF ITALY
REPUBLIC OF ITALY
KINGDOM OF BELGIUM
FEDERAL REPUBLIC OF GERMANY 094 04/07/39 242 160,000 2 3,344
802 802 Q C2 10 029 25/10/23 242 900,000 1 7,002
802 802 Q B3 10 050 15/07/17 242 340,000 2 7,065
802 802 Q C2 10 067 30/07/18 242 880,000 2 15,181
802 802 Q C2 10 029 25/04/18 242 750,000 3 20,492
802 802 Q G8 10 086 01/08/18 242 1,400,000 2 26,022
802 802 Q C2 10 067 31/01/24 242 1,020,000 4 44,802
802 802 Q B7 10
FRENCH REPUBLIC
KINGDOM OF THE NETHERLANDS
KINGDOM OF SPAIN
FRENCH REPUBLIC
REPUBLIC OF ITALY
KINGDOM OF SPAIN
KINGDOM OF SPAIN 067 31/01/16 242 540,000 3 15,565
802 802 Q B1 10 009 28/03/19 242 600,000 3 18,230
802 802 Q G8 10 086 01/03/25 242 1,450,000 2 24,100
802 802 Q B7 10 008 15/03/26 242 340,000 4 13,111
802 802 Q C1 10 029 25/10/19 242 180,000 1 1,236
802 802 UL 3A 094 242 1,378,077 1 1,378,077
802 802 Q C2 10 008 20/02/17 242 270,000 3 7,433
802 802 Q C2 10 029 25/04/26 242 800,000 2 19,126
802 802 Q B7 10 094 15/04/20 242 600,000 1 8,182
802 802 Q C2 10 094 04/01/21 242 450,000 2 11,127
802 802 Q G8 10
KINGDOM OF BELGIUM
REPUBLIC OF ITALY
REPUBLIC OF AUSTRIA
FRENCH REPUBLIC
State Street Bank GmbH
REPUBLIC OF AUSTRIA
FRENCH REPUBLIC
FEDERAL REPUBLIC OF GERMANY
FEDERAL REPUBLIC OF GERMANY
REPUBLIC OF ITALY 086 15/09/21 242 970,000 1 6,495
802 802 Q G8 10 086 01/05/17 242 1,000,000 1 7,830
802 802 Q C2 10 094 24/02/17 242 750,000 1 4,777
802 802 Q G8 10 086 01/09/22 242 1,500,000 2 27,424
802 802 Q B3 10 067 31/01/22 242 1,070,000 5 57,279
802 802 Q G8 10
REPUBLIC OF ITALY
FEDERAL REPUBLIC OF GERMANY
REPUBLIC OF ITALY
KINGDOM OF SPAIN
REPUBLIC OF ITALY 086 01/09/40 242 500,000 2 8,310
802 802 Q B1 10 009 22/06/23 242 350,000 1 4,131
802 802 Q C2 10 040 18/10/17 242 150,000 1 1,668
802 802 Q B3 10 009 22/06/45 242 130,000 2 2,557
802 802 Q C1 10 040 20/03/23 242 250,000 3 7,619
802 802 Q B7 10 028 04/07/28 242 125,000 1 1,691
802 802 Q B3 10 028 15/04/23 242 265,000 1 2,824
802 802 Q B7 10
KINGDOM OF BELGIUM
REPUBLIC OF IRELAND
KINGDOM OF BELGIUM
REPUBLIC OF IRELAND
REPUBLIC OF FINLAND
REPUBLIC OF FINLAND
REPUBLIC OF AUSTRIA 008 23/05/34 242 200,000 1 2,911
802 802 Q B1 10 050 15/07/21 242 350,000 2 5,252
802 802 Q B3 10 009 28/03/32 242 630,000 3 19,141
802 802 Q B7 10 050 15/01/33 242 100,000 2 2,397
802 802 Q B3 10 029 25/05/45 242 100,000 2 1,954
802 802 Q C2 10 094 15/02/24 242 370,000 2 5,659
802 802 Q B3 10
Replacement tax
BTP 3,75% 2006 - 1.8.16
Manager's fees
OTHER ASSETS TESEO GARANTITA
BTP 5 1/4% 2002-1.8.17
SPOT FORWARD LIQUIDITY PAYABLE
BTP FB 01 03/19 4,25
BTP 4,5% FB 04/20
BTP 2006 - 01/02/17 TF 4%
BTPS 4,5 02/01/18
BTP 05/08-01/08/18 TF 4,5%
BTP LKD 2,10% 06/17 €i
INTESA C/C TESEO LINEA GARANTITA EUR 100017
BTP 09/10-01/03/21 TF 3,75%
BTP 04/11-15/04/16 TF 3,75%
BTP 02/12-01/05/17 TF 4,75%
BTP 03/12-01/09/22 TF 5,5%
BTP 06/12-01/06/17 TF 4,75%
BTP 11/12-01/11/17 TF 3,50%
BTPS 2,25% 04/13 15/05/16 FIX
BTP 09/13-15/11/16 TF 2,75%
TESEO GARANTITA total
FONDO TESEO GARANTITA total
Replacement tax
FRANCE 3,75 % FTB - 2005 25/04/21
FRANCE 3 1/4 % 2006 - 25/04/16
GERMANY 3 1/2% 04/01/16
NETHERLANDS 01/98-15/01/28 5,5%
BTP 3,75% 2006 - 1.8.16
GERMANY 10/98-04/07/28 TF 4,75%
FRANCE 03/98-25/04/29 TF 5,5%
FRANCE 04/04-25/04/35 4,75%
Manager's fees
BTP-MG 01 99/31 6%
FINLAND 3,875 % - 15/09/17
OTHER ASSETS TESEO PRUDENZIALE
AUSTRIA 09/06-15/09/21 TF 3,5%
FRANCE 09/06-25/10/38 TF 4%
SPOT FORWARD LIQUIDITY PAYABLE
GERMANY 01/03-04/07/34 TF 4,75%
BTP 4,5% FB 04/20
BTP 4% 05 01.02.37
BELGIUM 2007 - 28/03/17 TF 4%
GERMANY 01/07-04/07/39 TF 4,25%
FRANCE 5/07-25/10/2023 TF 4,25%
NETHERLANDS GOVT 2007 - 15/07/17 TF 4,5%
SPAIN 02/08-30/07/18 4.1%
FRANCE 04/08-25/04/18 4%
BTP 05/08-01/08/18 TF 4,5%
SPAIN 09/08-31/01/24 TF 4,8%
SPAIN 09/05-31/01/16 TF 3,15%
BELGIUM 01/09 28/03/2019 4%
BTP 07/09-01/03/25 TF 5%
AUSTRIA 06/09-15/03/26 TF 4,85%
FRANCE 07/09-25/10/19 TF 3,75%
INTESA C/C TESEO LINEA PRUDENZIALE EUR 100018
AUSTRIA 01/10 - 20/02/17 TF 3,2%
FRANCE 07/10-25/04/26 TF 3,5%
GERMANY 12/09-15/04/20 LKD €i
GERMANY 11/10-04/01/21 TF 2,5%
BTP 04/10-15/09/21 2.1% LKD €i
BTP 02/12-01/05/17 TF 4,75%
GERMANY 01/12-24/02/17 TF 0,75%
BTP 03/12-01/09/22 TF 5,5%
SPAIN 11/11-31/01/22 TF 5,85%
BTPS 09/2009 09/01/40 FIX 5%
BELGIUM KINGDOM 2,25% 06/22/23 FIX
IRELAND 08/12-18/10/17 TF 5,5%
BELGIUM 09/13-22/06/45 TF 3,75%
IRELAND 3,9 % 03/13 20/03/23
FINLAND 2,75% 2012 04/07/28 FIX
FINLAND 04/13-15/04/23 TF 1,5%
AUSTRIA 2,4% 04/13 23/5/34 FIX
NETHERLANDS 3,25% 3/11 15/07/21 FIX
BELGIUM 03/12-28/03/32 TF 4%
NETHERLANDS 03/12-15/01/33 TF 2,5%
FRANCE 04/13-25/05/45 TF 3,25%
GERMANY 1,75% 01/14 15/02/24
SPAIN 01/05-31/01/37 TF 4,2%
KINGDOM OF THE NETHERLANDS
KINGDOM OF BELGIUM
KINGDOM OF THE NETHERLANDS
FRENCH REPUBLIC
FEDERAL REPUBLIC OF GERMANY
KINGDOM OF SPAIN 067 31/01/37 242 510,000 4 19,601
Current value
173
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Annex 4 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of remaining assets and liabilities (values in Euro)
Type/description Counterparty/Issuer State Expiry Currency Total nominal
code value Unitary Total
(1) (2) (3) (4) (5) (6) (7)
Current value
802 802 Q G8 10 086 01/09/44 242 440,000 2 6,948
802 802 Q C2 10 040 18/04/20 242 70,000 3 2,212
802 802 Q B3 10 050 15/07/24 242 100,000 1 924
802 802 Q C2 10
REPUBLIC OF ITALY
REPUBLIC OF IRELAND
KINGDOM OF THE NETHERLANDS
FEDERAL REPUBLIC OF GERMANY 094 15/08/46 242 100,000 1 943
802 802 Q C2 10 040 13/03/25 242 50,000 4 2,161
802 802 Q B3 10 008 20/06/44 242 30,000 2 501
802 802 Q B1 10
REPUBLIC OF IRELAND
REPUBLIC OF AUSTRIA
REPUBLIC OF IRELAND 040 15/05/30 242 110,000 2 1,659
802 802 Q C2 10 067 31/10/44 242 185,000 1 1,588
802 802 Q C2 10
KINGDOM OF SPAIN
KINGDOM OF THE NETHERLANDS 050 15/01/42 242 30,000 4 1,079
1,936,494
1,936,494
803 803 UL 13 086 242 -448,305 1 -448,305
803 803 Q B1 10 029 25/04/21 242 1,150,000 3 29,457
803 803 Q C2 10 029 25/04/16 242 710,000 2 15,762
803 803 Q B7 10 094 04/01/16 242 120,000 3 4,154
803 803 Q C2 10 050 15/01/28 242 465,000 5 24,524
803 803 Q B3 10 094 04/01/28 242 100,000 6 5,563
803 803 Q G8 10 086 01/11/29 242 560,000 1 4,846
803 803 Q G8 10 086 01/08/16 242 750,000 2 11,617
803 803 Q C2 10 029 25/04/29 242 630,000 4 23,668
803 803 Q C2 10
REPUBLIC OF ITALY
FRENCH REPUBLIC
FRENCH REPUBLIC
FEDERAL REPUBLIC OF GERMANY
KINGDOM OF THE NETHERLANDS
FEDERAL REPUBLIC OF GERMANY
REPUBLIC OF ITALY
REPUBLIC OF ITALY
FRENCH REPUBLIC
FRENCH REPUBLIC 029 25/04/35 242 260,000 3 8,436
803 803 UL 12 242 -78,521 1 -78,521
803 803 Q B3 10 REPUBLIC OF AUSTRIA 008 15/09/16 242 210,000 1 2,456
803 803 Q C2 10 KINGDOM OF SPAIN 067 31/01/29 242 660,000 5 36,237
803 803 Q B7 10 REPUBLIC OF FINLAND 028 15/09/17 242 150,000 1 1,699
803 803 Q C2 10 REPUBLIC OF AUSTRIA 008 15/07/27 242 120,000 3 3,463
803 803 UL 9 242 16,106 1 16,106
803 803 UL 14 242 0 0 6
803 803 Q G8 10 086 01/08/17 242 840,000 2 18,215
803 803 Q C2 10
REPUBLIC OF ITALY
FRENCH REPUBLIC 029 25/10/38 242 385,000 1 2,819
803 803 Q G8 10 086 01/02/20 242 600,000 2 11,152
803 803 Q G8 10 086 01/02/37 242 640,000 2 10,574
803 803 Q B7 10 094 04/07/39 242 180,000 2 3,762
803 803 Q C2 10
REPUBLIC OF ITALY
REPUBLIC OF ITALY
FEDERAL REPUBLIC OF GERMANY
KINGDOM OF SPAIN 067 31/01/17 242 500,000 3 17,386
803 803 Q C2 10 029 25/10/23 242 1,180,000 1 9,180
803 803 Q B3 10 050 15/07/17 242 300,000 2 6,234
803 803 Q C2 10 029 25/04/18 242 900,000 3 24,590
803 803 Q B7 10 094 04/07/18 242 150,000 2 3,135
803 803 Q C2 10
FRENCH REPUBLIC
KINGDOM OF THE NETHERLANDS
FRENCH REPUBLIC
FEDERAL REPUBLIC OF GERMANY
KINGDOM OF SPAIN 067 31/01/24 242 200,000 4 8,785
803 803 Q C2 10 094 04/01/19 242 535,000 4 19,843
803 803 Q B1 10 009 28/03/19 242 240,000 3 7,292
803 803 Q C2 10 050 15/07/19 242 230,000 2 4,248
803 803 Q B7 10 008 15/03/19 242 150,000 3 5,188
803 803 Q C2 10 094 04/07/19 242 480,000 2 8,262
803 803 Q G8 10 086 01/03/25 242 1,250,000 2 20,776
803 803 Q C1 10 029 25/10/19 242 100,000 1 686
803 803 UL 3A 094 242 1,249,017 1 1,249,017
803 803 Q B1 10 009 28/03/16 242 220,000 2 4,595
803 803 Q C2 10 067 30/04/20 242 750,000 3 20,082
803 803 Q G8 10 086 01/09/21 242 1,050,000 2 16,579
803 803 Q C1 10
BTP 05/13-01/09/44 TF 4,75%
IRISH 01/04-18/04/20 TF 4,5%
NETHERLANDS 03/14-15/07/24 TF 2%
GERMANY 02/14-15/08/46 TF 2,5%
IRISH 5,4% 10/09 13/03/25 FIX
AUSTRIA 3,15% 07/12 20/06/44 FIX
IRELAND 11/14-15/05/30 TF 2,4%
SPAIN 10/13-31/10/44 TF 5,15%
NETHERLANDS 05/10-15/01/42 3,75%
TESEO PRUDENZIALE total
FONDO TESEO PRUDENZIALE total
Replacement tax
FRANCE 3,75 % FTB - 2005 25/04/21
FRANCE 3 1/4 % 2006 - 25/04/16
GERMANY 3 1/2% 04/01/16
NETHERLANDS 01/98-15/01/28 5,5%
DE-GOV GE 01/1998 - 04/01/2028 TF 5,625%
BTP-NV 01 98/29 5,25
BTP 3,75% 2006 - 1.8.16
FRANCE 03/98-25/04/29 TF 5,5%
FRANCE 04/04-25/04/35 4,75%
Manager's fees
AUSTRIA 4% 06 15.09.16
SPAIN 01/98-31/01/29 TF 6%
FINLAND 3,875 % - 15/09/17
AUSTRIA 07/97-15/07/27 TF 6,25%
SPOT FORWARD LIQUIDITY-EURO
OTHER ASSETS TESEO BILANCIATA
BTP 5 1/4% 2002-1.8.17
FRANCE 09/06-25/10/38 TF 4%
BTP 4,5% FB 04/20
BTP 4% 05 01.02.37
GERMANY 01/07-04/07/39 TF 4,25%
SPAIN 10/06-31/01/17 TF 3,80% FRANCE 5/07-25/10/2023 TF 4,25%
NETHERLANDS GOVT 2007 - 15/07/17 TF 4,5%
FRANCE 04/08-25/04/18 4%
GERMANY 05/08-04/07/18 TF 4,25%
SPAIN 09/08-31/01/24 TF 4,8%
GERMANY 11/08-04/01/19 TF 3,75%
BELGIUM 01/09 28/03/2019 4%
NETHERLANDS 02/09-15/07/19 TF 4%
AUSTRIA 01/08-15/03/19 TF 4,35%
GERMANY 05/09-04/07/19 TF 3,5%
BTP 07/09-01/03/25 TF 5%
FRANCE 07/09-25/10/19 TF 3,75%
INTESA C/C TESEO LINEA BILANCIATA EUR 100019
BELGIUM 03/10-28/03/16 TF 2,75%
SPAIN 01/10-30/04/20 TF 4%
BTP 03/11-01/09/21 TF 4,75%
GERMANY 04/12-04/07/22 TF 1,75%
FEDERAL REPUBLIC OF GERMANY
KINGDOM OF BELGIUM
KINGDOM OF THE NETHERLANDS
REPUBLIC OF AUSTRIA
FEDERAL REPUBLIC OF GERMANY
REPUBLIC OF ITALY
FRENCH REPUBLIC
State Street Bank GmbH
KINGDOM OF BELGIUM
KINGDOM OF SPAIN
REPUBLIC OF ITALY
FEDERAL REPUBLIC OF GERMANY 094 04/07/22 242 200,000 1 1,721
174 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 192BILANCIO REALE MUTUA 2015.indd 192 14/04/16 16:0314/04/16 16:03
Annex 4 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of remaining assets and liabilities (values in Euro)
Type/description Counterparty/Issuer State Expiry Currency Total nominal
code value Unitary Total
(1) (2) (3) (4) (5) (6) (7)
Current value
803 803 Q B3 10 067 31/01/22 242 700,000 5 37,472
803 803 Q G8 10 086 01/09/40 242 180,000 2 2,992
803 803 Q B1 10 009 22/06/23 242 680,000 1 8,026
803 803 Q C2 10 040 18/10/17 242 200,000 1 2,224
803 803 Q B3 10 009 22/06/45 242 160,000 2 3,148
803 803 Q G8 10
KINGDOM OF SPAIN
REPUBLIC OF ITALY
KINGDOM OF BELGIUM
REPUBLIC OF IRELAND
KINGDOM OF BELGIUM
REPUBLIC OF ITALY 086 01/05/23 242 1,200,000 1 8,901
803 803 Q B7 10 028 04/07/28 242 150,000 1 2,029
803 803 Q B3 10 028 15/04/23 242 70,000 1 746
803 803 Q B7 10 008 23/05/34 242 200,000 1 2,911
803 803 Q B3 10 008 20/10/23 242 260,000 0 895
803 803 Q B3 10 009 28/03/32 242 200,000 3 6,077
803 803 Q C1 10
REPUBLIC OF FINLAND
REPUBLIC OF FINLAND
REPUBLIC OF AUSTRIA
REPUBLIC OF AUSTRIA
KINGDOM OF BELGIUM
REPUBLIC OF IRELAND 040 18/03/24 242 200,000 3 5,351
803 803 Q B7 10 050 15/01/33 242 200,000 2 4,795
803 803 Q B3 10 029 25/05/45 242 200,000 2 3,907
803 803 Q C2 10
KINGDOM OF THE NETHERLANDS
FRENCH REPUBLIC
FEDERAL REPUBLIC OF GERMANY 094 15/02/24 242 580,000 2 8,871
803 803 Q E4 1D 29/04/17 242 947 3 3,258
803 803 Q B3 10 067 31/01/37 242 240,000 4 9,224
803 803 Q G8 10 086 01/09/44 242 100,000 2 1,579
803 803 Q C2 10 094 15/08/46 242 190,000 1 1,791
803 803 Q B1 10
KINGDOM OF SPAIN
REPUBLIC OF ITALY
FEDERAL REPUBLIC OF GERMANY
REPUBLIC OF IRELAND 040 15/05/30 242 100,000 2 1,508
1,250,994
1,250,994
804 804 UL 13 REPUBLIC OF ITALY 086 242 -788,613 1 -788,613
804 804 UL 12 242 -72,610 1 -72,610
804 804 UL 9 242 34,540 1 34,540
804 804 UL 14 242 0 0 -6
804 804 UL 3A State Street Bank GmbH 094 242 1,218,449 1 1,218,449
804 804 Q E4 1D 29/04/17 242 2,373 3 8,163
399,923
399,923
SPAIN 11/11-31/01/22 TF 5,85%
BTPS 09/2009 09/01/40 FIX 5%
BELGIUM KINGDOM 2,25% 06/22/23 FIX
IRELAND 08/12-18/10/17 TF 5,5%
BELGIUM 09/13-22/06/45 TF 3,75%
BTP 03/13-01/05/23 TF 4,5%
FINLAND 2,75% 2012 04/07/28 FIX
FINLAND 04/13-15/04/23 TF 1,5%
AUSTRIA 2,4% 04/13 23/5/34 FIX
AUSTRIA 04/13-20/10/23 TF 1,75%
BELGIUM 03/12-28/03/32 TF 4%
IRLELAND 01/14-18/03/24 TF 3,4%
NETHERLANDS 03/12-15/01/33 TF 2,5%
FRANCE 04/13-25/05/45 TF 3,25%
GERMANY 1,75% 01/14 15/02/24
Wrt 290417 7,5 PEUGEOT PD
SPAIN 01/05-31/01/37 TF 4,2%
BTP 05/13-01/09/44 TF 4,75%
GERMANY 02/14-15/08/46 TF 2,5%
IRELAND 11/14-15/05/30 TF 2,4%
TESEO BILANCIATA total
FONDO TESEO BILANCIATA total
Replacement tax
Manager's fees
SPOT FORWARD LIQUIDITY-EURO
OTHER ASSETS TESEO SVILUPPO
INTESA C/C TESEO LINEA SVILUPPO EUR 100020
Wrt 290417 7,5 PEUGEOT PD
TESEO SVILUPPO total FONDO TESEO SVILUPPO total
Grand total 5,688,342
(1) Order number of the fund (4) Market on which listed: according to the coding of regulated markets
as seth forth in specific assets for the computerisation data
(2) Investment line: indicate the order number assigned to each investment line
within each fund (to be maintained in subsequent communications) (5) For the remaining assets and liabilities, indicate the codes set forth in Annex 3
of Circular No. 474 of February 21 2002
(3) indicate Q for investments traded on regulated markets and UL for others
(6) Code of the State of the counterparty or issuer (source U.I.C.)
(7) Code of the currency (source U.I.C.)
175
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Annex 5 to the Statement of investments relating to administration of
pension funds under class D.II of the Balance Sheet
Società Reale Mutua di Ass.ni Financial 2015
Detail of units according to pension fund and investment line (values in Euro)
Investment No. of units No. of units No. of units No. of units Unit value of the Net assets Additional
line as of January 1 issued eliminated as of December 31 as of the quotes allocated reserve
as of December 31 to contracts (*)
(1) (2) (3) (4)
801 801 2,796,354 630,672 243,305 3,183,721 14 45,551,880 0
2,796,354 630,672 243,305 3,183,721 14 45,551,880 0
802 802 1,848,776 345,280 106,965 2,087,090 19 39,960,217 0
1,848,776 345,280 106,965 2,087,090 19 39,960,217 0
803 803 2,795,547 360,227 190,473 2,965,300 16 47,485,360 0
2,795,547 360,227 190,473 2,965,300 16 47,485,360 0
804 804 4,072,544 471,750 324,350 4,219,944 10 43,076,273 0
4,072,544 471,750 324,350 4,219,944 10 43,076,273 0
TESEO GARANTITA
FONDO TESEO GARANTITA total
TESEO PRUDENZIALE
FONDO TESEO PRUDENZIALE total
TESEO BILANCIATA
FONDO TESEO BILANCIATA total
TESEO SVILUPPO
FONDO TESEO SVILUPPO total
Grand total 176,073,730
(1) Order number of the fund
(2) Investment line: indicate the order number assigned to each investment line
within each fund (to be maintained in subsequent communications)
(3) Insert the uncoded description of the type of investment line (e.g. Equity, Balanced, Guaranteed etc.)
(4) The grand total of the column must be equal to to item 10 of Form 3
(*) Indicate the additional reserve only for investment lines with guarantee for which the management technique used requires formation of such additional reserve
176 REPORTS AND ACCOUNTS 2015
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MODEL 4
Società Reale Mutua di Assicurazioni
ANNUAL SCHEDULE OF ASSETS ASSIGNED TO COVER TECHNICAL PROVISIONS SPECIFIED IN ARTICLE 37 OF LEGISLATIVE DECREE 209/05
Financial 2015
177
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values in Euro
5 6
A INVESTMENTS
A.1 Debt securities and similar
A.1.1a Securities issued or guaranteed by Member States of European Union or belonging to OCDE, or issuedby local institutions or public institutions of Member States or by international organisations of whichone or more of the aforesaid States are members, traded on a regulated market;
9
963,403,974
10
39.73
11
899,374,959
12
36.74
A.1.1b Securities issued or guaranteed by Member States of European Union or belonging to OCDE, or issuedby local institutions or public institutions of Member States or by international organisations of whichone or more of the aforesaid States are members, not traded on a regulated market;
13
20,403,729
14
0.84
15
21,922,870
16
0.90
A.1.2a Bonds or other similar securities traded on a regulated market; 17 345,984,445 18 14.27 19 275,624,088 20 11.26
A.1.2b Bonds or other similar securities not traded on a regulated market, issued by companies or creditinstitutions with registered offices in a Member States of European Union or belonging to OCDE, whoseFinancial Statements have been certified for at least 3 years by a duly authorised audit company;
21
0
22
0.00
23
0
24
0.00
A.1.2c Bonds and other debt securities issued pursuant to article 157, section 1 of Legislative Decree 163/2006by project companies pursuant to article 156, by companies that operate under public-private partnershipagreements pursuant to article 3, section 15-ter of the same Decree, by companies awarding public works contracts for the construction and management of road, rail, port, airport, hospital and telecomsinfrastructure and for the production and transportation of energy and energy sources, and by companiespursuant to article 157, section 4 of Legislative Decree 163/2006 whose financial statements must becertified by a duly authorised audit company. This class comprises bonds and other debt securitiesguaranteed pursuant to article 157, section 3 of Legislative Decree 163/2006;
3%
513
0
514
0.00
515
0
516
0.00
A.1.2d Bonds, finance bills and other securities pursuant to Art. 32, section 26-bis, of Italian Decree Law No.83 of June 22, 2012, even if not intended to be traded on a regulated market or in multilateral tradingsystems and even if unrated.
3%517
0
518
0.00
519
0
520
0.00
of which securities not traded 521 0 522 0.00 523 0 524 0.00
A.1.3 Other bonds or similar securities, other than those indicated in the points above, provided with aremaining duration of less than one year; 25
026
0.0027
028
0.00
A.1.4 Shares of Italian and UE OICVMs (UCITS); 29 8,040,200 30 0.33 31 75,034,439 32 3.07
A.1.5 Repo agreements with obligation of re-purchase and deposit of the securities; 20% 33 0 34 0.00 35 0 36 0.00
A.1.8 Accrued income on securities suitable for coverage of technical provisions; 49 5,296,716 50 0.22 51 7,039,110 52 0.29
A.1.9 Debt securities referring to factoring transactions even if not intended to be traded on a regulated marketor in multilateral trading systems and even if unrated. [A.1.9 = A.1.9a) + A.1.9b) + A.1.9c)] 5%
525
0 0.00
527
0
528
0.00
A.1.9a) Debt securities referring to credit factoring transactions as set forth in Art. 1, section 1, of ItalianLaw No. 130 of April 30, 1999 lacking the rating requirement as specified in macro-class A1 533
0534
0.00535
0536
0.00
A.1.9b) Debt securities referring to factoring transactions carried out through the subscription or purchase ofbonds and similar securities, i.e. finance bills, excluding securities representing share capital, hybrid andconvertible securities as specified in Art. 1, section 1-bis, of Italian Law No. 130 of April 30, 1999.
537
0
538
0.00
539
0
540
0.00
A.1.9c) Debt securities referring to factoring transactions involving loans granted by factoring companies toparties other than individuals and microenterprises pursuant to Art. 1, section 1-ter, of Italian Law No.130 of April 30, 1999. 541
0
542
0.00
543
0
544
0.00
of which securities not traded 529 0 530 0.00 531 0 532 0.00
Total A.1 53 1,343,129,064 54 55.39 55 1,278,995,466 56 52.25
of which structured securities (a) 501 178,115,026 502 7.35 503 172,154,701 504 7.03
of which factoring (b) 505 0 506 0.00 507 0 508 0.00
Total (a) + (b) 509 178,115,026 510 7.35 511 172,154,701 512 7.03
A.2 Loans 20% 545 0 546 0.00 547 0 548 0.00
A.2.1 Interest-bearing loans and advances guaranteed by mortgages or by bank and insurance guarantees or byother suitable guarantees given by territorial local authorities;
20% 570
580.00
590
600.00
A.2.2 Direct loans not guaranteed granted to parties other than individuals and microenterprises. [A.2.2 =A.2.2a) + A.2.2b) + A.2.2c) + A.2.2d)]
5% 5490
5500.00
5510
5520.00
A2.2a) Direct loans selected by a bank or financial intermediary and meeting all requirements as regardsborrower's quality and relations with the intermediary.
5% 5530
5540.00
5550
5560.00
A2.2b) Direct loans selected by a bank or financial intermediary not meeting requirements as regards theborrower.
2.5% 5570
5580.00
5590
5600.00
A2.2c) Direct loans selected by a bank or financial intermediary not meeting requirements as regards theborrower and relations with the intermediary.
1% 5610
5620.00
5630
5640.00
A2.2d) Direct loans not selected by a bank or financial intermediary. ** 565 0 566 0.00 567 0 568 0.00
A.3 Capital securities and other similar securities
A.3.1a Shares traded on a regulated market; 61 58,991,492 62 2.43 63 105,060,482 64 4.29
A.3.1b Banca d'Italia equity interests, interests in co-operative societies and limited companies and shares nottraded on a regulated market, issued by companies with registered offices in a Member State ofEuropean Union or belonging to OCDE, whose Financial Statements have been certified by a dulyauthorised audit company; 65
91,314,923
66
3.77
67
113,306,595
68
4.63
A.3.3 Shares of Italian and UE OICVMs (UCITS); 73 0 74 0.00 75 0 76 0.00
A.3.4 Shares of closed-end AIFs traded on a regulated market. 5% 77 0 78 0.00 79 0 80 0.00
Total A.3 81 150,306,415 82 6.20 83 218,367,077 84 8.92
A.4 Real estate compartment
A.4.1 Land, buildings and realty rights for quotas free of mortgages; 85 0 86 0.00 87 0 88 0.00
A.4.2 Real property leased; 10% 89 0 90 0.00 91 0 92 0.00
A.4.3 Equity investments in real property companies in which the company holds the majority of the sharecapital, pursuant to Art. 72, section 1 of Decree Law and intended solely for the construction ormanagement of real property for residential, not luxury housing or for industrial or commercial use or foragricultural activities, for the amount stated in the Financial Statements within the limit of the economicvalue of the real property assumed in proportion to the portion of share capital held and net of totalliabilities stated in the Financial Statements of the real estate company for the share corresponding tovalue of the equity investment held. 93
768,441,303
94
31.69
95
768,441,303
96
31.39
to be carried forward 2,261,876,782 93.28 2,265,803,846 92.56
ASSET DESCRIPTIONMaximum
Limits
Balance at the end of financial 2015
Balance at the end of of the previous year
Values % Values %
TECHNICAL PROVISIONSAt the end of
financial 2015At the end of
financial 2014
Technical provisions to be covered 2,424,848,286 2,448,008,787
178 REPORTS AND ACCOUNTS 2015
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carried forward 2,261,876,782 93.28 2,265,803,846 92.56
A.4.4 Shares of Italian real property AIFs. 10% 97 0 98 0.00 99 0 100 0.00
Total A.4 40% 101 768,441,303 102 31.69 103 768,441,303 104 31.39
A.5 Alternative investments
A.5.1a Shares of Italian and EU open-ended AIFs investing mainly in the bonds compartment. 301 0 302 0.00 303 0 304 0.00
A.5.1b Shares of Italian and EU open-ended AIFs investing mainly in the equity compartment. 305 0 306 0.00 307 0 308 0.00
A.5.2a Shares of Italian and EU closed-end AIFs not traded on a regulated market and of reserved Italian AIFs.309
0310
0.00311
0312
0.00
A.5.2b Shares of Italian and EU AIFs other than the previous classes. 313 0 314 0.00 315 0 316 0.00
Sub-total A.5.2a+A.5.2.b 5% 317 0 318 0.00 319 0 320 0.00
total A.5 10% 321 0 322 0.00 323 0 324 0.00
Sub-total A.1 + A.5.1a 85% 325 1,343,129,064 326 55.39 327 1,278,995,466 328 52.25
Sub-total A.3.+A.5.1b+A.5.2a+A.5.2.b 25% 329 150,306,415 330 6.20 331 218,367,077 332 8.92
TOTAL A 105 2,261,876,782 106 93.28 107 2,265,803,846 108 92.56
B RECEIVABLES
B.1 Receivables from reinsurers net of debit items, including the reinsurers' share of technical provisions,duly documented, up to 90% of their amount; 109
190,000,000110
7.84111
210,000,000112
8.58
B.2 Deposits and amounts receivable net of debit items with ceding companies, duly documented, up to 90%of their amount; 113
0114
0.00115
0116
0.00
B.3.1 Loans receivable from policyholders net of debit items, arising out of direct insurance operations, to theextent to which these are effectively collectable since at least 3 months; 117
40,000,000118
1.65119
30,000,000120
1.23
B.3.2 Loans receivable from intermediaries net of debit items, arising out of direct insurance and reinsuranceoperations to the extent to which these are effectively collectable since at least 3 months;
121
5,000,000
122
0.21
123
15,000,000
124
0.61
B.4 Amounts receivable resulting from salvage or substitution; 3% 125 0 126 0.00 127 0 128 0.00
B.5 Tax refunds, definitely ascertained or for which the term prescribed for assessment has elapsed; 5% 129 0 130 0.00 131 0 132 0.00
B.6 Loans receivable from guarantee funds, net of debit items; 5% 133 0 134 0.00 135 0 136 0.00
B.7 Loans arising out of centralised management operations of the Treasury of the Group claimed against thecompany responsible of the management 5% 401
0402
0.00403
0404
0.00
TOTAL B 137 235,000,000 138 9.69 139 255,000,000 140 10.42
C OTHER ASSETS
C.1 Tangible fixed assets, used in company operations, other than land and buildings, within the limit of30% of the carrying value adjusted by the related accumulated depreciation; 141
0142
0.00143
0144
0.00
C.2 Tangible fixed assets not used in company business, other than land and buildings, duly documented,within the limit of 10% of the carrying value; 145
0146
0.00147
0148
0.00
Sub-total C.1+C.2 5% 149 0 150 0.00 151 0 152 0.00
C.3 Acquisition commissions to be amortised within the limit of 90% of their amount; 153 0 154 0.00 155 0 156 0.00
C.4 Accrued income for rents within the limit of 30% of their amount; 157 0 158 0.00 159 0 160 0.00
TOTAL C 161 0 162 0.00 163 0 164 0.00
TOTAL B + C - B.1 25% 165 45,000,000 166 1.86 167 45,000,000 168 1.84
D Deposits with banks, deposits with other credit institutions or any other institutions authorised by thecompetent controlling authorities to receive deposits, net of debit items; 15% 169
0170
0.00171
0172
0.00
E Other categories of assets authorised by ISVAP according to Article 38, Section 4 of Legislative DecreeNo. 209/95; 173
0174
0.00175
0176
0.00
GRAND TOTALASSETS FOR COVERAGE
1772,496,876,782
178102.97
1792,520,803,846
180102.97
Sub-totale A.1.1b + A.1.2b + A.1.2d* + A.1.3 + A.1.9* + A.3.1b + A.5.2a + A.5.2b 10% 181 111,718,652 182 4.61 183 135,229,465 184 5.52
(*) For the purposes of the 10% limit with reference to classes A.1.2d and A.1.9, only securities not traded in a regulated market or multilateral trading systems are considered
(**): said limit is subject to a specific IVASS authorization.
179
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Annex A
values in Euro
CURRENCY EXCHANGE RATE (1) TECHNICAL PROVISIONS ASSETSFOR COVERAGE
European Economic Area
1.000 2,424,375,779 2,496,129,073
0.734 472,507 747,709
Euro Danish Krona Swedish Krona Pound Sterling Czech Krona Hungarian Forint Lithuanian Litas Polish Zloty Nuovo Leu Romeno Nuovo Lev Bulgaro Norwegian Krona Iceland Krona Liechtenstein Franc
Non-EU states
Swiss Franc U. S. Dollar Canadian Dollar Australian Dollar New Zealand Dollar Hong Kong Dollar Japanese Yen Arabian Riyal Turkish Lira
2,424,848,286 2,496,876,782
(1).
(2).
The amounts of technical provisions and assets assigned to cover these have been convertedat the exchange rate prevailing at the end of the reference year in relation to the currency in which the communication was made,including assets acquired after such date.The total technical provisions correspond to the amount of item 5 of the annual scheduleof assets assigned to cover technical provisions.
The total of the assets corresponds to item 177 of the same schedule.
List of commitments and related assets for coverage by currency
TOTAL (2)
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ANNEXES TO THE NOTES
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182 REPORTS AND ACCOUNTS 2015
Notes to the Financial Statements – Annex 1
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Company SOCIETA' REALE MUTUA DI ASS.NI
BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
ASSETS
Values of the year
A. SUBSCRIBED CAPITAL UNPAID 1 0
of which called-up capital 2 0
B. INTANGIBLE ASSETS1. Deferred acquisition commissions 4 0
2. Other acquisition costs 6 0
3. Start-up and expansion costs 7 0
4. Goodwill 8 0
5. Other multi-year costs 9 72 10 72
C. INVESTMENTS
I - Land and buildings1. Property used in company operations 11 15,595
2. Property rented to third parties 12 28,874
3. Other properties 13 0
Other property rights 14 0
5. Construction in progress and advance 15 0 16 44,469
II - Investments in Group companies and other shareholdings1. Shares and interests in
a) controlling companies 17 0
b) subsidiary companies 18 1,364,580
c) affiliated companies 19 0
d) associated companies 20 36,754
e) other companies 21 3,065 22 1,404,399
2. Bond issued by:a) controlling companies 23 0
b) subsidiary companies 24 0
c) affiliated companies 25 0
d) associated companies 26 0
e) other companies 27 0 28 0
3. Loans to:a) controlling companies 29 0
b) subsidiary companies 30 0
c) affiliated companies 31 0
d) associated companies 32 0
e) other companies 33 0 34 0 35 1,404,399
to be carried forward 72
4.
183
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Financial 2015
Values of the previous year
181 0
182 0
184 0
186 0
187 0
188 0
189 69,937 190 69,937
191 15,995
192 26,959
193 0
194 0
195 0 196 42,954
197 0
198 1,288,240
199 0
200 36,754
201 3,065 202 1,328,059
203 0
204 0
205 0
206 0
207 0 208 0
209 0
210 0
211 0
212 0
213 0 214 0 215 1,328,059
to be carried forward 69,937
184 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
ASSETS
Values of the year
carried forward 72
C. INVESTMENTS (continued)
III - Other financial investments1. Shares and interests
a) Listed shares 36 58,991
b) Unlisted shares 37 7,551
c) Interests 38 12,597 39 79,139
2. Shares in common investment funds 40 76,306
3. Bonds and other fixed-income securitiesa) listed 41 1,394,752
b) unlisted 42 20,494
c) convertible debentures 43 0 44 1,415,246
4. Loansa) loans secured by mortgage 45 27,339
b) loans on policies 46 0
c) other loans 47 1,491 48 28,830
5. Participation in investments pools 49 0
6. Deposits with credit institutions 50 4,267
7. Miscellaneous financial investments 51 1 52 1,603,789
IV - Deposits with ceding undertakings 53 313 54 3,052,970
D bis. REINSURERS' SHARE OF TECHNICAL PROVISIONS
I - NON-LIFE BUSINESS
1. Provisions for unearned premiums 58 32,169
2. Provisions for claims outstanding 59 138,455
3. Provisions for profit-sharing and premium refunds 60 0
4.Other technical provisions 61 0 62 170,624
to be carried forward 3,223,666
185
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Values of the previous year
carried forward 69,937
216 105,060
217 2,642
218 14,223 219 121,925
220 194,466
221 1,236,192
222 22,147
223 0 224 1,258,339
225 32,011
226 0
227 1,891 228 33,902
229 0
230 10,025
231 20 232 1,618,677
233 342 234 2,990,032
238 30,967
239 143,870
240 0
241 0 242 174,837
to be carried forward 3,234,806
186 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
ASSETS
Values of the year
carried forward 3,223,666
E. DEBTORS
I - Debtors arising out of direct insurance operations:
1. Policyholders
a) for premiums current year 71 138,590
b) for premiums previous years 72 10,397 73 148,987
2. Insurance intermediaries 74 173,553
3. Current accounts with Insurance companies 75 22,082
4. Policyholders and third parties for recoveries 76 54,168 77 398,790
II - Debtors arising out of reinsurance operations:
1. Insurance and Reinsurance companies 78 56,999
2. Insurance intermediaries 79 859 80 57,858
III - Other debtors 81 139,830 82 596,478
F. OTHER ASSETS
I - Tangible assets and stocks:
Furniture, office machines and internal transport vehicles 83 4,081
2. Vehicles listed in public registers 84 0
3. Machinery and equipment 85 8,667
4. Stocks and other goods 86 0 87 12,748
II - Cash at bank and in hand
1. Bank and Postal accounts 88 59,938
2. Cheques and cash on hand 89 3 90 59,941
91 0III - Own shares or equity interests
IV - Other
1. Deferred reinsurance items 92 2
2. 93 140,143 94 140,145 95 212,834 Miscellaneous assets
of which connection account with Life business 901 50
G. PREPAYMENTS AND ACCRUED INCOME
1. Accrued interest 96 6,000
2. Rents 97 0
3. Other prepayments and accrued income 98 35 99 6,035
TOTAL ASSETS 100 4,039,013
187
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Values of the previous year
carried forward 3,234,806
251 139,970
252 10,252 253 150,222
254 190,113
255 35,578
256 49,641 257 425,554
258 87,565
259 1,374 260 88,939
261 152,870 262 667,363
263 5,342
264 5
265 10,159
266 0 267 15,506
268 21,092
269 3 270 21,095
271 0
272 2
273 146,702 274 146,704 275 183,305
903 0
276 7,612
277 0
278 485 279 8,097
280 4,093,571
188 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
A. SHAREHOLDERS' EQUITY
101 45,000I - Subscribed capital or equivalent fund
II - Share premium reserve 102 0
103 111,817
104 160,441
105 0
III - Revaluation reserves
IV - Legal reserve
V - Statutory reserves
VI - Reserves for own shares and shares of the controlling company 106 0
107 973,833VII - Other reserves
VIII - Net profit (loss) brought forward 108 0
IX - Net profit (loss) for the year 109 55,865 110 1,346,956
B. SUBORDINATED LIABILITIES 111 0
C. TECHNICAL PROVISIONS
I - NON-LIFE BUSINESS
1. Provisions for unearned premiums 112 645,119
2. Provisions for claims outstanding 113 1,778,039
3. Provisions for profit-sharing and premium refunds 114 0
4. Other technical provisions 115 749
5. Equalisation provision 116 10,535 117 2,434,442
to be carried forward 3,781,398
189
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Values of the previous year
281 45,000
282 0
283 111,817
284 155,912
285 0
286 0
287 887,790
288 0
289 90,572 290 1,291,091
291 0
292 623,471
293 1,824,504
294 0
295 639
296 9,256 297 2,457,870
to be carried forward 3,748,961
190 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
carried forward 3,781,398
E. PROVISIONS FOR OTHER RISKS AND CHARGES
1. Provisions for pensions and similar obligations 128 19,179
2. Provisions for taxation 129 407
3. Other provisions 130 48,326 131 67,912
F. DEPOSITS RECEIVED FROM REINSURERS 132 818
G. CREDITORS AND OTHER LIABILITIES
I - Creditors arising out of direct insurance operations:
1. Insurance intermediaries 133 43,205
2. Current accounts with Insurance companies 134 2,165
3. Premium deposits and premiums due to policyholders 135 5,411
4. Guarantee funds in favour of policyholders 136 0 137 50,781
II - Creditors arising out of reinsurance operations:
1. Insurance and Reinsurance companies 138 1,100
2. Insurance intermediaries 139 3,066 140 4,166
III - Debenture loans 141 0
IV - Amounts owed to banks and credit institutions 142 0
V - Loans guaranteed by mortgages 143 0
144 0
145 8,142
VI - Miscellaneous loans and other financial liabilities
VII - Provisions for employee termination indemnities
VIII - Other creditors
1. Premium taxes 146 29,948
2. Other tax liabilities 147 3,083
3. Social security 148 5,168
4. Miscellaneous creditors 149 39,975 150 78,174
IX - Other liabilities
1. Deferred reinsurance items 151 0
2. Commissions for premiums in course of collection 152 40,024
3. Miscellaneous liabilities 153 6,731 154 46,755 155 188,018
of which connection account with Life business 902 0
to be carried forward 4,038,146
191
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Values of the previous year
carried forward 3,748,961
308 20,132
309 3,607
310 58,351 311 82,090
312 783
313 59,933
314 424
315 8,788
316 0 317 69,145
318 805
319 4,588 320 5,393
321 0
322 0
323 0
324 0
325 9,794
326 28,930
327 27,558
328 5,646
329 62,243 330 124,377
331 0
332 39,915
333 12,427 334 52,342 335 261,051
904 23
to be carried forward 4,092,885
192 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
carried forward 4,038,146
H. ACCRUALS AND DEFERRED INCOME
1. Accrued interest 156 0
2. Rents 157 867
3. Other prepayments and accrued income 158 0 159 867
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 160 4,039,013
BALANCE SHEET – NON-LIFE INSURANCE BUSINESS
GUARANTEES, COMMITMENTS AND OTHER MEMORANDUM ACCOUNTS
Values of the year
GUARANTEES, COMMITMENTS AND OTHER MEMORANDUM ACCOUNTS
I - Guarantees given
1. Sureties 161 0
2. Endorsements 162 0
3. Other personal guarantees 163 0
4. Guarantees secured by mortgages 164 0
II - Guarantees received
1. Sureties 165 25,951
2. Endorsements 166 0
3. Other personal guarantees 167 0
4. Guarantees secured by mortgages 168 27,339
169 39,025III - Guarantees issued by third parties in the interest of the Company
IV - Commitments 170 36,001
V - Third party assets 171 0
173 1,637,314VII - Securities deposited with third parties
VIII - Other memorandum accounts 174 0
193
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Values of the previous year
carried forward 4,092,885
336 0
337 686
338 0 339 686
340 4,093,571
Values of the previous year
341 0
342 0
343 0
344 0
345 26,404
346 0
347 0
348 31,851
349 31,033
350 36,020
351 0
353 1,653,787
354 0
194 REPORTS AND ACCOUNTS 2015
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Notes to the Financial Statements – Annex 2
Company SOCIETA' REALE MUTUA DI ASS.NI
BALANCE SHEET – LIFE INSURANCE BUSINESS
ASSETS
Values of the year
A. SUBSCRIBED CAPITAL UNPAID 1 0
of which called-up capital 2 0
B. INTANGIBLE ASSETS1. Deferred acquisition commissions 3 0
2. Other acquisition costs 6 0
3. Start-up and expansion costs 7 0
4. Goodwill 8 0
5. Other multi-year costs 9 0 10 0
C. INVESTMENTSI - Land and buildings
1. Property used in company operations 11 0
2. Property rented to third parties 12 0
3. Other properties 13 0
4. Other property rights 14 0
5. Construction in progress and advance 15 0 16 0
II - Investments in Group companies and other shareholdings1. Shares and interests in
a) controlling companies 17 0
b) subsidiary companies 18 255,531
c) affiliated companies 19 0
d) associated companies 20 0
e) other companies 21 0 22 255,531
2. Bond issued by:a) controlling companies 23 0
b) subsidiary companies 24 0
c) affiliated companies 25 0
d) associated companies 26 0
e) other companies 27 0 28 0
3. Loans to:a) controlling companies 29 0
b) subsidiary companies 30 0
c) affiliated companies 31 0
d) associated companies 32 0
e) other companies 33 0 34 0 35 255,531
to be carried forward 0
195
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Financial 2015
Values of the previous year
181 0
182 0
183 0
186 0
187 0
188 0
189 2,881 190 2,881
191 0
192 0
193 0
194 0
195 0 196 0
197 0
198 255,531
199 0
200 0
201 0 202 255,531
203 0
204 0
205 0
206 0
207 0 208 0
209 0
210 0
211 0
212 0
213 0 214 0 215 255,531
to be carried forward 2,881
196 REPORTS AND ACCOUNTS 2015
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BALANCE SHEET – LIFE INSURANCE BUSINESS
ASSETS
Values of the year
carried forward 0
C. INVESTMENTS (continued)
III - Other financial investments1. Shares and interests
a) Listed shares 36 0
b) Unlisted shares 37 0
c) Interests 38 0 39 0
2. Shares in common investment funds 40 102,378
3. Bonds and other fixed-income securities:a) listed 41 3,864,429
b) unlisted 42 744
c) convertible debentures 43 0 44 3,865,173
4. Loansa) loans secured by mortgage 45 0
b) loans on policies 46 2,613
c) other loans 47 0 48 2,613
5. Participation in investments pools 49 0
6. Deposits with credit institutions 50 0
7. Miscellaneous financial investments 51 0 52 3,970,164
IV - Deposits with ceding undertakings 53 4,893 54 4,230,588
D. INVESTMENTS FOR THE BENEFIT OF LIFE POLICYHOLDERS WHO BEAR THE INVESTMENT RISK AND RELATING TO THE ADMINISTRATION OF PENSION FUNDS
I 55 473,189
II
- Investments relating to contracts linked to investment funds and market indexes
- Investments relating to the administration of pension funds 56 176,074 57 649,263
D bis. REINSURERS' SHARE OF TECHNICAL PROVISIONS
II - LIFE BUSINESS
1. Provisions for policy liabilities 63 2,984
2. Unearned premium provision for supplementary coverage 64 0
3. Provision for claims to be paid 65 760
4. Provisions for profit-sharing and premium refunds 66 0
5. Other technical provisions 67 0
6. Technical provisions where the investments risk is borne by the policyholders and relating to theadministration of pension funds 68 0 69 3,744
to be carried forward 4,883,595
197
BILANCIO REALE MUTUA 2015.indd 215BILANCIO REALE MUTUA 2015.indd 215 14/04/16 16:0414/04/16 16:04
Values of the previous year
carried forward 2,881
216 31
217 0
218 0 219 31
220 87,873
221 3,456,343
222 10,900
223 0 224 3,467,243
225 0
226 3,469
227 0 228 3,469
229 0
230 0
231 0 232 3,558,616
233 5,416 234 3,819,563
235 455,391
236 155,827 237 611,218
243 3,535
244 0
245 720
246 0
247 0
248 0 249 4,255
to be carried forward 4,437,917
198 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 216BILANCIO REALE MUTUA 2015.indd 216 14/04/16 16:0414/04/16 16:04
BALANCE SHEET – LIFE INSURANCE BUSINESS
ASSETS
Values of the year
carried forward 4,883,595
E.
I- Debtors arising out of direct insurance operations:
1. Policyholders
a) for premiums current year 71 30,037
b) for premiums previous years 72 9,794 73 39,831
2. Insurance intermediaries 74 35,294
3. Current accounts with Insurance companies 75 1,150
4. Policyholders and third parties for recoveries 76 0 77 76,275
II - Debtors arising out of reinsurance operations:
1. Insurance and Reinsurance companies 78 2,169
2. Insurance intermediaries 79 0 80 2,169
III - Other debtors 81 31,813 82 110,257
F. OTHER ASSETS
I - Tangible assets and stocks:
Furniture, office machines and internal transport vehicles 83 205
2. Vehicles listed in public registers 84 0
3. Machinery and equipment 85 259
4. Stocks and other goods 86 0 87 464
II - Cash at bank and in hand
1. Bank and Postal accounts 88 28,090
2. Cheques and cash on hand 89 0 90 28,090
91 0III - Own shares or equity interests
IV - Other
1. Deferred reinsurance items 92 0
2. 93 20,267 94 20,267 95 48,821Miscellaneous assets
of which connection account with Non-life business 901 0
G. ACCRUALS AND DEFERRED INCOME
1. Accrued interest 96 46,134
2. Rents 97 0
3. Other prepayments and accrued income 98 0 99 46,134
TOTAL ASSETS 100 5,088,807
DEBTORS
199
BILANCIO REALE MUTUA 2015.indd 217BILANCIO REALE MUTUA 2015.indd 217 14/04/16 16:0414/04/16 16:04
Values of the previous year
carried forward 4,437,917
251 37,313
252 4,234 253 41,547
254 15,189
255 1,150
256 0 257 57,886
258 944
259 0 260 944
261 26,894 262 85,724
263 310
264 0
265 523
266 0 267 833
268 38,551
269 0 270 38,551
271 0
272 0
273 22,471 274 22,471 275 61,855
903 23
276 45,618
277 0
278 0 279 45,618
280 4,631,114
200 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 218BILANCIO REALE MUTUA 2015.indd 218 14/04/16 16:0414/04/16 16:04
BALANCE SHEET – LIFE INSURANCE BUSINESS
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
A. SHAREHOLDERS' EQUITY
101 15,000
102 0
I - Subscribed capital or equivalent fund
II - Share premium reserve
III - Revaluation reserves 103 24,406
104 47,096
105 0
IV - Legal reserve
V - Statutory reserves
VI - Reserves for own shares and shares of the controlling company 106 0
107 412,217VII - Other reserves
VIII - Net profit (loss) brought forward 108 0
IX - Net profit (loss) for the year 109 3,546 110 502,265
B. SUBORDINATED LIABILITIES 111 0
C. TECHNICAL PROVISIONS
II - LIFE INSURANCE BUSINESS
1. Provisions for policy liabilities 118 3,805,355
2. Unearned premium provision for supplementary coverage 119 171
3. Provision for claims to be paid 120 72,514
4. Provisions for profit-sharing and premium refunds 121 0
5. Other technical provisions 122 10,734 123 3,888,774
D. TECHNICAL PROVISIONS WHERE THE INVESTMENT RISK IS BORNEBY THE POLICYHOLDERS AND RELATING TO THE ADMINISTRATION OF PENSION FUNDS
I - Provisions relating to contracts linked to investment funds and market indexes 125 475,035
II - Provisions relating to the administration of pension funds 126 176,065 127 651,100
to be carried forward 5,042,139
201
BILANCIO REALE MUTUA 2015.indd 219BILANCIO REALE MUTUA 2015.indd 219 14/04/16 16:0414/04/16 16:04
Values of the previous year
281 15,000
282 0
283 24,406
284 46,686
285 0
286 0
287 404,434
288 0
289 8,193 290 498,719
291 0
298 3,400,474
299 148
300 49,000
301 0
302 11,609 303 3,461,231
305 457,011
306 155,822 307 612,833
to be carried forward 4,572,783
202 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 220BILANCIO REALE MUTUA 2015.indd 220 14/04/16 16:0414/04/16 16:04
BALANCE SHEET – LIFE INSURANCE BUSINESS
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
carried forward 5,042,139
E. PROVISIONS FOR OTHER RISKS AND CHARGES
1. Provisions for pensions and similar obligations 128 12,877
2. Provisions for taxation 129 0
3. Other provisions 130 1,434 131 14,311
F. DEPOSITS RECEIVED FROM REINSURERS 132 2,897
G. CREDITORS AND OTHER LIABILITIES
I - Creditors arising out of direct insurance operations:
1. Insurance intermediaries 133 7,669
2. Current accounts with Insurance companies 134 4,779
3. Premium deposits and premiums due to policyholders 135 7,331
4. Guarantee funds in favour of policyholders 136 0 137 19,779
II - Creditors arising out of reinsurance operations:
1. Insurance and Reinsurance companies 138 11
2. Insurance intermediaries 139 0 140 11
141 0
142 0
143 0
III - Debenture loans
IV - Amounts owed to banks and credit institutions
V - Loans guaranteed by mortgages
VI - Miscellaneous loans and other financial liabilities 144 0
145 1,450VII - Provisions for employee termination indemnities
VIII - Other creditors
1. Premium taxes 146 186
2. Other tax liabilities 147 0
3. Social security 148 0
4. Miscellaneous creditors 149 4,257 150 4,443
IX - Other liabilities
1. Deferred reinsurance items 151 0
2. Commissions for premiums in course of collection 152 2,501
3. 153 50 154 2,551 155 28,234Miscellaneous liabilities
of which connection account with Non-life business 902 50
to be carried forward 5,087,581
203
BILANCIO REALE MUTUA 2015.indd 221BILANCIO REALE MUTUA 2015.indd 221 14/04/16 16:0414/04/16 16:04
Values of the previous year
carried forward 4,572,783
308 12,862
309 0
310 1,180 311 14,042
312 3,416
313 21,488
314 6,252
315 4,627
316 0 317 32,367
318 17
319 46 320 63
321 0
322 0
323 0
324 0
325 1,631
326 211
327 3,006
328 0
329 151 330 3,368
331 0
332 2,145
333 0 334 2,145 335 39,574
904 0
to be carried forward 4,629,815
204 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 222BILANCIO REALE MUTUA 2015.indd 222 14/04/16 16:0414/04/16 16:04
BALANCE SHEET – LIFE INSURANCE BUSINESS
LIABILITIES AND SHAREHOLDERS' EQUITY
Values of the year
carried forward 5,087,581
H. ACCRUALS AND DEFERRED INCOME
1. Accrued interest 156 1,226
2. Rents 157 0
3. Other prepayments and accrued income 158 0 159 1,226
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 160 5,088,807
BALANCE SHEET – LIFE INSURANCE BUSINESS
GUARANTEES, COMMITMENTS AND OTHER MEMORANDUM ACCOUNTS
Values of the year
GUARANTEES, COMMITMENTS AND OTHER MEMORANDUM ACCOUNTS
I - Guarantees given
1. Sureties 161 0
2. Endorsements 162 0
3. Other personal guarantees 163 0
4. Guarantees secured by mortgages 164 0
II - Guarantees received
1. Sureties 165 0
2. Endorsements 166 0
3. Other personal guarantees 167 0
4. Guarantees secured by mortgages 168 0
169 0III - Guarantees issued by third parties in the interest of the Company
IV - Commitments 170 58,189
171 0V - Third party assets
VI - Assets relating to pension funds managed in the name and on behalf of third parties 172 0
173 4,599,537VII - Securities deposited with third parties
VIII - Other memorandum accounts 174 0
205
BILANCIO REALE MUTUA 2015.indd 223BILANCIO REALE MUTUA 2015.indd 223 14/04/16 16:0414/04/16 16:04
Values of the previous year
carried forward 4,629,815
336 1,299
337 0
338 0 339 1,299
340 4,631,114
Values of the previous year
341 0
342 0
343 0
344 0
345 0
346 0
347 0
348 0
349 0
350 62,152
351 0
352 0
353 4,137,028
354 0
206 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 224BILANCIO REALE MUTUA 2015.indd 224 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 3
Company SOCIETA' REALE MUTUA DI ASS.NI Financial 2015
Breakdown of the operating result between Non-life and Life business
Non-life business Life business Total
Result of the technical account……………………… 1 49,764 21 -19,088 41 30,676
Investment income……………………………………. + 2 97,515 42 97,515
Investment management and financial charges……….. - 3 22,226 43 22,226
24 17,842 44 17,842
Allocated investment return transferred from the technical account of Life business……………….... +
Allocated investment return transferred from the technical account of Non-life business………….... - 5 47,643 45 47,643
77,411 26 -1,246 46 76,164
60,985 27 962 47 61,947
Intermediate operating result……………………...... 6
Other income…………………………………………. + 7
Other charges…………………………………………. - 8 51,208 28 1,350 48 52,558
9,223 29 1,437 49 10,660Extraordinary income…………………………………. + 9
Extraordinary charges………………………………..... - 10 13,381 30 82 50 13,463
Profit before taxes ................................………........... 11 83,030 31 -279 51 82,751
Income taxes ...................……………………............... - 12 27,165 32 -3,825 52 23,340
Net profit for the year……………….......................… 55,865 33 3,546 53 59,41113
207
BILANCIO REALE MUTUA 2015.indd 225BILANCIO REALE MUTUA 2015.indd 225 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 4
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Changes during the year in intangible assets (item B) and land and buildings (item C.I)
Intangible assetsB
Land and buildingsC.I
Gross initial balance......................................…….................. + 1 259,096 31 54,610
172 32 2,149Increases during the year………………………………….. + 2
for: purchases or additions……………………………........ - 3 172 33 2,149
34
35
write-backs……………………………………………........ 4
revaluations……………………………………………....... 5
other changes…………………………………………… 6 36
257,659 37 0Reductions during the year………………………………… - 7
for: sales or decreases……………………………………... 8 38
39long-term write-downs………………………………......... 9
other changes…………………………………………… 10 257,659 40
Gross final balance......................................……................ 11 1,609 41 56,759
Amortisation and depreciation:
Gross initial balance......................................…….................. + 12 186,279 42 11,656
Increases during the year + 13 5 43 634
for: Third party interest in net income for the year ……….. 14 5 44 634
45other changes…………………………………………........ 15
Reductions during the year………………………………… - 16 184,747 46 0
for: reductions following disposals......................................... 17 47
184,747 48 other changes…………………………………………… 18
Final values of amortisation (b) (*)……………………… 1,537 49 12,290
72 50 44,469
51 109,992
52 6,021
Carrying value (a – b)……………………….......…………
Current value………………………………………………
Total revaluations…………………………………………..
Total write-downs................................................................................................... 53
20
23
22
19
208 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 226BILANCIO REALE MUTUA 2015.indd 226 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 5
Company SOCIETA' REALE MUTUA DI ASS.NI Financial 2015
Assets – Changes during the year in investments in Group companies and other shareholdings: shares andinterests (item C.II.1), bonds (item C.II.2) and loans (item C.II.3)
Bonds LoansShares and interestsC.II.1 C.II.2 C.II.3
Gross initial balance......................................…............. + 1 1,583,589 21 0 41 0
Increases during the year ............................................................. + 2 76,340 0 42 0
for: purchases, subscriptions or issues…......................... 0 23 0 43
write-backs……………………………………….. 4 0 24 0 44
0 25 0revaluations…………………………...…………. 5
other changes.................................................................... 6 76,340 26 0 46
Decreases during the year - ...................................................... 0 47 0
for: sales or repayments………………………………………………………. 8 0 28 0 48
0 29 0 49 write-downs………………………………………………………………… 9
other changes………………………………………………………………… 10 0 30 0 50
Carrying value………………………………………………… 11 1,659,929 31 0 51 0
Current value……………………………………………………………….. 12 1,659,929 32 0 52
Total revaluations………………………………………………………… 13 13,128 33 0
Total write-downs……………………………………………………………….. 14 174,120 34 0 54
Item C.II.2 includes:
0
0
0
Listed bonds……………………………………………………………………………………. 61
Unlisted bonds………………………………………………………………………………… 62
Carrying value…………………………………………………………………………………. 63
of which convertible debentures……………………………………………………………… 64 0
3
7
209
BILANCIO REALE MUTUA 2015.indd 227BILANCIO REALE MUTUA 2015.indd 227 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
6
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
2015
Ass
ets –
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rmat
ion
rega
rdin
g in
vest
ee c
ompa
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(*)
Ord
Type
List
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rA
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and
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ster
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quity
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et in
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e or
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of
Perc
enta
ge in
tere
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ount
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ount
Num
ber
the
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ious
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r (**
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rect
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l(*
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ndic
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l per
cent
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ffilia
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210 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 228BILANCIO REALE MUTUA 2015.indd 228 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
7
2015
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Ass
ets –
Det
aile
d sc
hedu
le o
f cha
nges
in in
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
sha
res a
nd in
tere
sts
Ord
Type
Nam
eIn
crea
ses d
urin
g th
e ye
arD
ecre
ases
dur
ing
the
year
Car
ryin
g va
lue
(4)
Purc
hase
Cur
rent
No.
For p
urch
ases
Oth
erFo
r sal
esO
ther
Qua
ntity
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ueco
stva
lue
(1)
(2)
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Qua
ntity
Val
uein
crea
ses
Qua
ntity
Val
uede
crea
ses
1B
D -
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-
28,
500,
000
40,1
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511
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511
3B
D -
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527,
060
31,5
55 31
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31,5
554
BD
--
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7,08
8,43
2 12
9,90
5 25
5,59
5 12
9,90
54
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--
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1
9,01
1,61
8 15
1,68
7 16
8,96
9 15
1,68
75
BD
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1
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0,00
0 83
0,74
7 83
0,74
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0,74
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3,84
3 10
3,84
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3,84
36
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76,3
40 -
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76,3
90 76
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76,3
907
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3,83
8,00
0 25
2,74
3 25
2,74
3 25
2,74
38
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--
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500
610
610
610
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D -
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1,
366,
000
22,1
36 22
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22,1
3610
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5,09
1,66
0 12
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12,2
70 12
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D -
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636,
457
2,24
8 2,
248
2,24
812
ED
--
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253
1,94
8 1,
948
1,94
813
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39,8
00 71
6 71
6 71
614
ED
BAN
CA
REA
LE S
PABL
UE
ASS
ISTA
NC
E SP
AIG
AR
S.A
.IT
ALI
AN
A A
SSIC
UR
AZI
ON
I SPA
ITA
LIA
NA
ASS
ICU
RA
ZIO
NI S
PAR
EALE
IMM
OBI
LI S
PAR
EALE
IMM
OBI
LI S
PAR
EALE
ITES
GEI
E R
MA
REA
LE S
EGU
RO
S G
ENER
ALE
S S.
A.
REA
LE V
IDA
Y P
ENSI
ON
ES S
.A.
CR
EDEM
ASS
ICU
RA
ZIO
NI S
PASA
RA
SPA
OR
D.
SAR
A S
PA P
RIV
.C
EDA
CR
I SPA
SYN
KR
ON
OS
ITA
LIA
S.r.
l.W
ELFA
RE
ITA
LIA
SER
VIZ
I SR
L -
- -
- 1
400
400
400
Tot
als C
.II.1
076
,340
1,65
9,92
81,
820,
920
1,65
9,92
9
a A
ssoc
iate
d co
mpa
nies
00
00
0
b S
ubsid
iary
com
pani
es0
76,3
401,
620,
110
1,78
1,20
21,
620,
110
c A
ffilia
ted
com
pani
es0
00
00
d A
ssoc
iate
d co
mpa
nies
00
36,7
5436
,654
36,7
54
e O
ther
00
3,06
43,
064
3,06
5
Tot
al D
.I0
00
00
Tot
al D
.II0
00
00
(1) M
ust m
atch
that
indi
cate
d in
Ann
ex 6
(3) I
ndic
ate:
(4) I
ndic
ate
whe
ther
val
ued
by th
e eq
uity
met
hod
with
an
(*) (
only
for T
ype
b an
d d)
(2)
Type
a =
Con
trolli
ng
b =
Sub
sidia
ry c
ompa
nies
c =
Affi
liate
d
D fo
r inv
estm
ents
ass
igne
d to
Non
-life
bus
ines
s (ite
m C
.II.1
)
V fo
r inv
estm
ents
ass
igne
d to
Life
bus
ines
s (ite
m C
.II.1
) V
1 fo
r inv
estm
ents
ass
igne
d to
Life
bus
ines
s (D
.I)
V2
for i
nves
tmen
ts a
ssig
ned
to L
ife b
usin
ess (
D.II
)
The
sam
e nu
mbe
r mus
t be
assig
ned
to th
e sh
areh
oldi
ng
d =
Ass
ocia
ted
eve
n if
split
e=
Oth
ers
211
BILANCIO REALE MUTUA 2015.indd 229BILANCIO REALE MUTUA 2015.indd 229 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
8
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets -
Bre
akdo
wn
of o
ther
fina
ncia
l inv
estm
ents
acc
ordi
ng to
use
: sha
res a
nd in
tere
sts i
n co
mpa
nies
, sha
res i
n co
mm
on in
vest
men
t fun
ds, B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s,pa
rtici
patio
n in
inve
stm
ent p
ools
and
othe
r fin
anci
al in
vest
men
ts (i
tem
s C.II
I.1, 2
, 3, 5
, 7)
I – N
on-li
fe b
usin
ess
Lo
ng-te
rm in
vest
men
t por
tfolio
S
hort-
term
fina
ncia
l ass
ets p
ortfo
lioTo
tal
Car
ryin
g va
lue
Mar
ket v
alue
Car
ryin
g va
lue
Mar
ket v
alue
Car
ryin
g va
lue
Mar
ket v
alue
1. S
hare
s and
inte
rest
s in:
.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
18,
610
21
10,0
75 4
170
,529
61
73,1
22 8
179
,139
101
83,1
97
a) L
iste
d sh
ares
……
……
……
……
……
……
……
……
……
……
……
……
……
……
28,
116
22
9,58
0 4
250
,875
62
53,4
68 8
258
,991
102
63,0
48
b) U
nlis
ted
shar
es…
……
……
……
……
……
……
……
……
……
……
……
……
..
339
8 2
339
9 4
37,
153
63
7,15
3 8
37,
551
103
7,55
2
c) In
tere
sts…
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
4
96 2
496
44
12,5
01 6
412
,501
84
12,5
97 1
0412
,597
2. S
hare
s in
com
mon
inve
stm
ent f
unds
......
......
......
......
......
......
......
......
......
......
......
......
......
.
50
25
0 4
576
,306
65
77,2
47 8
576
,306
105
77,2
47
3. B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s: ...
......
......
......
......
......
......
......
....
39,2
09 4
61,
378,
349
66
1,40
5,52
5 8
61,
415,
246
106
1,44
4,73
4
16,4
83 2
716
,581
47
963,
404
67
978,
691
87
979,
887
107
995,
272
0 2
80
48
414,
865
68
426,
754
88
414,
865
108
426,
754
20,4
04 2
922
,618
49
0 6
90
89
20,4
04 1
0922
,618
a
1) li
sted
Gov
ernm
ent s
ecur
ities
……
……
……
……
……
……
……
……
…
7
a
2) o
ther
list
ed se
curit
ies…
……
……
……
……
……
……
……
……
……
……
..
8
b
1) u
nlis
ted
Gov
ernm
ent s
ecur
ities
……
……
……
……
……
……
……
……
……
..
9
b
2) o
ther
unl
iste
d se
curit
ies…
……
……
……
……
……
……
……
……
……
……
……
…
1
010
30
10 5
080
70
80 9
090
110
90
c) c
onve
rtibl
e de
bent
ures
……
……
……
……
……
……
……
……
……
……
……
1
10
31
0 5
10
71
0 9
10
111
0
5. P
artic
ipat
ion
in in
vest
men
t poo
ls...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.
12
0 3
20
52
0 7
20
92
0 1
120
7. M
isce
llane
ous f
inan
cial
inve
stm
ents
……
……
……
……
……
......
......
.....
1
30
33
0 5
31
73
1 9
31
113
1
II –
Life
bus
ines
s
Lo
ng-te
rm in
vest
men
t por
tfolio
S
hort-
term
fina
ncia
l ass
ets p
ortfo
lioTo
tal
Car
ryin
g va
lue
Mar
ket v
alue
Car
ryin
g va
lue
Mar
ket v
alue
Car
ryin
g va
lue
Mar
ket v
alue
1. S
hare
s and
inte
rest
s in:
.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
1
210
141
0 1
610
181
0 2
010
221
0
a) L
iste
d sh
ares
……
……
……
……
……
……
……
……
……
……
……
……
……
……
.
122
0 1
420
162
0 1
820
202
0 2
220
b) U
nlis
ted
shar
es…
……
……
……
……
……
……
……
……
……
……
……
……
…..
123
0 1
430
163
0 1
830
203
0 2
230
c) In
tere
sts…
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
….
124
0 1
440
164
0 1
840
204
0 2
240
2. S
hare
s in
com
mon
inve
stm
ent f
unds
......
......
......
......
......
......
......
......
......
......
......
......
......
.
1
250
145
0 1
6510
2,37
8 1
8510
7,11
3 2
0510
2,37
8 2
2510
7,11
3
3. B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s .....
......
......
......
......
......
......
......
......
......
......
......
......
......
..29
1,02
6 1
663,
656,
042
186
4,05
1,87
0 2
063,
865,
173
226
4,34
2,89
6
a
1) li
sted
Gov
ernm
ent s
ecur
ities
……
……
……
……
……
……
……
….
127
130,
119
147
153,
464
167
3,03
9,15
6 1
873,
421,
474
207
3,16
9,27
5 2
273,
574,
938
a
2) o
ther
list
ed se
curit
ies…
……
……
……
……
……
……
……
……
……
……
..
1
2878
,268
148
136,
739
168
616,
886
188
630,
396
208
695,
154
228
767,
135
b
1) u
nlis
ted
Gov
ernm
ent s
ecur
ities
……
……
……
……
……
……
….
129
286
149
319
169
0 1
890
209
286
229
319
b
2) o
ther
unl
iste
d se
curit
ies…
……
……
……
……
……
……
……
……
..
130
458
150
504
170
0 1
900
210
458
230
504
c) c
onve
rtibl
e de
bent
ures
……
……
……
……
……
……
……
……
……
….
131
0 1
510
171
0 1
910
211
0 2
310
5. P
artic
ipat
ion
in in
vest
men
t poo
ls...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.
1
320
152
0 1
720
192
0 2
120
232
0
7. M
isce
llane
ous f
inan
cial
inve
stm
ents
……
……
……
……
……
……
……
133
0 1
530
173
0 1
930
213
0 2
330
146
209,
131
36,8
97 2
66
212 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 230BILANCIO REALE MUTUA 2015.indd 230 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
9
Fina
ncia
l20
15C
ompa
nySO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
I
Ass
ets –
Cha
nges
dur
ing
the
year
in o
ther
fina
ncia
l inv
estm
ents
hel
d as
long
-term
inve
stm
ents
:sha
res a
nd in
tere
sts i
n co
mpa
nies
, sha
res i
n co
mm
on in
vest
men
t fun
ds, b
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s, pa
rtici
patio
n in
inve
stm
ent p
ools
and
oth
er fi
nanc
ial i
nves
tmen
ts (i
tem
s C.II
I.1, 2
, 3, 5
, 7)
Shar
es a
nd in
tere
sts
Shar
es in
com
mon
inve
stm
ent f
unds
Oth
er fi
nanc
ial
Mis
cella
neou
sIn
vest
men
t fun
dsC
.III.1
C.II
I.2
Bon
ds a
nd o
ther
fix
ed-in
com
e se
curit
ies
C.II
I.3
Parti
cipa
tion
in in
vest
men
tpo
ols
C.II
I.5C
.III.7
Initi
al b
alan
ce...
......
......
......
......
......
.....…
…...
......
......
......
......
.+
1
10,3
27 2
10
41
186,
424
81
0 1
010
Incr
ease
s dur
ing
the
year
......
......
......
......
......
......
......
......
......
..+
2
0 2
20
42
62,7
55 8
20
102
0
for:
purc
hase
s……
……
……
……
……
……
……
……
……
..
30
23
0 4
359
,659
83
0 1
030
4
0 2
40
44
0 8
40
104
0
5
0 2
50
45
0 8
50
105
0
writ
e-ba
cks…
……
……
……
……
……
……
……
……
…
tran
sfer
from
shor
t-ter
m p
ortfo
lio…
……
……
……
……
oth
er c
hang
es…
……
……
……
……
……
……
……
……
6
0 2
60
46
3,09
6 8
60
106
0
Dec
reas
es d
urin
g th
e ye
ar ..
......
......
......
......
......
......
......
......
-
71,
717
27
0 4
73,
151
87
0 1
070
for:
sale
s……
……
……
……
……
……
……
……
……
……
…
891
28
0 4
80
88
0 1
080
9
0 2
90
49
0 8
90
109
0
10
0 3
00
50
0 9
00
110
0
writ
e-do
wns
……
……
……
……
……
……
……
……
……
tran
sfer
to sh
ort-t
erm
por
tfolio
……
……
……
……
……
…
oth
er c
hang
es…
……
……
……
……
……
……
……
……
11
1,62
6 3
10
51
3,15
1 9
10
111
0
12
8,61
0 3
20
52
246,
028
92
0 1
120
Car
ryin
g va
lue…
……
……
……
……
……
……
……
……
…
Cur
rent
val
ue…
……
……
……
……
……
……
……
……
……
13
10,0
75 3
30
53
330,
236
93
0 1
130
213
BILANCIO REALE MUTUA 2015.indd 231BILANCIO REALE MUTUA 2015.indd 231 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 10
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Assets – Changes during the year in loans and deposits with credit institutions (items C.III.4, 6)
Loans
C.III.4
Deposits with credit institutions
C.III.6
Initial balance......................................…….....................+ 1 37372 21 10024
Increases during the year + ............................................... 2 9,569 22 256
for: issues......................................................................... 3 9569
write-backs………………………………… ….... 4
Decreases during the year ...........................................…- 6 15,498 26 6014
for: repayments………………………………………. 7 15137
361
write-downs………………………………........……… 8
other changes…………………………………… … 9
Carrying value………………………………………… 10 31,443 30 4,266
other changes…………………………………..... 5
214 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 232BILANCIO REALE MUTUA 2015.indd 232 14/04/16 16:0414/04/16 16:04
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
11
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
elat
ing
to c
ontra
cts l
inke
d to
inve
stm
ent f
unds
and
mar
ket i
ndex
es (i
tem
D.I
)
Fund
cod
e: 1
Fund
des
crip
tion:
CO
NTR
AC
TS T
IED
TO
TH
E V
ALU
E O
F SH
AR
ES O
F U
CIT
S
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I.0
21
0 4
10
61
0
II.
Land
and
bui
ldin
gs…
……
……
……
……
……
……
……
……
……
……
…..
1
Inve
stm
ents
in G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
s:1.
Shar
es a
nd in
tere
sts .
......
......
......
......
......
......
......
......
.....…
......
. 2
0 2
20
42
0 6
20
2.B
onds
......
......
......
......
......
......
......
......
......
......
......
......
......
......
....
30
23
0 4
30
63
0
3.Lo
ans..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 4
0 2
40
44
0 6
40
III.
Shar
es in
com
mon
inve
stm
ent f
unds
.....
......
......
......
......
......
......
.. 5
0 2
50
45
0 6
50
IV.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
......
......
......
......
.…. 6
0 2
60
46
0 6
60
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s.....
......
......
......
......
.....
70
27
0 4
70
67
0
3.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
... 8
0 2
80
48
0 6
80
4.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
…...
......
....
90
29
0 4
90
69
0
V.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
100
30
0 5
00
70
0
VI.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
..... 1
10
31
0 5
10
71
0
VII.
Oth
er li
abili
ties…
……
……
……
……
……
……
……
…...
......
....
120
32
0 5
20
72
0
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 13
33
53
73
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 140
34
0 5
40
74
0
215
BILANCIO REALE MUTUA 2015.indd 233BILANCIO REALE MUTUA 2015.indd 233 14/04/16 16:0414/04/16 16:04
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
11
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
elat
ing
to c
ontra
cts l
inke
d to
inve
stm
ent f
unds
and
mar
ket i
ndex
es (i
tem
D.I
)
Fund
cod
e: 2
Fund
des
crip
tion:
CO
NTR
AC
TS T
IED
TO
TH
E V
ALU
E O
F SH
AR
ES O
F IN
TER
NA
L FU
ND
S
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I.0
21
0 4
10
61
0
II.
Land
and
bui
ldin
gs…
……
……
……
……
……
……
……
...
1
Inve
stm
ents
in G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
s:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
2
0 2
20
42
0 6
20
2.B
onds
......
......
......
......
......
......
......
......
......
......
......
......
......
.... 3
0 2
30
43
0 6
30
3.Lo
ans..
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 4
0 2
40
44
0 6
40
III.
Shar
es in
com
mon
inve
stm
ent f
unds
.....
......
......
......
......
......
.. 5
225,
586
25
198,
379
45
213,
990
65
180,
592
IV.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
6
68,7
26 2
668
,215
46
58,6
97 6
660
,146
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s.....
......
......
......
.....
716
7,28
9 2
716
4,39
4 4
716
0,16
4 6
715
2,50
6
3.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
...
80
28
0 4
80
68
0
4.O
ther
fina
ncia
l inv
estm
ents
…...
......
......
......
......
......
......
...
. 965
9 2
971
9 4
965
9 6
971
9
V.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
..... 1
02,
784
30
2,34
7 5
02,
784
70
2,34
7
VI.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
.. . 11
12,7
27 3
122
,967
51
12,7
27 7
122
,967
VII.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
.. 12
-4,5
82 3
2-1
,630
52
-4,5
82 7
2-1
,630
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
13
33 5
3 7
3
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
14
473,
189
34
455,
391
54
444,
439
74
417,
647
216 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 234BILANCIO REALE MUTUA 2015.indd 234 14/04/16 16:0414/04/16 16:04
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
11
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
elat
ing
to c
ontra
cts l
inke
d to
inve
stm
ents
fund
s and
mar
ket i
ndex
es (i
tem
D.I
)
Fund
cod
e: 3
Fund
des
crip
tion:
CO
NTR
AC
TS L
INK
ED T
O S
HA
RE
IND
EXES
OR
OTH
ER R
EFER
ENC
E V
ALU
ES
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I.0
21
0 4
10
61
0
II.
Land
and
bui
ldin
gs…
……
……
……
……
……
……
......
......
.…
1
Inve
stm
ents
in G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
s:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
..
20
22
0 4
20
62
0
2.B
onds
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 3
0 2
30
43
0 6
30
3.Lo
ans..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 4
0 2
40
44
0 6
40
III.
Shar
es in
com
mon
inve
stm
ent f
unds
.....
......
......
......
......
......
......
.. 5
0 2
50
45
0 6
50
IV.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
..
60
26
0 4
60
66
0
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s.....
......
......
......
......
.... 7
0 2
70
47
0 6
70
3.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
... 8
0 2
80
48
0 6
80
4.O
ther
fina
ncia
l inv
estm
ents
……
……
……
…...
......
......
......
......
......
..
90
29
0 4
90
69
0
V.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.... 1
00
30
0 5
00
70
0
VI.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
... 11
0 3
10
51
0 7
10
VII.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
... 12
0 3
20
52
0 7
20
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.... .
. 13
33 5
3 7
3
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
..... 1
40
34
0 5
40
74
0
217
BILANCIO REALE MUTUA 2015.indd 235BILANCIO REALE MUTUA 2015.indd 235 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
11
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
elat
ing
to c
ontra
cts l
inke
d to
inve
stm
ent f
unds
and
mar
ket i
ndex
es (i
tem
D.I
)
Fund
cod
e:Fu
nd d
escr
iptio
n:
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I.0
21
0 4
10
61
0
II.
Land
and
bui
ldin
gs…
……
……
……
……
……
……
……
......
.…
1
Inve
stm
ents
in G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
s:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
2
0 2
20
42
0 6
20
2.B
onds
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
30
23
0 4
30
63
0
3.Lo
ans..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.... 4
0 2
40
44
0 6
40
III.
Shar
es in
com
mon
inve
stm
ent f
unds
.....
......
......
......
......
......
......
.... 5
225,
586
25
198,
379
45
213,
990
65
180,
592
IV.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
6
68,7
26 2
668
,215
46
58,6
97 6
660
,146
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s.....
......
......
......
......
......
7
167,
289
27
164,
394
47
160,
164
67
152,
506
3.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
8
0 2
80
48
0 6
80
4.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
......
......
......
.…
965
9 2
971
9 4
965
9 6
971
9
V.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 102,
784
30
2,34
7 5
02,
784
70
2,34
7
VI.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
..... 1
112
,727
31
22,9
67 5
112
,727
71
22,9
67
VII.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
..... 1
2-4
,582
32
-1,6
30 5
2-4
,582
72
-1,6
30
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 13
3
3 5
3 7
3
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 14
473,
189
34
455,
391
54
444,
439
74
417,
647
218 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 236BILANCIO REALE MUTUA 2015.indd 236 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
12
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
esul
ting
from
adm
inis
tratio
n of
pen
sion
fund
s (ite
m D
.II)
Cod
e: 1
Pens
ion
fund
des
crip
tion:
ETH
ICA
L PR
UD
ENTI
AL
LIN
E
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I. In
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
1.
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
esul
ting
from
adm
inis
tratio
n of
pen
sion
fund
s (ite
m D
.II)
Cod
e: 1
Pens
ion
fund
des
crip
tion:
ETH
ICA
L PR
UD
ENTI
AL
LIN
E
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I. In
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
. 1
0 2
10
41
61
0
2.B
onds
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
20
22
0 4
2 6
20
II.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
. 3
0 2
30
43
0 6
30
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s……
……
……
……
……
….
4
38,0
24 2
433
,456
44
36,0
77 6
430
,436
3.Sh
ares
in c
omm
on in
vest
men
t fun
ds…
……
……
……
……
……
….
5
0 2
50
45
0 6
50
4.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
......
60
26
0 4
6 6
60
5.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
……
……
……
….
7
0 2
70
47
0 6
70
III.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 8
685
28
632
48
685
68
632
IV.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
......
91,
359
29
1,27
1 4
91,
359
69
1,27
1
V.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
..... 1
0-1
08 3
0-4
26 5
0-1
08 7
0-4
26
51
71
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 12
39,9
60 3
234
,933
52
38,0
13 7
231
,913
0 2
10
41
61
0
2.B
onds
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
20
22
0 4
2 6
20
II.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
. 3
0 2
30
43
0 6
30
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s……
……
……
……
……
….
4
38,0
24 2
433
,456
44
36,0
77 6
430
,436
3.Sh
ares
in c
omm
on in
vest
men
t fun
ds…
……
……
……
……
……
….
5
0 2
50
45
0 6
50
4.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
......
60
26
0 4
6 6
60
5.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
……
……
……
….
7
0 2
70
47
0 6
70
III.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 8
685
28
632
48
685
68
632
IV.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
......
91,
359
29
1,27
1 4
91,
359
69
1,27
1
V.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
..... 1
0-1
08 3
0-4
26 5
0-1
08 7
0-4
26
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 11
31
51
71
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 12
39,9
60 3
234
,933
52
38,0
13 7
231
,913
219
BILANCIO REALE MUTUA 2015.indd 237BILANCIO REALE MUTUA 2015.indd 237 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
12
Com
pany
SOC
IETA
' REA
LE
MU
TU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
esul
ting
from
adm
inis
tratio
n of
pen
sion
fund
s (ite
m D
.II)
Cod
e: 2
Pens
ion
fund
des
crip
tion:
ETH
ICA
L B
ALA
NC
ED L
INE
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I. In
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
1..Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
......
......
......
......
1
0 2
10
41
61
0
2..B
onds
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
. 2
0
220
42
62
0
II.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1..Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
......
......
......
.....
3
18,5
86 2
317
,338
43
15,8
93 6
314
,589
2..B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s……
……
……
……
……
……
……
……
……
……
……
….
427
,648
24
24,3
09 4
426
,305
64
22,0
79
3..Sh
ares
in c
omm
on in
vest
men
t fun
ds…
……
……
……
……
……
……
……
……
……
……
……
5
0 2
50
45
0 6
50
4..D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
......
......
......
......
.....
60
26
0 4
6 6
60
5..O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
.. 7
3 2
71
47
3 6
71
III.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 8
521
28
459
48
521
68
459
IV.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 91,
253
29
1,18
3 4
91,
253
69
1,18
3
V.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
....
10-5
26 3
0-4
54 5
0-5
26 7
0-4
54
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 1
1 3
1 5
1 7
1
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
..... 12
47,4
85 3
242
,836
52
43,4
49 7
237
,857
220 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 238BILANCIO REALE MUTUA 2015.indd 238 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
12
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
esul
ting
from
adm
inis
tratio
n of
pen
sion
fund
s (ite
m D
.II)
Cod
e: 3
Pens
ion
fund
des
crip
tion:
ETH
ICA
L D
EVEL
OPM
ENT
LIN
E
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I. In
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
......
......
......
......
......
..
10
21
0 4
1 6
10
2.B
onds
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
.
20
22
0 4
2 6
20
II.
Oth
er fi
nanc
ial i
nves
tmen
ts:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
......
......
......
......
......
.
339
,075
23
35,1
39 4
332
,507
63
30,0
81
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s……
……
……
……
……
……
……
……
……
……
……
.
43,
601
24
2,84
0 4
43,
607
64
2,84
5
3.Sh
ares
in c
omm
on in
vest
men
t fun
ds…
……
……
……
……
……
……
……
……
……
……
……
……
….
5
0 2
50
45
0 6
50
4.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
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......
......
......
......
......
.....
6
0 2
60
46
66
0
5.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
……
……
……
……
……
……
……
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……
……
……
7
8 2
73
47
8 6
73
III.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 8
26 2
826
48
26 6
826
IV.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 91,
228
29
751
49
1,22
8 6
975
1
V.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
....
10
-862
30
-224
50
-862
70
-224
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.......
......
......
......
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.....1
1 3
1 5
1 7
1
Tota
l.....
......
......
......
......
......
......
......
......
......
......
......
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......
......
......
......
......
......
......
......
......
......
......
. 1243
,076
32
38,5
35 5
236
,514
72
33,4
82
221
BILANCIO REALE MUTUA 2015.indd 239BILANCIO REALE MUTUA 2015.indd 239 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
12
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
esul
ting
from
adm
inis
tratio
n of
pen
sion
fund
s (ite
m D
.II)
Cod
e: 4
Pens
ion
fund
des
crip
tion:
ETH
ICA
L G
UA
RA
NTE
ED L
INE
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I. In
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
......
......
......
.....
1
0 2
10
41
61
0
2.B
onds
……
……
……
……
……
……
……
……
……
……
……
……
......
......
…
2
0 22
0 4
2 6
20
II. O
ther
fina
ncia
l inv
estm
ents
:1.
Shar
es a
nd in
tere
sts .
......
......
......
......
......
......
…...
......
......
......
......
......
......
......
...
30
23
0 4
30
63
0
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s……
……
……
……
……
…...
......
..… 4
43,4
51 2
437
,812
44
43,5
41 6
436
,932
3.Sh
ares
in c
omm
on in
vest
men
t fun
ds…
……
……
……
……
……
…...
......
....…
50
25
0 4
50
65
0
4.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
......
......
......
......
......
60
26
0 4
6 6
60
5.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
……
……
……
……
……
……
……
……
……
….
7
0 2
70
47
0 6
70
III.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 8
478
28
364
48
478
68
364
IV.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 91,
744
29
1,56
0 4
91,
744
69
1,56
0
VI.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 1
0-1
21 3
0-2
13 5
0-1
21 7
0-2
13
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 1
1 3
1 5
1 7
1
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 1
245
,552
32
39,5
23 5
245
,642
72
38,6
43
222 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 240BILANCIO REALE MUTUA 2015.indd 240 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
12
Com
pany
SOC
IET
A' R
EA
LE
MU
TU
A D
I ASS
.NI
Fina
ncia
l20
15
Ass
ets –
Sch
edul
e of
ass
ets r
esul
ting
from
adm
inis
tratio
n of
pen
sion
fund
s (ite
m D
.II)
Cod
e: 4
Pens
ion
fund
des
crip
tion:
TESE
O O
PEN
EN
DED
PEN
SIO
N F
UN
D
Cur
rent
val
uePu
rcha
se c
ost
Fina
ncia
l20
14Fi
nanc
ial
2014
I. In
vest
men
ts in
Gro
up c
ompa
nies
and
oth
er sh
areh
oldi
ngs:
1.Sh
ares
and
inte
rest
s ....
......
......
......
......
......
...…
......
......
......
......
......
......
.....
10
21
0 4
10
61
0
2.B
onds
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
……
.
20
22
0 4
20
62
0
II.O
ther
fina
ncia
l inv
estm
ents
:1.
Shar
es a
nd in
tere
sts .
......
......
......
......
......
......
…...
......
......
......
......
......
......
.. 3
57,6
61 2
352
,477
43
48,4
00 6
344
,670
2.B
onds
and
oth
er fi
xed-
inco
me
secu
ritie
s……
……
……
……
……
…...
.… 4
11
2,72
4 24
98,4
17 4
410
9,53
0 6
492
,292
3.Sh
ares
in c
omm
on in
vest
men
t fun
ds…
……
……
……
…...
......
......
......
…
5
0 25
0 4
50
65
0
4.D
epos
its w
ith c
redi
t ins
titut
ions
……
……
……
…...
......
......
......
......
......
... 6
0 2
60
46
0 6
60
5.O
ther
fina
ncia
l inv
estm
ents
……
……
……
……
……
......
......
......
......
...…
7
11
27
4 4
711
67
4
III.
Oth
er ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
81,
710
28
1,48
1 4
81,
710
68
1,48
1
IV.
Cas
h at
ban
k an
d in
han
d ...
......
......
......
......
......
......
......
......
......
......
......
......
... 9
5,58
4 2
94,
765
49
5,58
4 6
94,
765
VI.
Oth
er li
abili
ties..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 10
-1,6
17 3
0-1
,317
50
-1,6
17 7
0-1
,317
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
11
0 3
10
51
0 7
10
Tota
l.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 12
176,
073
32
155,
827
52
163,
618
72
141,
895
223
BILANCIO REALE MUTUA 2015.indd 241BILANCIO REALE MUTUA 2015.indd 241 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 13
2015Company SOCIETA' REALE MUTUA DI ASS.NI Financial
Liabilities - Changes during the year in components of the reserve for unearned premiums (item C.I.1) and the provision for outstanding claims (item C.I.2) of the Non-life branches
Type Financial 2014 Change
Provisions for unearned premiums:
Reserve for premium instalments................................................................... 1 644,901 11 623,467 21 21,434
Reserve for unexpired risks.................................………………................... 2 218 12 4 22 214
Carrying value............................................................................................... 3 645,119 13 623,471 23 21,648
Provisions for claims outstanding:
Provision for damages and direct expenses..............................….................. 4 1,464,337 14 1,516,617 24 -52,280
Provision for claim settlement costs............................................................... 5 63,940 15 60,969 25 2,971
Provision for claims incurred and not notified................................................ 6 249,763 16 246,918 26 2,845
Carrying value............................................................................................... 7 1,778,040 17 1,824,504 27 -46,464
224 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 242BILANCIO REALE MUTUA 2015.indd 242 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 14
Company SOCIETA' REALE MUTUA DI ASS.NI Financial 2015
Liabilities - Changes during the year in the components of the provisions for policy liabilities (item C.II.1) and in the provisions for profit-sharing and premium refunds (item C.II.4)
Type Financial 2014 Change
Actuarial reserve for pure premiums............................................. 1 3,738,224 11 3,347,337 21 390,887
Premiums carried forward................................................................ 2 11,270 12 12,520 22 -1,250
Provision for mortality risk.......................................................... 8,262 13 3,484 23 4,778
Integration provisions.................................................................... 4 47,599 14 37,133 24 10,466
Carrying value............................................................................. 5 3,805,355 15 3,400,473 25 404,882
Provisions for profit-sharing and premium refunds 6 0 ....................................................................................................................................16 0 26 0
3
225
BILANCIO REALE MUTUA 2015.indd 243BILANCIO REALE MUTUA 2015.indd 243 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
15
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15
Liab
ilitie
s – C
hang
es d
urin
g th
e ye
ar in
the
prov
isio
ns fo
r oth
er ri
sks a
nd c
harg
es (i
tem
E) a
nd in
the
prov
isio
ns fo
r em
ploy
ee te
rmin
atio
n in
dem
nitie
s (ite
m G
.VII
)
Prov
isio
ns fo
r pen
sion
s a
nd si
mila
r obl
igat
ions
Prov
isio
ns fo
r tax
atio
nO
ther
pro
visi
ons
Term
inat
ion
bene
fits
empl
oym
ent
subo
rdin
ated
1G
ross
initi
al b
alan
ce...
......
......
......
......
......
.....…
….
+
32,9
94 1
13,
607
21
59,5
30 3
111
,425
Prov
isio
ns fo
r the
yea
r.....
......
......
......
......
......
..+
2
1,03
9 1
2 2
215
,436
32
163
Oth
er in
crea
ses..
......
......
......
......
......
......
......
....
+
3 1
3 2
3 3
334
Util
isat
ion
for t
he y
ear..
......
......
......
......
......
.....
-
41,
505
14
3,20
0 2
422
,942
34
981
Oth
er in
crea
ses..
......
......
......
......
......
......
......
....
-
547
3 1
5 2
52,
264
35
1,04
8
Car
ryin
g va
lue.
......
......
......
......
......
......
......
....
6
32,0
55 1
640
7 2
649
,760
36
9,59
3
226 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 244BILANCIO REALE MUTUA 2015.indd 244 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
16
Fina
ncia
l20
15C
ompa
nySO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
I
Det
aile
d st
atem
ent o
f ass
ets a
nd li
abili
ties r
elat
ing
to G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
s
I: A
sset
s
Con
trolli
ng c
ompa
nies
Subs
idia
ries
Affi
liate
d co
mpa
nies
Ass
ocia
ted
com
pani
esO
ther
Tota
l
Shar
es a
nd in
tere
sts .
......
......
......
......
......
......
......
......
......
......
.
10
2
1,62
0,11
1
30
4
36,7
54
53,
065
6
1,65
9,93
0
Bond
s.....
......
......
......
......
......
......
......
......
......
......
......
......
......
.
70
8
0
90
10
0 1
10
12
0
Loan
s.....
......
......
......
......
......
......
......
......
......
......
......
......
......
. 1
30
14
0 1
50
16
0 1
70
18
0
Parti
cipa
tion
in in
vest
men
t poo
ls....
......
......
......
......
......
......
... 1
90
20
0 2
10
22
0 2
30
24
0
Dep
osits
with
cre
dit i
nstit
utio
ns...
......
......
......
......
......
......
......
25
0 2
60
27
0 2
80
29
0 3
00
Oth
er fi
nanc
ial i
nves
tmen
ts...
......
......
......
......
......
......
......
......
31
0 3
20
33
0 3
40
35
0 3
60
Dep
osits
with
ced
ing
unde
rtaki
ngs..
......
......
......
......
......
......
.. 3
70
38
71 3
90
40
22 4
10
42
93
Inve
stm
ents
rela
ting
to c
ontra
cts l
inke
d to
inve
stm
ents
fund
s and
mar
ket i
ndex
es...
......
......
......
......
....
43
0 4
411
,554
45
0 4
60
47
0 4
811
,554
Inve
stm
ents
rela
ting
to th
e ad
min
istra
tion
of
pens
ion
fund
s.....
......
......
......
......
......
......
......
......
......
......
......
. 4
90
50
0 5
10
52
0 5
30
54
0
Deb
tors
aris
ing
out o
f di
rect
insu
ranc
e....
......
......
......
......
......
......
......
......
......
......
.....
55
0 5
60
57
0 5
850
1 5
90
60
501
Deb
tors
aris
ing
out o
f re
insu
ranc
e op
erat
ions
……
……
……
……
……
……
……
……
……
……
……
……
……
… 6
10
62
8 6
30
64
0 6
50
66
8
Oth
er d
ebto
rs...
......
......
......
......
......
......
......
......
......
......
......
... 6
70
68
5,59
8 6
90
70
19 7
10
72
5,61
7
Bank
and
Pos
tal a
ccou
nts..
......
......
......
......
......
......
......
......
....
73
0 7
463
,099
75
0 7
60
77
0 7
863
,099
Misc
ella
neou
s ass
ets..
......
......
......
......
......
......
......
......
......
.....
79
0 8
00
81
0 8
211
83
0 8
411
Tot
al.…
.……
……
……
……
……
……
……
……
..……
.……
. 8
50
86
1,70
0,44
1 8
70
88
37,3
07 8
93,
065
90
1,74
0,81
3
of w
hich
subo
rdin
ated
ass
ets..
......
......
......
......
......
......
......
.....
91
0 9
20
93
0 9
40
95
0 9
60
227
BILANCIO REALE MUTUA 2015.indd 245BILANCIO REALE MUTUA 2015.indd 245 14/04/16 16:0414/04/16 16:04
Det
aile
d st
atem
ent o
f ass
ets a
nd li
abili
ties r
elat
ing
to G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
s
II: L
iabi
litie
s
Con
trolli
ng c
ompa
nies
Subs
idia
ries
Affi
liate
d co
mpa
nies
Ass
ocia
ted
com
pani
esO
ther
Tota
l
Subo
rdin
ated
liab
ilitie
s.....
......
......
......
......
......
......
......
......
.....
97
0 9
80
99
010
00
101
010
20
Dep
osits
rece
ived
from
rein
sure
rs...
......
......
......
......
......
......
... 1
030
104
0 1
050
106
010
70
108
0
Cre
dito
rs a
risin
g ou
t of
dire
ct in
sura
nce.
......
......
......
......
......
......
......
......
......
......
......
..10
90
110
1,66
311
10
112
011
30
114
1,66
3
Cre
dito
rs a
risin
g ou
t of
rein
sura
nce
oper
atio
ns...
......
......
......
......
......
......
......
......
......
115
011
628
011
70
118
397
119
012
067
7
Am
ount
s ow
ed to
ban
ks a
nd c
redi
t ins
titut
ions
......
......
......
....
121
012
20
123
012
40
125
012
60
Loan
s gua
rant
eed
by m
ortg
ages
......
......
......
......
......
......
......
...12
70
128
012
90
130
013
10
132
0
Misc
ella
neou
s loa
ns a
nd o
ther
fina
ncia
l lia
bilit
ies..
......
......
....
133
013
40
135
013
60
137
013
80
Misc
ella
neou
s cre
dito
rs...
......
......
......
......
......
......
......
......
......
139
014
04,
577
141
014
20
143
014
44,
577
Misc
ella
neou
s lia
bilit
ies..
......
......
......
......
......
......
......
......
......
145
014
60
147
014
84
149
015
04
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
....
151
015
26,
520
153
015
440
115
50
156
6,92
1
228 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 246BILANCIO REALE MUTUA 2015.indd 246 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 17
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Detail of classes I, II, III and IV of “Guarantees, commitments and other memorandum accounts”
Financial 2014
I. Guarantees given:a) sureties and endorsements given in the interest of controlling
subsidiary and affiliated companies..................................................................................................………… . 1 0 31 0
b) sureties and endorsements given in the interest of associated companies andother shareholdings............................................................................................................................................... 2 0 32 0
c) sureties and endorsements given in the interest of third parties ........................................................................... 3 0 33 0
d) other personal guarantees given in the interest of subsidiary and affiliated companies..................................................................................................………….…. 4 0 34 0
e) other personal guarantees given in the interest of other shareholdings.............................................................................................................................................. 5 0 35 0
f) other personal guarantees given in the interest of third parties ............................................................................ 6 0 36 0
g) guarantees secured by mortgages given for obligations of third parties subsidiary and affiliated companies...............................................................................………….….…............. 7 0 37 0
h) guarantees secured by mortgages given for obligations of associated companies andother shareholdings.............................................................................................................................................. 8 0 38 0
i) guarantees secured by mortgages given for obligations of third parties................................................................ 9 0 39 0
l) guarantees given for obligations of the Company ................................................................................................ 10 0 40 0
m) assets deposited for inwardreinsurance........................................................................................................................................................... 11 0 41 0
Total............................................................................................................................................................................... 12 0 42 0
II. Guarantees received:a) from Group companies, associates and other shareholdings ............................................................................... 13 0 43 0
b) from third parties ………………………………………………….……....…..................................................... 14 53,291 44 58,256
Total............................................................................................................................................................................... 15 53,291 45 58,256
III. Guarantees issued by third parties in the interest of the Company:a) from Group companies, associates and other shareholdings ............................................................................... 16 0 46 0
b) from third parties ………………………………………………….……....…................................................... 17 39,025 47 31,033
Total............................................................................................................................................................................... 18 39,025 48 31,033
IV. Commitments:a) commitments for purchases with obligation of resale .......................................................................................... 19 0 49 0
b) commitments for purchases with obligation of resale .......................................................................................... 20 0 50 0
c) other commitments............................................................................................................................................... 21 94,190 51 98,172
Total............................................................................................................................................................................... 22 94,190 52 98,172
229
BILANCIO REALE MUTUA 2015.indd 247BILANCIO REALE MUTUA 2015.indd 247 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
18
Com
pany
SO
CIE
TA
' RE
AL
E M
UT
UA
DI A
SS.N
IFi
nanc
ial
2015
Sche
dule
of c
omm
itmen
ts fo
r tra
nsac
tions
on
deriv
ativ
es
Fina
ncia
l20
14Pu
rcha
seSa
lePu
rcha
seSa
le(1
)(2
)(1
)(2
)(1
)(2
)(1
)(2
)
Futu
res:
on sh
ares
1
0 1
010
21
0 1
210
41
0 1
410
61
0 1
610
on b
onds
2
0 1
020
22
0 1
220
42
0 1
420
62
0 1
620
on c
urre
ncie
s
30
103
0 2
30
123
0 4
30
143
0 6
30
163
0
on ra
tes
4
0 1
040
24
0 1
240
44
0 1
440
64
0 1
640
othe
r
50
105
0 2
50
125
0 4
50
145
0 6
50
165
0
Opt
ions
:on
shar
es
618
,016
106
16 2
618
,000
126
0 4
618
,067
146
67 6
618
,000
166
0
on b
onds
7
0 1
070
27
0 1
270
47
0 1
470
67
0 1
670
on c
urre
ncie
s
80
108
0 2
80
128
0 4
80
148
0 6
80
168
0
on ra
tes
9
0 1
090
29
0 1
290
49
0 1
490
69
0 1
690
othe
r 1
018
,814
110
0 3
00
130
0 5
020
,204
150
0 7
00
170
0
Swap
s:on
cur
renc
ies
11
0 1
110
31
0 1
310
51
0 1
510
71
0 1
710
on ra
tes
12
13,1
20 1
12-1
5,44
1 3
20
132
0 5
213
,120
152
-18,
867
72
0 1
720
othe
r 1
326
,240
113
656
33
0 1
330
53
26,2
40 1
5376
7 7
30
173
0
Oth
er tr
ansa
ctio
ns 1
40
114
0 3
40
134
0 5
40
154
0 7
42,
542
174
90
Tot
al ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 1
576
,190
11
5-1
4,76
9 3
518
,000
135
0 5
577
,631
155
-18,
033
75
20,5
42 1
7590
Onl
y tra
nsac
tions
on
deriv
ativ
es e
xist
ing
at th
e da
te o
f the
acc
ount
s tha
t inv
olve
com
mitm
ents
for t
he C
ompa
ny m
ust b
e st
ated
. If t
he c
ontra
ct d
oes n
ot c
orre
spon
d pr
ecise
ly to
the
figur
es d
escr
ibed
or i
n th
e ca
se in
whi
ch it
is c
hara
cter
ised
by e
lem
ents
of s
ever
al ty
pes,
it m
ust b
e st
ated
in th
e cl
oses
t con
tract
ual c
ateg
ory.
Offs
ettin
g of
item
s is n
ot p
erm
itted
exc
ept i
n re
latio
n to
pur
chas
e/sa
le tr
ansa
ctio
ns re
latin
g to
the
sam
e ty
pe o
f con
tract
(sam
e co
nten
t, ex
piry
, und
erly
ing
asse
ts, e
tc.).
Con
tract
s tha
t env
isage
swap
ping
of t
wo
curr
enci
es m
ust b
e in
dica
ted
once
onl
y re
ferr
ing,
by
conv
entio
n, to
the
curr
ency
to b
e pu
rcha
sed.
Con
tract
s tha
t env
isage
inte
rest
rate
and
cur
renc
y sw
aps m
ust b
e in
dica
ted
only
und
er c
ontra
cts
on c
urre
ncy.
Inte
rest
swap
der
ivat
ives
are
cla
ssifi
ed c
onve
ntio
nally
as "
purc
hase
s" o
r as "
sale
s" a
ccor
ding
to w
heth
er th
ey in
volv
e th
e pu
rcha
se o
r sal
e of
the
fixed
rate
for t
he in
sura
nce
com
pany
.(1
) For
der
ivat
ive
cont
ract
s tha
t inv
olve
or m
ay in
volv
e th
e ex
chan
ge o
f cap
ital a
t ter
m th
e se
ttlem
ent p
rice
of th
ese
mus
t be
indi
cate
d; in
all
othe
r cas
es, t
he n
omin
al v
alue
of t
he re
fere
nce
capi
tal m
ust b
e in
dica
ted.
(2) I
ndic
ate
the
fair
valu
e of
der
ivat
ive
cont
ract
s;
Der
ivat
ives
230 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 248BILANCIO REALE MUTUA 2015.indd 248 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
19
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15
Sum
mar
y in
form
atio
n re
latin
g to
the
tech
nica
l acc
ount
of N
on-li
fe in
sura
nce
busi
ness
Gro
ss p
rem
ium
sG
ross
cha
rge
Man
agem
ent
Rei
nsur
ance
Gro
ss p
rem
ium
s:w
ritte
nfo
r the
yea
rfo
r cla
ims
cost
sba
lanc
e
Dir
ect b
usin
ess:
Per
sona
l acc
iden
t and
Hea
lth (c
lass
es 1
and
2) …
...…
......
.... 1
183,
610
218
0,98
5 3
125,
007
459
,699
51,
353
TPL
land
veh
icle
s (cl
ass 1
0) 6
474,
841
780
,837
8
333,
916
910
7,23
5 1
05,
088
TPL
land
veh
icle
s (cl
ass 3
).....
......
......
......
......
......
......
......
.....
1110
2,45
9 1
299
,894
13
61,9
90 1
428
,879
15
-2,5
84
Mar
ine,
Avi
atio
n, T
rans
port
(cla
sses
4, 5
, 6, 7
, 11
and
12)..
......
......
......
......
......
......
..…...
….
168,
011
177,
711
182,
451
192,
611
20-1
,349
Fire
and
oth
er p
rope
rty d
amag
e(cl
asse
s 8 a
nd 9
).....
......
......
.. 21
377,
855
2236
5,20
723
241,
316
2413
4,66
525
-19,
640
Non
-mot
or T
PL (c
lass
13)
......
......
......
......
......
......
......
......
..... 2
620
9,22
927
201,
499
2810
7,63
229
76,1
1630
-4,6
74
Per
sona
l acc
iden
t and
Hea
lth (c
lass
es 1
4 an
d 15
)…...
…...
.... 31
29,4
9832
28,3
9533
18,4
2034
11,1
8735
-929
Sun
dry
Pecu
niar
y Lo
sses
(cla
ss 1
6)…
……
……
……
……
……
……
……
……
……
……
……
362,
292
372,
312
381,
159
3981
040
40
Leg
al F
ees (
clas
s 17)
......
......
......
......
......
......
......
......
......
......
.. 41
11,8
2542
11,5
7043
2,42
844
4,59
345
-1,2
59
Ass
ista
nce
(cla
ss 1
8)...
......
......
......
......
......
......
......
......
......
..... 4
614
,017
4713
,624
488,
143
495,
233
500
Tot
al d
irec
t bus
ines
s.....
......
......
......
......
......
......
......
......
......
.. 511,
413,
637
521,
392,
034
5390
2,46
254
431,
028
55-2
3,95
4
Rei
nsur
ance
bus
ines
s.....
......
......
......
......
......
......
......
......
......
. 563,
087
573,
066
581,
920
5976
660
138
Tot
al It
alia
n po
rtfo
lio...
......
......
......
......
......
......
......
......
......
.. 611,
416,
724
621,
395,
100
6390
4,38
264
431,
794
65-2
3,81
6
For
eign
por
tfol
io...
......
......
......
......
......
......
......
......
......
......
.... 66
115
6711
668
469
1870
-7
Gra
nd to
tal..
......
......
......
......
......
......
......
......
......
......
......
......
.. 711,
416,
839
721,
395,
216
7390
4,38
674
431,
812
75-2
3,82
3
231
BILANCIO REALE MUTUA 2015.indd 249BILANCIO REALE MUTUA 2015.indd 249 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 20
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Summary statement concerning life insurance business referring to premiums and the reinsurance balance
Direct business Inward reinsurance Total
Gross premiums: 1 813,449 11 311 21 813,760
a) 1. for individual policies........................................... 2 708,220 12 311 22 708,531
2. for group policies.................................................. 3 105,229 13 0 23 105,229
b) 1. periodic premiums................................................ 4 222,137 14 311 24 222,448
2. single premiums.................................................... 5 591,312 15 0 25 591,312
c) 1. for contracts without profit-sharing...................... 6 720,505 16 311 26 720,816
2. for contracts with profit-sharing............................ 7 0 17 0 27 0
3. for contracts when the investment risk is borne by the policyholders and for pension funds.................................................. 8 92,944 18 0 28 92,944
Balance of reinsurance 9 -879 19 -377 29 -1,256
232 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 250BILANCIO REALE MUTUA 2015.indd 250 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 21
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Investment income (item II.2 and III.3)
Non-life business Life business Total
Income from shares and interests:
Dividends and other income from shares and interests of Group companies and shareholdings.................................................................................1 19,582 41 18,251 81 37,833
Dividends and other income from shares and interests in other companies..........................2 3,514 42 4,960 82 8,474
Total.......................................................................................…………………………………......... 3 23,096 43 23,211 83 46,307
Income from investments in land and buildings...............................................................................4 3,542 44 0 84 3,542
Income from other investments:
Income from bonds of Group companies and shareholdings..................................................................................................................... 5 0 45 0 85 0
Interest on loans to group companies and shareholdings..........................................................................................................................6 0 46 0 86 0
Income from shares in common investment funds................................................................7 0 47 0 87 0
Income from bonds and other fixed-income securities..................................................... 8 19,681 48 134,652 88 154,333
Interest on loans.....................................................................................................................9 327 49 0 89 327
Income from shares in investment pools................................................................................10 0 50 0 90 0
Interests on deposits with credit institutions..........................................................................11 6 51 0 91 6
Income from other financial investments...............................................................................12 121 52 106 92 227
Interest on deposits with ceding undertakings.......................................................................13 6 53 130 93 136
Total.......................................................................................................................................................14 20,141 54 134,888 94 155,029
Value re-adjustments on investments in:
Land and buildings.................................................................................................................15 0 55 0 95 0
Shares and interests, Group companies and shareholdings...................................................16 0 56 0 96 0
Bonds issued by Group companies andshareholdings..........................................................................................................................17 0 57 0 97 0
Other shares and interests......................................................................................................18 28 58 0 98 28
Other bonds............................................................................................................................19 29 59 287 99 316
Other financial investments....................................................................................................20 0 60 32 100 32
Total.......................................................................................................................................................21 57 61 319 101 376
Income from the disposal of investments:
Gains on disposal of land and buildings ...............................................................................22 0 62 0 102 0
Gains on shares and interests in Group companies and shareholdings ……........................................................................................................... 23 0 63 0 103 0
Income from bonds issued by Group companies andshareholdings..................................................................................................................... 24 0 64 0 104 0
Gains on other shares and interests........................................................................................25 27,887 65 45 105 27,932
Gains on other bonds.......................................................................................................... 26 19,055 66 12,306 106 31,361
Gains on other financial investments............................................…………………........ 27 3,737 67 1,846 107 5,583
Total..................................................................................................................................................... 28 50,679 68 14,197 108 64,876
GRAND TOTAL ………………………….…................................................................................................... 29 97,515 69 172,615 109 270,130
233
BILANCIO REALE MUTUA 2015.indd 251BILANCIO REALE MUTUA 2015.indd 251 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 22
Company SOCIETA' REALE MUTUA DI ASS.NI Financial 2015
Income and unrealised gains on investments for the benefit of policyholders who bearthe Investments risk and on investments relating to the administration of pension funds(item II.3)
I. Investments relating to contracts linked to investment funds and market indexes
Amounts
Income from:Land and buildings................................................................................................................................................ 1 0
Investments in Group companies and shareholdings....................................................................................... 2 0
Shares in common investment funds..................................................................................................................... 3 40
Other financial investments.................................................................................................................................. 4 7,432
- of which income from bonds...................................................... 5 4,843
Other................................................................................................................................................................ 6 85
Total.......................................................................................…………………………………..................................... 7 7,557
Income from disposal of investments
Gains on disposal of land and buildings .............................................................................................................. 8 0
Gains on investments in Group companies and shareholdings ............................................................................ 9 0
Gains on common investment funds.................................................................................................................. 10 6,554
Gains on other financial investments............................................…………………....…………….................... 11 8,823
- of which bonds........................................................................... 12 840
Other income.................................................................................................................................................... 13 4,859
Total.................................................................................................................................................................................... 14 20,236
Unrealised gains................................................................................................................................................................. 15 11,426
GRAND TOTAL ..............................................................................................................................................…....................................... 16 39,219
II. Investments relating to the administration of pension funds
Amounts
Income from:Investments in Group companies and shareholdings ………………................................................................... 21 0
Other financial investments................................................................................................................................... 22 5,220
- of which income from bonds...................................................... 23 3,619
Other..................................................................................................................................................................... 24 15
Total......................................................................................................................................................…........................... 25 5,235
Income from disposal of investments
Gains on investments in Group companies and shareholdings............................................................................. 26 0
Gains on other financial investments............................................…………………....……………............... 27 2,918
- of which bonds........................................................................... 28 611
Other income........................................................................................................................................................ 29 0
Total..................................................................................................................................................................................... 30 2,918
Unrealised gains.................................................................................................................................................................. 31 6,417
GRAND TOTAL ......................................................................................................................................................................................... 32 14,570
234 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 252BILANCIO REALE MUTUA 2015.indd 252 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 23
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Investment management and financial charges (items II.9 and III.5)
Non-life business Life business Total
Investment management charges and other charges
Charges relating to shares and interests....................................................... 1 669 31 1 61 670
Charges relating to investments in land and buildings ................................ 2 2,123 32 0 62 2,123
Charges relating to bonds............................................................................ 3 5,748 33 10,722 63 16,470
Charges relating to common investment funds............................................ 4 0 34 0 64 0
Charges relating to participation in investment pools.................................. 5 0 35 0 65 0
Charges relating to miscellaneous financial investments ............................ 6 0 36 3,876 66 3,876
Interest on deposits received from reinsurers.............................................. 7 56 37 90 67 146
Total..........................................................................................................................… 8 8,596 38 14,689 68 23,285
Value adjustments on investments referring to:
Land and buildings..................................................................................... 9 633 39 0 69 633
Shares and interests of Group companies and shareholdings....................... 10 0 40 0 70 0
Bonds issued by Group companies and shareholdings................................ 11 0 41 0 71 0
Other shares and interests........................................................................... 12 1,806 42 0 72 1,806
Other bonds................................................................................................ 13 2,434 43 8,912 73 11,346
Other financial investments......................................................................... 14 3,129 44 65 74 3,194
Total............................................................................................................................ 15 8,002 45 8,977 75 16,979
Capital losses on disposal of investments
Losses on the sale of land
and buildings.............................................................................................. 16 0 46 0 76 0
Losses on other shares and interests............................................................ 17 120 47 1 77 121
Losses on bonds.......................................................................................... 18 1,372 48 267 78 1,639
Losses from other financial investments..................................................... 19 4,134 49 1 79 4,135
Total............................................................................................................................ 20 5,626 50 269 80 5,895
GRAND TOTAL............................................................................………………………….…. 21 22,224 51 23,935 81 46,159
235
BILANCIO REALE MUTUA 2015.indd 253BILANCIO REALE MUTUA 2015.indd 253 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 24
Company SOCIETA' REALE MUTUA DI ASS.NI Financial 2015
Investment management and financial charges and unrealised losses on investments for the benefit of policyholders who bear the investment risk and on investments relating to the administration of pension funds (item II.10)
I. Investments relating to contracts linked to investment funds and market indexes
Amounts
Management charges resulting from:
Land and buildings.................................................................................................. 1 0
Investments in Group companies and shareholdings.............................................. 2 0
Shares in common investment funds....................................................................... 3 48
Other financial investments..................................................................................... 4 886
Other....................................................................................................................... 5 6,631
Total.......................................................................................……………………….......… 6 7,565
Capital losses on disposal of investments
Losses on disposal of land and buildings .............................................................. . 7 0
Losses on investments in Group companies and shareholdings ............................ . 8 0
Losses on common investment funds...................................................................... 9 1,753
Losses from other financial investments................................................................. 10 6,764
Other charges.......................................................................................................... 11 188
Total...................................................................................................................................... 12 8,705
Unrealised gains................................................................................................................... 13 7,021
GRAND TOTAL .................................................................................................................................. 14 23,291
II. Investments relating to the administration of pension funds
Amounts
Management charges resulting from:
Investments in Group companies and shareholdings.............................................. 21 0
Other financial investments..................................................................................... 22 428
Other....................................................................................................................... 23 2,725
Total.......................................................................................…………………………..… 24 3,153
Capital losses on disposal of investments
Losses on investments in Group companies and shareholdings ............................ 25 0
Losses from other financial investments................................................................. 26 842
Other charges.......................................................................................................... 27 0
Total...................................................................................................................................... 28 842
Unrealised gains................................................................................................................... 29 4,648
GRAND TOTAL .................................................................................................................................. 30 8,643
236 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 254BILANCIO REALE MUTUA 2015.indd 254 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
25
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15N
on-li
fe b
usin
ess -
Sum
mar
y st
atem
ent o
f the
tech
nica
l a
ccou
nts b
y in
divi
dual
bra
nch
– Ita
lian
portf
olio
Acc
ount
ing
clas
s01
Acc
ount
ing
clas
s02
Acc
ount
ing
clas
s03
Acc
ount
ing
clas
s04
Acc
ount
ing
clas
s05
Acc
ount
ing
clas
s06
Acc
iden
tH
ealth
Hul
ls la
nd v
ehic
les
Hul
ls a
ircra
ft(n
ame)
(nam
e)(n
ame)
Hul
ls ra
ilway
rolli
ng st
ock
(nam
e)(n
ame)
Hul
ls m
arin
e, la
ke, r
iver
cra
ft(n
ame)
Dir
ect b
usin
ess g
ross
of r
eins
uran
cePr
emiu
ms w
ritte
n....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.+
1
93,6
22
189
,988
1
102,
459
1
5
18
1
2,60
7
Cha
nge
in th
e pr
ovis
ions
for u
near
ned
prem
ium
s (+
or -)
......
......
......
......
......
......
......
......
......
......
.. -
2
1,99
9
262
6
22,
565
2
-5
20
2
220
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
…...
......
......
......
......
......
......
......
......
......
..-
3
54,3
47
370
,661
3
61,9
92
3-1
9
3-1
0
32,
169
Cha
nge
in m
isce
llane
ous t
echn
ical
pro
visi
ons (
+ or
-) (1
) ....
......
......
......
......
......
......
......
......
......
....
-
40
4
111
4
0
40
4
0
40
Bal
ance
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. +
5
-3,0
57
5-1
,457
5
-664
5
-9
51
5
-11
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
-
635
,275
6
24,4
24
628
,879
6
1
61
6
800
Tec
hnic
al b
alan
ce d
irec
t bus
ines
s (+
or -)
......
......
......
......
......
......
......
......
......
......
. A
7
-1,0
56
7-7
,291
7
8,35
9
719
7
18
7-5
93
Res
ult o
f out
war
d re
insu
ranc
e (+
or
-)....
......
......
.....…
......
......
......
......
......
......
..... B
889
9
845
4
8-2
,584
8
-10
8
-100
8
-126
Net
res
ult o
f inw
ard
rein
sura
nce
(+ o
r -).
......
......
......
......
......
......
......
......
......
......
. C
9
257
9
-25
9
-1
9-1
9
0
944
Cha
nge
in th
e eq
ualis
atio
n pr
ovisi
on (+
or -
).....
......
......
......
......
......
......
......
......
. D
10
61
100
10
201
10
0
100
10
7
Allo
cate
d in
vest
men
t ret
urn
trans
ferr
ed fr
om th
e no
n-te
chni
cal a
ccou
nt...
......
......
E
11
2,56
8
111,
925
11
1,16
2
110
11
0
1111
4
Res
ult o
f the
tech
nica
l acc
ount
(+ o
-) ..
......
......
......
......
(A
+ B
+ C
- D
+ E
)
122,
607
12
-4,9
37
126,
735
12
8
12-8
2
12-5
68
Acc
ount
ing
clas
s07
Acc
ount
ing
clas
s08
Acc
ount
ing
clas
s09
Acc
ount
ing
clas
s10
Acc
ount
ing
clas
s11
Acc
ount
ing
clas
s12
Goo
ds T
rans
porte
dFi
re a
nd N
atur
al F
orce
sO
ther
Pro
perty
Dam
age
Mot
or T
PLTP
L ai
rcra
ftTP
L M
arin
e(n
ame)
(nam
e)(n
ame)
(nam
e)(n
ame)
(nam
e)
Dir
ect b
usin
ess g
ross
of r
eins
uran
cePr
emiu
ms w
ritte
n....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.+
1
4,09
2
117
2,58
9
120
5,26
6
147
4,84
1
151
1
1,24
8
Cha
nge
in th
e pr
ovis
ions
for u
near
ned
prem
ium
s (+
or -)
......
......
......
......
......
......
......
......
......
......
... -
2
77
26,
591
2
6,05
7
2-5
,996
2
0
26
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
…...
......
......
......
......
......
......
......
......
......
..-
3
1,13
2
310
1,94
0
313
9,37
3
333
3,91
5
3-1
8
3-7
99
Cha
nge
in m
isce
llane
ous t
echn
ical
pro
visi
ons (
+ or
-) (1
) ....
......
......
......
......
......
......
......
......
......
....
-
40
4
0
40
4
0
40
4
0
Bal
ance
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. +
5
-40
5
-4,2
05
5-2
,821
5
-8,3
52
50
5
-1
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
-
61,
506
6
62,4
10
672
,255
6
107,
235
6
14
628
9
Tec
hnic
al b
alan
ce d
irec
t bus
ines
s (+
or -)
......
......
......
......
......
......
......
......
......
......
. A
7
1,33
7
7-2
,557
7
-15,
240
7
31,3
35
755
7
1,75
1
Res
ult o
f out
war
d re
insu
ranc
e (+
or
-)....
......
......
.....…
......
......
......
......
......
......
..... B
8-8
09
8-1
1,41
8
8-8
,219
8
5,08
7
8-3
05
80
Net
res
ult o
f inw
ard
rein
sura
nce
(+ o
r -).
......
......
......
......
......
......
......
......
......
......
. C
9
220
9
-491
9
397
9
-101
9
0
90
Cha
nge
in th
e eq
ualis
atio
n pr
ovisi
on (+
or -
).....
......
......
......
......
......
......
......
......
. D
10
12
1037
9
1061
9
100
10
0
100
Allo
cate
d in
vest
men
t ret
urn
trans
ferr
ed fr
om th
e no
n-te
chni
cal a
ccou
nt...
......
......
E
11
114
11
4,12
1
113,
301
11
15,3
07
110
11
71
Res
ult o
f the
tech
nica
l acc
ount
(+ o
-) ..
......
......
......
......
(A
+ B
+ C
- D
+ E
)
1285
0
12-1
0,72
4
12-2
0,38
0
1251
,628
12
-250
12
1,82
2
237
BILANCIO REALE MUTUA 2015.indd 255BILANCIO REALE MUTUA 2015.indd 255 14/04/16 16:0414/04/16 16:04
Acc
ount
ing
clas
s13
Acc
ount
ing
clas
s14
Acc
ount
ing
clas
s15
Acc
ount
ing
clas
s17
Acc
ount
ing
clas
s18
Non
-mot
or T
PLC
redi
tSu
rety
ship
Acc
ount
ing
clas
s16
Sund
ry P
ecun
iary
Los
ses
Lega
l Fee
sA
ssis
tanc
e(n
ame)
(nam
e)(n
ame)
(nam
e)(n
ame)
(nam
e)D
irec
t bus
ines
s gro
ss o
f rei
nsur
ance
Prem
ium
s writ
ten.
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
....
+
120
9,22
9
11
1
29,4
97
12,
292
1
11,8
25
114
,017
Cha
nge
in th
e pr
ovis
ions
for u
near
ned
prem
ium
s (+
or -)
......
......
......
......
......
......
......
......
......
......
...
-
27,
730
2
-1
21,
104
2
-20
2
255
2
393
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
…...
......
......
......
......
......
......
......
......
......
..
-
310
7,63
0
3-9
3
318
,512
3
1,16
0
32,
428
3
8,14
2
Cha
nge
in m
isce
llane
ous t
echn
ical
pro
visi
ons (
+ or
-) (1
) ....
......
......
......
......
......
......
......
......
......
....
-
40
4
0
40
4
0
40
4
0
Bal
ance
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. +
5
-5,5
48
50
5
-5,1
93
5-1
38
5-1
37
5-5
6
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
-
676
,116
6
0
611
,187
6
810
6
4,59
3
65,
233
Tec
hnic
al b
alan
ce d
irec
t bus
ines
s (+
or -)
......
......
......
......
......
......
......
......
......
......
. A
7
12,2
05
795
7
-6,4
99
720
4
74,
412
7
193
Res
ult o
f out
war
d re
insu
ranc
e (+
or
-)....
......
......
.....…
......
......
......
......
......
......
..... B
8-4
,673
8
-195
8
-734
8
40
8-1
,259
8
0
Net
res
ult o
f inw
ard
rein
sura
nce
(+ o
r -).
......
......
......
......
......
......
......
......
......
......
. C
9
121
9
0
9-2
0
911
8
90
9
0
Cha
nge
in th
e eq
ualis
atio
n pr
ovisi
on (+
or -
).....
......
......
......
......
......
......
......
......
. D
10
0
100
10
0
100
10
0
100
Allo
cate
d in
vest
men
t ret
urn
trans
ferr
ed fr
om th
e no
n-te
chni
cal a
ccou
nt...
......
......
E
11
17,3
27
1124
11
1,12
4
1162
11
276
11
143
Res
ult o
f the
tech
nica
l acc
ount
(+ o
-) ..
......
......
......
......
(A
+ B
+ C
- D
+ E
)
1224
,980
12
-76
12
-6,1
29
1242
4
123,
429
12
336
(1) I
n ad
ditio
n to
the
chan
ge in
“O
ther
tech
nica
l pro
visio
ns”,
this
item
also
incl
udes
the
chan
ge in
the
“Pro
visio
ns fo
r pro
fit-s
harin
g an
d pr
emiu
m re
fund
s”.
238 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 256BILANCIO REALE MUTUA 2015.indd 256 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
26
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15
Sum
mar
y st
atem
ent o
f the
tech
nica
l acc
ount
of a
ll th
e N
on-li
fe b
ranc
hes
Italia
n po
rtfol
io
Risk
s of d
irect
insu
ranc
eR
isks o
f ind
irect
insu
ranc
eR
isks p
rese
rved
Dire
ct ri
sks
Risk
s ced
edR
isks a
ssum
edR
isks r
etro
cede
dTo
tal
12
34
5 =
1 - 2
+ 3
- 4
Prem
ium
s writ
ten.
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
+
11,
413,
637
11
138,
039
21
3,08
7 3
177
41
1,27
8,60
8
Cha
nge
in th
e pr
ovisi
ons f
or u
near
ned
prem
ium
s (+
or -)
......
......
......
......
......
......
......
......
......
......
......
......
......
.-2
21,6
01 1
21,
810
22
21 3
2-1
42
19,8
13
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
…...
......
......
......
......
......
......
......
......
......
......
......
....
-
390
2,46
2 1
390
,822
23
1,92
0 3
318
1 4
381
3,37
9
Cha
nge
in m
iscel
lane
ous t
echn
ical
pro
visio
ns (+
or )
.....
......
......
......
......
......
......
......
......
......
......
......
......
......
.-
411
1 1
40
24
0 3
40
44
111
Bala
nce
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
+
5-3
1,68
8 1
527
25
0 3
50
45
-31,
715
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
-
643
1,02
8 1
621
,482
26
766
36
35 4
641
0,27
7
Tec
hnic
al b
alan
ce (+
or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.........................
7
26,7
47 1
723
,952
27
380
37
-138
47
3,31
3
Cha
nge
in th
e eq
ualis
atio
n pr
ovis
ion
(+ o
r -)..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
- 4
81,
279
Allo
cate
d in
vest
men
t ret
urn
trans
ferr
ed fr
om th
e no
n-te
chni
cal a
ccou
nt...
......
......
......
......
......
......
......
......
..+
9
47,5
10 2
912
9 4
947
,639
Res
ult o
f the
tech
nica
l acc
ount
(+ o
r -)
….…
……
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
...................
10
74,2
57 2
023
,952
30
509
40
-138
50
49,6
73
239
BILANCIO REALE MUTUA 2015.indd 257BILANCIO REALE MUTUA 2015.indd 257 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
27
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15
Life
bus
ines
s – S
umm
ary
stat
emen
t of t
he te
chni
cal a
ccou
nts b
y in
divi
dual
bra
nch
– Ita
lian
portf
olio
Acc
ount
ing
clas
s01
Acc
ount
ing
clas
s02
Acc
ount
ing
clas
s03
(nam
e)(n
ame)
(nam
e)D
irec
t bus
ines
s gro
ss o
f rei
nsur
ance
Prem
ium
s writ
ten.
……
……
……
……
……
……
……
……
……
……
……
…..…
……
……
……
......
......
......
......
+ 1
610,
963
10
192
,944
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
……
……
……
……
...…
…...
......
......
......
......
......
......
......
- 2
343,
621
20
289
,370
Cha
nge
in p
rovi
sion
s for
pol
icy
liabi
litie
s and
in o
ther
tech
nica
l pro
visi
ons (
+ or
)-..
......
......
......
......
......
......
......
- 3
343,
058
30
320
,020
Bal
ance
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.+ 4
-2,6
67 4
0 4
4,33
8
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.-
531
,589
50
56,
683
Inco
me
from
inve
stm
ents
net
of t
he a
lloca
ted
inve
stm
ent r
etur
n tra
nsfe
rred
to th
e no
nte
chni
cal a
ccou
nt
(*)..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.+
610
1,72
7 6
0 6
16,6
77
Res
ult o
f dir
ect b
usin
ess g
ross
of r
eins
uran
ce (+
or
-) ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.A
7
-8,2
45 7
0 7
-2,1
14
Res
ult o
f inw
ard
rein
sura
nce
(+ o
r -)
...…
......
......
......
......
......
......
.....…
...…
.….…
…...
......
......
......
......
......
......
......
......
.............
B
8-8
79 8
0 8
0
Net
res
ult o
f inw
ard
rein
sura
nce
(+ o
r -)
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
...........
C
98
90
968
Res
ult o
f the
tech
nica
l acc
ount
(+ o
r -)
….…
……
......
......
......
......
......
......
......
......
......
. (A
+ B
+ C
) 1
0-9
,116
10
0 1
0-2
,046
Acc
ount
ing
clas
s04
Acc
ount
ing
clas
s05
Acc
ount
ing
clas
s06
(nam
e)(n
ame)
(nam
e)D
irec
t bus
ines
s gro
ss o
f rei
nsur
ance
Prem
ium
s writ
ten.
……
……
……
……
……
……
……
……
……
……
……
……
……
……
......
......
......
......
......
.....
+ 1
158
186
,113
123
,271
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
…...
......
......
......
......
......
......
......
......
......
......
......
......
......
.-
220
256
,780
28,
710
Cha
nge
in p
rovi
sion
s for
pol
icy
liabi
litie
s and
in o
ther
tech
nica
l pro
visi
ons (
+ or
-)...
......
......
......
......
......
......
....
- 3
71 3
57,6
54 3
23,0
19
Bal
ance
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.+ 4
0 4
-116
467
6
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
...-
55
54,
887
51,
109
Inco
me
from
inve
stm
ents
net
of t
he a
lloca
ted
inve
stm
ent r
etur
n tra
nsfe
rred
to th
e no
nte
chni
cal a
ccou
nt (*
).....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
+ 6
11 6
28,1
57 6
6,05
8
Res
ult o
f dir
ect b
usin
ess g
ross
of r
eins
uran
ce (+
or
-) ..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.A
7
73 7
-5,1
67 7
-2,8
33
Res
ult o
f inw
ard
rein
sura
nce
(+ o
r -)
...…
......
......
......
......
......
......
.....…
...…
.….…
…...
......
......
......
......
......
......
......
......
............
B
80
80
80
Net
res
ult o
f inw
ard
rein
sura
nce
(+ o
r -)
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
...........................
C 9
5 9
0 9
0
Res
ult o
f the
tech
nica
l acc
ount
(+ o
r -)
….…
……
......
......
......
......
......
......
......
......
......
. (A
+ B
+ C
) 1
078
10
-5,1
67 1
0-2
,833
(*) A
lgeb
raic
sum
of i
tem
s ref
errin
g to
the
bran
ch a
nd to
the
Italia
n po
rtfol
io in
clud
ed in
item
s II.2
, II.3
, II.9
, II.1
0 an
d II
.12
of th
e Pr
ofit
and
Loss
Acc
ount
240 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 258BILANCIO REALE MUTUA 2015.indd 258 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
28
Com
pany
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Fina
ncia
l20
15
Sum
mar
y st
atem
ent o
f the
tech
nica
l acc
ount
of a
ll th
e Li
fe b
ranc
hes
Italia
n po
rtfol
io
Risk
s of d
irect
insu
ranc
eR
isks o
f ind
irect
insu
ranc
eR
isks p
rese
rved
Dire
ct ri
sks
Risk
s ced
edR
isks a
ssum
edR
isks r
etro
cede
dTo
tal
12
34
5 =
1 - 2
+ 3
- 4
Prem
ium
s writ
ten.
……
……
……
……
……
……
……
……
……
……
……
……
……
..……
……
……
……
……
.+
181
3,44
9 1
13,
531
21
311
31
246
41
809,
983
Cha
rges
rela
ting
to c
laim
s ...…
……
……
……
……
……
…...
......
......
......
......
......
......
......
......
......
......
......
- 2
498,
501
12
2,45
5 2
261
1 3
236
7 4
249
6,29
0
Cha
nge
in p
rovi
sion
s for
pol
icy
liabi
litie
s and
oth
er te
chni
cal p
rovi
sion
s di
ffere
nt (+
or -
).....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
....-
344
3,82
2 1
3-2
8 2
3-7
17 3
3-5
19 4
344
3,65
2
Bal
ance
of o
ther
tech
nica
l ite
ms (
+ or
-)...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....+
42,
231
14
0 2
43
34
4 4
42,
230
Ope
ratin
g ex
pens
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.- 5
44,2
73 1
522
5 2
526
35
25 4
544
,049
Inco
me
from
inve
stm
ents
net
of t
he a
lloca
ted
inve
stm
ent r
etur
n tra
nsfe
rred
to th
eno
n-te
chni
cal a
ccou
nt (*
).....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
..+ 6
152,
630
26
64 4
615
2,69
4
Res
ult o
f the
tech
nica
l acc
ount
(+ o
r -)
.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
7-1
8,28
6 1
787
9 2
745
8 3
737
7 4
7-1
9,08
4
(*) A
lgeb
raic
sum
of i
tem
s ref
errin
g to
the
Italia
n po
rtfol
io in
clud
ed in
item
s II.2
, II.3
, II.9
, II.1
0 an
d II.
12 o
f the
Pro
fit a
nd L
oss A
ccou
nt
241
BILANCIO REALE MUTUA 2015.indd 259BILANCIO REALE MUTUA 2015.indd 259 14/04/16 16:0414/04/16 16:04
Section II: Life business
Total classes
Direct business gross of reinsurance
Premiums written.………………………………………………………………………........................+ 1 0
Charges relating to claims ...………………………………................................................................. - 2 0
Change in provisions for policy liabilities and in other technical provisions (+ or -)............................ - 3 0
Balance of other technical items (+ or -)............................................................................................... + 4 0
Operating expenses............................................................................................................................... - 5 0
Income from investments net of the allocated investment return transferred to the nontechnical account (*)........................................................................................................................... + 6 0
Result of direct business gross of reinsurance (+ or -) ............................................................................................ A 70
Result of inward reinsurance (+ or -)...….........................................…...….….…….............................................B 8 0
Net result of inward reinsurance (+ or -)............................................................................................................ C 9 0
Result of the technical account (+ or -)….………..................................... (A + B + C) 10 0
(1) Algebraic sum of items referring to the foreign portfolio included in items II.2, II.3, II.9, II.10 and II.12 of the Profit and Loss Account
Notes to the Financial Statements – Annex 29
Company SOCIETA' REALE MUTUA DI ASS.NI Financial 2015
Summary schedule relating to the Non-life and Life technical accounts – Foreign portfolio
Section I: Non-life business
Total classes
Direct business gross of reinsurance
Premiums written................................................................................................................................ + 1 0
Change in the provisions for unearned premiums (+ or -)..........................................................................................- 2 0
Charges relating to claims ...………………………………................................................................ - 3 0
Change in miscellaneous technical provisions (+ or ) - ..................................................................................4..............................................0.
Balance of other technical items (+ or -)..................................................................................................................+ 5 0
Operating expenses............................................................................................................................. - 6 0
Technical balance direct business (+ or -)............................................................................................................. A 7 0
Result of outward reinsurance (+ or -).....................….........................................…...….….……....................... B 8 0
Net result of inward reinsurance (+ or -).............................................................................................................. C 9 87
Change in the equalisation provision (+ or -)................................................................................ D 10 0
Allocated investment return transferred from the non-technical account...................................... E 11 1
Result of the technical account (+ or -)….………........................... (A + B + C - D + E) 12 88
242 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 260BILANCIO REALE MUTUA 2015.indd 260 14/04/16 16:0414/04/16 16:04
Not
es to
the
Fina
ncia
l Sta
tem
ents
– A
nnex
30
Com
pany
Fina
ncia
l20
15SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
I
Rel
atio
nshi
p w
ith G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
sI:
Inco
me
Con
trolli
ng c
ompa
nies
Subs
idia
ries
Aff
iliat
ed c
ompa
nies
Ass
ocia
ted
com
pani
esO
ther
Tota
l
Inve
stm
ent i
ncom
e
Inco
me
from
land
and
bui
ldin
gs...
......
......
......
......
......
......
......
......
......
......
......
......
......
...
10
2
0
30
4
0
50
6
0
Div
iden
ds a
nd o
ther
inco
me
from
shar
es a
nd in
tere
sts..
......
......
......
......
......
......
......
.....
70
8
37,8
33
90
10
0 1
10
12
37,8
33
Inco
me
from
bon
ds...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.....
13
0 1
40
15
0 1
60
17
0 1
80
Inte
rest
on
loan
s.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 1
90
20
0 2
10
22
0 2
30
24
0
Inco
me
from
oth
er fi
nanc
ial i
nves
tmen
ts...
......
......
......
......
......
......
......
......
......
......
......
. 25
0 2
60
27
0 2
80
29
0 3
00
Inte
rest
on
depo
sits w
ith c
edin
g un
derta
king
s.....
......
......
......
......
......
......
......
......
......
....
310
32
3 3
30
34
0 3
50
36
3
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 37
0 3
837
,836
39
0 4
00
41
0 4
237
,836
Inco
me
and
unre
alis
ed g
ains
on
inve
stm
ents
for
the
bene
fit o
f pol
icyh
olde
rs w
ho
bear
the
inve
stm
ent r
isk
and
rela
ting
to th
e ad
min
istr
atio
nof
pen
sion
fund
s.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
43
0 4
40
45
0 4
60
47
0 4
80
Oth
er in
com
e
Inte
rest
on
rece
ivab
les..
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
... 4
90
50
0 5
10
52
0 5
30
54
0
Ref
unds
of a
dmin
istra
tive
expe
nses
and
cha
rges
......
......
......
......
......
......
......
......
......
.... 5
50
56
32,6
37 5
70
58
248
59
0 6
032
,885
Oth
er in
com
e an
d re
fund
s.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
..... 6
10
62
2 6
30
64
0 6
50
66
2
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 67
0 6
832
,639
69
0 7
024
8 7
10
72
32,8
87
Inco
me
from
the
disp
osal
of i
nves
tmen
ts (*
).....
......
......
......
......
......
......
......
......
......
..... 7
30
74
0 7
50
76
0 7
70
78
0
Ext
raor
dina
ry in
com
e....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 79
0 8
00
81
0 8
20
83
0 8
40
GR
AN
D T
OT
AL
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 85
0 8
670
,475
87
0 8
824
8 8
90
90
70,7
23
243
BILANCIO REALE MUTUA 2015.indd 261BILANCIO REALE MUTUA 2015.indd 261 14/04/16 16:0414/04/16 16:04
Rel
atio
nshi
p w
ith G
roup
com
pani
es a
nd o
ther
shar
ehol
ding
sII:
Cha
rges
Con
trolli
ng c
ompa
nies
Subs
idia
ries
Ass
ocia
ted
com
pani
esA
ffili
ated
com
pani
esO
ther
Tota
l
Inve
stm
ent m
anag
emen
t cha
rges
and
In
tere
st e
xpen
se:
Cha
rges
rela
ting
inve
stm
ent p
ools.
......
......
......
......
......
......
......
......
......
......
......
......
......
.. 91
0 9
27,
827
93
0 9
40
95
0 9
67,
827
Inte
rest
on
subo
rdin
ated
liab
ilitie
s.....
......
......
......
......
......
......
......
......
......
......
......
......
.... 9
70
98
0 9
90
100
0 1
010
102
0
Inte
rest
on
depo
sits r
ecei
ved
from
rein
sure
rs...
......
......
......
......
......
......
......
......
......
......
. 103
0 1
040
105
0 1
060
107
0 1
080
Inte
rest
on
liabi
litie
s aris
ing
out o
f di
rect
insu
ranc
e....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
109
011
00
111
011
20
113
011
40
Inte
rest
on
liabi
litie
s aris
ing
out o
f dire
ct
rein
sura
nce
oper
atio
ns...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
...... 1
150
116
011
70
118
011
90
120
0
Am
ount
s ow
ed to
ban
ks a
nd c
redi
t ins
titut
ions
......
......
......
......
......
......
......
......
......
......
. 121
012
20
123
012
40
125
012
60
Inte
rest
s on
loan
s gua
rant
eed
by m
ortg
ages
......
......
......
......
......
......
......
......
......
......
...... 1
270
128
012
90
130
013
10
132
0
Inte
rest
on
othe
r loa
ns...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 133
013
40
135
013
60
137
013
80
Loss
es o
n re
ceiv
able
s.....
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
...... 1
390
140
014
10
142
014
30
144
0
Adm
inist
rativ
e co
sts a
nd e
xpen
ses o
n be
half
of th
ird p
artie
s.....
......
......
......
......
......
.... 14
50
146
32,6
3714
724
814
80
149
015
032
,885
Oth
er c
harg
es...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
..15
10
152
015
30
154
015
50
156
0
Tot
al...
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
......
. 157
015
840
,464
159
248
160
016
10
162
40,7
12
Exp
ense
s and
unr
ealis
ed lo
sses
on
inve
stm
ents
for
the
bene
fit o
f pol
icyh
olde
rs w
hobe
ar th
e in
vest
men
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244 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 262BILANCIO REALE MUTUA 2015.indd 262 14/04/16 16:0414/04/16 16:04
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BILANCIO REALE MUTUA 2015.indd 263BILANCIO REALE MUTUA 2015.indd 263 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements – Annex 32
Financial 2015Company SOCIETA' REALE MUTUA DI ASS.NI
Statement of expenses referring to personnel, directors and statutory auditors
I: Expenses for personnel
Non-life business Life business Total
Expenses arising out of self employment:Italian portfolio:
- Wages and salaries 1 66,652 31 8,249 61 74,901
- Social security contributions................................................................................... 2 17,478 32 2,163 62 19,641
- Allocation to the provisions for employee termination indemnities and similar obligations......................................................................................... 3 4,872 33 603 63 5,475
- Sundry personnel expenses..................................................................................... 4 15,335 34 1,898 64 17,233
Total......................................................................................................................... 5 104,337 35 12,913 65 117,250
Foreign portfolio:- Wages and salaries 6 0 36 0 66 0
- Social security contributions................................................................................... 7 0 37 0 67 0
- Sundry personnel expenses..................................................................................... 8 0 38 0 68 0
Total......................................................................................................................... 9 0 39 0 69 0
Grand Total................................................................................................................. 10 104,337 40 12,913 70 117,250
Expenses arising out of self employment:Total Italian portfolio................................................................................................. 11 53,613 41 71 53,613
Foreign portfolio........................................................................................................ 12 42 72 0
Total............................................................................................................................. 13 53,613 43 0 73 53,613
Total expenses for personnel ..................................................................................... 14 157,950 44 12,913 74 170,863
II: Description of the item
Non-life business Life business Total
Investment management charges.............................................................................. 15 515 45 506 75 1,021
Charges relating to claims......................................................................................... 16 73,380 46 783 76 74,163
Other acquisition costs.............................................................................................. 17 30,444 47 4,292 77 34,736
Other acquisition costs.............................................................................................. 18 29,650 48 7,159 78 36,809
Administrative costs and expenses on behalf of third parties.................................... 19 23,961 49 173 79 24,134
20 50 80 0
Total............................................................................................................................. 21 157,950 51 12,913 81 170,863
III: Average number of personnel during the year
Number
Managers........................................................................................................... 91 42
White collar............................................................................................................... 92 1,100
Blue collar................................................................................................................. 93 0
Others........................................................................................................................ 94 61
Total............................................................................................................................. 95 1,203
IV Directors and statutory auditors
Number Fees
Directors........................................................................................................................ 96 13 98 1,304
Statutory Auditors......................................................................................................... 97 3 99 178
BILANCIO REALE MUTUA 2015.indd 264BILANCIO REALE MUTUA 2015.indd 264 14/04/16 16:0414/04/16 16:04
OTHER ANNEXES
BILANCIO REALE MUTUA 2015.indd 265BILANCIO REALE MUTUA 2015.indd 265 14/04/16 16:0414/04/16 16:04
248 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 266BILANCIO REALE MUTUA 2015.indd 266 14/04/16 16:0414/04/16 16:04
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BILANCIO REALE MUTUA 2015.indd 267BILANCIO REALE MUTUA 2015.indd 267 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements
Financial 2015
Società Reale Mutua di Assicurazioni
Class C.II, C.III, D.I, D.II: list of long-term investments in shares, bonds, common investment fundspursuant to Art. 15 Section 1 - Law No. 173/1997
Class Category Type Name Currency Carrying valueof assets (1) (2)
Nom. value in currency/quantity in thousands of Euro
C.III O f D EUR 8,500,000 8,505C.III O f D EUR 8,000,000 7,978C.III O f D LIT 1,578,000,000 815C.III O f D LIT 1,578,000,000 815C.III O f D LIT 1,469,000,000 759C.III O f D LIT 1,509,000,000 779C.III O f D LIT 1,508,000,000 779C.III O f D LIT 1,538,000,000 794C.III O f D LIT 1,538,000,000 794C.III O f D LIT 1,552,000,000 802C.III O f D LIT 24,000,000,000 12,450C.III O f D LIT 1,566,000,000 809C.III O f D LIT 1,565,000,000 808C.III O f D LIT 19,656,525 10C.III O f V EUR 5,000,000 5,000C.III O f V EUR 10,624,645 5,401C.III O f V EUR 1,000,000 1,050C.III O f V EUR 8,700,000 11,165C.III O f V EUR 25,000,000 29,995C.III O f V EUR 4,200,000 4,732C.III O f V EUR 18,000,000 17,995C.III O f V EUR 48,500,000 52,582C.III O f V EUR 3,000,000 3,002C.III O f V LIT 29,910,000,000 13,701C.III O f V LIT 94,860,000,000 22,870C.III O f V EUR 31,960,000 31,646C.III O f V LIT 551,000,000 286C.III O f V LIT 19,656,432 10C.III O f V LIT 85,501,080 44C.III O f V LIT 85,501,108 44C.III O f V LIT 37,406,082 20C.III O f V LIT 37,406,088 19C.III O f V LIT 45,980,565 24C.III O f V LIT 45,980,570 24C.III O f V LIT 72,538,788 37C.III O f V LIT 72,538,783 37C.III O f V LIT 72,541,182 37C.III O f V LIT 72,541,189 38C.III O f V LIT 120,146,258 63C.III O f V LIT 120,146,265 62C.III O f V EUR 9,267,680 4,550C.III O f V EUR 4,200,000 4,198C.III O f V EUR 500,000 500C.III P f D EUR 17,974 46C.II P b D EUR 28,500,000 40,119C.II P b D EUR 3,120,000 2,511C.II P e D EUR 253 1,948C.III P f D EUR 1,082 243C.II P d D EUR 1,366,000 22,136C.III P f D EUR 1,397,500 8,116C.III P f D EUR 12,183 155C.II P b D EUR 527,060 31,555C.II P b D EUR 7,088,432 129,905C.II P b D EUR 16,000,000 830,747C.II P b D EUR 1 76,390C.II P b D EUR 3,838,000 252,743C.II P b D EUR 500 610C.II P d D EUR 5,091,660 12,370C.II P d D EUR 636,457 2,248C.II P e D EUR 39,800 716C.III P f D EUR 25,241 49C.II P e D EUR 1 400C.II P b V EUR 19,011,618 151,687C.II P b V
BTPS 2.25% 04/13 15/05/16 FIXCTZ 04/14-29/04/16 ZCENEL 00/20 TV XL TR. IMP.ASS.ENEL 00/21 TV XL TR. IMP.ASS.ENEL 95/16 TV XXXI TR. IMP.ASS.ENEL 96/16 TV XXXII TR. IMP.ASS.ENEL 96/17 TV XXXIII TR. IMP.ASS.ENEL 97/17 TV XXXIV TR. IMP.ASS.ENEL 97/18 TV XXXV TR. IMP.ASS.ENEL 98/18 TV XXXVI TR. IMP.ASS.ENEL 98/19 TV XXXVII TR. IMP.ASS.ENEL 99/19 TV XXXVIII TR. IMP.ASS.ENEL 99/20 TV XXXIX TR. IMP.ASS.FOND.7% ANIA 3^EM. ISPBAT 99/19 4,60% FLOORBEI ZC 11/96 - 05/11/26BELGIUM 03/14-22/03/34 TF 3%BTP 05/13-01/09/44 TF 4.75%BTP 11/93-01/11/23 TF 9%BTP 4% 05 01.02.37BTP NV 01 98/29 5.25BTPS 09/14 - 01/12/24 TF 2,5%BTPS 2.25% 04/13 15/05/16 FIXCENTROB 98/18 ZCCOMMERZBANK 96/26 ZCCREDIOP 2,1% 99/25 OPT FLOOR PREMIUM 4,2 RESTRUCENEL 98/19 TV XXXVII TR. IMP.ASS.FOND.7% ANIA 3^EM. CARIPLOFOND.7% ANIA 4^EM. CARIPLOFOND. 7% ANIA 4^EM ISPFOND.7% ANIA 5^EM. CARIPLOFOND.7% ANIA 5^EM. ISPFOND.7% ANIA 6^EM. CARIPLOFOND.7% ANIA 6^EM. ISPFOND. 7% ANIA 7^EM CARIPLOFOND. 7% ANIA 7^EM ISPFOND.7% ANIA 8^EM. CARIPLOFOND.7% ANIA 8^EM. ISPFOND.7% ANIA 9^EM. CARIPLOFOND.7% ANIA 9^EM. ISPLOMB MC 98/28 ZCQUEBEC STEP-UP EURORBS 99/19 CMS10 FLOOR 4.7% SUB TIER IIBANCA D'ALBA SCRLBANCA REALE SPABLUE ASSISTANCE SPACEDACRI SPACQOP SOA SPACREDEMASSICURAZIONI SPACREDITO EMILIANODEVELOPMENT CAPITAL 1 S.C.A.IGAR S.A.ITALIANA ASSICURAZIONI SPAREALE IMMOBILI SPAReale ITES GEIE RMAREALE SEGUROS GENERALES S.A.REALE VIDA Y PENSIONES S.A.SARA SPA ORD.SARA SPA PRIV.SYNKRONOS ITALIA S.r.l.UFF.CENTR.ITALIANO S.CONS.A R.L.Welfare Italia Servizi SrlITALIANA ASSICURAZIONI SPAREALE IMMOBILI SPA EUR 2,000,000 103,843
250 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 268BILANCIO REALE MUTUA 2015.indd 268 14/04/16 16:0414/04/16 16:04
Notes to the Financial Statements
Financial 2015
Società Reale Mutua di Assicurazioni
Class C.II, C.III, D.I, D.II: list of long-term investments in shares, bonds, common investment fundspursuant to Art. 15 Section 1 - Law No. 173/1997
Class Category Type Name Currency Carrying valueof assets (1) (2)
Nom. value in currency/quantity in thousands of Euro
C.II Totals C.II 1,659,928O 0P 1,659,928Q
Bonds and other securities Shares and interests Shares in common investment funds 0
C.III Totals C.III 254,639O 246,029P 8,610Q
Bonds and other securities Shares and interests Shares in common investment funds 0
D.I Totals D.I 0O 0P 0Q
Bonds and other securities Shares and interests Shares in common investment funds 0
D.II Totals D.II 0O 0P 0Q
Bonds and other securities Shares and interests Shares in common investment funds 0
Grand total 1,914,567O 246,029P 1,668,538Q
Bonds and other securities Shares and interests Shares in common investment funds 0
(1) Typea = Controlling b = Subsidiary companiesc = Affiliatedd = Associated
(2) :D for investments assigned to Non-life business V for investments assigned to Non-life business V1 for investments assigned to Life business (D.I)V2 for investments assigned to Life business (D.II)
e = Other shareholdingsf = Other
BILANCIO REALE MUTUA 2015.indd 269BILANCIO REALE MUTUA 2015.indd 269 14/04/16 16:0414/04/16 16:04
Meeting of Delegates of April 30, 2016
2015 CONSOLIDATED FINANCIAL STATEMENT
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THE GROUP
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BILANCIO REALE MUTUA 2015.indd 272BILANCIO REALE MUTUA 2015.indd 272 14/04/16 16:0414/04/16 16:04
255
BILANCIO REALE MUTUA 2015.indd 273BILANCIO REALE MUTUA 2015.indd 273 14/04/16 16:0414/04/16 16:04
(% interest)
Real property companies Insurance companies Services companies
(Parent companies)
100.00 10.00
100.00
100.00 100.00
100.00
100.00
100.00
100.00
31.43
50.00
Label:
REALE GROUP at December 31, 2015
REALE IMMOBILI S.p.A.
ITALIANA ASSICURAZIONI S.p.A.
BLUE ASSISTANCE S.p.A.
BANCA REALE S.p.A.
REALE MUTUA ASSICURAZIONI
REALE SEGUROS GENERALES S.A. (Madrid)
SARA ASSICURAZIONI S.p.A.
Associated companies consolidated by the equity
Subsidiary companies fully consolidated
REALE VIDA Y PENSIONES S.A. (Madrid)
IGAR S.A. (Madrid)
CREDEMASSICURAZIONI S.p.A.
REALE ITES G.E.I.E.
ITALNEXT S.r.l.
BILANCIO REALE MUTUA 2015.indd 274BILANCIO REALE MUTUA 2015.indd 274 14/04/16 16:0414/04/16 16:04
REPORT ON OPERATIONS
BILANCIO REALE MUTUA 2015.indd 275BILANCIO REALE MUTUA 2015.indd 275 14/04/16 16:0414/04/16 16:04
BILANCIO REALE MUTUA 2015.indd 276BILANCIO REALE MUTUA 2015.indd 276 14/04/16 16:0414/04/16 16:04
259
1.1 MACROECONOMIC SCENARIO AND MARKETS 1.1.1 MACROECONOMIC SCENARIO
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2015 was a year of moderate growth in the world economy.
According to the latest estimates by the International Monetary Fund (IMF), world GDP grew by 3.1% in 2015, compared to 3.4% in 2014.
Growth was modest and weaker than expected in some countries, especially in emerging and developing markets, whereas the advanced economies experienced more constant expansion.
Inflation pressures continued to be subdued in advanced economies, held in check by the sharp downturn in oil prices. From the beginning of 2015 the price of Brent crude plummeted from 57 to 37 dollars a barrel. The slump in oil prices was due to increased supply and weak demand. Inflation therefore remained very low. Estimated annual inflation for 2015 stands at 0.1% in the US, 0.2% in the euro area and 0.7% in Japan.
Again according to the latest estimates by the IMF, the US economy grew by 2.5% in 2015 compared to 2.4% in 2014. The increase in GDP was mainly driven by private consumption and this enabled the American economy to mitigate the negative effects of weak global growth as well as those associated with the strength of the dollar.
Japan experienced positive growth of 0.6%, but trends in prices forced its central bank to further bolster its aggressive stimulus measures.
China's economy grew by 6.9%, confirming the government's target and proving that concerns over the stability of the economy may have been exaggerated.
There was widespread recovery across the euro area with an increasing number of countries reporting positive growth, albeit more fragile and lagging behind the US and the UK. GDP in the area rose by 1.5%, a marked improvement on the 0.9% growth recorded in 2014.
In Italy economic recovery continued, albeit gradually, and GDP increased by 0.8% in 2015.
Growth was buoyed less by foreign trade and more by domestic demand, especially private consumption. Investment conditions were affected by uncertainties over foreign demand. The growth of bank loans to business enterprises was positive for the first time since 2011, at 1.5%.
Annual inflation, as measured by the harmonised index of consumer prices (HICP), was +0.2% in November and then fell to 0.1% in December, reflecting another drop in the prices of energy products and persistently low use of production capacity.
The unemployment rate in December stood at 11.4%, its lowest since the end of 2012. This was mainly due to a decline in the number of young people out of work, which is still at a record level.
The Spanish economy advanced by 3.2%, expanding at the fastest rate in Europe. Growth was driven by a rise in consumer spending and supported by the effects of reforms and improved financial conditions, fast recovery of the labour market situation and renewed business confidence.
Spain's annual harmonised inflation fell to -0.1%, according to the National Institute of Statistics in Madrid, mainly as the result of low energy prices.
The labour market situation improved and the rate of unemployment fell by 2.8% compared with the previous year, to 21.6%. However, weaknesses remain since the majority of new jobs are short-term.
260 REPORTS AND ACCOUNTS 2015
1.1.2 FINANCIAL MARKETS
In 2015 the financial markets were affected by the economic climate characterised by moderate recovery in the world economy, as outlined previously, the political crisis in Greece and concerns over the threat of renewed terror attacks.
The improvement in US labour market conditions prompted the Federal Reserve to raise its official interest rates by 25 bps in December, opening the door for further possible hikes in future.
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In Europe, as well as being actively involved in the management of the Greek crisis, the European Central Bank was faced with the persistent decline in inflation expectations and, as a result, price stability, which is its primary objective. To pursue that objective, the ECB's Governing Council introduced a package of non-standard monetary policy measures, which included directly purchasing government bonds and, most importantly and for the first time, introducing a negative interest rate of -0.3% on the deposit facility, as an effective method for lowering real rates in the context of negative inflation.
Persistent deflationary pressures and fears of prolonged economic stagnation influenced the performance of the government bond market in the advanced economies which were once again characterised by low yields.
In Europe, the ECB's decisions to cut interest rates and expand the asset purchase programme affected short-term yields, which turned negative on several occasions, especially in Germany and other core countries.
Confidence in peripheral countries strengthened and was reflected in a narrowing of spreads between German bunds and bonds issued by these countries.
Short-term rates thus fell and those of up to one year turned negative. Euribor 6 months moved from 0.17% at the beginning of the year to -0.04% at the end of December.
Yields on ten-year Italian government bonds fell from 1.89% at the end of December 2014 to 1.6% at the end of December 2015. The spread compared with ten-year German bunds fell from 135 basis points at the end of 2014 to 97 at the end of December 2015. During the same period, yields on ten-year German bunds moved from 0.54% to 0.62%.
In Spain, however, the delay in forming a new government has led to a rise in interest rates. Yields on ten-year government bonds increased from 1.61% at the end of 2014 to 1.77% at the end of 2015, and the spread with German bunds widened from 107 to 114 basis points.
Ten-year government bond yields GERMANY - ITALY - SPAIN (source: Bloomberg)
261
2015 was a tough year for corporate bonds, with rising yields and widening spreads with debt instruments deemed more secure, especially European investment grade securities.
On exchange markets, the euro depreciated by 11% against the US dollar, hitting a low of 1.0458 euros to the dollar in April. Emerging market currencies were extremely weak owing to competitive imbalances.
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Equity markets were affected by the sharp decline in prices of raw materials, the Greek debt crisis, speculation over the Fed's first interest rate hike and the weakness of the global economy.
In the US, the Dow Jones closed the year down 2.23%. European share indices closed the year in positive territory; the Euro Stoxx index moved up 3.85% and the Italian index by 12.66%.
Prices on the Euro Stoxx index -31/12/2014-31/12/2015 (source: Bloomberg)
262 REPORTS AND ACCOUNTS 2015
1.1.3 THE INSURANCE MARKET
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According to the latest data provided by ANIA for the last quarter of 2015, on the Italian insurance market (Italian companies and representative offices of non-EU insurers) there was a 2.5% year-on-year increase in premium income, reflecting positive performance of Life business and a negative trend in the Non-life sector.
The Spanish insurance market grew by 2.1% in 2015 with respect to the previous year. Total premiums amounted to € 56,833 million, compared with € 55,686 million in 2014. In particular, Non-life business increased by 2.4% and Life business by 1.7%.
Non-life insurance business
On the Italian market (Italian companies and representative offices of non-EU insurers as at the last quarter of 2015) there was a 2.4% year-on-year decrease in Non-life business, which accounted for 21.8% of overall premium income (22.9% in 2014).
There was a 5.3% reduction in premium income in the Motor sector: specifically, premium income in the TPL land vehicles and TPL marine, lake and river craft businesses fell by 6.5%, whereas Hulls land vehicles went in the opposite direction, with a 2.9% increase. These lines accounted for 52.1% of total Non-life premiums (53.7% in 2014).
Premium income in the Non-motor sector increased by 0.8%; among the businesses with the highest premium income were Health (+4.2%) and Non-motor TPL (+1.4%), whereas year-on-year decreases were posted by the Accident business (-0.4%), Fire and natural forces (-0.2%) and Other property damage (-1.7%). The premium income generated by Non-motor classes accounted for 47.9% of total Non-life premium income (46.3% in 2014).
Agencies with mandate continued to be the main channel for premium income and accounted for 79.5% of total business (81.3% in the corresponding period of 2014), while banks continued to represent only 4.8% of all premium income (4.0% in 2014). Other direct sales channels such as internal agencies, telephone and online sales increased, however, to 8.4% (8.1% in 2014).
According to the latest data for 2015 published by ICEA, on the Spanish market there was a 2.4% year-on-year increase in Non-life business, which accounted for 55.1% of overall premium income (54.9% in 2014).
There was a 1.7% increase in premium income in the Motor sector: specifically, premium income in the TPL land vehicles business increased by 2.7%, but grew by 0.7% in the other Motor businesses. These lines accounted for 32.1% of total Non-life premiums (32.3% in 2014).
Premium income in the Non-motor sector increased by 2.7%; among the businesses with the highest premium income were Accident (+3.5%), Health (+3.1%), Non-motor TPL (+3.3%) and Multi-risk (+1.7%). These lines accounted for 67.9% of total Non-life premiums (67.7% in 2014).
Life insurance business
On the Italian market (Italian companies and representative offices of non-EU insurers) as at the last quarter of 2015 there was a 4.0% year-on-year increase in Life business, which accounted for 78.2% of overall premium income (77.1% in 2014).
In particular, class III (Insurance with benefits linked directly to the value of UCITS or of internal funds or to indices or other benchmarks) increased by 45.8%, and accounted for 27.7% of total Life premiums (19.8% in 2014). Class I (Insurance on the duration of human life) decreased by 5.7% and class V (Operations of capital redemption) decreased by 24.1%. These classes accounted, respectively, for 67.7% and 3.1% of total Life premiums (74.6% and 4.2% respectively in the same period of 2014).
Class VI premiums (Pension funds), which accounted for 1.4% of total premiums in the sector (1.3% in 2014), increased by 16.9%.
According to the latest data for 2015 published by ICEA, on the Spanish market there was a 1.7% increase in Life business, which accounted for 44.9% of overall premium income (45.1% in 2014).
In terms of products, the biggest increase in premiums was for term life policies (+7.4%). Savings products increased by 0.7%.
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1.1.4 REAL ESTATE AND SERVICES SECTOR
In the real estate sector, the first signs of economic recovery in Italy in 2015 were partially reflected in increased investments in residential housing.
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In the housing sector, there was a 6% increase in the number of contracts of sale signed in 2015 compared with the previous year. End-of-year forecasts put the number of housing units sold at around 442,500, compared with 417,524 in 2014. Sales of property in the non-residential sector fell by around 1.2% in 2015, when some 43,800 units were sold compared with 44,353 in 2014.
The banking system also contributed to the rise in house sales, by easing credit restrictions and partially renewing its interest in supporting purchases by families.
The upturn in commercial property sales was not common to all markets, but limited to urban areas that have emerged as new (or renewed) commercial districts. In the service and production sectors, excluding the primary markets of Milan and Rome, where demand by large companies is concentrated, demand was associated with the relocation of activities in order to reduce the use of space and cut costs (which is not enough to give a real boost to recovery in these segments).
In Italy's main cities, growth in the market, in terms of property sales, was widespread and generally more evenly spread across the residential and non-residential sectors (+2% and +3.7%, respectively).
Prices on the rental market continued to fall, albeit less markedly: although official data for the end of the year are not available, rentals are forecast to have fallen in 2015 by an average of -1% in the housing sector (-3.6% in 2014), by around -2.3% for offices (-5.2% in 2014) and by about -2.2% for commercial premises (-7.5% in 2014), an evident slowing of the downward trend.
Rental times were also practically unchanged and almost as long as in 2013 and 2014. The average rental time for residential housing was 3.9 months (4 months in 2014), 6.8 months for offices (7.3 months in 2014) and 6.3 months for commercial properties (6.8 months in 2014).
In Spain, the business property market enjoyed extremely positive growth in 2015, with sales up 32.6% in Madrid and 41.6% in Barcelona. Average rental prices in both areas increased in 2015, confirming the trend reversal. The vacancy rate fell in both cities as a result of strong demand and the shortage of new properties on the market.
The volume of investments reached an all-time high in 2015 and was twice the level recorded in 2014. 83% of investments were concentrated in the Madrid property market and the remaining 17% referred to properties in Barcelona.
The volume of investments in the corporate sector, amounted to € 5,385 million, making 2015, along with 2007, the year of the highest investment in the history of the sector.
The initial rate of return on office space investments located in city centres and in more outlying areas stabilised owing to strong demand by investors which clearly exceeded the supply of property on the market. Prime property yields in Madrid stood at 4.25% - 4.5% and in Barcelona were around 4.5% - 5%.
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The only signs of growth in the corporate sector were, instead, linked to activities by foreign investors and recovery in this sector is still weak. According to the latest analyses, investments in the first three quarters of 2015 amounted to around € 5.1 billion: office buildings attracted the greatest interest (accounting for about 32% of the total), followed by investments in mixed use developments (31%), retail (14%) and hotel (8%) facilities.
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The IT sector is forecast to expand at international level, but growth in Italy will continue to be negative. This is mainly due to the contraction of traditional segments of the IT and telecommunications sectors, such as consumer electronics. Digital Transformation will continue to drive growth in this sector.
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Adaptability, agility, multiculturalism and accountability now form the basis for daily business operations, and the best way for implementing these strategies is through Digital Transformation. An increasingly digital business environment allows companies to compete across different sectors and in new markets, leveraging a collaborative ecosystem that is profoundly linked to technological development.
The four pillars of digital transformation are the development of mobile devices, connection and payment systems, the development of social media platforms, adapting to new behaviour patterns, as customers are less loyal and more active, and the establishment of the IoT (Internet of Things) in all areas, which represents a new industrial revolution. All this in a rapidly evolving technological universe.
Today we are faced with two entirely different market scenarios: one for "traditional" IT solutions, which is basically in decline and characterised by replacement and rationalisation, and the other a rapidly growing market for "innovative" IT solutions that embodies an entirely new approach to Digital technology, breaking from the past and based on new mobile, cloud, big data and social platforms. This is leading to the development of bimodal IT systems that are solid enough to manage current business but also sufficiently agile for digital transformation and all future opportunities.
Mobility, Cloud Computing, Big Data and IoT projects, Software Defined Data Centres and Networking, 3D Printing and Wearables are the new areas of digital innovation for businesses.
* * *
Profound changes continued to affect the Italian health and welfare system and people's needs in these areas. Health care in Italy revolves around three particularly important aspects of the national health system: the role of primary health care, improvements to training of the health care workforce, improvements to quality monitoring in a regionally-based system.
According to the OECD (Organisation for Economic Co-operation and Development), Italy is faced with two main challenges: the first is to ensure that ongoing efforts to contain health spending do not subsume health care quality as a fundamental governing principle, and the second is to support weaker Regions and Autonomous Provinces to deliver consistently high quality health care. Italy has a rapidly ageing population and a growing burden of chronic conditions. This will presumably result in increased health expenditure and place further pressure on primary care services. The Italian health system is highly fragmented, lacks proper coordination and has been affected by cuts in public spending. There are still significant differences in the quality and efficiency of the health care system across Italian regions.
In this context, there is a need for supplementary cover for health expenditure together with an overall strategy of prevention.
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1.1.5 BANKING SECTOR
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Direct bank deposits in Italy shrank less in 2015, but remained in negative territory. In detail, at the end of 2015 overall euro-denominated deposits by clients with Italian banks, consisting of deposits by resident clients and bonds, amounted to € 1,698.3 billion, decreasing by -0.6% on an annual basis (-1.2% at December 2014). The stock of deposits fell by around € 9.5 billion. An analysis of trends in the various components reveals that deposits held by resident clients increased at a tendential rate of +3.8% compared with the previous year, while bonds decreased by -13.0% on an annual basis.
As the economic situation improved, there was a slight recovery in demand for loans by businesses and households. There was, however, a further deterioration in the quality of credit.
Overall, bank loans to clients (in the private sector and to public authorities) amounted to € 1,824.7 billion at the end of 2015, a year-over-year decrease of -0.2% (-1.3% at the end of 2014). Loans to households and non-financial undertakings amounted to around € 1,413.5 billion, an annual reduction of -0.1% (-1.9% at year-end 2014). As regards business undertakings, there was a reduction of around -0.7% in loans to non-financial companies, compared with -2.3% in 2014.
Non-performing loans net of write-downs amounted to around € 89 billion, which represented an increase of 5.3% compared with the previous year. The ratio of net non-performing loans to total loans stood at 4.9% (4.6% at December 2014).
There was a slight decline in interest rates on euro bank deposits for households and non-financial undertakings, which moved from 0.7% at the end of 2014 to 0.5% at year-end 2015. The average rate on customer bank deposits was 1.2% at December 2015 (1.5% at December 2014). Returns on bank bonds also decreased over the year, from 3.2% to 2.9%.
According to figures issued by the Italian Banking Association (ABI), the weighted average rate of returns on all loans to households and non-financial undertakings decreased further, from 3.7% to 3.3% at the end of the year. Interest rates on euro current accounts and revolving loans to households and non-financial undertakings also decreased (from 5.0% in December 2014, 4.4% in December 2015).
Rates on new transactions declined more markedly: in December 2015 the interest rate on loans in euros to non-financial undertakings was 1.7% (2.6% in December 2014), while that on loans in euros to households for house purchase, which takes into account trends in fixed and variable rates, was equal to 2.5% (2.8% in December 2014). Fixed-rate loans accounted for 66% of the total in December 2015, compared with 30.9% in December 2014.
The spread between average lending and deposit rates for families and non-financial undertakings remained low: 212 basis points in 2015 (210 basis points in 2014). This spread was more than 300 basis points prior to the financial crisis.
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1.2 REGULATORY DEVELOPMENTS
The legislative provisions that had the greatest impact in the sector in Italy in 2015 are outlined below:
"Competition Bill" dated February 20, 2015The bill implements the annual provisions for markets and competition, which had previously not been applied. It includes the obligation to offer significant premium discounts on Motor TPL policies where the policyholder agrees to contract clauses designed to curb costs and combat fraud, such as the installation of black box or alcohol-detection devices, prior inspection of the vehicle and compensation through approved body shops.
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The main regulatory measures issued by IVASS during the year are outlined below:
IVASS Regulation No. 8 of March 3, 2015 The Regulation describes the simplified procedures and compliance obligations applying to contractual relations between enterprises, intermediaries and customers. Its intent is to foster technological innovation, by reducing paperwork and encouraging the use of digital technology in relations between enterprises, intermediaries and customers.
IVASS Regulation No. 9 of May 19, 2015 This Regulation establishes the rules applicable to the risk certificate database and to the certification of risks. It completes the first phase of the project to introduce "dematerialised attestation of risk status" for Motor TPL policies. The second phase of dematerialisation envisages the transition from "static" risk attestation (a snapshot of the current situation) to "dynamic" attestation, i.e. constant and automatic updating by the system, to make it more effective against evasion of insurance obligations and more closely in line with practice in other EU countries. The Regulation takes effect for Motor TPL policies expiring from July 1, 2015. Pursuant to art. 3 of this Regulation, until IVASS issues a specific measure, the risk category conversion table drawn up by ISVAP in Annex 2 to Regulation No. 4/2006 will continue to apply.
IVASS Measure No. 30 of March 24, 2015 These rules amend ISVAP Regulation No. 24/2008 concerning the procedure for submitting complaints to the Supervisory Authority and the handling of such complaints by insurance undertakings. For insurance undertakings with their registered office in Italy the deadline for implementing the new regulatory provisions was 30 June 2015. In detail, the order introduces a clear definition of "complaint" and "complainant" and requires all complaints to the Supervisory Authority to be submitted in writing and include full details of the grievance. One important innovation is the obligation for insurance undertakings authorised in Italy to adopt a complaint handling policy, to be approved and revised at least once a year by the governing body, that ensures equal treatment for insureds, contracting parties, beneficiaries and damaged parties and is aimed at guaranteeing the fair and prompt handling of complaints.
Letter to the Market dated March 20, 2015 The letter concerns the use of certified e-mail for the exchange of correspondence with IVASS. It establishes the certified e-mail system as the preferred channel for communication between IVASS and insurance undertakings. Pursuant to the Digital Administration Code (art. 5-bis of Legislative Decree No. 82 of March 7, 2005 as amended) information and communication technology must be used for all communications between public offices and business undertakings, including for the exchange of data in fulfilment of any legal and regulatory requirements.
Joint letter by IVASS and Banca d'Italia issued on August 26, 2015. The letter, addressed to insurers and insurance intermediaries registered in Section D of the RUI (Register of Insurance and Reinsurance Intermediaries, including banks), aims to increase the level of protection of customers who purchase insurance policies paired with mortgage and other loans (PPI - Payment Protection Insurance).
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Other measures include the obligation, for claims involving property damage only, to identify witnesses at the moment the claim is filed, the possibility of cancelling accessory coverage upon expiry of the main policy, and granting IVASS the authority to control and monitor implementation of the new rules. The bill also reformulates articles 138 and 139 of the Code of Private Insurance by introducing tables for evaluating non-economic damages that include both "physical" and "moral" damages.As regards pension funds, the bill includes measures to allow workers full pension portability, eliminating the possibility for national agreements to include limitations and conditions on the portion payable by the employer. Pension funds are no longer required to seek subscribers exclusively from within the specific professional category.
Decree No. 95/2014 issued by the Ministry of Economy and FinanceThe Decree regulates matters concerning the prevention of fraud pursuant to art 30-ter of Legislative Decree No. 141/2010. In detail, it envisages the creation of a public fraud prevention system in the sector of consumer credit and deferred or instalment payment schemes, with specific reference to identity theft. The prevention system is based on a central computerised database held by the Ministry of Economy and Finance and managed by CONSAP.
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Decree enacting Law No. 183/2014 (the "Jobs Act") Notable aspects of the Jobs Act include: - the introduction of new contract types:
fixed-term, staff leasing, part time, collaboration;
- new rules governing duties: employers have greater flexibility in changing their employees' duties and roles;
- reconciliation of work-life requirements: the Legislative Decree also includes changes, on an experimental basis, to the consolidated law on maternity and paternity leave (Legislative Decree. No. 151/2001), by introducing measures to support parental care and protect working mothers.
Decree No. 108 issued by the Ministry for Economic Development on May 11, 2015The Decree (published in the Official Journal of the Italian Republic on July 15, 2015 and which came into force on July 30, 2015), establishes the rules governing the Integrated Antifraud Database (Archivio Integrato Antifrode, AIA), which will be used by IVASS to alert insurance companies and help them to identify and prevent cases of motor vehicle insurance fraud. The Decree came into effect on July 30, 2015. The database will be consulted for every motor liability claim, which will be given a score indicating its degree of anomaly. The database may only be accessed by insurance companies, law enforcement bodies, the courts and government bodies engaged in action against insurance fraud.
Decree Law No. 83 of June 27, 2015 introducing “urgent measures concerning bankruptcy, civil law and civilprocedural law and the organisation and functioning of judicial administration” Decree No. 83/2015 introduced changes to the rules applicable to banks and insurance undertakings for deducting write-downs and losses on receivables. Specifically, art. 106(3) of Presidential Decree No. 917/1986 (Consolidated Law on Income Tax) and articles 6(1)(c-bis) and 7(1)(b-bis) of Legislative Decree No. 446/1997 have been amended as follows for the purposes of IRES and IRAP:
-
-
-
-
credit and financial institutions and insurance undertakings will be allowed to fully deduct write-downs and losses on receivables and losses arising from disposals for consideration in the year they are recorded in the financial statements (instead of over a five-year period as envisaged under the previous system);write-downs and losses other than those arising from disposal for consideration are considered net of the revaluation of receivables as recorded in the financial statements; the new provisions are applicable starting from the current tax year as at December 31, 2015; a transitory regime has been introduced: for the first period of application, i.e. 2015, the write-downs and losses other than losses arising from disposals for consideration will be deductible for up to 75% of their total amount. The remainder will be deductible in equal instalments over a period of 10 years.
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Insurance undertakings are among the direct members of the fraud prevention system.Under the legislation in question, the provisions concerning insurance companies became applicable twelve months after the date on which the Decree came into force, and thus from July 16, 2015. From that date, such undertakings have registered by submitting a form via the specific portal maintained by CONSAP.
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Law No. 208 of December 28, 2015, (the so-called "2016 Stability Law") This Law came into force on January 1, 2016 and includes "Provisions for the preparation of the annual and multi-year state budget" (published in No. 302 of the Official Journal of the Italian Republic on December 30, 2015). The main changes introduced by the Law are outlined below: - the corporate income tax (IRES) rate will be reduced from 27.5% to 24% with effect from tax year 2017; - an IRES surcharge of 3.5 percentage points has been introduced for banks and financial institutions and
the non-deductibility of 4% of interest expense incurred has been abolished; - VAT rates will not be increased in 2016. However, unless other measures are implemented that would
guarantee positive effects on public spending, the reduced VAT rate of 10% will be increased to 13% from January 1, 2017 and the current standard rate of 22% will be increased to 24% from January 1, 2017 and to 25% in 2018;
- an extra 40% depreciation deduction for IRES tax purposes will be available for operating assets. The measure is applicable to new capital goods purchased or leased between October 15, 2015 and December 31, 2016. The allowance is only applicable for the purposes of calculating the rate of depreciation and lease payments. The deduction relating to the share of increased depreciation operates outside of the accounts and the asset and related depreciation are therefore entered in the accounts in accordance with the normal rules, i.e., only from the date on which the asset, purchased in the relevant period, is put into use, applying the depreciation rate reduced by 50% for the first year. If the asset is sold, the allowance ceases to apply;
- as regards the revaluation of capital assets, the possibility of recording in the 2015 accounts the higher value of tangible assets and equity investments included in the financial statements as at December 31, 2014 has been extended for one year. The revaluation surplus can be freed, in whole or in part, through payment of a 10% substitute tax in place of IRES or IRAP or any applicable surcharge. The higher value attributed to company assets will be recognised for the purposes of IRES and IRAP as from 2018 but an additional substitute tax will be levied at the rate of 16% on depreciable assets and of 12% on non-depreciable assets. For taxpayers that prepare their financial statements according to IAS, the amount corresponding to the increased values to be realigned must be allocated to a reserve fund for suspension of tax, that may be freed through payment of the substitute tax;
- the Stability Law provides for a 40% tax break on social security contributions for up to two years for private sector employers hiring with permanent contracts in 2016;
- the reform introduces a new sanctions regime, specifically in the field of administrative and tax sanctions, and changes to the terms for tax assessments;
- the so-called ”art bonus” (tax credit for cultural donations), initially only introduced for the three-year period from 2014-2016, has now been made permanent.
In Spain, Law No. 35 of September 22, 2015 introduced changes to the system for assessing damages for claimants injured in road traffic accidents. The new provisions take effect as from January 1, 2016. The aim of the new "Baremo" is to increase cover for victims of road traffic accidents by speeding up the settlement procedure and providing a more modern system to ensure payment of adequate compensation.
* * *
The definition of the regulatory framework in connection with the new Solvency II system, which will come into effect on January 1, 2016, is reviewed below.
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Legislative Decree No. 74 of May 12, 2015 Legislative Decree No. 74 of May 12, 2015 implementing the provisions of Directive 2009/138/EC (Solvency II) on the taking-up and pursuit of the business of insurance and reinsurance and amending the Code ofPrivate Insurance, was published in No. 136 of the Official Journal of the Italian Republic on June 15, 2015. The Directive introduces a new prudential supervisory regime, for the purpose of providing a regulatory framework to ensure the maximum protection of the users of insurance services and creating a new system that gives the supervisory authorities the appropriate instruments for assessing the overall solvency of insurance undertakings. IVASS will now have to enact several regulations to implement the new rules, which will take effect as from January 1, 2016. The transposition of Solvency II is a fundamental step in the transition to the new regulatory framework for the insurance industry. The Directive will change the entire system, replacing existing Life and Non-life directives (with the exception of those concerning the Motor business) and introducing a new prudential supervisory regime to protect customers and the stability of markets. In detail, the Directive, as subsequently amended by Directive No. 2014/51/EU (the Omnibus II Directive) introduces new rules on capital requirements essentially centred on the risks assumed by the insurer (or by the group of insurance undertakings) aimed at improving the corporate governance structure and establishing a system of so-called "internal" controls that will in future be implemented by four main functions (risk management, compliance, internal auditing, actuarial) with ultimate responsibility lying with the company's administrative body. Legislative Decree No. 74/2015 amends and repeals several articles of the Code of Private Insurance, and introduces some new provisions. Specifically, Chapter I of Title III (Pursuit of insurance business) has been supplemented with rules on governance; Chapter II of Title III now includes new rules for calculating technical provisions; Chapter IV of Title III now contains provisions governing so-called "own funds" (and not the solvency margin); the new Chapter IV-bis sets out the capital requirements for solvency purposes, the most innovative aspect of the Code of Private Insurance; Title XV (Supervision of groups) has been redrafted to include the rules governing the control of groups. The Level 1 framework (Solvency II Directive No. 2009/138/EC) has been integrated at Level 2 with the delegated acts and technical standards issued by the European Commission, which are directly applicable in Italy, and at Level 3 with the technical standards of EIOPA, which must be implemented in Italy through specific IVASS regulations.
The delegated acts, containing detailed implementing measures, were published in the Official Journal of the European Union on January 17, 2015 and will be directly applicable as from January 1, 2016 without any specific measures for implementation into the Italian system.
The technical standards issued by EIOPA in 2015, which are also directly applicable in the Member States, included the "implementing technical standards on the templates for the supervisory authorities" and the "implementing technical standards on the templates for public disclosure", regarding the qualitative and quantitative information to be included in Pillar III disclosures to be drafted by insurance companies and submitted to the national and European supervisory authority as from January 1, 2016.
Lastly, IVASS issued implementing regulations for the EIOPA guidelines (level 3 framework), which will come into effect on January 1, 2016. Some of these are still in the public consultation stage.
In Spain, Law No. 20 of July 14, 2015, implemented the provisions of Directive No. 2009/138/EC (Solvency II).
Royal Decree No. 1060 of November 20, 2015 implements the aforesaid law on the activities of private insurance and reinsurance undertakings and completes the transposition of the Solvency II Directive into Spanish law.
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1.3 REALE GROUP STRATEGY In 2015 Reale Group reached the end of its Strategic Plan for 2013 - 2015, marked by the achievement of important goals, including:
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- growth in Group premium income, which has risen by 8.7% from € 3,537 million to € 3,846 million;
- significant profits, amounting to a total of € 429 million in the three-year period;
- increase in the capital held by the Group, with a solvency ratio that has increased from 218.7% to 250.5%;
- investment in a very broad range of strategic projects: Group brand, multi-channel platforms, agency models (digitalisation, light agencies, service centre), member-customer centrality, welfare, motor vehicles, HR and asset management;
- ongoing development of corporate social responsibility, with numerous initiatives aimed at enhancing the Group's mutualistic nature and commitment towards the outside world;
- evolution of the Group governance model, in order to create a modern organisation ready to meet the challenges of the future and capable of fostering knowledge and financial synergies.
The new 2016 - 2018 Strategic Plan will come into effect in 2016 and will mainly be organised along the following lines:
- further expansion of the Group, also through international growth and cooperation;
- confirmation of profitability, financial soundness and social responsibility as core objectives for the Group;
- adoption of an improvement-oriented approach in order to fully exploit the strategic projects developed over the previous three years;
- selection of some additional strategic projects in order to seize opportunities as they arise in the near future (in the field of Big Data, for example).
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1.4 SUMMARY OF RESULTS
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Reale Group operates in Italy and Spain and is made up of twelve companies, of which six insurers, two real estate companies, a bank and three service providers. Ten companies, of which four insurance undertakings, have been fully consolidated, while two insurance undertakings have been valued by the equity method insofar as they are associates and joint ventures.
Reale Mutua is the Parent of Reale Group, registered under number 006 in the Register of insurance companies set up by ISVAP with Regulation No. 15 of February 20, 2008.
* * *
The main operating results in the 2015 consolidated financial statements, with 2014 comparables, are set forth in the table below.
2015 2014 (in millions of euro)
Change
Net premiums 3,526.2 3,444.2 2.4% Commissions receivable 13.8 12.0 15.1% Income and expense on financial instruments measured at fair value through the income statement 32.3 63.0 -48.7% Income on equity investments in subsidiaries, affiliates and j.v. 31.3 27.8 12.8% Income on other financial instruments and investment property 415.1 357.4 16.1% Other revenues 114.2 139.0 -17.8% TOTAL REVENUES AND INCOME 4,132.8 4,043.3 2.2% Net charges for claims -2,805.1 -2,679.9 4.7% Commissions payable -5.1 -3.6 39.7% Charges on equity investments in subsidiaries, affiliates and j.v. 0.0 -16.7 -100.0% Charges on other financial instruments and real property investments -45.5 -46.1 -1.3% Management costs -866.1 -844.0 2.6% Other costs -196.3 -203.4 -3.5% TOTAL COSTS AND CHARGES -3,918.0 -3,793.7 3.3% PROFIT (LOSS) BEFORE TAXES 214.8 249.7 -14.0% TAX -55.5 -77.0 -27.9% GROUP NET INCOME (LOSS) 159.3 172.7 -7.8%
TOTAL ON THE STATEMENT OF GROUP COMPREHENSIVE INCOME 79.9 282.9 -71.7%
Further information is provided in the table below.
2015 2014 Change
Loss Ratio 64.8% 61.1% 3.7 Combined ratio for the year 95.6% 91.0% 4.6 Solvency ratio 250.5% 242.2% 8.3
Net premiums amounted to € 3,526.2 million and increased by 2.4% compared with 2014. € 2,430.6 million refer to Non-life business and € 1,095.6 million to Life business.
Gross premiums written for direct business and inward reinsurance, net of infra-group eliminations, reached € 3,847.2 million, obtained for 78.8% in Italy and for 21.2% in Spain. This item amounted to €3,789.5 million in 2014. It therefore increased by 1.5%. In particular, direct business income amounted to € 3,846.0 million, with a year-on-year upswing of 1.5%, and stemmed for € 2,727.9 million from Non-life business, with an increase of 1.9%, and for € 1,118.1 million from Life business, with an increase of 0.6%.
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Investment income and charges generated a positive balance of € 433.2 million in relation to € 385.4 million in the previous year. In 2014 this item included the valuation loss on the shareholding in Cai Seguros Generales S.A. equal to € 16.7 million.
Management costs amounted to € 866.1 million compared with € 844.0 million in the previous year. These reflect commissions and other acquisition costs of € 682.8 million (+3.3%), investment management expenses of € 52.7 million (+9.3%) and other administrative expenses for € 130.6 million (-3.1%).
The gross consolidated result before taxes was positive in the amount of € 214.8 million, compared with € 249.7 million in 2014.
After taxes, for € 55.5 million, consolidated income stood at € 159.3 million (€ 172.7 million in 2014). This represents the Group's interest in net income as there was no minority interest. This result, adjusted by profit or loss taken directly to equity in accordance with the provisions of International Accounting Standards (IFRS 1), determined a Group interest in the overall result on theincome statement amounting to a profit of € 79.9 million, compared with a profit of € 282.9 million in 2014.
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The main balance sheet data in the 2015 consolidated financial statements, with 2014 comparables, are set forth in the table below.
31.12.2015 31.12.2014 (in millions of euro)
Change
Investments 11,831.6 11,172.3 5.9% Technical provisions, net 10,078.5 9,435.5 6.8% Group shareholders' equity 2,325.6 2,245.5 3.6%
Group investments reached € 11,831.6 million (an increase of 5.9%) of which € 963.5 million of real estate investments, € 178.2 million of equity investments in subsidiaries, affiliates and joint ventures, € 456.8 million of loans and receivables, € 9,410.2 million of AFS financial assets and € 822.9 million of financial assets measured at fair value through the income statement.
Net technical provisions amounted to € 10,078.5 million compared with € 9,435.5 million in the previous year (+6,8%).
Group shareholders’ equity amounted to € 2,325.6 million compared with € 2,245.5 million at year-end 2014 (+3.6%).
The solvency margin was equal to € 737.0 million. The sum of the components forming the Group's solvency margin was equal to € 1,845.8 million. Therefore, at December 31, 2015, there was an excess of € 1,108.8 million in relation to the aforementioned margin, compared with € 994.5 million in 2014.
The Group reported a solvency ratio of 250.5% compared with 242.2% the previous year.
* * *
With regard to fully-consolidated Group companies, the performance during the year of each single sector of business is discussed below.
Net charges for claims, in the amount of € 2,805.1 million, increased by 4.7%. These refer for € 1,568.3 million to Non-life business (+9.0% compared with 2014) and for € 1,236.8 million to Life business (-0.4%).
The Group’s combined ratio worsened compared with that of the previous year, rising from 91,0% to 95,6%.
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1.4.1 NON-LIFE INSURANCE BUSINESS
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Within Reale Group, the Non-life insurance companies Reale Mutua, Italiana Assicurazioni and Reale Seguros Generales, reported total gross premium income of € 2,728.7 million in relation to € 2,678.4 million in 2014, with an increase of 1.9%.
Reale Group reported an overall increase of 1.9% in Non-life premium income relating to direct business only, with a slight drop in the Motor business (-0.2%) and a 4.0% rise in the Non-motor business.
On the Italian market the Group reported a more marked downturn in the Motor business (-2.6%), mainly due to the substantial and widespread fall in the average price of premiums in this sector. The Non-motor business achieved growth of 3.8%, which was above the market average.
On the Spanish market, premium income increased in both the Motor business (4.2%) and in the Non-motor sector (4.6%), with growth exceeding the market average in both areas.
The detail of gross premiums written for Non-life business, divided by accounting segment, is set forth in the table below.
(in thousands of euro)
2015 2014 Change Composition
Non-life business 2015 2014
Personal accident and Health 280,704 270,528 3.8% 10.3% 10.1% Motor TPL 938,911 960,183 -2.2% 34.4% 35.9% Motor, other branches 312,359 297,786 4.9% 11.5% 11.1% Marine, aviation and transport 20,729 19,790 4.7% 0.8% 0.7% Fire and other property damage 743,728 720,640 3.2% 27.3% 26.9% Non-motor TPL 287,831 272,593 5.6% 10.6% 10.2% Credit and suretyship 42,674 39,726 7.4% 1.6% 1.5% Sundry pecuniary losses 7,082 8,239 -14.0% 0.3% 0.3% Legal fees 19,338 18,993 1.8% 0.7% 0.7% Assistance 74,518 69,165 7.7% 2.7% 2.6% Total direct business 2,727,875 2,677,643 1.9% 100.0% 100.0% Total inward reinsurance 869 788 10.3% 0.0% 0.0% Total Non-life premium income 2,728,744 2,678,431 1.9% 100.0% 100.0%
The Group's combined ratio for the year for Non-life insurance business (i.e. the ratio of claims for the year and management expenses to premiums for the year) was equal to 95.6%, worsening in relation to the previous year (91.0%), mainly owing to the claims component.
As shown in the table below, claims paid in 2015 amounted to € 1,864.8 million in relation to € 1,875.0 million in 2014, with a decrease of 0.6%. In 2015, 1,304,587 claims were reported compared with 1,341,144 in 2014, with a decrease of 2.7%.
274 REPORTS AND ACCOUNTS 2015
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Number of claims reported Claims paid (*) 2015 2014 Change 2015 2014 Change
Personal accident and Health 231,665 304,510 -23.9% 167,901 161,607 3.9% Motor TPL 301,041 277,551 8.5% 735,687 736,115 -0.1% Motor, other branches 208,310 202,306 3.0% 185,808 189,530 -2.0% Marine, aviation and transport 4,165 4,615 -9.8% 12,097 12,632 -4.2% Fire and other property damage 436,603 445,820 -2.1% 493,938 502,463 -1.7% Non-motor TPL 40,556 40,559 0.0% 181,441 187,506 -3.2% Credit and suretyship 806 840 -4.1% 29,203 32,795 -11.0% Sundry pecuniary losses 672 843 -20.3% 977 1,139 -14.2% Legal fees 3,491 3,297 5.9% 4,389 4,402 -0.3% Assistance 77,278 60,803 27.1% 53,330 46,836 13.9% Total 1,304,587 1,341,144 -2.7% 1,864,771 1,875,025 -0.6% (*) amounts in thousands of euro
The loss ratio for the period corresponded to 64.8%, compared with 61.1% in 2014. This result was mainly affected by the Motor business where, in both countries, the average price of premiums fell, the frequency of claims increased and the number of serious claims rose, all of which had negative repercussions on the result for the year.
The expenses ratio for the year was equal to 30.8%, about one percentage point higher than in 2014 (29.9%). This increase, spread equally across both countries, mainly reflected the costs sustained to develop strategic projects.
* * *
Research and development - New products
During 2015, the Italian companies of the Group marketed new products and launched the initiatives described below.
Società Reale Mutua di Assicurazioni
Following on from previous years, further improvements were made to the product catalogue in 2015, aimed at preventing any loss of competitiveness and offering insurance solutions that will allow us to continue to grow more than the market, especially in areas of business that are most profitable and strategic for Reale Mutua.
One important area of activity was the restyling of the mainstream "Globale Fabbricati" civil buildings product. This was overhauled and a new tariff system, calculated entirely on the basis of actuarial criteria, was developed, similar to that used for professional TPL cover.
In the Non-motor TPL sector, the Company overhauled the regulatory, tariff and IT framework of the "Industry, craft and services TPL" product (in March 2015).
A new version of the "All Risks" product was made available to the sales network In July (mainly geared to medium and large-sized companies, it offers cover for direct and indirect loss, theft, breakdown of machinery and catastrophic guarantees).
In light of the changing market context, new versions of the "Leasing Reale Strumentale" and "Leasing Reale Immobiliare" products were launched in October.
In order to more effectively respond to new needs in the professional indemnity insurance sector and continue to strengthen the Company's position in this area, a new version of the "Professionista Reale 2015" product was launched in November. The tariff scheme has been reformulated and several changes made to the contractual terms and conditions.
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Carrying on from the previous year, when the "Per Te Salute Reale" health insurance policy was revised and improvements made to make the policy clearer, the "Unica Reale" multi-risk product underwent a number of improvements in the first half of 2015. The new version of this product has been designed to be more competitive in the retail Accident insurance sector.
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The personal protection and health insurance offering was augmented in the first half of the year with the launch of the "Family Care" product, the first to be released under the strategic Family Welfare project: the package includes a first range of Non-life ("Family care Pro") and Life ("Family Care Life") insurance covers against serious events that could undermine continuity of income, health and wealth.
The “RealmenteInSalute” and “Salute Facile Wellness” products were launched in the second half of 2015 within the scope of the same project.
The “RealmenteInSalute” offering was conceived as a supplementary welfare product providing cover against accidents or ill-health of varying significance.
“Salute Facile Wellness” pays a benefit to insureds who undergo surgery or a daily allowance in the event of hospitalisation without surgery.
“RealmenteInSalute” and “Salute Facile Wellness” encourage member-policyholders to adopt a healthy and active lifestyle by granting discounts to those who are in good health.
The following products were launched in the Motor sector in 2015:
- the "Cristalli" windscreen insurance policy was revised in February, with the inclusion of new contractual clauses designed to encourage the use of approved repair shops, which are not widely used at present, and so achieve savings on settlement costs;
- the Company signed a partnership agreement with a new supplier of "black boxes" with a view to broadening the offer with latest-generation electronic devices, in a segment that has good potential for growth and for building customer loyalty. The agreement came into effect in April 2015;
- the policy terms and tariff structure of the “Contachilometri Reale” product were revised and the possibility of linking the premium paid to the way a person drives was also introduced. “Contachilometri Reale” is thus a highly innovative product on the Italian Motor TPL market.
Italiana Assicurazioni
As part of the Group's strategic Welfare project aimed at offering innovative insurance solutions that cater to the concrete needs of families, two new policies were launched in 2015: the “Salute!” health insurance policy and the “Easy Wellness” indemnity product, which pays a fixed benefit to insureds who undergo surgery or have to stay in hospital. The Company also marketed the new “First Protection Family” insurance solution to cover physical health and damage to the home.
As regards the study and implementation of new products, the Company focused on developing a new version of the "Studio e Attività" policy, in order to improve its insurance cover for offices, schools and activities in general. It also overhauled the "Globale Fabbricati" civil buildings product, revising the contractual framework and adopting a new tariff structure based on statistical and actuarial methods designed to guarantee long-term technical sustainability.
In the Motor sector, as from April 1, 2015, people who subscribe to the “In Prima Classe” policy will be entitled to install the black box provided by Viasat S.p.A. This offer, which operates alongside the existing Octotelematics service, features the use of latest-generation devices that meet the changing needs of customers and is extremely competitive in terms of both price and technology. The contractual terms and tariff structure of the “Salvachilometri” product have also been remodelled so that the premium can be linked to the policyholder's driving habits. This confirms the Company's focus on meeting the growing demand for customisable insurance solutions.
276 REPORTS AND ACCOUNTS 2015
Reale Seguros S.A.
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In 2015 the subsidiary continued to develop and improve its products and services, taking into account the opinion of its customers, agents and intermediaries who took part in various focus groups and work sessions.
This ongoing commitment led to the launch of some new products.
“Auto Reale”: the product was updated to make it more flexible and adaptable to meet customers' needs.
“Reale Ciber Seguridad”: this product offers protection for business undertakings against cyber risk (hacking, database theft and/or manipulation, protection of sensitive data). The policy offers technical assistance for policyholders who experience a breach of their information systems. It also provides assistance with the management of complaints in connection with privacy breaches, the transmission of malware and defamation.
The main changes in the area of TPL insurance were related to the hotel, construction, transport of dangerous goods and professional insurance sectors.
* * *
The main results of the Non-life insurance companies in 2015 are set forth below.
Società Reale Mutua di Assicurazioni - Turin
The Parent posted direct business premium income related to Non-life operations of € 1,413,636 thousand at December 31, 2015, in relation to € 1,388,580 thousand in 2014, with an increase of 1.8%: Non-life business closed the year with a net profit of € 55,865 thousand in relation to € 90,571 thousand in 2014.
Italiana Assicurazioni S.p.A. - Milan
The Company posted direct business premium income related to Non-life operations of € 529,097 thousand at December 31, 2015, in relation to € 536,670 thousand in 2014, with a decrease of 1.4%: Non-life business closed the year with a net profit of € 19,270 thousand in relation to € 39,115 thousand in 2014.
Reale Seguros Generales S.A. – Madrid
In financial 2015, the company reported a volume of premiums from direct business of € 785,142 thousand (€ 752,393 thousand in 2014), with a y/y increase of 4.4%. The year closed with a net profit of € 30,913 thousand, compared with € 24,794 thousand in the previous year.
277
1.4.2 LIFE INSURANCE BUSINESS
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The Life insurance companies of Reale Group (Reale Mutua, Italiana Assicurazioni and Reale Vida) posted gross premium income of € 1,118.4 million, in relation to 1,111.1 million in 2014, with an increase of 0.7%. The Italian market continued to generate the greatest proportion of total premium income (97.3%), although Reale Vida is gradually gaining ground in Spain.
The substantial stability of premium income over the past two years mainly reflects the change in strategy aimed at limiting premiums on Class I and V products (mainly separately managed funds) in favour of Class II products (unit-linked) in order to reduce the level of risk exposure and improve capital absorption.
The detail of Life business gross premiums written according to accounting segment is set forth below.
(in thousands of euro)
2015 2014 Change Composition
Life business 2015 2014
I Insur. on the duration of human life 869,895 905,289 -3.9% 77.8% 81.5% III Insur. linked to investment funds 132,890 54,691 143.0% 11.9% 4.9% IV Health insurance 218 228 -4.4% 0.0% 0.0% V Oper. of capital redemption 91,825 129,230 -28.9% 8.2% 11.6% VI Oper. of group pension funds 23,271 21,666 7.4% 2.1% 2.0% Total direct business 1,118,099 1,111,104 0.6% 100.0% 100.0% Total inward reinsurance 308 0 0.0% 0.0% 0.0% Total premiums written - Life business 1,118,407 1,111,104 0.7% 100.0% 100.0%
Sums paid in 2015, referring to direct business only, amounted to € 652.5 million, increasing by 11.1% in relation to the previous year. The change was mainly due to the increase in payments of principle and annuities matured and for claims. In detail, the increase in sums paid for claims was mainly attributable to one major claim (for around € 33 million) on a unit-linked policy paid by the Parent.
Technical provisions, before the reinsurers’ share, amounted to € 6,448.2 million, increasing by 11.8% in relation to the previous year.
* * *
Research and development - New products
During 2015, Group companies issued the following new products.
Società Reale Mutua di Assicurazioni
The new products launched and specially developed products sold in 2015 are discussed below.
“Vantaggio Reale 2015”, a single-premium with-profits whole life policy with benefits guaranteed directly by Reale Mutua and returns linked to the “Reale Uno” fund. All or part of the revalued capital can be redeemed at any time from just three months after the starting date. The product was re-launched in January 2015, having proved extremely successful for the previous three years.
The “RisparMio Reale Serie Opportunità” mixed insurance contract was launched on February 12, 2015. It is a single recurrent-premium with-profits product, with performance pegged to the "Valuta Reale" fund. It rewards the loyalty of member-policyholders by paying a loyalty bonus at the end of the fifth year to policyholders who have paid all the amounts due according to the payment schedule.
The “RisparMio Reale PU” product was launched on March 16, 2015. Offered exclusively to member-policyholders who had reinvested policies coming to maturity at the end of the year in the "Caveau" deposit account with Banca Reale, it gave them the opportunity to invest capital already set aside in the Valuta Reale fund, one of Reale Mutua's best performing separately managed funds. “RisparMio Reale PU” is a single-premium with-profits investment solution with a duration of between 10 and 15 years; it envisages the payment of a bonus at the end of the fifth year from the starting date, provided the contract is still in force and no part of the capital has already been redeemed.
278 REPORTS AND ACCOUNTS 2015
As interest rates continue to fall, and in continuing to adopt a prudent approach towards separately managed accounts, Reale Mutua also reviewed the main features of its best-selling products ("Crescita Reale" and "Riserva Reale") to foster the inclusion of a large number of equity positions in its separately managed funds while keeping premiums lower.
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“Reale Quota Protetta” is a specially developed product that was sold from May 18 to June 29, 2015. It is asingle premium unit-linked product, with the possibility of additional payments. Benefits are linked to a new Reale Consolida internal fund which adds an innovative feature to our offering; it envisages protection of at least 80% of the fund's maximum quota value during the term of the contract, which is 7 years. Cover is provided by Société Générale.
The new “Reale Quota Attiva” product was launched on July 27, 2015. This is a single premium unit-linked whole life investment solution, with the possibility of additional payments. Benefits are linked to the internal "Reale Linea Mercato Globale" and "Reale Linea Controllata" funds currently underlying the unit-linked product in the catalogue.
Management commissions for the two funds have been reduced, to maximise their financial performance and make the product more competitive.
The "Reale Quota Attiva Premi Ricorrenti” product was added to the unit-linked catalogue on October 22,2015, to enrich the offering of unit-linked products for member-policyholders.
This is a recurrent premium mixed investment solution, with the possibility of additional payments and benefits linked to internal funds: “Reale Linea Controllata”, “Linea Bilanciata Attiva” and “Reale Linea Mercato Globale”.
With the “Reale Quota Attiva Premi Ricorrenti” product, contracting parties who take out a savings policy can also pay an initial single premium with attractive tariff conditions. This offers members a single product in which to invest not only a savings policy, but also capital from a previous policy coming to maturity or other amounts already set aside.
A new product developed as part of the Family Welfare strategic project was included in the catalogue starting from November 9, 2015: “Valore Vita Wellness”.
"Valore Vita Wellness" is a constant capital and premium term life insurance policy. The contract has a fixed term of 5 years. The modular tariff structure is based on the policyholder's state of health.
Italiana Assicurazioni
The following new products were developed and launched in 2015:
“Italiana Assicurazioni per Dynamo Camp”, a conventional single premium life policy on which ItalianaAssicurazioni has pledged to make a charitable donation to the Dynamo Camp non-profit organisation, amounting to 0.30% of the total premium income with a minimum donation of € 3,000.
“First Protection Life”, a term life policy developed as part of the Group's “Family Welfare” strategicproject, protects families by guaranteeing continuity of income in the event of premature death of the insured.
“ProAttiva” is a unit-linked policy with benefits linked to an internal fund that gives policyholders theopportunity to benefit from growth in financial markets without having to sacrifice insurance cover. Cover is provided by Société Générale for 80% of the maximum quota value.
“LifeMotiv” is the single premium version of the conventional unit-linked policy.
“Domino Wellness” is the new term life insurance product developed to enrich the range of Life productsunder the Group's “Family Welfare” strategic project.
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Other activities included:
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- updating of the catalogue of products linked to separately managed funds, to adapt them better to the needs of a changing market, in terms of costs, risk and returns, and to control production of this type of product;
- revision of the product catalogue for Banca del Piemonte to bring it into line with the requirements of Italiana Assicurazioni's established distribution network.
Reale Vida S.A.
Falling interest rates in 2015 continued to affect returns on asset portfolios. To safeguard against present and future risks, the Company made changes to its offering of savings products and cut the guaranteed interest rate for policyholders.
The following products were launched:
“Reale SIALP”: a flexible contract for customers with a low risk profile who want a safe savings plan thatoffers a minimum guaranteed return with the possibility of additional payments and partial redemption.
“Reale Ahorro Futuro Protegido” is a traditional single or recurrent premium with-profits savings product.
With-profits savings plans, products linked to pensions or with a minimum duration and offering tax benefits have been added to the product catalogue. These products are “PIAS Futuro Protegido”, “PPA Bienestar Futuro” and “SIALP Bienestar Futuro”.
The Life product catalogue underwent a complete overhaul in the last quarter of 2015 in order to bring it in line with market conditions.
The following changes were made:
- the amount paid in the event of death varies according to the age of the insured at the time of taking out the policy;
- there has been a gradual transition in the marketing of Life products from whole life policies to fixed-term contracts;
- the guaranteed technical rate of return has been revised, maintaining a high level of participation in profits.
* * *
The main results of the Life insurance companies in 2015 are set forth below.
Società Reale Mutua di Assicurazioni - Turin
The Parent posted direct business premium income related to Life operations of € 813,448 thousand at December 31, 2015, in relation to € 806,036 thousand in 2014, with an increase of 0.9%. The Life business closed the year with a net profit of € 3,547 thousand in relation to € 8,193 thousand in 2014.
Italiana Assicurazioni S.p.A. - Milan
The Company posted direct business premium income related to Life operations of € 274,222 thousand at December 31, 2015, in relation to € 279,576 thousand in 2014, with a decrease of 1.9%. The Life business closed the year with a net profit of € 4,150 thousand in relation to € 5,459 thousand in 2014.
280 REPORTS AND ACCOUNTS 2015
Reale Vida y Pensiones S.A. – Madrid
In 2015 the Spanish subsidiary of Reale Seguros Generales reported a volume of premiums of € 30,429 thousand, compared with € 25,492 thousand in 2014. At the end of the year it reported a profit of € 52 thousand compared with a negative result of € 1,047 thousand in 2014.
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281
1.4.3 REINSURANCE
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The reinsurance policy of Reale Group companies is applied seeking to obtain the best possible combination between proportional (quota share, surplus share or a combination of the two) and non-proportional covers (excess of loss or stop loss, to protect the part retained or as single coverage). In view of the different characteristics of the Italian and Spanish reinsurance markets and the presence of representative offices of foreign reinsurers who operate on the two markets, cessions are made separately by the Italian and Spanish companies, while ensuring operational synergy and sharing strategies for placing treaties in the reinsurance market.
Relationships between Reale Group and the reinsurance market are based on the principle of obtaining congruous coverage of risks, with particular attention to the long-term relationship between ceding company and reinsurer, acknowledging a fair margin of profit to the latter and avoiding any short-term speculative goals. During financial 2015, the continental reinsurers selected by Reale Group companies achieved satisfactory underwriting results, demonstrating an adequate level of economic and financial solidity.
ITALIAN COMPANIES
As the Parent and according to its activity of guidance, governance and control, Reale Mutua negotiates all compulsory cessions of Group companies jointly on the reinsurance market in order to secure the best economic and contractual conditions for each company, pursing an attentive strategy of curtailing risks and of balancing the portfolio.
Italiana Assicurazioni and Reale Mutua Assicurazioni, as indicated and coordinated by the latter, protect themselves with suitable forms of direct cession with professional reinsurers; recourse to facultative cessions is restricted and the Parent intervenes to indicate the channels that can be adopted for this type of business.
This approach has been adopted in order to promote more efficient risk management in accordance with current legislation and also to optimise reinsurance structures and simplify management and administrative aspects.
Also in 2015, reinsurance treaties were assessed, adopting deterministic and stochastic modelling tools. Prospective quantitative analyses were also carried out to measure the adequacy of reinsurance structures, also in the event of an adverse rate of claims (frequency and severity), taking into account both particularly significant individual claims and the all-round claims rate. Particular attention was also dedicated to earthquake and flood risks, evaluating geographic and seismic concentration. For Fire business, an analysis has been made of the earthquake catastrophe exposure of Reale Mutua and Italiana, based on more updated information regarding the single portfolios, and an assessment of the forecast claims rate using the RMS, RQE and AIR commercial models.
Reinsurance structures As regards Non-life insurance, mainly proportional treaties are adopted for Fire, Theft, Health, Transport, Suretyship, Technological Risks, Legal Fees and Hail business. Retention of proportional treaties, also taking into account guarantee extensions to catastrophic risks, is protected by suitable forms of non-proportional coverage, while only non-proportional covers are adopted for Accident, Motor TPL, Non-motor TPL and Aviation business (in view of reinsurance market trends, the greater homogeneity of the risks portfolio and the lower cost of excess of loss covers).
Of the structures described, the excess of loss treaties of Hulls of land vehicles, Aviation and Hail proportional classes of business are Group covers. A new Group treaty called "Aggregate XL" has also been drawn up to protect the retained portfolio of ceding companies in the Fire/Technological risk and Hulls land vehicles businesses.
The Life reinsurance structures envisage a combination of proportional (quota and excess) and non-proportional (excess of catastrophic risk, to protect risks retained) treaties.
282 REPORTS AND ACCOUNTS 2015
SPANISH COMPANIES
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Reinsurance policy is based on an analysis of historical data concerning profitability, claims rates and exposure to the various risk categories underwritten. The reinsurers selected guarantee the actual transfer of the risk and reduce counterparty and legal risks to a minimum, in order to achieve a balance between the actual protection of the portfolio and the cost of that protection.
A comprehensive study is carried out every three years to verify the adequacy of reinsurance covers in the various business lines. Exposure to catastrophic risks is not assessed since this cover is provided by the Consorcio de Compensación de Seguros.
Reale Seguros Generales has stipulated proportional contacts for Other property damage. It has stipulated proportional and non-proportional contracts for Fire and Multi-risk business.
Quota and excess contracts were used for the Transport and Technological Risks business lines; non-proportional treaties are adopted as single reinsurance cover for Motor TPL, Non-motor TPL and Accident business.
* * *
The Group's main reinsurers are listed in the table below, which also shows their rating, as assigned by Standard & Poor’s.
Reinsurer Rating 2015
MÜNCHENER RÜCK AA- SWISS RE AA- SCOR AA- MAPFRE A ARAG ASSICURAZIONI NR GENERAL RE AG AA+ NATIONAL DE REASEGUROS A HANNOVER RE AA-
Overall in 2015, reinsurance ceded generated a negative balance of € 33,430 thousand, distributed as follows: a loss of € 34,368 thousand for Non-life business and a profit of € 938 thousand for Life business.
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1.4.4 REAL ESTATE AND SERVICES SECTOR
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* * *
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In 2015 Reale Immobili focussed on technical and commercial management of its assets and those of theother Reale Group companies, and on providing technical and commercial advisory services to its affiliates.
The Company's main ongoing redevelopment activities are described below:
- Turin, Via Bertola 48, the Group's new operational headquarters: completion of all elevated structures and internal façades, commencement of work on the external façade in Corso Siccardi. Completion of building work is scheduled for the end of June 2016. The furnishings and fittings will then be installed and staff will be able to move in by July/August 2016;
- Turin, Via Sacchi 8: completion of work to convert the building into an hotel. The new manager signed the lease agreement , which came into effect on May 1, 2015, and the hotel started doing business later than month;
- Milan, Isolato Dogana: work continued on the renovation and functional and energy-related upgrading of the entire building. Some additional internal and external work has been necessary and completion is now scheduled for 2016 instead of December 2015;
- Milan, Piazza Duca D’Aosta 4/6 and Via Napo Torriani 30: upon completion of work to convert the building into an hotel, Duca Hotel S.r.l. signed the lease agreement on August 1, 2015 and the hotel opened.
The Company has decided to sell the buildings listed below:
- Turin, Via Montevecchio 11: the property units were put up for sale in March 2015;
- Turin, Corso Francia 28: in a move to trim down its real estate holdings, the property units owned by Reale Immobili in the condominium building were put up for sale in 2015;
- Milan, Via Soderini 54: following the conclusion of the framework agreement for the sale by lots of a new residential building, the existing building was demolished in 2015. Construction of the new building commenced in November 2015 and will end not later than May 2017. Meanwhile, the units that are being built have been put up for sale.
The deed of sale for the property in Via Boncompagni 15 in Rome was finalised on July 3, 2015 (postponed from April 30, 2015 by mutual agreement between the parties), with payment of the balance of the agreed price, equal to € 31 million, in addition to the repayment of all costs sustained by Reale Immobili between the date originally agreed upon and the actual date of completion. The sale generated gains for € 19.7 million.
The Spanish real estate company IGAR continued to manage and administer two high prestige, rented premises in Madrid and the commercial premises in Granada.
On July 2, 2015 the Reale Seguros subsidiary finalised the agreement to purchase the building, which willserve as the Group's new headquarters in Spain. The building is located in Via Principe de Vergara in the centre of Madrid and has undergone major renovation work. Completion of building work is scheduled for early 2016. Staff and the various service facilities will move in at the end of April 2016.
In 2015 Blue Assistance continued its activities in traditional areas of business and in the variouscomplementary fields, focusing on the implementation of existing processes to foster organisational and technological renewal.
284 REPORTS AND ACCOUNTS 2015
The number of customers using the Company's services increased in all areas of business: Blue Assistance has strengthened its position even in sectors other than insurance, by developing a portfolio of customers who use its network of approved service providers. Several acquisitions have also enabled it to further diversify its customer portfolio and guarantee delivery of high-quality, reasonably-priced health care services. Customers in the Banking and Service sectors include a number of leading Italian organisations.
In the Health sector, in 2015 Blue Assistance started providing services to a leading insurance group. Besides leading to an upswing in volumes, this also resulted in technological improvements in the settlement process. The Company embarked on a project to reorganise its settlement activities and improve its management of the customer portfolio to meet new market demands and satisfy customers' needs more fully.
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The application used to manage Assistance and Service activities has been further improved to speed up procedures and enhance operational efficiency. The offering has been enriched with the inclusion of new networks and services that, using marketing synergies, have made the services even more innovative and easier to use. During the year the Company also took steps to expand into physiotherapy, setting a target of 1,000 providers throughout Italy, with a view to offering this type of service, which is currently provided through the new Blue portal.
As part of its commitment to developing provider networks and in pursuing its traditional activities to expand and improve the networks of approved Health care, Assistance and Service providers, the “Young VIPs” campaign was launched at the beginning of September. The scheme was for the children and grandchildren aged between 5 and 14 years of member-policyholders of Reale Mutua and Italiana Assicurazioni. The project focused on a selection of specific services and offered a choice from among a dental examination, eye-test or a medical fitness check-up for non-competitive sports. More than 9,000 of these medical examinations were delivered (through the network of approved providers) under the "Young VIPs " scheme between September and December 2015 and over 41,000 vouchers were requested and can be used up until the end of 2016. This campaign contributed to the selection of a further 300 health centres to be included in the network, with a specific focus on the delivery of sports medicine services, distributed throughout the country.
In terms of volumes of business, the Health care sector recorded a notable upswing in settlement and call centre activities, mainly in connection with the new contract; there was a 47% increase in health care services (13% net of the new contract). Business volumes in the Assistance and Services sectors continued to record steady growth, following the same trend as the TPL sector: specifically, business increased in the area of assistance (+31%), supervisory activities within the scope of certain specific contracts (+23%) and home-care under one particular contract (+11%), bur decreased in that of "home visit by medical staff".
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Reale Ites EEIG, the information technology service provider for Reale Group, became fully operational on January 1.
The role of Reale Ites EEIG is to guarantee the routine operation of IT services, gearing to changes in business requirements and those in connection with the design of new insurance products. It plans activities aimed at optimising and improving the overall IT system, with a view to substantially improving the service and reducing costs.
2015 was focused on managing the technology issues of the business plans of each Group company. These plans are based on the development of the multi-channel platform and the subsequent introduction of a new operational model. This will require the definition of a multi-channel strategy, new operating processes and a web/mobile strategy to upgrade the corporate website and create new alternative digital channels (social media, mobile apps, aggregators). A multi-channel (front-end) IT platform is currently being developed to meet these requirements and will be used by both Italiana Assicurazioni and Reale Mutua. The platform was released for use by a small pilot group of agencies in June 2015. Improvements were also made to the system architecture of the aggregator channel (web launch) for the partnership with Facile.it, for Motor insurance only.
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The digitalisation process continued, with an overhaul of the agency business model and the introduction of new digital tools and services ("Digital Agency" project). The aim is to increase operational efficiency by creating a paperless environment and to leverage mobile tools to improve sales force effectiveness. With the new POQ premium payment form, starting from the first half of 2015 the digital signature and innovative payment systems were made available to a group of pilot agencies.
Another mobile sales project envisages the integration of information about member-policyholders contained in the CRM (Customer Relationship Management) database with data in the CCW (Customer Contact Workflow) database. This project is also closely synchronised with the multi-channel project. It was released for use in pilot agencies in June.
2015 also saw continued expansion and use of the new Business Intelligence (BI) platform to monitor Key Performance Indicators (KPI) in line with business requirements. The information content was improved during the year and the data will be ready for use from the beginning of next year.
As part of the Solvency II project, the IT platform for generating the reports that European insurance companies will be required to produce under the new Solvency regime was developed in the first half of 2015. Group companies in Italy and Spain will share the same platform.
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On May 28, 2015, the Italian subsidiary Italiana Assicurazioni established Italnext S.r.l., a company set upfor the purpose of insurance mediation and development of new distribution channels. The Company is still in the start-up stage.
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A summary of the main results of the subsidiaries operating in the real estate and services sector in 2015were as follows.
Reale Immobili S.p.A. - Turin
At December 31, 2015 rents from real estate amounted to € 64,370 thousand, down € 69 thousand compared with December 31, 2014. Gains arising from the sale of real estate amounted to € 21,279 thousand compared with € 914 thousand in the previous year. This amount includes the profit amounting to € 19,701 thousand made on the sale of the property in Via Boncompagni in Rome. The year closed with a profit of € 35,823 thousand compared with € 5,160 thousand in 2014. Taxes showed a positive balance of € 1,775 thousand: this result includes the effects of the re-calculation of deferred tax assets and liabilities following the reduction in the IRES tax rate (from 27.5% to 24%) which will come into effect on January 1, 2017 under the provisions of the 2016 Stability Law. The re-calculation of the items in question resulted in the recognition in the income statement of extraordinary income for € 17.4 million in 2015.
Immobiliaria Grupo Asegurador Reale S.A. - Madrid
In 2015 revenues generated by ordinary operations amounted to € 3,835 thousand, compared with € 3,850 thousand in 2014, with a year-on-year decrease of 0.4%. Financial 2015 closed with a net profit of € 1,697 thousand in relation to € 1,615 thousand in the previous year.
Blue Assistance S.p.A. - Turin
Revenues generated by ordinary operations amounted to € 27,069 thousand, 18.1% up on 2014. The year closed with a net profit of € 457 thousand compared with a profit of € 195 thousand in 2014.
286 REPORTS AND ACCOUNTS 2015
Reale Ites EEIG - Turin
Revenues from services amounted to € 96,251 thousand and referred to fees for IT services supplied to Group companies that are members of the Grouping. At year-end investments in hardware and software amounted to € 98,414 thousand.Reale Ites broke even at the end of 2015.
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Italnext Srl – Milan
At the end of its first year of business, and thus its startup year, the Company reported a loss of € 311 thousand.
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1.4.5 BANKING SECTOR
The Company strengthened its role of supporting the insurance business, by pursuing projects to integrate the offering of products and services aimed at fostering the growth of business among the companies within the Group. Following improvements to the policy instalment loan process (which now includes an automated scoring system to screen customers under an agreement with CRIF, a leading provider in the field of credit data), in 2015 Banca Reale made a positive contribution to the advertising campaigns run by the insurance companies for the sale of Motor insurance with payment by instalments at a subsidised rate.
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In 2015 Banca Reale pursued its medium and long-term goals in accordance with the 2015-2017 three-year plan, with specific reference to the following:
- continual development of lending activities, also by gradually opening more branches in Italy, placing the focus on precautionary measures and giving priority to the quality of relations with customers rather than mere quantitative objectives;
- consolidation of direct deposits, both demand and medium and long-term deposits, to guarantee balanced support to lending activities;
- gradual strengthening of the role of Banca Reale within Reale Group, through direct involvement in plans to overhaul the insurance companies' sales model (within the scope of the Group's strategic projects). This envisages high-level digitalisation of processes and more robust synergies with the banking business aimed at enhancing the high-value offering for the Group's customers.
In continuing to support the Group's insurance agencies, the Company expanded its lending activities to individuals and SMEs by appointing its first regional managers to the branch offices in Turin and Milan. The task of these professionally qualified resources is to support the business of insurance agents and financial advisers at the "Spazio Banca" areas of the Bank's branches for which they are responsible ("hub and spoke" structure).
Following changes to the Group's financial investment governance model, a centralised system has now been set up at the Parent company to manage financial investments, including those of the Spanish subsidiaries. In order to optimise the synergies between Group companies in terms of knowledge, expertise and processes, Banca Reale has also been appointed to manage the financial assets of the aforesaid companies. The Spanish Asset Management organisational unit has been set up for that purpose and reports, with the Italian Asset Management unit, to the Bank's Finance department. Said management activities commenced on September 1, 2015.
In pursuing its territorial development plan, 2015 was the first year of business for the Verona branch office, which opened in December 2014. The Bank already has branches in Turin, Borgosesia (VC), Milan, Legnano (MI) and Parma.
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The main results of the banking sector subsidiary in 2015 are set forth below.
Banca Reale S.p.A. - Turin
Total customer deposits moved up 14.6% over the previous year to a total of € 10,277,627 thousand at December 31, 2015, while loans to customers amounted to € 245,760 thousand at the end of the year, an increase of 24.7% over 2014. The intermediation margin, equal to € 27,918 thousand, reflects a y/y decrease of 2.8%. Profit from current operations, before taxes, amounted to € 3,607 thousand (-51.3% compared with 2014). The income statement for 2015 closed with a net profit of € 2,091 thousand compared with € 4,609 thousand in 2014.
288 REPORTS AND ACCOUNTS 2015
1.5 INVESTMENT MANAGEMENT
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Group companies managed their investment activities according to the usual criteria of prudence, adopting an approach that succeeded in achieving gains while limiting financial risks and bearing up to the volatility of the markets.
In the bonds compartment, Reale Group pursued a strategy aimed at achieving a balance between the soundness of investments and portfolio profitability, by ensuring adequate diversification of issuers. Overall portfolio risk remained consistent with the Group’s overall risk profile.
Various indices relating to the bonds portfolio at December 31, 2015 are set forth in the table below for the main Group companies.
Reale Mutua
Assicurazioni
Italiana
Assicurazioni
Reale Seguros
Generales Reale Vida
Total duration 5.00 4.60 - -
Duration Non-life 2.80 2.80 2.94 -
Duration Life 5.80 5.70 - 6.44 5.80 5.70 - 6.44
Average rating BAA1 BAA1 A3 BAA1
Duration objectives are defined according to the risk profile of the liabilities held for the Non-life segment, while for the Life segment they are determined using cash flow matching techniques in order to matchassets with commitments with subscribers.
There was an improvement in the average portfolio rating of the Spanish companies after Standard & Poor's raised Spain's credit rating in October 2015, which resulted in the upgrading of the credit rating of certain Spanish corporate bonds.
Group investments, by individual item, are set forth in the table below
(in thousands of euro) 31.12.2015 Composition 31.12.2014 Composition Change
Real estate investments 963,487 8.1% 946,569 8.5% 1.8% Equity investments in subsidiaries, affiliates and j.v. 178,234 1.5% 145,032 1.3% 22.9% Loans and receivables 456,790 3.9% 412,551 3.7% 10.7% AFS financial assets 9,410,187 79.5% 8,805,876 78.8% 6.9% Financial assets measured at fair value through the income statement 822,902 7.0% 862,310 7.7% -4.6% Total 11,831,600 100.0% 11,172,338 100.0% 5.9%
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Details of income and charges on Group investments, divided by single item, are set forth in the table below.
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(in thousands of euro) 2015 2014 Change
Net income on financial instruments measured at fair value through the income statement 32,302 62,985 -48.7% Income on equity investments in subsidiaries, affiliates and j.v. 31,300 27,757 12.8% Income on other financial instruments and property investments: 415,076 357,438 16.1%
Interest income 204,198 214,466 -4.8% Other income 87,152 85,292 2.2% Realised gains 123,515 57,481 114.9% Valuation gains 211 199 6.0%
Total income 478,678 448,180 6.8% Charges on equity investments in subsidiaries, affiliates and j.v. 0 16,697 -100.0% Charges on other financial instruments and property investments: 45,503 46,096 -1.3%
Interest expense 4,683 5,718 -18.1% Other charges 15,378 22,326 -31.1% Realised losses 11,704 6,137 90.7% Valuation losses 13,738 11,915 15.3%
Total charges 45,503 62,793 -27.5% Total net income 433,175 385,387 12.4%
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In carrying out their business activities, Group companies use derivative and structured financial instruments for hedging purposes, to limit the investment risk, and also to enhance portfolio management and achieve their investment goals more quickly, more easily, more economically or more flexibly than would be possible using the underlying assets.
All investment activities, also with regard to structured securities and derivatives, are regulated by specific resolutions of the Boards of Directors in accordance with their strategic guidelines and the financial situation of each company. The competent company structures verify these activities at regular intervals, on the basis of financial risk measurement parameters, and submit periodical reports on their findings to the Boards of Directors.
Use of derivative and structured instruments did not generate any significant losses or potential risks in 2015.
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As regards strategic investments, the main transactions undertaken by the Group in 2015, as reportedbelow, were directed towards the requalification and value enhancement of Reale Group in Italy and Spain.
In December 2014 the Parent signed a letter of intent with a view to becoming a member of EURAPCO(European Alliance Partners Company), an alliance of independent insurance companies that have decided to join forces in order to exchange business skills and best practices and foster their growth, create more value and implement their strategic plans better and more quickly. At the time, the Alliance consisted of seven leading mutual insurance companies, each from a different country ( France, Netherlands, Germany, Spain, Sweden, Switzerland, Finland). Combined, they have achieved a gross written premium of around € 50 billion; the Alliance operates through a Swiss service company called Eurapco AG, headquartered in Zurich, in which each Eurapco partner holds an equal interest. A 12-month trial period started on January 1, 2015, during which Reale Mutua prepared to join the Alliance as a fully-fledged member by the end of 2015. Becoming a partner was subject to the Company acquiring a share in Eurapco AG not later than January 1, 2016.
290 REPORTS AND ACCOUNTS 2015
Following the resolution passed by the Board of Directors of the Parent at the meeting of July 14, 2015 on its membership of the Alliance, on September 23, 2015 Reale Mutua applied to become a permanent member. On October 9, 2015, the Chairman of Eurapco wrote to Reale Mutua, informing the Parent that the Board of Eurapco AG had approved its accession, once the trial period had ended, and that its membership would commence on January 1, 2016.
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Reale Mutua became a member of the Alliance upon acquiring a 12.50% interest in Eurapco AG; on January 4, 2016 Reale Mutua paid the amount of 1,254,722.44 Swiss francs (€ 1,150,804.75) in proportion to each of the other partners, to purchase the share in question.
All Reale Group companies will be able to benefit from the services of Eurapco.
Thus, as from January 1, 2016, the Alliance is made up of eight leading companies, namely Achmea (Netherlands), Covea (France), Gothaer (Germany), Caser (Spain), Lansforsakringar (Sweden), Swiss Mobiliar (Switzerland), Local Tapiola (Finland) and Reale Mutua Assicurazioni (Italy), that operate in 18 countries across Europe. Combined they insure over 40 million Europeans and employ more than 66,000 people.
On May 28, 2015, the Italiana Assicurazioni subsidiary established Italnext S.r.l., a company set up for the purpose of insurance mediation and development of new distribution channels. Italiana Assicurazioni paid € 50 thousand to the capital of the new company and will made additional contributions to its capital in future, up to a maximum of € 2 million. This company is a point of reference for small agencies that work with Reale Group companies or might work with them in future, including for the provision of administrative services. At December 31, 2015 its share capital contributions amounted to € 600 thousand.
On April 3, 2014 the Reale Seguros Generales subsidiary exercised the right to sell its 50% stake in the Spanish Non-life insurance company CAI Seguros Generales de Seguros y Reaseguros S.A. based in Saragoza to Banco Grupo CajaTres, the Spanish banking group that already held the remaining 50% stake. At the end of the previous year Reale Seguros had initiated arbitration proceedings to determine the value of its investment in CAI Seguros Generales. The matter has still not been settled.
Said investment was written down by the amount of € 16,697 thousand in the 2014 accounts. The value of the investment has thus been aligned with the best estimate of the future realisable value currently available bearing in mind the uncertainty surrounding the outcome of the operation.
The amount of the write-down reflects the business strategy adopted as from January 1, 2014 by Banco IberCaja in its capacity as the sole managing body of CAI Segros Generales. Its recognition does not presuppose acceptance of the write-down and is exclusively the consequence of adoption of the most prudent accounting criteria at year-end 2014.
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1.6. HUMAN RESOURCES At December 31, 2015 the Group had a workforce of 3,150 people, 57 more than in the previous year.
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Reale Ites EEIG became operational on January 1, 2015. The integrated IT service company serving RealeGroup was established following the transfer by Reale Mutua and Reale Seguros of their respective IT business units. The transfer involved 248 employees, of whom 217 office staff, 26 middle managers and 5 senior managers.
Under the trade union agreements signed on December 2, 2014 and December 12, 2014, pursuant to art. 2112 of the Italian Civil Code, the existing office staff and senior management-level contracts of all those who had previously worked at Reale Mutua di Assicurazioni remained in force, all employees have maintained their rights existing at the time of the transfer and all are based at the Turin office of the EEIG.
Furthermore, all of the above employees received assurance of their immediate return to the Parent in the following cases:
- winding-up of Reale ITES;
- departure of Società Reale Mutua di Assicurazioni as a shareholder of Reale ITES;
- cessation of business activities by Reale ITES;
- changes in business activities and/or downsizing and/or changes to the place of work, such as to jeopardise jobs.
The same employment terms applied to employees transferred from Reale Seguros based in Madrid.
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On January 16, 2015 Società Reale Mutua di Assicurazioni, in its capacity as Parent, and trade union representatives from Reale Mutua and Reale Immobili signed an agreement to overhaul the organisational structure and optimise the processes of Reale Immobili. The project was completed in September 2015.
The aim of the project, which involves Reale Immobili and some areas of Reale Mutua, is to improve the efficiency and efficacy of company functions from a Group-wide perspective and enhance the focus of Reale Immobili's core structures and processes at a particularly challenging time for the property market. Under the agreement, the 54 employees of Reale Immobili and 2 employees of Reale Mutua affected by the project will remain at their current place of work. No workers will be asked to move to a different place of work without their permission. The reorganisation may result in some changes to duties and employees, for which they will receive training, in the form of direct instruction, at the offices of the Parent.
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On June 8, 2015 Società Reale Mutua di Assicurazioni, in its capacity as Parent, and trade union representatives from Reale Mutua and Italiana Assicurazioni signed an agreement to overhaul the organisational structure and optimise the settlement network of the Group Claims Handling department.
In line with the framework agreement entered into on September 15, 2004 and subsequent enabling agreements, the aim was to improve the efficiency of the Claims Settlement offices in Italy and thus improve settlement times and relations with the agencies. Four small offices (in Lecco, Modena, Salerno and Reggio Calabria) were closed and their workload spread across the other Claims Settlement offices nearest to them. The project had no repercussions on current employment levels.
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Negotiations for the renewal of the national collective employment contract for non-executive employees,which expired on June 30, 2013, commenced in April 2015. Talks are ongoing.
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292 REPORTS AND ACCOUNTS 2015
The agreement concerning the functions of the new company ID card was signed on November 9, 2015. The new cards will ensure better security and safety for employees and for company property and enable the use of new technologies at work.One feature is a physical access control system with electro-mechanical devices installed at entrances. Access will be granted based on presentation of the specific company ID card, without which access will be refused. This access control system will also help the Company keep a better check on operational risks, by monitoring the exact number of people inside the building.
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Academy, the corporate university for employees founded in 2010 to promote the Group culture, overhauled its organisational structure in 2015. The Training (now Learning Centre) and Social Collaboration functions have been incorporated into Internal Communication and Professional and Managerial Development, in order to offer a more people-oriented service.
From that perspective, in 2016 Academy will work to foster an ecosystem of change, made up of people, relationships and tools, to develop a culture of social responsibility and collaboration.
Academy's mission is to accelerate the pace of cultural change and support the Group's strategies, while at the same time developing the skill base of employees through formal and informal learning activities and personal engagement.
In supporting the changes taking place within the Group, the Learning Centre has developed courses designed to improve the ability of managers to delegate powers. It also promoted a training plan funded by the inter-professional fund for continuing education in the credit and insurance sector - Fondo Banche Assicurazioni (FBA), aimed at integrating the skills of younger workers and the expertise of older employees. It also continued to provide language courses in view of the increasing importance of being able to communicate with colleagues in Spain and with the international organisations (Eurapco) in which the Group operates.
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In Spain, within the scope of the strategic Leadership project, appraisals of all managers were completed in 2015 and the results were shared. The aim was to work with them to develop an action plan that will allow them and their team members to grow together professionally. This with a view to developing a system for managing relations between managers and staff members that can be applied across all Reale Group companies.
The first job exchange scheme was also implemented in 2015. Two colleagues from the Organisation office (one from Reale Seguros in Spain and one from Reale Mutua in Italy) exchanged places and spent six months working at the headquarters of the other company.
The first internal coaching scheme was completed at Reale Seguros. 22 colleagues took part in the initiative and received more than 130 hours of coaching, aimed at teaching them to recognise their strengths and how to overcome problems
A partnership with the Business School ESCP also got underway in 2015, under the Executive Insurance Programme with the active participation of the Management Committee, which sponsored the projects. 25 employees will receive more than 100 hours of training on the subject of the insurance business, with specific reference to that of Reale Seguros.
As confirmation of the fact that the Group's Spanish companies also put people first, the title of the convention held in Madrid in June 2015 was "Somos, Seremos": during the event, which is for employees only and is held every four years, the results of the previous year were presented and the strategies for future years were illustrated. Above all though, this is an opportunity for employees based at the various offices to come together and enjoy an interesting and eventful day, to foster a sense of belonging and team spirit.
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Every company within the Group is committed to pursuing improvements in occupational health and safety, and to making sure they provide all the necessary human and financial resources and instruments to protect all aspects of the health and safety of all those who work for them. In accordance with Legislative Decree No. 81/08 and subsequent amendments on occupational health and safety, in 2010 all Reale Group companies implemented an Occupational Health and Safety management system that meets the requirements of BS OHSAS 18001:2007.
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In 2015 Reale Group continued to monitor employees’ health through a specialist firm with a nationwide network of medical staff.
Defibrillators were installed at the head offices of the Parent and of the Italiana Assicurazioni subsidiary in 2015.
In February 2015 Reale Group received "Top Employers Italia" certification for the second year running, although this was the first time it included all of the Group's Italian companies. It is awarded each year to companies that achieve the highest standards of excellence in employee conditions.
The Top Employers Institute, which is based in Amsterdam, carries out objective assessments of the organisation's employee conditions and certifies more than 900 undertakings in 92 countries.
Participation in the certification programme allows companies to position themselves alongside an exclusive group of leading multinationals and industry front-runners that set the employer benchmark. The evaluation process includes careful scrutiny of various aspects of HR management: payment policies, working conditions and employee benefits, corporate culture, training and advancement, career opportunities.
In 2015 the Reale Seguros subsidiary was ranked among the “50 best workplaces in Spain”, having already been included in the list in 2013. Moreover, the Company was awarded the prize for its "Commitment to the emotional wellbeing of its people" by the Association of Psychologists of Madrid.
Lastly, Reale Seguros is the first company in the world to have obtained an A+ rating for its attention to the needs of families and related issues: this is the highest distinction awarded by Fundacion Masfamilia, an independent body endorsed by the Spanish Ministry for social services and equal opportunities and the United Nations.
294 REPORTS AND ACCOUNTS 2015
1.7 SALES, MARKETING AND COMMUNICATION1.7.1 DISTRIBUTION CHANNELS
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At December 31, 2015 the Group had 1,021 agencies, a decrease of 10 compared with the previous year.
Reale Mutua has developed its distribution channels over the years to establish a network of agencies that, as at December 31, 2015, included 344 agencies under contract and 562 insurance agents/brokers.
In addition to these, it has five subsidiary agencies and one for employees.
At the end of 2015, the Parent had 24 standing distribution agreements with banks and/or leasing firms, through its agencies under contract and subsidiary agencies, for the sale of both Life and Non-life policies.
Italiana continued to reorganise its sales network with a view to improving the quality and quantity of its services. The Company closed 15 agencies in 2015 and opened 9 new points of sale, 3 of which as agencies providing the services of Italnext S.r.l.; consequently, the total number of agencies fell from 332 in 2014 to 326 in 2015. Counting the 10 units of the REM Division as well, at December 31, 2015 the Company had a total of 336 agencies.
Reale Seguros and Reale Vida distribute their products through a nationwide network of 55 branch offices, 351 exclusive agencies and 2,286 brokers.
1.7.2 COMMERCIAL/TRAINING ACTIVITIES
In order to streamline activities, improve the standard of service for policyholders and agents and enhance Group synergies, the Sales and Market department of the Italian Assicurazioni subsidiary has undergone a structural reorganisation. As from January 1, 2015, a number of activities have been centralised at the corresponding offices of the Parent. Among the most important of these are: Corporate Communication, Customer Services, Web and Training.
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In line with the provisions issued by the insurance supervisory authority with Regulation No. 5/2006 and Measure No. 2743/2009, the Sales department of the Italian insurance companies prepared the annual report for financial 2014 on the control of sales network activities. The document, examined by each of the Boards of Directors at the meeting in February 2015, analyses the composition of the sales network, according to each distribution channel, vocational training and refresher schemes and the implementation thereof; it also describes the methods used to monitor training schemes and, more generally, the rules of conduct that must be observed by the sales network. The report was then sent to the Authority, together with the observations of the head of the Internal Audit department and the considerations of the Board on the latter.
* * *
The first results of the 2013-2015 three-year strategic plan were seen in the year that has just ended.
The strategic project for the new Motor business model resulted in a major overhaul of the procedures for managing the commercial flexibility of agencies. The Motor insurance catalogue was enriched with a new black box offering: while maintaining its existing provider, the Company also appointed a new supplier with a view to offering new economically and technologically competitive devices. The sale of conventional Motor products through aggregator websites continued throughout the year.
The “Family Welfare” project (which concerns both Reale Mutua and Italiana Assicurazioni) sets out to satisfy customers' needs in terms of cover for individuals and families through a two-pronged approach: on the one hand, the development of a new retail and corporate supply model, and on the other distribution through professional networks that are also capable of offering specialist advice.
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A specific software ("Welfare Point") was developed for the sales network, to identify customers' needs, and efforts got underway to recruit Welfare and Social Insurance specialists to work at the agencies. The agencies where they were to be based were selected and trained on how to adopt an advisory approach. They also received assistance in their search for potential new customers (Geomarketing and Direct marketing).
As far as the “Light Agency Project” is concerned, the workshop stage of the “Service Centre” project was completed. Parallel to this, on May 28, 2015 the new company called ItalNext S.r.l. was set up. Owned by Italiana Assicurazioni, its purpose is insurance mediation and development of new distribution channels. It also delivers services to agencies that request its assistance in the areas of underwriting, back office, accounting, marketing and payment activities and with opening claims through Blue Assistance. By the end of the year a total of seven agencies were using this new sales model and the services of ItalNext S.r.l.: four conventional agencies and three new points of sale recruited from the market.
ItalNext S.r.l. is a new and innovative sales model (Light Agency) established primarily to support the agency network, especially agencies where profitability is undermined by high fixed costs, by changing the way they work and enhancing their value.
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In the field of Customer Relationship Management, work on implementing the new CRM systemcontinued in 2015. The flexible platform will be used to support strategic decisions concerning the management of relations with customers and policyholders. The aim of the system, for managing relationships through the various contact channels, is to guarantee a multi-channel and multi-centre customer experience.
During the year efforts continued to improve the quality of the information in the databases and develop new keys for interpreting data about customers. A new segmentation model was developed for dividing the customer base according to insurance patterns and a new statistical model for predicting the possibility of customers "abandoning the Company" (churn rate) was completed and shared.
In relation to the Multi-channel strategic project activities were undertaken to develop a model centredaround the customer and which caters to consumption patterns linked to digital technology and mobile devices. The first outcomes of the project regarded the lead management platform, i.e. the process by which new contacts via websites (corporate website, mobile website, mobile apps and aggregator websites) are transformed into sales opportunities for the agencies. Agents can now use modern software to manage consumers who use the website quote engine and request an appointment with the agency for further information and to purchase policies. Between them the websites of Italiana Assicurazioni and Reale Mutua generated more than 527,000 requests for quotes in 2015, providing input data for lead management.
The operational stage of the Digitalisation project also began in 2015. The first pilot agencies were set upand training was provided in preparation for roll-out. In practice the first enabling components were developed and implemented, such as the electronic hand-written signature (AES) and digital data storage systems. Classroom training sessions were held to "launch" the project; these were an opportunity for agency staff to obtain detailed information about operational aspects and to understand the advantages of the system in terms of time saving and improved quality of service for members.
The project aroused great enthusiasm and the transition to a paperless agency environment (elimination of printed records in favour of electronic document management) is now well underway. This transition was fundamental in order to move on to the next step towards a completely digitalised system using electronic hand-written signatures on contracts. Contracts can now be signed digitally, using tablets and Wacom signature pads, eliminating the need for printed documents. In the second half of the year, training sessions were held on the subject of electronic hand-written signatures and on completing the transition to a paperless agency environment; this will gradually be extended to all Group agencies. Specific training meetings were also held for the external business network.
296 REPORTS AND ACCOUNTS 2015
The next stage of the project was also launched in the second half of the year. This envisages the use of mobile connectivity (the network app) to consult customers' profiles, quote prices and issue contracts. Activities included one-to-one meetings with agency staff and co-workers held at the agencies by members of the project team, area managers and specialists.
The Digit project will continue in 2016, when it will be extended to all of the agencies.
* * *
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The Group Business Training unit was set up on January 1, 2015 at the Parent Company, to manage the agency training activities of both Reale Mutua Assicurazioni and Italiana Assicurazioni. This led to a series of activities to harmonise existing processes, in order to maximise office efficiency, strengthen synergies in the use of training companies and providers, and standardise training methods across the Group.
IVASS Regulation No. 6/2014, which came into effect on January 1, 2015, introduced some significant changes to the rules concerning professional training and refresher courses for insurance intermediaries. The number of hours of refresher training has been increased from 30 to 60 every two years, with at least 15 of the total hours in a year; classroom and distance learning techniques are now considered on a par.
This resulted in significant changes to how training courses are planned and the methods used to monitor compliance with requirements as regards professional qualifications of the sales network. Under the new rules established by IVASS No. 6/2014, the e-learning platform was completely overhauled; the publication of courses entailed not only meeting standard requirements but also a thorough review of the content.
In detail:
- traditional classroom lessons continue to play a crucial role and are mainly used for advanced managerial and technical training courses, as well as being the preferred channel for training on strategic projects;
- the virtual classroom environment is mainly used for courses on operational aspects of Company processes, and for providing further information about issues dealt with in classroom lessons;
- the online channel continues to be mainly used for product training purposes.
1.7.3 MARKETING
The "Young VIPs" sales scheme (run jointly by Reale Mutua and Italiana Assicurazioni) was launched in the second half of the year, allowing these companies to demonstrate their closeness to policyholders. From September 7, policyholders were able to request a free medical fitness check-up, eye-test or dental examination for their children or grandchildren aged between 5 and 14 years.
The initiative proved extremely popular with member-policyholders, and by December 31, when the scheme ended, over 41,000 specialist medical examinations had been booked.
Continuing along the lines of the “Young VIPs” initiative that ran in 2015 and to bolster the Group's positioning in the field of preventive care and personal well-being, at the meeting in November 2015 the Boards of Directors of Reale Mutua and Italiana Assicurazioni approved the “Mynet.blue” initiative. The € 2.4 million scheme for policyholders of Reale Mutua and Italiana Assicurazioni envisages free access to the network of dental care services, outpatient clinics and nursing homes managed by Blue Assistance and its approved physiotherapy providers.
In early 2013 Reale Seguros entered into an agreement with the Spanish bank BBVA regarding the exclusive sale of insurance products through the bank channel. The outcome of this partnership was the sale of two custom "Commercio" (commerce) and "Globale Fabbricati" (civil buildings) products through an online platform designed to meet the requirements of the bank. The results are extremely positive, in terms of both turnover and the claims rate. New products and new tariffs will be introduced to the "Commercio" business in 2016 to make it more competitive, which bodes well for the future development of the agreement. In view of the satisfactory results that have been achieved under the agreement, BBVA has asked Reale Seguros to export its business model to another bank in the group, Catalunya Caixa: this should lead to a further 771 bank branches through which to sell insurance products.
297
1.7.4 COMMUNICATION
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In the field of communication, the Group brand project was launched at the end of April 2015.
Between January and April, activities were focused on preparing for the launch of the new Reale Group image, starting with the inclusion of branding elements in and personalisation of the workplace, videos illustrating the new brand, replacement of signs at the head offices and distribution of the brand book setting out the values and philosophy.
The press and billboard campaign to launch the new Reale Group brand, which ran simultaneously in Italy and Spain, was based on the concept of "You at the centre". It featured the use of evocative images to highlight the new logo and the centrality of people, the values that permeate Reale Group, for which people have always at the centre.
The project was launched in June 2015, on completion of the tender process, and involved some 1808 sites including agencies, sub-agencies and branches of Banca Reale. All existing signage should be replaced between 2015 and 2017.
The launch of the new Group brand and logo also included a restyling of the Parent's website and those of its subsidiaries, which are now all consistent with the new brand identity, and the creation of the new www.realegroup.eu website with all Reale Group's institutional content.
298 REPORTS AND ACCOUNTS 2015
1.8 LITIGATION
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At Reale Mutua, in addition to cases involving insurance issues, litigation is in course with former employees of the Company and a number of former agents. Provisions for risks and charges, which amounted to around € 2,805 thousand at December 31, 2015, are sufficient to cover the charges deriving from lawsuits in course.
The Parent is involved in tax disputes following assessments relating to tax periods from 2003 to 2010.
The disputes referring to IRES (Corporate Income Tax) and IRAP (Regional Tax on Production Activities) mainly concern the allocation of provisions for outstanding claims. Those relating to VAT regard coinsurance assignments and certain intra-group operations.
In the cases concerning provisions for outstanding claims, which mainly refer to the correct recognition of the relevant expense and revenue items, the Parent is convinced that it has always operated correctly and in accordance with the law, namely with the applicable tax regulations and with normal accounting practice. The correctness of the Company’s actions was also confirmed by a recent sentence of the Italian Court of Cassation (cf. Court of Cassation, Tax Law Chamber, sentence No. 16332 of September 26, 2012) which, with reference to a set of circumstances identical to those at issue, ruled the opinion of the Tax Authority to be unfounded.
The VAT issues merely regard the interpretation of tax regulations governing the application of VAT to coinsurance assignments, on which there is ample case law supporting the approach applied by insurance companies. Although in a few isolated cases the court has handed down an unfavourable ruling, two of which against Reale Mutua and two against the Italiana Assicurazioni S.p.A. subsidiary, the Company is firmly convinced that the dispute will be settled in its favour.
No funds have been set aside in connection with the aforesaid issues.
In March the Turin Finance Police concluded their audit in connection with the recording of "cancellations of premiums" as a reduction in "premiums for the year" in the financial statements. As mentioned above, the audit regarded the tax periods from 2009 up to 2013 and the investigators had already issued an Official Tax Audit Report for 2009 in October 2014.
The Finance Police continued their assessment relating to the subsequent years (specifically 2010-2013), at the end of which they issued a second Official Tax Audit Report on March 16, 2015.
This final Report is in line with the forecasts made at the end of 2014 and thus confirms the provision amounting to € 3,200 thousand that was set aside. The amount reflects the impact of the audit on the income statement and refers for € 1,100 thousand to sanctions and for € 2,100 thousand to tax.
On March 31, 2015 the Company notified the Tax Office and the Finance Police of its decision to adhere to the Official Tax Audit Report. The objection raised by the investigators was linked to a significant extent to issues pertaining to certain types of adjustments, with the result that part of the contested amount will be recovered in the years after 2027. That is also one of the reasons why the Parent decided to adhere to the aforesaid Official Tax Audit Reports. The procedure was concluded with payment of the amount due in June 2015.
Italiana Assicurazioni, like the Parent, is involved in tax disputes following assessments relating to tax periods from 2004 to 2010.
The disputes referring to IRES (Corporate Income Tax) and IRAP (Regional Tax on Production Activities) mainly concern the allocation of provisions for outstanding claims. Those relating to VAT regard coinsurance assignments and certain intra-group operations.
With regard to the assessments concerning provisions for outstanding claims and VAT, the same applies as for Reale Mutua.
In view of certain aspects specific to the dispute in question, the Company is attempting to reach an agreement with the Tax Office for tax year 2006, which should result in a definitive settlement. A provision for tax disputes amounting to € 1,000 thousand has therefore been set aside.
299
In accordance with Spanish tax laws, the Reale Seguros and Reale Vida, subsidiaries are subject to inspections by the tax authorities for all fiscal periods relating to the last four years.
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Reale Seguros is involved in a tax dispute following assessments for tax years 2007 and 2008 and awaits the ruling of the Central Economic Administrative Court.
It also awaits the ruling of the High Court of Justice of the Basque Country on an appeal filed by the Company against a judgement issued by the Regional Economic Administrative Court of Biscay (province of the autonomous Basque Country region) concerning an administrative dispute about the taxation of premiums initiated in 2014.
In both cases, amounts have been set aside to cover the estimated future cost of possible liability and any penalties that may ensue.
The Reale Immobili subsidiary was subject to a tax audit by the Piedmont Regional Tax Office (Major Taxpayers Unit), which began on July 22, 2015 and refers to the 2001 tax year. The audit was completed on November 11 and resulted in the notification of an Official Tax Audit Report. The issues raised refer to IRES, IRAP and VAT and mainly relate to a reclassification by the Tax Office of certain costs as non-deductible and the re-calculation of the pro-rata deductibility of VAT. The elements referred to in the Report amount to around € 1.1 million (quantification of taxes for which payment is requested).
300 REPORTS AND ACCOUNTS 2015
1.9 OTHER INFORMATION
In 2015 the Group continued to work on the projects launched in 2010 aimed at implementing the actions necessary in order to meet the new Solvency II requirements. During the year it intensified its efforts to ensure alignment with Solvency II, in preparation for this taking full effect as from January 1, 2016. Specifically, under the interim measures of the new EIOPA reporting requirements, insurance undertakings were required to submit a first report based on annual data as at December 31, 2014 and a second report for data as at September 30, 2015. The Parent sent its annual report to IVASS by June 3, 2015 and its quarterly report by November 25, 2015. The respective reports with data for the Group were submitted on July 15, 2015 and January 6, 2016.
* * *
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In accordance with art. 28-bis(1) of ISVAP Regulation No. 20/2008, as introduced by IVASS Measure No. 17/2014 (repealing art. 6.5 of ISVAP Regulation No. 15/2008 on the same subject), together with its financial statements, Reale Mutua in its capacity as the Parent responsible for management and coordination of the Group, sent the Supervisory Authority a report containing the following information:
a) instructions given to Group companies within the scope of its management and coordination activities;
b) the mechanisms in place to ensure coordination between the corporate bodies and the Group's RiskManagement, Compliance and Internal Audit functions and between the latter and the respective bodies and functions of each insurance company in the Group;
c) the systems of internal controls and risk management procedures, initially adopted pursuant to art. 87 ofLegislative Decree No. 209/2005 and subsequently pursuant to art. 1 of Legislative Decree No. 74/2015, the related internal control and risk management implementing provisions, including the results of assessments undertaken by Group companies;
d) the measures adopted to implement the provisions issued by IVASS regarding the insurance Group;
e) the outcome of the assessments to monitor compliance by each company in the insurance Group withthe requirements established by IVASS;
f) the mechanisms in place to ensure that the systems of internal control, risk management and internaland external reporting procedures are implemented consistently by all Group companies and how these procedures relate to the flow of information from companies included in the area of supplementary supervision.
* * *
In accordance with ISVAP Regulation No. 25/2008 the Boards of the Group's Italian insurance companies resolved on the adoption of guidelines relating to transactions between the individual Company and intra-group counterparties and the corresponding annual operations envisaged for 2015.
* * *
* * *
In March and December 2015 Fitch Ratings confirmed the IFS (Insurer Financial Strength) rating for Reale Mutua and Reale Seguros Generales of "BBB+" with a stable outlook.
The "BBB+" rating with stable outlook assigned to the Parent by Fitch Ratings is the same as that assigned by the same rating agency to the Italian State.
In its assessment, Fitch Ratings underlined the positive contribution by Reale Seguros to the profitability and diversification of the Group.
301
Turning to environmental issues, on September 17, 2015, the Board of Reale Mutua approved the Group Environmental Policy, which was subsequently submitted to each Group company for their approval.
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Once the document had been approved, General Management implemented the Group environmental management system.
So far, Banca Reale, Italiana Assicurazioni and Blue Assistance have obtained certification to UNI EN ISO 14001 and, after three years, Reale Mutua has renewed its certificate.
Reale Immobili has started the certification process, which it expects to complete by May 2016, after which all the other Group companies will gradually obtain the same certification.
1.10 MAIN EVENTS IN EARLY 2016 On January 4, 2016 the Company formalised its purchase of the 12.5% interest in Eurapco AG, for a total of CHF 1,255 thousand, equal to € 1,150,804.75 at the exchange rate on December 31, 2015.
* * *
On January 26, 2016 the sale of the interest in CBA Vita S.p.A. to Banca Sella Holding S.p.A. was finalised, for a price of € 2,133 thousand, equal to the carrying value.
* * *
No further significant events have occurred after the closure of the accounts that could have a significant effect on the information provided in the balance sheet or income statement.
302 REPORTS AND ACCOUNTS 2015
1.11 BUSINESS OUTLOOK
* * *
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The outlook for the euro area is for a faster pace of GDP growth, despite increased risks. According to estimates by the International Monetary Fund, growth is forecast to stand at 1.7% in 2016. This growth is expected to be driven by an upswing in domestic demand, sustained by expansionary monetary policies, the increase in disposable income of households, an upturn in investments and improvements in labour market conditions. The harmonised index of consumer prices is forecast to rise to 1%, mainly due to depreciation of the euro and the first hikes in prices of raw materials. Unemployment should fall to 10.5%, as a result of economic recovery, tax incentives in a number of countries, wage moderation and labour market reforms undertaken in previous years.
According to the latest IMF estimates, Italian GDP is expected to grow by 1.3% in 2016. This is based on the assumption that the lack of impetus from foreign trade as a consequence of the slowdown in the world economy, will be offset by an upswing in demand from within Italy and other euro area countries. The credit market is also expected to continue to benefit from expansionary monetary policies and gradual economic recovery.
There have been improvements on the labour market following the recent introduction of new legislation and unemployment looks set to fall to 11.1%.
Inflation, measured on the basis of the harmonised index of consumer prices, is forecast to rise very gradually, from 0.1% in 2015 to 0.3% in 2016.
After gathering momentum in 2015, Spanish GDP is forecast to grow at a slightly slower pace in 2016. According to studies by the IMF, economic growth is expected to stand at around 2.7%, buoyed by strong domestic demand, positive trends on the employment market, low inflation and a reduction in income tax, which will drive consumption.
Inflation should recover and is expected to increase at a rate of 0.6% in 2016
Solid recovery and the flexibility introduced by reforms should continue to sustain growth of the labour market and market analysts forecast that unemployment will stand at 19.5% by the end of 2016.
In this context, indications regarding Reale Group’s insurance business confirm the projections examined during the Meeting of Delegates of December 5, 2015.
The guidelines for 2016 envisage the continued improvement of underwriting performance in the Non-life Non-motor sector, and an increase in premiums at above the market average.
The Motor business will have to take into account some significant changes to the law introduced in 2016 in both Italy and Spain.
In the Life sector, the product catalogue will continue to be overhauled as in previous years, and new LTC (Long-Term Care) products will be developed as part of the Family Welfare project. A new multi-line product will also be launched in 2016, making it possible to diversify the offering in this sector.
1.12 AUDIT Pursuant to art. 25 of ISVAP Regulation No. 7 of July 13, 2007, the consolidated annual accounts at December 31, 2015 have been audited by Reconta Ernst & Young S.p.A.
THE BOARD OF DIRECTORS
CONSOLIDATED ACCOUNTING SCHEDULES
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304 REPORTS AND ACCOUNTS 2015
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Company: SOCIETA' REALE MUTUA DI ASS.NI
(in thousands of euro)
FINANCIAL 2015 FINANCIAL 2014
1 INTANGIBLE ASSETS 321,561 315,522
1.1 Goodwill 201,114 201,114
1.2 Other intangible assets 120,447 114,408
2 PROPERTY, PLANT AND EQUIPMENT 262,607 210,777
2.1 Real property 231,894 177,001
2.2 Other property, plant and equipment 30,713 33,776
3 REINSURERS' SHARE OF TECHNICAL PROVISIONS 394,284 396,535
4 INVESTMENTS 11,831,600 11,172,338
4.1 Real property investments 963,487 946,569
4.2 Equity investments in subsidiaries, associates and joint ventures 178,234 145,032
4.3 Investments held to maturity 0 0
4.4 Loans and receivables 456,790 412,551
4.5 AFS financial assets 9,410,187 8,805,876
4.6 Financial assets at fair value through the income statement 822,902 862,310
5 MISCELLANEOUS RECEIVABLES 960,378 995,331
5.1 Debtors arising out of direct insurance operations 676,931 681,229
5.2 Debtors arising out of reinsurance operations 89,775 135,193
5.3 Other debtors 193,672 178,909
6 OTHER ASSETS 341,417 390,590
6.1 Non-current assets or of a disposal group HFS 9,588 22,801
6.2 Deferred acquisition costs 0 0
6.3 Deferred tax assets 160,654 172,408
6.4 Current tax assets 100,413 117,255
6.5 Other assets 70,762 78,126
7 CASH AT BANK AND IN HAND AND CASH EQUIVALENTS 107,672 116,790
TOTAL ASSETS 14,219,519 13,597,883
BALANCE SHEET - Assets
305
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(in thousands of euro)
FINANCIAL 2015 FINANCIAL 2014
1 SHAREHOLDERS' EQUITY 2,325,646 2,245,498
1.1 of which Group interest 2,325,646 2,245,498
1.1.1 Capital 60,000 60,000
1.1.2 Other equity instruments 0 0
1.1.3 Capital reserves 0 0
1.1.4 Retained earnings and other equity reserves 2,016,503 1,843,591
1.1.5 (Treasury stock) 0 0
1.1.6 Reserve for net exchange differences 0 0
1.1.7 Gains or losses on AFS financial assets 91,087 175,502
1.1.8 Other profit or losses recognised directly in equity -1,245 -6,291
1.1.9 Group interest in net income (loss) for the year 159,301 172,696
1.2 of which minority interest 0 0
1.2.1 Minority interest in capital and reserves 0 0
1.2.2 Profit or losses recognised directly in equity 0 0
1.2.3 Minority interest in net income (loss) for the year 0 0
2 PROVISIONS 96,694 101,606
3 TECHNICAL PROVISIONS 10,472,777 9,832,042
4 FINANCIAL LIABILITIES 552,367 512,189
4.1 Financial liabilities measured at fair value through the income statement 24,101 23,448
4.2 Other financial liabilities 528,266 488,741
5 PAYABLES 414,638 437,652
5.1 Creditors arising out of direct insurance operations 179,258 210,046
5.2 Creditors arising out of reinsurance operations 16,287 18,247
5.3 Other payables 219,093 209,359
6 OTHER LIABILITIES 357,397 468,896
6.1 Liability of a disposal group HFS 0 0
6.2 Deferred tax liabilities 266,785 331,747
6.3 Current tax liabilities 2,365 30,425
6.4 Other liabilities 88,247 106,724
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 14,219,519 13,597,883
BALANCE SHEET – Liabilities and Shareholders’ equity
306 REPORTS AND ACCOUNTS 2015
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Company: SOCIETA' REALE MUTUA DI ASS.NI
(in thousands of euro)
FINANCIAL 2015 FINANCIAL 2014
1.1 Net premiums 3,526,244 3,444,245
1.1.1 Gross premiums earned 3,825,311 3,780,830
1.1.2 Premiums earned ceded in reinsurance -299,067 -336,585
1.2 Commissions receivable 13,754 11,953
1.3 Income and expense on financial instruments measured at fair value through the i. s. 32,302 62,985
1.4 Income on equity investments in subsidiaries, associates and j.ventures 31,300 27,757
1.5 Income on other financial instruments and investment property 415,076 357,438
1.5.1 Interest income 204,198 214,466
1.5.2 Other income 87,152 85,292
1.5.3 Realised gains 123,515 57,481
1.5.4 Valuation gains 211 199
1.6 Other revenues 114,158 138,956
1 TOTAL REVENUES AND INCOME 4,132,834 4,043,334
2.1 Net charges for claims -2,805,060 -2,679,866
2.1.1 Amounts paid and change in technical provisions -3,004,820 -2,898,028
2.1.2 Reinsurers' share 199,760 218,162
2.2 Commissions payable -5,082 -3,637
2.3 Charges on equity investments in subsidiaries, associates and j.v. 0 -16,697
2.4 Charges on other financial instruments and investment property -45,503 -46,096
2.4.1 Interest expense -4,683 -5,718
2.4.2 Other charges -15,378 -22,326
2.4.3 Realised losses -11,704 -6,137
2.4.4 Valuation losses -13,738 -11,915
2.5 Management costs -866,082 -843,951
2.5.1 Commissions and other acquisition costs -682,816 -660,943
2.5.2 Investment management expenses -52,650 -48,218
2.5.3 Other administrative expenses -130,616 -134,790
2.6 Other costs -196,288 -203,408
2 TOTAL COSTS AND CHARGES -3,918,015 -3,793,655
PROFIT (LOSS) FOR THE YEAR BEFORE TAXES 214,819 249,679
3 Taxes -55,518 -76,983
PROFIT (LOSS) FOR THE YEAR NET OF TAXES 159,301 172,696
4 PROFIT (LOSS) ON DISCONTINUED OPERATIONS 0 0
CONSOLIDATED PROFIT (LOSS) 159,301 172,696
of which Group interest 159,301 172,696
of which minority interest 0 0
INCOME STATEMENT
307
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Company: SOCIETA' REALE MUTUA DI ASS.NI
(in thousands of euro)
FINANCIAL 2015 FINANCIAL 2014
CONSOLIDATED PROFIT (LOSS) 159,301 172,696
Other income items net of taxes not reclassified to the income statement 3,188 -5,621
Change in shareholders' equity of subsidiaries 0 0Change in the intangible assets revaluation reserve 0 0Change in the tangible assets revaluation reserve 0 0Income and charges relating to non-current assets or of a disposal group held for sale 0 0Actuarial gains and losses and adjustments arising from defined benefit plans 3,188 -5,621Other items 0 0Other income items net of taxes with reclassification in the income statement -82,556 115,632
Change in the reserve for net exchange differences 0 0Gains or losses on AFS financial assets -84,416 107,361Gains or losses on cash flow hedges 0 0Gains or losses on hedges of net investments in foreign entities 0 0Change in shareholders' equity of subsidiaries 1,860 8,271Income and charges relating to non-current assets or of a disposal group held for sale 0 0Other items 0 0TOTAL OTHER COMPONENTS OF THE STATEMENT OF COMPREHENSIVE INCOME -79,368 110,011
TOTAL STATEMENT OF CONSOLIDATED COMPREHENSIVE INCOME 79,933 282,707
of which Group interest 79,933 282,876
of which minority interest 0 -169
STATEMENT OF COMPREHENSIVE INCOME
308 REPORTS AND ACCOUNTS 2015
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Statement of changes in equity
Changes in the last two years in the individual items of Shareholders’ equity are set forth in the schedule below.
Company: SOCIETA' REALE MUTUA DI ASS.NI
(in thousands of euro)
Balanceat 01‐01‐2014
Change in closing balances
AllocationsAdjustments for
reclassification in the income statement
TransfersChanges in ownership
interest
Balanceat 31‐12‐2014
60,000 0 0 0 60,000
00 0 0 0
00 0 0 0
1,739,737 0 103,854 0 0 1,843,591
000 0 0
94,881 0 77,815 0 172,696
59,031 0 139,671 ‐20,826 ‐8,665 0 169,211
1,953,649 0 321,340 ‐20,826 ‐8,665 0 2,245,498
6,170 0 ‐6,170 0 0 0
814 0 ‐814 0 0
169 0 ‐169 0 0 0 0
7,153 0 ‐7,153 0 0 0 0
1,960,802 0 314,187 ‐20,826 ‐8,665 0 2,245,498
Balanceat 31‐12‐2014
Change in closing balances
AllocationsAdjustments for
reclassification in the income statement
TransfersChanges in ownership
interest
Balanceat 31‐12‐2015
60,000 0 0 0 60,000
000 0 0
000 0 0
1,843,591 0 172,912 0 0 2,016,503
00 0 0 0
172,696 0 ‐13,395 0 159,301
169,211 0 ‐36,235 ‐43,134 0 0 89,842
2,245,498 0 123,282 ‐43,134 0 0 2,325,646
000 0 0 0
000 0 0
000 00 0 0
000 0 00 0
2,245,498 0 123,282 ‐43,134 0 0 2,325,646
Total
Group interest in Shareholders’ equity
Minority interest in shareholders’
equity
CapitalOther equity instrumentsCapital reservesRetained earnings and other equity reserves(Treasury stock)Net profit (loss) for the yearOther components of the statement of comprehensive incomeTotal of which Group interestMinority interest in capital and reserves
Net profit (loss) for the yearOther components of the statement of comprehensive incomeTotal of which minority interest
Group interest in shareholders’ equity
Total
Minority interest in shareholders’
equity
CapitalOther equity instrumentsCapital reservesRetained earnings and other equity reserves(Treasury stock)Net profit (loss) for the yearOther components of the statement of comprehensive incomeTotal of which Group interestMinority interest in capital and reservesNet profit (loss) for the yearOther components of the statement of comprehensive incomeTotal of which minority interest
309
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CASH FLOW STATEMENT (indirect method)
Company: SOCIETA' REALE MUTUA DI ASS.NI(in thousands of euro)
FINANCIAL 2015 FINANCIAL 2014
Profit (loss) for the year before taxes 214,819 249,679
Change in non-monetary items 691,132 983,886
Change in the non-life provisions for unearned premiums 21,319 56,622
Change in the provisions for outstanding claims and in other non-life technical provisions -57,561 -71,987
Change in provisions for policy liabilities and other life technical provisions 679,228 951,911Change in deferred acquisition costs 0 0Change in provisions -4,912 15,534
Non-monetary income and expenses deriving from financial instruments, real property investments and equity investments 12,784 -5,914
Other changes 40,274 37,720Change in receivables and payables generated by operating activities -24,258 -88,926
Change in receivables and payables deriving from direct and reinsurance operations 16,968 -137,268
Change in other receivables and payables -41,226 48,342
Taxes paid -94,863 -82,637
Net liquidity generated/absorbed by monetary items relating to investments and financial activities 54,764 -37,880
Liabilities arising on financial contracts issued by insurance companies 654 6,497
Amounts owed to bank and interbank customers 57,865 52,111
Loans and receivables from bank and interbank customers -43,905 -24,035
Other financial instruments measured at fair value through the income statement 40,150 -72,453TOTAL NET CASH FLOW DERIVING FROM OPERATING ACTIVITIES 841,594 1,024,122
Net cash flow generated/absorbed by real property investments -28,049 8,887
Net cash flow generated/absorbed by investments in subsidiaries, associates and joint ventures -33,202 -31,905
Net cash flow generated/absorbed by loans and receivables -1,092 2,334Net cash flow generated/absorbed by HTM investments 0 0
Net cash flow generated/absorbed by AFS financial assets -685,953 -915,504
Net cash flow generated/absorbed by intangible assets and property, plant and equipment -97,290 -24,292
Other net cash flow generated/absorbed by investment activities 13,213 -22,801TOTAL NET CASH FLOW FROM INVESTMENT ACTIVITIES -832,373 -983,281
Net cash flow generated/absorbed by capital instruments pertaining to the Group 0 0
Net cash flow generated/absorbed by own shares 0 0
Distribution of dividends pertaining to the Group 0 0Net cash flow generated/absorbed by minority interest in capital and reserves 0 -7,153
Net cash flow generated/absorbed by subordinated liabilities and equity financial instruments 0 0
Net cash flow generated/absorbed by sundry financial liabilities -18,339 -23,663
TOTAL NET CASH FLOW DERIVING FROM FINANCING ACTIVITIES -18,339 -30,816
Effect of exchange differences on cash and cash equivalents 0 0
Cash at bank and in hand and cash equivalents at start of year 116,790 106,765
Increase (decrease) in cash and at bank and in hand and cash equivalents -9,118 10,025
Cash at bank and in hand and cash equivalents at end of the year 107,672 116,790
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NOTES TO THE FINANCIAL STATEMENTS
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PART A: GENERAL ACCOUNTING PRINCIPLES
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Statement of compliance with International Accounting Standards
The Consolidated Financial Statements of Reale Group have been prepared in accordance with International Accounting Standards. Legislative Decree No. 38 of February 28, 2005, exercising the options envisaged by EC Regulation No. 1606/2002 regarding the adoption of International Accounting Standards, has extended the obligation of preparing the Consolidated Financial Statements in accordance with international accounting standards starting from the year closed or in course at December 31, 2005 to all listed and unlisted insurance companies.
The schedules of the Balance Sheet, Income Statement, Changes in Shareholders’ Equity, Cash Flow Statement and the annexes to the Notes to the Consolidated Financial Statements comply with the formats defined by the Supervisory Authority with Regulation No. 7 of July 13, 2007, amended by IVASS Directive No. 29 of January 27, 2015, and have been compiled according to the instructions set forth in the above measure.
Reale Group has taken advantage of the possibility, permitted by IFRS 1, of applying the following accounting standards as of January 1, 2005:
- IAS 32 Financial instruments: disclosure and additional information;
- IAS 39 Financial instruments: recognition and measurement;
- IFRS 4 Insurance contracts.
All other IAS/IFRS have been applied starting from January 1, 2004.
Basis of preparation
The Consolidated Financial Statements have been prepared according to the principle of going concern. For the reasons set forth in the Report on Operations to which reference should be made, no uncertainty exists regarding its ability to continue to operate as a functioning entity.
In financial 2015, as in previous years, Reale Group made no recourse to anti-crisis measures. It did nottake advantage of the option, of an exceptional and transitory nature, permitted by ISVAP Regulation No. 43 of July 12, 2012 (issued in enactment of the provisions of Decree-Law No. 216 of December 29, 2011 converted by Law No. 14 of February 24, 2012), for valuation of debt instruments issued or guaranteed by EU states not intended to be held for the longer term.
New accounting standards
As far as new accounting standards, amendments or interpretations are concerned, no significant updates were applicable as from January 1, 2015.
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CONSOLIDATION PRINCIPLES
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Financial statements used for consolidation
The Consolidated Financial Statements have been prepared using, for the consolidated companies, the reporting package drawn up according to the instructions of the Parent Company.
Date of the Consolidated Financial Statements
The reference date is December 31, the date on which all consolidated companies close their accounts.
Presentation currency
The accounts have been prepared using the euro as presentation currency; all amounts stated in the schedules and in the related Notes are rounded to the nearest thousand.
Basis of consolidation The main criteria adopted in preparing the Consolidated Financial Statements are set forth below:
- Full consolidation
The Consolidated Financial Statements include those of the Parent and of associated companies in which Reale Mutua holds, directly or indirectly, a majority of the voting rights or exercises effective control. The assets and liabilities of fully-consolidated companies are included in the Consolidated Financial Statements after eliminating the carrying value of the investments against the related shareholders’ equity. Minority interest in shareholders’ equity and in the operating result has been disclosed, according to the schedules envisaged, in specific items of consolidated Shareholders’ equity and of the consolidated Income Statement.
- Consolidation by the equity method
According to the equity method of consolidation, the Consolidated Financial Statements disclose only the portion of the carrying value of the shareholders’ equity of investments including the operating results of the year but not the values of the individual items. Associated companies are valued by the equity method as established by IAS 28.
Differences arising on consolidation
Differences between the underlying shareholders’ equity of the consolidated companies and the carrying values of the investments set forth in the individual accounts are allocated directly to consolidated shareholders’ equity in the consolidation reserve included under the retained earnings and other capital reserves item. If the higher price paid reflects prospects of future earnings, positive differences are taken to goodwill as difference on consolidation.
Elimination of intra-group transactions
When preparing the Consolidated Financial Statements, all receivables, payables, revenues, expenses referring to transactions between Group companies consolidated line by line and by the proportional method and gains and losses, except for those considered permanent, resulting from transactions between Group companies and not yet realised with third parties have been eliminated. Dividends collected during the year by companies included in the scope of consolidation have also been eliminated.
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VALUATION CRITERIA The main valuation criteria adopted in preparing the Consolidated Financial Statements are set out below.
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Consolidation criteria
The Consolidated Financial Statements of Reale Group reflect line-by-line integration of the accounts of the Reale Mutua Assicurazioni Parent with those of all the companies controlled both directly and indirectly thereby. IFRS 10 envisages line-by-line consolidation also of subsidiaries that perform dissimilar activities to those of the Parent.
Associated companies are stated according to the underlying shareholders’ equity.
The Group does not have joint arrangements for which IFRS 11 envisages adoption of the proportional integration method.
Business combinations - Goodwill
Business combinations are valued according to the purchase method. Therefore, the assets, liabilities and any identifiable potential liabilities of the business acquired that comply with the conditions for disclosure according to IFRS 3 are recognised at their current values on the date of acquisition, except for non-current assets which are designated as held for sale as prescribed by IFRS 5 and which are recognised and measured at current values minus transaction costs.
Goodwill represents the excess of the cost of the acquisition over the fair value of the Group’s share of the identifiable assets, liabilities and potential liabilities of the business acquired. Goodwill is recognised under assets and is tested for impairment at least once a year. Impairments of value are recognised in the income statement and are not reinstated subsequently.
Other intangible assets
This item comprises intangible assets identifiable and controllable by the company from which future economic benefits are expected to flow to the enterprise, as established by IAS 38.
Intangible assets with a definite useful life are recognised at cost net of amortisation, according to their residual useful life, and tested periodically for impairment.
Intangible assets with an indefinite useful life are not amortised but are tested for impairment.
Property, plant and equipment
This item comprises property used in company operations, construction in progress, furniture, fittings, plant, equipment, office machines and also vehicles listed in public registers, as established by IAS 16.
Such assets are recognised at cost which, in addition to the purchase price, includes any accessory charges directly attributable to the purchase and to start of functioning of the asset.
Subsequently they are stated using the amortised cost method and net of any permanent impairments of value. Depreciation is calculated on a straight-line basis over the estimated residual useful life of the assets. Land, which has an indefinite useful life, is not depreciated.
At each reporting date, if there is evidence that an asset is impaired, the asset's carrying value is compared with its recoverable value, equal to the higher of fair value, net of any sale costs, and the relative value of the asset in use, meaning the current value of future cash flows deriving from the asset. Any adjustments are recorded in the income statement. If the reasons for the impairment no longer exist, the value is adjusted upwards by an amount that must not exceed the value of the asset, net of depreciation, if it had not been previously impaired.
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Upkeep and maintenance expenses that result in a significant and tangible increase in production capacity or safety or that extend the future useful life of the asset, are capitalised and added to the value of the relative asset. Ordinary maintenance costs are recognised in the income statement as incurred.
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Leases
Leases are classified as finance leases when, according to the terms of the lease, all the risks and rewards of ownership are transferred to the lessee. All other leases are considered operating leases.
Assets under finance leases are recognised as assets of the Group at their fair value on the date of stipulation of the contract, or if lower, at the current value of the minimum lease payments. The corresponding liability towards the lessee is stated under liabilities for finance leases. Lease payments are allocated between the liability and finance charges so as to achieve a constant rate of interest on the finance balance outstanding. Financial charges are charged to income as incurred.
The costs of lease fees arising on operating leases are stated according to the term of the lease.
Reinsurers’ share of technical provisions
These are calculated according to the contractual conditions of reinsurance treaties in that this method is deemed to represent the specific economic results of the sector most correctly.
Real estate investments
Investments intended to earn rentals or for capital appreciation are classified under this item; property held for instrumental use or available for purchase/sale is not included.
At the time of the initial application of IAS/IFRS principles, real estate investments were recognised according to a deemed cost basis (corresponding to the values of expert appraisals of the property at January 1, 2004) established by IFRS 1.
Items of significant value, for which the useful life differs, are recognised separately.
These items are subsequently recognised at cost, in accordance with IAS 16 to which IAS 40 refers, net of depreciation and any permanent impairment of value. Depreciation is calculated on a straight-line basis over the estimated residual useful life of the assets, except for land which, insofar as of unlimited duration, is not depreciated. The estimated residual life varies according to the category of the property (high, medium, low), also on the basis of appraisals by qualified external consultants.
The following depreciation rates are used:
high-range properties 1.00%
mid-range properties 2.00%
low-range properties and individual units 3.00%
At each reporting date, if there is evidence that an asset is impaired, the asset's carrying value is compared with its recoverable value, equal to the higher of fair value, net of any sale costs, and the relative value of the asset in use, meaning the current value of future cash flows deriving from the asset. Any adjustments are recorded in the income statement. If the reasons for the impairment no longer exist, the value is adjusted upwards by an amount that must not exceed the value of the asset, net of depreciation, if it had not been previously impaired.
Upkeep and maintenance expenses that result in a significant and tangible increase in production capacity or safety or that extend the future useful life of the asset, are capitalised and added to the value of the relative asset. Ordinary maintenance costs are recognised in the income statement as incurred.
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Equity investments in associates and joint ventures
The item comprises equity investments not consolidated line by line that can be measured by the equity or cost method.
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This item comprises equity investments in associates.
Such investments are recognised according to the equity method, proportionally to the interest held by the Group.
The equity investment is derecognised when contractual rights to receive expected cash flows from this are transferred.
Loans and receivables
This category includes loans, receivables and financial instruments not traded in an active market, with fixed or measurable incoming cash flows.
These assets are initially recognised on the date of signing of the contract, which coincides with the date of payment or, in the case of debt securities, the settlement date, based on fair value, equal to the amount paid, or subscription price, inclusive of directly attributable transaction costs.
Subsequently, these items are recognised at amortised cost calculated using the effective yield method. The effective interest rate is determined by calculating the rate that exactly discounts the current value of estimated future cash payments on the loan, both capital and interest, to the amount of the loan including costs/income attributable to the loan.
These assets are tested for impairment at each annual or interim reporting date: impairments of value are stated in the income statement. If the reason for the impairment ceases to exist, the carrying value is reinstated in subsequent years; increases in value are stated in the income statement and must not result in a value of the asset in excess of what the amortised cost would have been if the write-down for impairment had not been made.
The financial asset is derecognised when the contractual rights to receive the cash flows from the asset and the underlying risks are transferred.
The fair value of such assets is represented by the presumable value of recent or similar transactions or based on valuation techniques.
Financial assets available for sale
This category comprises all financial assets not covered by the other IAS 39 classifications. This section therefore includes equity securities, except for those included in subsidiary, associated and affiliated equity investments, listed debt securities, structured securities with embedded derivatives and mutual funds and unlisted debt securities not included in the previous categories.
These items are recognised initially on the date of settlement and at cost, considered to be the fair value of the financial instrument, increased by directly attributable transaction costs.
The assets classified in such category are recognised at amortised cost using the effective yield method and measured at fair value. The fair value coincides with the closing price on the last day of trading of the year for instruments traded in an active market whereas, for the remaining securities, it is represented by actual patterns of trading or similar or by valuation models.
Differences in relation to the carrying value must be recognised in equity in a specific reserve for retained earnings or unrealised losses that will be utilised in the case of disposal.
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At the time of sale or redemption, any losses or gains in relation to the value stated under assets are recognised in the income statement together with reversal of cumulative gains or losses and recorded in the corresponding item of shareholders’ equity.
These assets are tested for impairment at each annual or interim reporting date. Impairments of value are stated as reducing the cost with offsetting item in the income statement through reversal of the portions of cumulative gains or losses and recorded in the specific equity item. If the reasons for the impairment no longer exist, the carrying value is reinstated and recognised in the income statement in the case of debt securities and posted to equity in the case of equity securities. The increase in value must not result in a value of the asset in excess of what the amortised cost would have been if the write-down for impairment had not been made.
The financial asset is derecognised when the contractual rights to receive the cash flows from the asset and the underlying risks are transferred.
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Financial assets at fair value through the income statement
This category comprises financial instruments held for trading in the near term, derivatives and securities designated by the enterprise as measured at fair value through the income statement. Designated securities include structured financial instruments for which the embedded derivative must be valued separately if not closely related to the host contract, assets hedging the pension fund, unit- and index-linked policies and any excesses intended to be disposed of.
These items are recognised initially on the settlement date and at cost deemed to be the fair value of the financial instrument; transaction costs and proceeds directly attributable to the purchase/sale of the instrument are not considered on initial recognition and are recognised directly in the income statement.
Subsequently, the liability is measured at fair value and the difference between the fair value and the carrying value is recognised in the income statement. The fair value coincides with the closing price on the last day of trading of the year for instruments traded in an active market whereas, for the remaining securities, it is represented by actual patterns of trading or similar or by valuation models.
A financial asset measured at fair value through the income statement is derecognised when the contractual rights to receive the cash flows from the asset and the underlying risks are transferred.
Hedging derivatives (Hedge Accounting)
Where appropriate, financial risks are covered using hedging derivatives in the form of cash flow hedges. A necessary condition for use of these hedges is the drafting of documentation that precisely identifies the strategy and objectives of the hedge and also the hedge derivative, the asset hedged and the correlation between these. With regard to strategies and declared objectives, hedging operations are monitored through periodic tests intended to demonstrate their effectiveness.
As regards cash flow hedges, changes in fair value of the derivative are recognised in equity for the effective portion of the hedge and in the income statement for the ineffective portion. Amounts stated under equity will be recorded in the income statement when the cash flows hedged are realised. If the test does not confirm the effectiveness of the hedge, recognition of this is interrupted and the derivative is reclassified under non-hedge derivatives.
With regard to fair value hedges, the derivatives hedge fluctuations in the value of certain liabilities and are disclosed initially and recognised subsequently at fair value.
In the case of effective hedge, the change in fair value of the item hedged is offset by the change in fair value of the hedging derivative. Such offsetting is disclosed through recognition in the income statement of the changes in value of both the item hedged and the hedging derivative. Any difference, which represents the ineffective portion of the hedge, therefore represents its net economic effect.
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Measurement of the fair value of financial assets
General principles
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Fair value is the amount for which an asset could be exchanged or a liability settled between knowledgeable, willing parties in an arm’s length transaction.
An active market is the market for which quoted prices are readily and regularly available or systematically quoted on “alternative” trading systems from official circuits whose prices are considered “significant” and also those observable from contributors who operate as primary traders on the various markets where the prices proposed are representative of potential transactions and represent effective market transactions carried out in an orderly manner in normal trading conditions. The fair value determined is not the amount that would be received or paid in a forced transaction but the value at which a transaction could be carried out on the reporting date for such instruments in the most advantageous market to which the entity has access.
Fair value hierarchy
Assets and liabilities measured at fair value are classified according to the hierarchy established by IFRS 13. This classification defines a fair value hierarchy according to the level of discretion used. It gives the highest priority to quoted prices in active markets that represent the assumptions that market participants would use when pricing the asset or liability.
The classification is based on the approach used to measure the fair value (Mark to Market, Mark to Model, Counterparty) and on whether the inputs are observable, if the Mark to Model approach is used.
The fair value hierarchy defined and adopted as of December 31, 2015 is illustrated below:
Effective market quotes (Level 1): market price according to quoted prices in active markets. The existenceof unadjusted quoted prices in an active market represents the best evidence of fair value; such prices are therefore those to which priority must be given for the valuation of financial assets.
In the absence of an active market, valuation techniques must be adopted to determine an appropriate fair value. Such techniques include:
Valuation techniques - (Level 2): this approach refers to market values connected directly or indirectly tothe instrument to be valued and referring to products with similar risk characteristics.
It is based on approximate valuations furnished by reliable providers or on prices determined using appropriate calculation methods and market observables. This method of calculation does not include discretional parameters - i.e. parameters whose value cannot be derived from the prices of financial instruments traded in active markets or cannot be determined at levels such as to replicate prices not present on active markets – such as to have a decisive influence on the final valuation price.
Valuation techniques - (Level 3): measurements are based on observable and unobservable inputs andtherefore involve estimates and assumptions when making the valuation.
The above methods must be applied in hierarchical order: if a price is available at level 2, one of the other valuation approaches based on assumptions formulated by the valuer must not be used (level 3).
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Valuation process
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In order to guarantee continuity and consistency of portfolio valuation and also comparison with the previous year, no modifications were made during the year as regards the determination of the fair value.
For debt securities, the fair value is determined as follows:
- for financial instruments quoted in active markets: the official prices on the last day of the reference year as these provide the best evidence of fair value and must be used when available (level 1);
- for financial instruments not quoted in active markets: the value furnished by contributors or financial intermediaries on the reference date. In a limited number of cases in which a value was not available, an estimate of fair value, made by a Group banking company according to market observables (level 2), was used.
For a number of instruments belonging to the loans and receivables category, where the price furnished is not available, the following valuation technique based on market observables was adopted: discounting of future cash flows (coupons and repayments) according to the risk-free discount rate increased by a valuation spread of the security (discounted cash flows, in level 2).
The fair value of capital instruments has been determined as follows:
- for financial instruments quoted in active markets: the official prices of the last day of the reference year (level 1);
- for financial instruments whose fair value cannot be reliably determined: valuation at cost. The fair value is not reliable if the variability in the range of reasonable estimates of fair value is significant and the probability of the various estimates within the range is not reasonably ascertained. This type of valuation is applied to equity investments of a not significant amount, both at individual level and with regard to all Group financial assets (level 3).
For shares of common investment funds, the fair value is equal to the Net Asset Value provided by the asset management companies (level 3 for closed or speculative funds, level 1 for all others).
For derivative financial instruments, fair value is determined according to the values furnished by financial counterparties who use a standard method complying with those adopted on the market. This method adopts multiple parameters and indices which are in turn determined according to market observables derived from primary sources recorded on the valuation date (level 2).
The fair value of other receivables, which is required for information only, is mainly based on the use of unobservable internal parameters and is equal to the carrying value (level 3).
The fair value of real estate investments, which is required for information only, is equal to the appraisal value as calculated by independent experts (level 3).
Permanent impairment of financial assets
A financial asset or group of financial assets, excluding those designated at fair value recognised in the income statement, is impaired in the case of objective evidence of an impairment of value following one or more loss events after initial recognition of the asset, such as to generate a reduction in reliably estimated future cash flows relating to the financial assets.
Possible indicators (qualitative factors) of impairment include: significant financial difficulties of the issuer, high probability of bankruptcy or admission to insolvency proceedings, disappearance of an active market due to financial difficulties, significant negative changes in the technological, market, economic or regulatory context in which the issuer operates, substantial downgrading of the issuer’s credit rating, the announcement or application of debt restructuring plans and the presence of impairments already disclosed in the accounts of previous years. In particular, further parameters can be distinguished according to type of financial assets; for example, for debt securities, effective breach of contract (such as default or failure to pay interest or principal).
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For Group and unquoted investments and also for capital instruments held for strategic purposes, in addition to the above aspects, consideration must also be given to significant, prolonged impairments with consequent erosion of shareholders’ equity or significant differences between costs and pro-quota shareholders’ equity, always in relation to the general capital and financial situation of the company and its development prospects.
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For quoted capital instruments or shares in common investment funds, a significant or prolonged impairment of fair value in relation to the carrying value of the security is objective evidence of impairment of value. The Group considers the following quantitative parameters:
- the price of the security is continuously below its initial recognition value for a period of more than 24 months (prolonged impairment);
- the price of the security on the reporting date is more than 40% lower than the initial value (significant impairment).
In the case of objective evidence of impairment, this is determined as the difference between the amortised cost and the fair value or the current value of the prudent estimate of their probable recovery value at the time of valuation and is taken to the income statement.
If, in subsequent periods there is evidence that this no longer exists, the carrying value of the assets is restored, in the income statement for debt securities (up to the limit of the previous impairment) and in shareholders’ equity for capital securities; otherwise further reductions of value, even if only slight with respect to the carrying value of the investment, are automatically taken to the income statement.
Miscellaneous receivablesThis item mainly reflects receivables from policyholders for premiums being collected, from agents and other intermediaries and from insurance and reinsurance companies. Receivables are recognised atamortised cost calculated using the effective yield method. Such method is not adopted for receivables of such short duration as to make the effects of actualisation negligible; such receivables are carried at historical cost which corresponds to their face value, and are tested for impairment.
Non-current HFS assets
Non-current HFS assets are measured at the lower of their carrying value and market value net of sales costs.
Non-current assets are designated as Held For Sale when the carrying amount will be recovered principally through a sale transaction rather than through continuing use in the operations of the company. This condition is met only when sale is highly probable and the asset can be sold immediately in its initial conditions.
Cash and cash equivalents
This category comprises cash on hand and sight deposits. These items are stated at face value and in the case of foreign currencies at the year-end exchange rate.
Group interest in shareholders’ equity
This heading reflects capital instruments and Group interest in shareholders’ equity.
In particular, the capital item reflects the amount of the Parent Company’s guarantee fund.
Retained earnings and other equity reserves include, amongst others, gains or losses deriving from first-time application of international accounting standards, catastrophe and equalisation provisions as set forth in IFRS 4.14(a) and consolidation reserves.
Gains or losses on AFS assets reflect gains and losses deriving from valuation of AFS financial assets, net of any deferred taxes and of the part attributable to policyholders and posted to insurance liabilities (so-called shadow accounting).
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Minority interest in shareholders’ equityThis heading comprises minority interest in capital instruments and related equity reserves.
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Provisions
This item comprises the allocations pursuant to IAS 37 for present obligations (legal or implicit) deriving from a past event with which the company will probably be required to comply and the amount of which can be reliably estimated.
Provisions represent the best possible estimate based on the data available on the reporting date and are discounted when the effect is significant.
Non-life business premiums and technical provisions
Gross premiums written include amounts maturing during the year on insurance contracts, as defined by IFRS 4. Any revenues related to policies with an insignificant insurance risk component are not included under this item but treated according to the requirements of IAS 39 and IAS 18.
Insurance contracts within the scope of application of IFRS 4 are recognised according to the principles applicable to the statutory financial statements and, in particular, in accordance with the provisions of ISVAP Regulations Nos. 16 and 22. Therefore, such principles and provisions constitute the general rules applied for the recognition and measurement of technical provisions. In particular, the principle whereby the amount of the provisions must always be sufficient to guarantee compliance by the companies, as far as reasonably possible, with commitments assumed towards insureds has been complied with. The provisions are therefore calculated according to the criteria of the individual financial statements and technical provisions have not been re-measured according to IFRS 4.
The provision for unearned premiums comprises two components, namely the provision for premium instalments and the provision for unexpired risks. The provision for premium instalments has been calculated according to the pro-rata method based on gross premiums written, minus acquisition costs.
The provision for claims outstanding is estimated analytically according to a prudent evaluation based on objective data, adopting an ultimate cost approach, in the measure necessary to match commitments for the payment of the claims and the related direct and indirect claim settlement costs. The provision includes the estimate of claims for the year not yet reported. Actuarial statistical methods are used to verify the adequacy of the provisions in relation to ultimate cost.
At each reporting date, the company is required to carry out a Liability Adequacy Test on the provisions, as established by IFRS 4. The test consists in estimating future cash flows relating to existing contracts and on the basis of current assumptions. Any inadequacy of technical provisions in relation to estimated future cash flows must be recognised entirely in the income statement.
With regard to the foregoing, it is considered that the requirements established by Italian insurance regulations are consistent and comply with the requirements of IFRS 4.
In particular, it is considered that the unexpired risks component of the provision for unearned premiums, accrued in the case in which, for each class of business, the expected charge for claims exceeds the revenues of subsequent years, constitutes a reasonable approximation of the Liability Adequacy Test.
Also in the case of the provision for claims outstanding, it is considered that measurement of such provisions on an ultimate cost basis comprises the main non-discounted future cash flows and can, therefore, be considered as exceeding the amount resulting from application of the L.A.T. according to IFRS 4.
Recognition of catastrophe and equalisation provisions is not permitted in that IFRS 4 does not envisage recording of any prudent provision for future claims; therefore the related provisions stated in the individual financial statements are reversed on consolidation.
The provision for increasing age is calculated analytically on the basis of actuarial methods.
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Life business premiums and technical provisions
The Life portfolio has been classified interpreting the concept of significant insurance risk envisaged by IFRS 4 as equivalent to a ratio of risk capital to the total mathematical provision of at least 10%.
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and zero technical return rate);
- Non-revaluable policies (term life insurance);
- Deferred and immediate annuity policies;
Financial instruments containing a discretionary participating feature:
- Revaluable capitalisation policies (without guaranteed annuity coefficients);
- Revaluable policies tied to the duration of human life (deferred capital, mixed and whole life and zero technical return rate).
Financial instruments without discretionary participating feature:
- Non-revaluable policies (deferred capital, capitalisations);
- Indexed policies;
- Unit-linked and index-linked policies with death benefit at market value.
Insurance contracts and financial instruments with discretionary participation feature are recognised and measured according to current Italian legislation.
Contracts classified as financial instruments without discretionary participation are recognised according to IAS 39. However, class C policies and unit-linked policies classified as non-participating financial instruments, have been recognised according to Italian regulations as, in view of the limited amount of the provisions of such policies, the resulting economic impact would be insignificant also in relation to the Life portfolio aggregate provisions. The only policy class for which it has been necessary to adopt the new accounting standards are index-linked policies with death benefit at market value.
For insurance contracts and financial contracts with discretionary participation feature, the provisions have been calculated according to current Italian GAAP and adequacy is tested according to IFRS 4. This test verifies the adequacy of “net technical provisions” through comparison with the “realistic provision" determined according to the current value of future cash flows.
For index-linked contracts with death benefit at market value, the service component has been extrapolated and recognised according to IAS 18. In particular IAS 18 requires that:
- revenues and costs relating to the same transaction must be recognised simultaneously;
- revenues and costs from rendering of services must be recognised according to stage of completion of the transaction.
Stage of completion can be measured using various methods, also including the constant rate method unless it is evident that other methods would represent stage of completion more effectively. Therefore, the portion to be amortised of costs incurred on financial contacts (DAC) and, conversely, the portion not yet matured of revenues linked to such contracts (DIR) have been determined on a linear basis.
The financial component of the liabilities has been measured at fair value consistently with the underlying assets.
The contracts portfolio has been classified at individual policy level.
Briefly, the breakdown of the portfolio is as follows:
Insurance contracts:
- Revaluable policies tied to the duration of human life (except for deferred capital, mixed and whole life
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Shadow Accounting
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Paragraph 30 of IFRS 4 permits shadow accounting in order to match the value of the provision for policy liabilities relating to contracts inserted in Life separately managed accounts with the value of the financial assets inserted in separately managed accounts, determined according to IAS 39.
Financial assets assigned to separately managed accounts are included in the AFS financial assets and financial assets measured at fair value through the income statement categories, both measured at fair value. According to this accounting practice, shareholders’ equity or the result for the period has been adjusted for a value equal to the difference between the fair value and the carrying value of assets inserted in separately managed accounts, taking into account the average retrocession rate established in Life contracts and in compliance with guaranteed minimum rates.
In other words, the difference in the mathematical provision measured according to international accounting standards, and that measured according to Italian GAAP reflects the year’s portion of unrealised gains and unrealised losses relating to securities inserted in separately managed accounts that will be paid to policyholders only at the time of sale of the assets.
Financial liabilities measured at fair value through the income statement
This category comprises financial liabilities held for trading in the near term, derivative financial instruments and liabilities designated by the enterprise as measured at fair value through the income statement. This category comprises all Life business financial policies.
These items are recognised initially on the date of settlement at the fair value of the liability; direct transaction costs and proceeds are not considered at the time of initial recognition and are recognised directly in the income statement.
Subsequently, the liability is measured at fair value and the difference between the fair value and the carrying value is recognised in the income statement.
A financial liability measured at fair value through the income statement is derecognised when the contractual rights to receive the cash flows from the liability and the underlying risks are transferred.
Other financial liabilities
This category comprises financial liabilities not held for trading. It reflects loans and mortgages received and reinsurers’ deposits.
These items are recognised initially on the date of payment at fair value, increased by direct transaction costs.
Subsequently, these liabilities are recognised at amortised cost according to effective yield.
Financial liabilities are derecognised when the contractual rights to the liabilities and underlying risks are transferred.
Payables
This item reflects trade payables and includes in particular payables arising out of direct insurance operations and reinsurance operations and also employee termination benefits.
324 REPORTS AND ACCOUNTS 2015
Employee benefits
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The provision for employee termination indemnities is regarded as a defined benefit plan.
Payables and the cost of the benefits disbursed in the year, recognised in the income statement, are determined using the Projected Unit Credit Method, which envisages the estimation of future outflows according to statistical and demographic assumptions and the financial discounting of such flows based on a market interest rate. Actuarial gains and losses from the remeasurement of liabilities and assets at the reporting date are stated under equity.
Following the reform of supplementary pension schemes introduced by Law No. 296/06, a distinction must be made between:
- Termination indemnities, accrued at December 31, 2006: these are qualified as defined-benefit plans as they have not been modified by the aforementioned reform.
- Termination benefits accrued after December 31, 2006: as decided by each employee, termination benefits accruing are allocated to supplementary pension funds or transferred to the Treasury Fund set up at INPS. In both cases, termination benefits are classed as defined-benefit plans and the company recognises the quotas of contributions to supplementary pension funds and to the INPS Fund for dependent employment in the income statement.
The healthcare policy for retired managers and the seniority bonuses for employees under the collective national employment contract, are classified as defined-benefit plans.
Tax assets and liabilities
Income taxes are determined according to the forecast tax liability calculated on the income of the Group according to the tax rate in force on the reporting date. The Parent Company and the Italian subsidiaries have exercised the option of participating in the national fiscal consolidation scheme. Advance and deferred taxes have been calculated on the total amount of timing differences between the values valid for fiscal purposes and the carrying values, in accordance with IAS/IFRS principles. Deferred taxes have been calculated at the rate of taxation that is expected to apply at the time of realisation of the asset orcancellation of the liability. Deferred tax assets are recognised in the income statement, except for those relating to items recognised directly in equity, in which case the respective deferred taxes are also recognised under equity.
Commissions receivable and payable
These items comprise commissions relating to investment contracts not within the sphere of application of IFRS 4. In particular, they reflect the year's portion of explicit and implicit loadings and of management commissions, as regards commissions receivable, and acquisition costs as regards commissions payable. The items also reflect commissions accrued by companies operating in the banking sector.
325
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Income and charges on investments
- Net income on financial instruments measured at fair value through the income statement
This item comprises realised gains and losses and positive and negative changes of value of assets and liabilities included in the “fair value through the income statement” category. The changes of value are measured according to the difference between fair value and carrying value of the financial instruments recorded in this category.
- Income/charges on investments in subsidiaries, associates and joint ventures
This item comprises income/charges deriving from investments in Group associated companies. In particular, it reflects Group interest in the result for the period of such associates.
- Income/charges on other financial instruments and real estate investments
The item includes:
income/charges and realised gains/losses on AFS investments;
income and charges on loans and receivables and other financial liabilities;
income and charges on real estate investments.
Other revenues
The item includes, in particular:
- revenues on the sale of goods, the rendering of services other than those of a financial nature and the use, by third parties, of property, plant and equipment and intangible assets and of other business assets;
- other technical income not linked to insurance contracts;
- exchange differences recognised in the income statement according to IAS 21;
- realised gains and any readjustments of value on intangible assets and property, plant and equipment.
Net charges for claims
This heading reflects claims paid, net of refunds, the change in the provisions for outstanding claims and other Non-life technical provisions, the change in the mathematical provision and other Life technical provisions, the change in technical provisions relating to contracts where the investment risk is borne by the policyholders relating to insurance contracts and financial instruments within the scope of application of IFRS 4. The amounts are disclosed before claim settlement costs and net of portions ceded in reinsurance.
Other costs
The item includes, in particular:
- costs relating to the sale of assets and supply of services other than of a financial nature;
- other net technical charges linked to insurance contracts;
- provisions taken during the year;
- exchange differences recognised in the income statement according to IAS 21;
- realised losses, any permanent impairments of value and provisions relating to property, plant and equipment when not allocated to specific items - and intangible assets.
326 REPORTS AND ACCOUNTS 2015
UNCERTAINTIES CONCERNING THE USE OF ESTIMATES
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The information required in accordance with paragraph 125 of IAS 1 is provided below.
The Consolidated Financial Statements for 2015 have been presented clearly and provide a true and fair view of the equity and financial situation and the operating result. Information about decisions made and the criteria used for estimations and valuations as required in accordance with international accounting standards is suitably illustrated in the explanatory notes.
The use of estimates and assumptions by the Directors may however affect the amounts written in terms of assets and liabilities, costs and revenues.
It is important to note that the estimates and hypotheses used, formulated on the basis of past experience and other reasonable assumptions, are subject to possible variations that could significantly affect the equity and financial situation as reported in these accounts.
The following in particular are based on the use of subjective judgements:
- the estimated recoverability of goodwill stated in assets arising on company acquisitions;
- the determination of the fair value of financial assets and liabilities when not observable on active markets. Such measurements are subjective in that they use inputs that are not directly or indirectly based on market observables and therefore involve estimates and assumptions when making the valuation;
- the estimated recoverability of deferred tax assets;
- the quantification of provisions for other risks and charges and employee benefit funds, given the impossibility of ascertaining the amount or date of occurrence and applicable actuarial methods;
- the estimation of Non-life technical provisions.
327
Remeasurement of certain items of the accounts at December 31, 2014
In order to make the Consolidated Financial Statements more meaningful, following the reclassification of certain assets in the "Real estate investments" item, the comparables in the schedules for 2014 have also been reclassified accordingly, as established by IAS 1.
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Owing to such reclassification, item 2.2 Other property, plant and equipment has been reduced by € 853 thousand, while item 4.1 Real estate investments has been increased by € 853 thousand. These items were also reclassified by the Reale Immobili S.p.A. subsidiary.
The adjustments made to the specific items in the balance sheet are shown below.
Item Description Balance before reclassification
Amount of reclassification
(in thousands of euro)
Reclassified balance
34,629 -853 33,776 2.2 Other property, plant and equipment 4.1 Real estate investments 945,716 853 946,569
The above reclassifications did not affect the operating result for the previous year or shareholders’ equity at December 31, 2014.
Therefore, the schedules of the Balance Sheet , the Annexes to the accounts and schedules inserted in the Notes indicate the balances reclassified according to the above methods in the column referring to financial 2014.
328 REPORTS AND ACCOUNTS 2015
PART B: CONSOLIDATION AREA
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List of Group equity investments
The schedules that follow illustrate, respectively, fully-consolidated equity investments, which form the consolidation area, and those consolidated by the equity method.
With respect to the previous year, the service company Italnext S.r.l., wholly owned by the Italiana Assicurazioni S.p.A. subsidiary, was included as a fully consolidated company. As already explained in the Report on Operations, the purpose of this company is insurance mediation and it will focus on developing new distribution channels for Reale Group, as a point of reference for small agencies that work with Reale Group companies or might work with them in future, including for the provision of administrative services.
329
Fully consolidated companies
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Company Sector % Company and % Group
direct indirect interest
Non-life and Life 100.00 - - 100.00 ITALIANA ASSICURAZIONI S.p.A. Milan Share Capital €40,455,077 insurance
Non-life 95.00 Italiana Ass. S.p.A. 5.00 100.00 REALE SEGUROS GENERALES S.A. Madrid Share Capital €87,425,600 insurance
real estate 95.00 Reale Seguros S.A. 5.00 100.00 IGAR S.A. Madrid Share Capital €33,343,480
Life 5.00 Reale Seguros S.A. 95.00 100.00 REALE VIDA Y PENSIONES S.A. Madrid Share Capital €10,000,000 insurance
real estate 85.92 Italiana Ass. S.p.A. 14.08 100.00 REALE IMMOBILI S.p.A. Turin Share Capital €209,500,000
banking 95.00 Italiana Ass. S.p.A. 5.00 100.00 BANCA REALE S.p.A. Turin Share Capital €30,000,000
services 79.96 Italiana Ass. S.p.A. 0.02 100.00 REALE ITES EEIG Turin Endowment fund € 85,242,782 20.00
0.01 Reale Seguros S.A.
Reale Vida S.A. Banca Reale S.p.A. 0.01
services - Italiana Ass. S.p.A. 100.00 100.00 ITALNEXT S.r.l. Milan Share Capital €650,000
services 100.00 - - 100.00 BLUE ASSISTANCE S.p.A. Turin Share Capital €3,120,000
Companies valued by the equity method
Company Sector % Company and % Group
direct indirect interest
Non-life 31.43 - - 31.43 SARA ASSICURAZIONI S.p.A. Rome Share Capital €54,675,000 insurance
Non-life 50.00 - - 50.00 CREDEMASSICURAZIONI S.p.A. Reggio Emilia Share Capital €14,097,120 insurance
330 REPORTS AND ACCOUNTS 2015
PART C: INFORMATION REGARDING THE CONSOLIDATED BALANCE SHEET
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1.. INTANGIBLE ASSETS
The detail of intangible assets is as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Goodwill 201,114 201,114 0
Other intangible assets 120,447 114,408 6,039
Total 321,561 315,522 6,039
Goodwill
The movement on this item is detailed in the table below:
(in thousands of euro)
31.12.2015 31.12.2014
Gross value at the start of the year 208,435 228,311
Permanent impairments of value recorded in previous years -7,321 -7,321
Sub-total 201,114 220,990
Increase for the year 0 0
Reductions due to transfers and reclassifications 0 -19,876
Impairments of value recorded in the year 0 0
Other changes 0 0
Total 201,114 201,114
The goodwill arising on incorporation of Imperio Vida y Diversos, Union Aseguradora S.A. and Mutual Flequera S.A. by Reale Seguros in 2003, 2005 and 2007, respectively, reflects the residual value of the positive difference between the purchase cost and the carrying values of the assets and liabilities acquired by the Group.
The goodwill arising on incorporation of the investment in CredemAssicurazioni S.p.A. by the Parent carried out during 2012 reflects the positive difference between the purchase cost and the fair value of the assets and liabilities acquired.
The goodwill allocated during first-time adoption on the date of transition to IFRS-IAS (January 1, 2004) was equal to the total amount of the goodwill “inherited” as such on December 31, 2003, insofar as business combinations that occurred prior to such date have not been redetermined, as permitted by IFRS 1.
The goodwill, regardless of origin, has been allocated to the CGU - Cash Generating Units – that are expected to benefit from synergies of the business combination, as prescribed by IAS 36 paragraph 80.
Goodwill amounted to € 201,114 thousand and stemmed from the following operations:
- Reale Seguros: incorporation of Imperio Vida y Diversos S.A., Union Aseguradora S.A. 182,175
and Mutual Flequera S.A.:
- Consolidation difference on Credem Assicurazioni S.p.A.: 18,939
331
The Group carries out an impairment test on goodwill allocated to CGU when preparing the annual and interim accounts. In fact, according to IAS 36 “Impairment of Assets”, IAS 38 “Intangible Assets” and IFRS 3 “Business combinations”, insofar as goodwill has an indefinite useful life, it is not systematically amortised but must be tested for impairment.
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The carrying value of the CGU corresponds to the aggregate consisting of assets, liabilities and shareholders’ equity of the legal entity and related goodwill (so-called equity side), equivalent to the contribution of the CGU to consolidated shareholders’ equity.
The recoverable value of the CGU is determined only according to the value in use model as it is not possible to determine the fair value net of costs to sell. Practically speaking, value in use is determined by estimating forecast incoming and outgoing cash flows that will be generated or absorbed by the CGU, discounted at a pre-established rate (Discounted Cash Flow).
Therefore, for the Spanish company, reference was made to the plan approved by the Board of Directors projected over a time horizon of 8 years. For CredemAssicurazioni, reference was made to the three-year plan approved by the Board of Directors.
Forecast cash flows also comprise premiums and charges relating to the management of insurance portfolios and also income and charges relating to financial assets in the portfolio insofar as closely linked to the nature of insurance business. Consequently, cash flows tend to coincide with the net result of the CGU.
The discount rate adopted is the cost of equity, determined as the sum of the risk-free rate of return and a premium for risk that, in turn, depends on the systematic risk profile of the company to which the valuation refers, measured via a ß coefficient.
The methods used to calculate the discount rate adopted for the Spanish and Italian CGUs are shown below:
Risk-free rate ß Risk premium Cost of capital
Spanish CGU 1.77% 0.87 6.00% 7.02%
Italian CGU 1.60% 0.87 6.00% 6.84%
For the Spanish CGU, the risk-free rate was taken as being equal to the yield on ten-year Spanish government bonos, and for the Italian CGU as being equal to the yield on ten-year Italian BTPs on the valuation date (average of the previous 3 months, thus corresponding to the period from 30/09/2015 – 31/12/2015). The ß coefficient was determined as the average of the variations in securities issued by European insurers with respect to changes on the market. The Risk Premium represents the compensation for an investment where the risk is higher than that of a risk-free asset.
Value in use comprises the terminal value of the CGU, determined through capitalisation of cash flows generated after the explicit forecast period adopting perpetual annuity formulas. In particular, the last cash flow has been discounted assuming a perpetual growth rate of 1%.
A sensitivity analysis has been carried out on the valuations made with the DCF method, assuming fluctuations of the discount rate of +/- 1% correlated to changes in the growth rate adopted to calculate terminal value in a range of between 0.5% and +1.5%.
The Reale Mutua Group adopts the general rule that the CGU is identified as the company acquired.
In the case of operations that have resulted in incorporation of a company or business unit by the Reale Seguros S.A. subsidiary in previous years, as from financial 2012 the Group has identified the CGU as the company acquired. The decision to consider Reale Seguros as the entity upon which to conduct the impairment test is entirely in line with the definition of CGU as set forth in IAS 36.
332 REPORTS AND ACCOUNTS 2015
A summary of the results of the analysis is set forth in the table below:
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REALE SEGUROS GENERALES
Change in the recoverable value of the CGU
Terminal Value growth rate
Discount rate 0.50% 1.00% 1.50%
6.02% 113.69% 122.94% 134.23%
7.02% 93.88% 100.00% 107.23%
8.02% 79.42% 83.68% 88.59%
840,572 recoverable value (in thousands of euro)
carrying value (in thousands of euro) 532,950
ACQUISITION CREDEM
Change in the recoverable value of the CGU
Terminal Value growth rate
Discount rate 0.50% 1.00% 1.50%
5.84% 109.70% 119.34% 131.20%
6.84% 93.40% 100.00% 107.84%
7.84% 81.54% 86.32% 91.85%
45,027 recoverable value (in thousands of euro)
carrying value (in thousands of euro) 33,246
333
Other intangible assets
The movement on this item is detailed in the table below:
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(in thousands of euro)
Other intangible assets Total
Software Other
Gross initial balance 312,588 22,854 335,442
Purchases and capital expenditure 37,659 35 37,694
Decreases following sale or reclassification 0 -136 -136
Increases deriving from business combinations 0 0 0
Impairments of value 0 0 0
Reversals of write-downs 0 0 0
Other changes 0 0 0
Gross final balance 350,247 22,753 373,000
Initial accumulated depreciation -219,064 -1,970 -221,034
Depreciation for the period -31,397 -258 -31,655
Other changes 0 136 136
Final accumulated depreciation -250,461 -2,092 -252,553
Carrying value at end of period 99,786 20,661 120,447
Other intangible assets mainly reflect the costs of software for long-term use and other assets.
Software assets have a definite useful life and are amortised at rates of between 20% and 33%.
The main items in connection with purchases, for € 36,298 thousand, regarded the Reale Ites EEIG subsidiary and primarily stemmed from investments in IT to implement the projects envisaged under the Group's strategic plan.
Among other intangible assets, the agreement between the Reale Seguros S.A. subsidiary and the Spanish bank BBVA signed in 2013 regarding the exclusive sale of insurance products through the bank channel is recorded for € 20,000 thousand. This was classified as an intangible asset with an indefinite useful life and thus tested for impairment. The carrying value corresponds to the price paid, equal to € 20,000 thousand. The recoverable value is determined according to the value in use model as it is not possible to determine the fair value net of costs to sell. Practically speaking, value in use is determined by estimating forecast cash flows, discounted at a pre-established rate (Discounted Cash Flow). The parameters used (discount rate and growth rate) are those used for the impairment test on the goodwill of Reale Seguros. A sensitivity analysis has been carried out on the valuations made with the DCF method, assuming fluctuations of the discount rate of +/- 1% correlated to changes in the growth rate adopted to calculate terminal value in a range of between 0.5% and +1.5%. A summary of the results of the analysis is provided below:
SALES AGREEMENT WITH BBVA
Change in the recoverable value of the CGU
Terminal Value growth rate
Discount rate 0.50% 1.00% 1.50%
6.02% 112.94% 121.80% 132.61%
7.02% 94.11% 100.00% 106.96%
8.02% 80.26% 84.39% 89.14%
47,080 recoverable value (in thousands of euro)
carrying value (in thousands of euro) 20,000
334 REPORTS AND ACCOUNTS 2015
2. PROPERTY, PLANT AND EQUIPMENT
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This item totalled € 262,607 thousand with a positive change of € 51,830 thousand in relation to December 31, 2014. The breakdown is provided in the schedule below.
(in thousands of euro) 31.12.2015 31.12.2014 Change
Real estate used in company operations: Land 129,421 91,071 38,350 Buildings 141,296 121,919 19,377 Accumulated depreciation on buildings -38,823 -35,989 -2,834 Net value 231,894 177,001 54,893 Other property, plant and equipment: Gross value 203,773 202,241 1,532 Accumulated depreciation -173,060 -168,465 -4,595 Net value 30,713 33,776 -3,063 Total 262,607 210,777 51,830
Real estate used in company operations
Real estate stated under property, plant and equipment includes that used in company business. These items are recognised at cost and, after unbundling of the land, are depreciated on a straight-line basis over their useful life. The depreciation rate used was generally 3%. The land was unbundled on the basis of appraisals made in 2005 which provided a reliable benchmark for measuring the values on the date of transition (01/01/04).
The value of Group real estate is tested annually. In particular, insurance companies are required to comply with the provisions of the Supervisory Authority regarding determination of the market value of their real estate investments.
Those properties for which there was a significant difference between the value at December 31, 2015 and that at the end of the previous year were re-valued at current market conditions. In that context, a number of properties were appraised and valued for a total of € 105,003 thousand.
The carrying value of real estate used in company operations is € 89 million lower than the market value determined by expert appraisals.
The movement on this item is set out in the table below: (in thousands of euro)
Land Buildings Total
Gross initial balance 91,071 121,919 212,990
Purchases 38,364 9,957 48,321
Upkeep expenses 0 11,095 11,095
Decreases following sale or reclassification 0 0 0
Increases deriving from business combinations 0 0 0
Impairments of value 0 -2,679 -2,679
Reversals of write-downs 0 832 832
Other changes -14 172 158
Gross final balance 129,421 141,296 270,717
Initial accumulated depreciation -35,989 -35,989
Depreciation for the period -3,075 -3,075
Other changes 241 241
Final accumulated depreciation -38,823 -38,823
Carrying value at end of period 129,421 102,473 231,894
335
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Purchases were made by the Reale Seguros S.A. subsidiary, which concluded the transaction to purchase a property in Madrid on July 1, 2015 that will serve as the single head office for the Group's Spanish companies.
Upkeep expenses mainly refer to construction work on the Group's new operational headquarters in Via Bertola 48 in Turin.
The permanent impairments recorded during the year, for € 2,679 thousand, refer to real estate for which the carrying value exceeds the market value as emerged from specific appraisals; the difference between the carrying value and the value that emerged from the appraisal was therefore considered to represent a permanent impairment. Write-downs refer to properties in Spain only.
The other changes are the result of the correct allocation of buildings owned by the Reale Immobili S.p.A. and Igar S.A. subsidiaries under property and real estate investments.
336 REPORTS AND ACCOUNTS 2015
Other property, plant and equipment
The movement on this item is set out in the table below.
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(in thousands of euro)
Office furniture and machines Plant
Other property, plant and
equipment
Total
Gross initial balance 97,963 93,621 10,657 202,241 Purchases and capital expenditure 3,822 3,158 70 7,050 Decreases following sale or reclassification -568 -4,949 0 -5,517 Increases deriving from business combinations 0 0 0 0 Impairments of value 0 0 0 0 Reversals of write-downs 0 0 0 0 Other changes -34 34 0 0 Gross final balance 101,183 91,864 10,727 203,774 Initial accumulated depreciation -87,287 -70,593 -10,585 -168,465 Depreciation for the period -4,154 -5,885 -61 -10,100 Other changes 576 4,928 0 5,504 Final accumulated depreciation -90,865 -71,550 -10,646 -173,061 Carrying value at end of period 10,318 20,314 81 30,713
Other property, plant and equipment mainly includes instrumental assets used by Group companies to carry out their business, such as furniture, hardware, machinery and equipment.
Decreases mainly reflect disposals by the Igar S.A. subsidiary of obsolete hardware that had been fully amortised.
3.. REINSURERS' SHARE OF TECHNICAL PROVISIONS
This item amounted to a total of € 394,284 thousand and refers to direct business for € 388,794 thousand and to inward reinsurance for € 5,490 thousand. The detail is as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Non-life provisions for unearned premiums 73,900 73,476 424
Non-life provisions for claims outstanding 253,773 258,098 -4,325
Other Non-life provisions 0 0 0
Provision for sums to be paid 6,898 4,273 2,625
Provisions for policy liabilities 50,444 50,868 -424
Class D Life provisions 8,188 8,903 -715
Other Life provisions 1,081 917 164
Total 394,284 396,535 -2,251
The breakdown of such provisions between ceded and retroceded is set forth in the specific IVASS attachment.
337
4. INVESTMENTS
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The detail is as follows:
31.12.2015 31.12.2014 Change
Real estate investments 963,487 946,569 16,918 Equity investments in subsidiaries, affiliates and j.v. 178,234 145,032 33,202 Investments held to maturity 0 0 0 Loans and receivables 456,790 412,551 44,239 AFS financial assets 9,410,187 8,805,876 604,311 Financial assets measured at fair value through the income statement 822,902 862,310 -39,408 Total 11,831,600 11,172,338 659,262
Real estate investments
Real estate stated under investments is intended for rental to third parties.
These items are recognised at cost, in accordance with IAS 16, to which IAS 40 refers in the case of adoption of the cost model and, after unbundling of the land, are depreciated on a straight-line basis according to useful life.
For the Italian companies, the value of the land has been unbundled from that of the building according to appraisals made in 2005, which provide a reliable benchmark for measuring the values on the date of transition (01.01.04). With regard to the Spanish companies, the value of the land is already unbundled from that of the buildings in the statutory accounts according to Spanish GAAP.
A depreciation rate of between 1% and 3% was applied.
The value of Group real estate is tested regularly. In particular, insurance companies are required to comply with the provisions of the Supervisory Authority regarding determination of the market value of their real estate investments. Those properties for which there was a significant difference between the value at December 31, 2015 and that at the end of the previous year were re-valued at current market conditions. In that context, a number of properties were appraised and valued for a total of € 389,697 thousand. The carrying value of real estate investments is € 506 million lower than the market value determined by the appraisals.
The movement on this item is set out in the table below.
(in thousands of euro) Land Buildings Total
Gross initial balance 404,103 650,985 1,055,088 Purchases 3,882 627 4,509 Upkeep expenses 0 27,559 27,559 Decreases following sale or reclassification -950 -4,725 -5,675 Increases deriving from business combinations 0 0 0 Impairments of value 0 -522 -522 Reversals of write-downs 0 86 86 Other changes -114 -44 -158 Gross final balance 406,921 673,966 1,080,887 Initial accumulated depreciation -108,519 -108,519 Depreciation for the period -9,841 -9,841 Other changes 960 960 Final accumulated depreciation -117,400 -117,400 Carrying value at end of period 406,921 556,566 963,487
(in thousands of euro)
338 REPORTS AND ACCOUNTS 2015
Upkeep expenses mainly refer to extraordinary maintenance on the Group's real estate in Italy, including the property in Piazzale Duca d'Aosta/Via Napo Torriani in Milan and that in Via Sacchi in Turin.
Decreases following sale or reclassification refer to properties sold during the year by the Reale Immobli S.p.A. subsidiary for € 3,852 thousand, as well as a number of properties owned by the latter that were the subject of preliminary contracts of sale entered into before the reporting date and which were therefore reclassified under non-current assets or of an HFS disposal group, for € 1,823 thousand.
The other changes are the result of the correct allocation of buildings owned by the Reale Immobili S.p.A. and Igar S.A. subsidiaries under real estate used in company operations and real estate investments.
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Equity investments in subsidiaries, associates and joint ventures
The Reale Mutua Parent fully consolidates all subsidiaries including those that carry out dissimilar activities. This item therefore includes the interest in Sara Assicurazioni S.p.A., an associated company valued by the equity method, and that in CredemAssicurazioni S.p.A., a joint venture valued by the equity method.
This item amounted to € 178,234 thousand at December 31, 2015. The € 33,202 thousand y/y increase reflects the alignment of the pro-quota shareholders’ equity of Sara Assicurazioni S.p.A. for € 29,928 thousand and of CredemAssicurazioni S.p.A. for € 3,274 thousand.
Loans and receivables
The item is broken down as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Debt securities 29,255 27,012 2,243
Loans and receivables from bank customers 245,264 196,417 48,847
Interbank loans 9,711 14,652 -4,941
Deposits with ceding undertakings 5,276 6,009 -733
Other loans and receivables 167,284 168,461 -1,177
Total 456,790 412,551 44,239
The debt securities item, with a fair value of around € 29 million, reflects bonds not quoted on an active market. The increase stems from the purchase of unlisted securities issued by Santander, with a duration of less than one year, for € 4.6 million, offset by the reimbursement of bonds of ANIA for a value of around € 2.4 million. No impairments of value were recorded on debt securities belonging to this category.
The interbank loans item reflects receivables by the consolidated Banca Reale from other credit institutes for active deposits.
The other loans and receivables item includes non-sight deposits and repo agreements for € 32 million and, as established by IVASS Regulation No. 7., receivables from incoming agents for refund of severance allowances paid to discontinued agents for € 81 million (net of write-downs for € 4 million) and loans on Life policies for € 5 million.
339
AFS financial assets
The detail is as follows:
(in thousands of euro)
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31.12.2015 31.12.2014 Change
Capital securities 114,169 162,231 -48,062
Debt securities 8,919,727 8,120,126 799,601
Shares of UCI 376,291 523,519 -147,228
Other financial investments 0 0 0
Total 9,410,187 8,805,876 604,311
The entire portfolio of AFS financial assets is recognised at fair value, except for various unlisted shares, valued at cost, for a value of around € 23.2 million for which the fair value cannot be determined in a reliable manner.
The debt securities mainly comprise bonds issued by Governments or Supranational Entities as specified in the section “Information on risks (Liquidity risk)”.
The shares of UCI item includes the recognition of 80 shares in the GRIES property investment fund, the value of which amounted to € 16,232 thousand. The shares represent 95.24% of the total and in 2015 were written down and offset in the income statement for the amount of € 1,945 thousand.
In accordance with the disclosure requirements of IFRS 12, information about the aforesaid interest as at December 31, 2015 is provided below:
- The total value of the real estate investments held by the fund is equal to € 24,093 thousand;
- No dividends were paid to shareholders during the year;
- The appraisal of the overall value of the real estate by independent experts generated a valuation loss of € 1,602 thousand;
- On June 19, 2014 the Board of the Banca Reale S.p.A. subsidiary resolved to extend the loan, for € 8,000 thousand, granted to the GRIES fund until December 31, 2017. The loan was granted at ordinary market conditions to permit the fund to continue its business activities. During the year the loan generated interest income for € 320 thousand.
The AFS capital reserve , before taxes and shadow accounting items, is divided as follows:
- Latent gains of around € 669 million;
- Latent losses of around € 28 million.
With regard to impairments of value recognised in the income statement in the period, a summary of the related amounts according to each type of financial asset is provided below:
(in thousands of euro)
31.12.2015 31.12.2014
Debt securities -240 0
Capital securities -52 -582
Shares of UCI -2,199 -1,901
Total -2,491 -2,483
The value of debt securities was reduced on the basis of objective evidence of impairment as of the reporting date.
On the contrary, the value of capital securities and shares of UCI, written down during the year, had already been impaired in previous years.
340 REPORTS AND ACCOUNTS 2015
Financial assets at fair value through the income statement The detail is as follows:
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(in thousands of euro)
31.12.2015 31.12.2014 Change
Financial assets held for trading
Debt securities 0 70,200 -70,200
Capital securities 0 0 0
Shares of UCI 541 585 -44
Other financial investments 1 20 -19
Total 542 70,805 -70,263
Financial assets measured at fair value through the
income statement
Debt securities 404,409 406,500 -2,091
Capital securities 144,362 136,539 7,823
Shares of UCI 271,225 246,168 25,057
Other financial investments 2,364 2,298 66
Total 822,360 791,505 30,855
Total financial assets through the income statement 822,902 862,310 -39,408
The decrease in financial assets held for trading mainly reflects the sale of debt securities held by the Banca Reale S.p.A subsidiary for € 70.2 million.
Financial assets measured at fair value through the income statement comprise investments the risk of which is borne by Life policyholders and deriving from the administration of pension funds for € 738.2 million.
Shares of UCI include the reimbursement of the 47 shares of the "Venere" closed-end property mutual investment fund, subscribed by the Reale Immobili S.p.A. subsidiary. The shares sold, for a total of € 21.5 million, generated gains on disposal in the income statement for € 713 thousand.
Financial assets held for trading reflect net valuation gains for a total of around € 0.2 million, while financial assets measured at fair value through the income statement include net valuation losses for a total of around € 2.9 million.
The reclassifications under level 2 instead of level 1 of the fair value hierarchy made during the year were deemed not significant (with a value of around € 32.7 million) and were attributable to the lack of an active market. There were no significant changes in or amounts of level 3 financial instruments.
For further details reference should be made to the related annexes.
With regard to sovereign bonds, a summary of the relative impacts on shareholders' equity and on the result according to issuer is provided below:
341
(in thousands of euro)
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Country Market value 31/12/2015 AFS reserve Impairment and
write-backs (AFS) FVTPL
Australia 66 0 0 0 Austria 33,741 1,554 0 -299 Belgium 96,223 2,951 0 -401 Canada 13,088 1,694 0 0 Finland 27,840 2,453 0 -59 France 364,646 11,616 0 -1,644 Germany 780,778 3,492 0 -727 Ireland 60,279 1,055 0 -98 Italy 5,081,183 517,079 0 -102 Mexico 17,238 -408 0 0 Norway 51 0 0 0 Netherlands 180,780 5,408 0 -326 Poland 25,814 582 0 0 Portugal 3,226 0 0 -14 Slovenia 15,699 732 0 0 Spain 496,555 22,529 0 -692 USA 230 0 0 -3 Supranational 104,883 8,391 0 0 Total 7,302,320 579,128 0 -4,365
5..MISCELLANEOUS RECEIVABLES
This item amounted to € 960,378 thousand with a decrease of € 34,953 thousand in relation to December 31, 2014. The detail is as follows:
(in thousands of euro) 31.12.2015 31.12.2014 Change
Receivables arising out of direct insurance operations 676,931 681,229 -4,298 Receivables arising out of reinsurance operations 89,775 135,193 -45,418 Other receivables 193,672 178,909 14,763 Total 960,378 995,331 -34,953
It is considered that the carrying value of trade and other receivables is aligned with their fair value. Trade receivables do not produce interest and fall due in the short term.
With reference to receivables from insureds, agents and insurance and reinsurance companies, the Group is not affected by any particular concentrations of credit risk insofar as exposure is spread between a large number of counter parties.
342 REPORTS AND ACCOUNTS 2015
Receivables arising out of direct insurance operations
The detail is as follows:
(in thousands of euro)
(in thousands of euro)
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31.12.2015 31.12.2014 Change
Receivables from policyholders 346,539 350,671 -4,132
Receivables from agents 211,058 212,865 -1,807
Receivables from companies c/a 42,082 45,339 -3,257
Sums to be recovered 77,252 72,354 4,898
Total 676,931 681,229 -4,298
Receivables from policyholders are stated net of the write-downs of € 29,618 thousand. The allowance for doubtful debts is mainly allocated to the Accident, Health, Fire, Other property damage, Motor TPL, Non-motor TPL and Surety businesses.
The allowance for doubtful debts allocated to receivables from agents amounted to € 11,540 thousand and current accounts with insurance companies are written net of the allowance for doubtful debts for € 2,409 thousand.
Receivables arising out of reinsurance operations:
This item amounted to € 89,775 thousand net of the related allowance for doubtful accounts of € 1,056 thousand.
This item is detailed in the table below:
31.12.2015 31.12.2014 Change
Receivables from reinsurance companies 86,708 131,135 -44,427
Receivables from reinsurance intermediaries 3,067 4,058 -991
Total 89,775 135,193 -45,418
The decrease in receivables from reinsurance companies was mainly due to the reduction in the Fire reinsurance treaty (from 25% to 15%) for the Italian insurance companies, which generated a reduction in receivables linked to the contractual application of the portfolio withdrawal. Also at December 31, 2014 there was one credit item linked to a major claim in the Fire business.
Sundry receivables
The detail is as follows:
(in thousands of euro) 31.12.2015 31.12.2014 Change
Receivables from tenants 21,996 22,092 -96 Receivables from Tax Authorities 87,352 87,638 -286 Miscellaneous receivables 84,324 69,179 15,145 Total 193,672 178,909 14,763
Sundry receivables are shown net of the allowance for doubtful debts for a total of € 13,667 thousand, of which € 12,571 thousand refer to receivables from tenants.
343
Receivables from the tax authorities include receivables other than those for income taxes for the year. In particular, they include receivables for VAT and also advances paid on the tax on insurance premiums.
Miscellaneous receivables comprise negative variation margins on interest rate swaps of the Parent for € 17,330 thousand, Parent Company receivables from CONSAP for management of the Road Victims Fund for € 6,414 thousand, receivables of the Italian insurance undertakings for contributions to the Guarantee Fund for victims of road and hunting accidents for € 1,632 thousand, receivables for tax disputes for € 8,581 thousand and receivables deriving from the handling of foreign claims for € 1,697 thousand.
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6.. OTHER ASSETS
This item amounted to € 341,417 thousand with a decrease of € 49,173 thousand in relation to December 31, 2014. The detail is as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Non-current assets or of an HFS disposal group 9,588 22,801 -13,213
Deferred acquisition costs 0 0 0
Current tax assets 100,413 117,255 -16,842
Deferred tax assets 160,654 172,408 -11,754
Other assets 70,762 78,126 -7,364
Total 341,417 390,590 -49,173
Non-current assets or of an HFS disposal group
This item, amounting to € 9,588 thousand, refers for € 7,765 thousand to the interest in Cai Seguros Generales S.A. for which the Reale Seguros Generales S.A. subsidiary exercised the right to sell on April 3, 2014, and for € 1,823 thousand to the value of the properties owned by the Reale Immobili S.p.A. subsidiary for which preliminary contracts of sale had been entered into before December 31, 2015.
Current tax assets
Current tax assets reflect receivables from the tax authorities for withholdings and receivables for income taxes. In accordance with ISVAP Regulation No. 7, they also include amounts deriving from recognition of taxes on mathematical provisions pursuant to art. 1(2) of Legislative Decree No. 209/02 as converted by Law No. 265/2002 as amended.
Deferred tax assets
Deferred tax assets are calculated on the total amount of timing differences between the carrying value of the assets and liabilities on the balance sheet and the respective fiscal value as established by IAS 12 and considering the possibility of recovery at a later date.
The timing differences stem mainly from value re-adjustments on financial assets for approx. € 4 million, changes in provisions for outstanding claims for around € 34 million, write-downs of receivables from policyholders and other receivables for around € 74 million, provisions for future risks and charges for about € 27 million and the adjustment of the value of assets for approx. € 8 million.
344 REPORTS AND ACCOUNTS 2015
Other assets Other assets amounted to € 70,762 thousand with a decrease of € 7,364 thousand in relation to December 31, 2014 and are detailed as follows:
(in thousands of euro)
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31.12.2015 31.12.2014 Change
Premium payments 53,881 52,206 1,675 Indemnities discontinuous agents pending reimbursement 7,317 8,682 -1,365 Miscellaneous assets 9,564 17,238 -7,674 Total 70,762 78,126 -7,364
7.. CASH AT BANK AND IN HAND AND CASH EQUIVALENTS
At year-end, this item amounted to € 107,672 thousand compared with € 116,790 thousand at December 31, 2014.
This heading includes Group bank current accounts and short-term deposits. The carrying value of such assets is aligned with their fair value.
345
1. SHAREHOLDERS' EQUITY
Group interest in shareholders' equity amounted to € 2,325,646 thousand, which is the same as the total. The changes in the individual items are set forth in the Schedule of the Changes in Shareholders' Equity.
(in thousands of euro)
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31.12.2015 31.12.2014 Change
Group interest in shareholders’ equity Capital 60,000 60,000 0 Other equity instruments 0 0 0 Capital reserves 0 0 0 Retained earnings and other equity reserves 2,016,503 1,843,591 172,912 (Treasury stock) 0 0 0 Reserve for net exchange differences 0 0 0 Gains or losses on AFS financial assets 91,087 175,502 -84,415 Other profit or losses recognised directly in equity -1,245 -6,291 5,046 Net profit (loss) for the year 159,301 172,696 -13,395 Total of which Group interest 2,325,646 2,245,498 80,148 Minority interest in shareholders’ equity Minority interest in capital and reserves 0 0 0 Profit or losses recognised directly in equity 0 0 0 Minority interest in the net income (loss) for the year 0 0 0 Total of which minority interest 0 0 0 Total shareholders' equity 2,325,646 2,245,498 80,148
The breakdown of retained earnings and other equity reserves is as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Legal reserve 207,537 202,598 4,939
Ordinary reserve fund 1,377,405 1,283,580 93,825
Extraordinary reserve 1,931 1,931 0
Other equity reserves 123,955 120,118 3,837
Consolidation and IAS/IFRS first-time application reserves 305,675 235,364 70,311
Total 2,016,503 1,843,591 172,912
With regard to gains or losses on AFS financial assets, the balance of which at the end of the previous year was equal to € 175,502 thousand, € 43,134 thousand were transferred to the income statement during the year, as a consequence of disposal of the underlying financial assets and impairment of assets.
Other profit or losses recognised directly in equity include the positive AFS reserve referring to associated companies/joint ventures for € 15,706 thousand and actuarial losses in relation to obligations deriving from defined benefit plans for employees, for € 16,951 thousand.
With regard to disclosure of the information required by IAS 1.124A, the Parent pursues objectives, policies and capital management processes strictly tied to the Company's mutual insurance business. By virtue of this legal standing, capital management is directed towards maximising the financial solidity of the Group in time in accordance with commitments assumed towards members-insureds.
346 REPORTS AND ACCOUNTS 2015
The capital managed corresponds to total shareholders’ equity and is subject to the minimum requirements defined by the Supervisory Authority regarding calculation of the correct solvency of insurance companies and is calculated, in this specific case, according to the consolidated financial statements method. In particular, in order to determine the components of the solvency margin, Group shareholders’ equity is assumed in its entirety except for the following items:
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- gains or losses on AFS financial assets
- other gains or losses recognised directly in equity.
The excess of the elements forming the Group solvency margin, in relation to the correct amount required (equal to € 737.0 million), amounted to € 1,108.8 million, compared with € 994.5 million at the end of the previous year.
347
RECONCILIATION BETWEEN THE STATUTORY FINANCIAL STATEMENTS OF THE PARENT COMPANY AND THE IAS/IFRS CONSOLIDATED FINANCIAL STATEMENTS
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(in thousands of euro)
Result for the year Shareholders’ equity
2015 2014 31.12.2015 31.12.2014
Parent Company financial statements (local GAAP) 59,411 98,764 1,849,222 1,789,810 Remeasurement of value of property (IAS 16 - IAS 40) -404 -393 -415 -11
Adjustments to provisions (IAS 36) 0 0 -929 -929
Actuarial gains/losses (IAS 19) that affect the income statement -1,469 2,781 10,607 12,076
Actuarial gains/losses (IAS 19) that affect equity -9,551 -11,475
Adjustments on AFS securities net of deferred liabilities towards policyholders (IAS 39) 0 0 40,498 104,315
Adjustments on financial assets (IAS 39) that affect the income statement 1,175 4,141 37,544 36,369
Reduction to zero of provisions for catastrophic risks, equalisation, others (IFRS 4) 6,130 6,074 60,109 53,979
Deferred liabilities towards policyholders through the income statement (IFRS4) 6,203 -7,603 -25,317 -31,521
Other minor adjustments 2,220 550 1,315 1,062
Fiscal effect on items reconciled -3,663 -1,716 -28,113 -26,417
Parent Company IAS/IFRS financial statement 69,603 102,598 1,934,970 1,927,258 Effect deriving from consolidation of controlling interests 96,818 81,073 191,044 132,516
Effect deriving from consolidation of interests measured by the equity method 31,300 27,757 144,361 113,062
AFS reserve subsidiaries 0 0 50,589 71,187
AFS reserve associates 0 0 15,707 13,847
Actuarial gains/losses (IAS 19) subsidiaries 0 0 -5,769 -6,990
Actuarial gains/losses (IAS 19) associates 0 0 -1,632 -1,674
Elimination of the effects of intra-group transactions 87 -122 -3,624 -3,708
Elimination of intra-group dividends of companies:
. fully consolidated -38,506 -34,681 0 0
. consolidated by the equity method 0 -3,929 0 0
IAS/IFRS consolidated financial statements 159,301 172,696 2,325,646 2,245,498 Minority interests 0 0 0 0
Total 159,301 172,696 2,325,646 2,245,498
348 REPORTS AND ACCOUNTS 2015
2. PROVISIONS
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Provisions amounted to € 96,694 thousand compared with € 101,606 thousand at year-end 2014. They refer to obligations as the consequence of past events, the occurrence of which is likely and the amount of which can be reliably estimated. The detail is as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Provisions for taxes 1,834 4,076 -2,242
Other provisions: 94,860 97,530 -2,670
Non-fiscal litigation 9,973 8,312 1,661
Personnel expenses 31,222 33,352 -2,130
Non-recoverable refunds from agents 20,335 21,252 -917
Other charges 33,330 34,614 -1,284
Total 96,694 101,606 -4,912
The movement on other provisions during the year is set out below:
(in thousands of euro)
Non-fiscal
litigation
Personnel
expenses
Non-
recoverable
refunds from
agents
Other
charges Total
Initial balance 8,312 33,352 21,252 34,614 97,530
Provisions 4,613 15,786 570 7,285 28,254
Utilisations -2,119 -17,916 -1,487 -9,402 -30,924
Other changes -833 0 0 833 0
Final balance 9,973 31,222 20,335 33,330 94,860
Provisions for personnel expenses include additions in connection with the renewal of the company-level employees' agreement and expenses relating to the corporate incentive scheme.
None of the provisions were discounted except for the provision referring to non-recoverable refunds calculated on the basis of the discounted estimate of the economic effects deriving from future payments of agent severance allowances.
349
3. TECHNICAL PROVISIONS
These amounted to € 10,472,777 thousand compared with € 9,832,042 thousand at December 31, 2014 and are detailed as follows:
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(in thousands of euro)
31.12.2015 31.12.2014 Change
Non-life business
Provision for unearned premiums 1,120,412 1,098,670 21,742
Provision for claims outstanding 2,901,072 2,963,685 -62,613
Other reserves 3,118 2,391 727
Total Non-life business 4,024,602 4,064,746 -40,144
Life business:
Provisions for policy liabilities 5,011,316 4,509,714 501,602
Provision for sums to be paid 109,055 71,353 37,702
Technical provisions where the investment risk is borne by the
policyholders and relating to the administration of pension funds 756,892 689,089 67,803
Other reserves 570,912 497,140 73,772
Total Life business 6,448,175 5,767,296 680,879
Total technical provisions 10,472,777 9,832,042 640,735
Non-life business
With regard to provisions for claims outstanding, the provision for claims incurred but not reported (IBNR) amounted to € 390,164 thousand.
Other reserves include the ageing reserve in compliance with art. 47 of ISVAP Regulation No. 16/2008, and also the reserve formed following the adequacy test on the provisions for unearned premiums. In particular, a provision has been made for unexpired risks, equal to € 1,033 thousand, determined according to the empirical method suggested by the Supervisory Authority and considered suitable to comply with the requirements of IFRS 4 regarding the adequacy test on provisions for unearned premiums.
Life business
The mathematical provision on financial contracts with discretionary participation feature amounted to € 4,138,034 thousand.
A Liability Adequacy Test (LAT) has been carried out on contracts classified as "insurance contracts" and those classified as "financial instruments with discretionary participation feature", as prescribed by art. 15 of IFRS 4; this consists in verifying the adequacy of “net technical provisions” through comparison with the “realistic reserve”, determined on the basis of the present value of cash flows. The results of the test, described in part F “Information on risks”, have demonstrated the adequacy of the provisions accrued for all Reale Group companies.
Other provisions include the provision for future charges (art. 31 ISVAP Regulation No. 21/2008) for € 32,209 thousand, the provision for complementary insurance premiums for € 230 thousand and the provision for deferred liabilities towards policyholders, set aside in application of shadow accounting and equal to € 538,473 thousand.
350 REPORTS AND ACCOUNTS 2015
4. FINANCIAL LIABILITIES
The composition of financial liabilities is detailed in the schedule below.
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31.12.2015 31.12.2014 Change
Financial liabilities measured at fair value through the income statement - held for trading 16,667 20,166 -3,499 - measured at fair value through the income statement 7,434 3,282 4,152 Other financial liabilities 528,266 488,741 39,525 Total 552,367 512,189 40,178
Financial liabilities held for trading
Financial liabilities held for trading, which amounted to € 16,667 thousand, refer to swap contracts entered into by the Parent Company for a total notional value of € 13,120, (for further details reference should be made to part F “Information on risks – derivatives”). The item includes net valuation gains for a total of around € 3.4 million.
Financial liabilities measured at fair value through the income statement
This item amounted to € 7,434 thousand and consists entirely of liabilities relating to financial contracts not regulated by IFRS 4 and booked according to the deposit accounting method. In detail, € 5,817 thousand refer to contracts where the investment risk is borne by policyholders and € 1,617 thousand relate to the administration of pension funds.
Other financial liabilities
This item amounted to € 528,266 thousand at year-end, compared with € 488,741 thousand at December 31, 2014. Such liabilities consist mainly of deposits received from reinsurers for € 58,308 thousand, of debenture loans issued by Banca Reale and distributed to its own customers for € 93,135 thousand, payables to bank customers for € 268,907 thousand and interbank payables for € 66,029 thousand.
The change in this item was mainly attributable to the increase in payables to bank customers stemming from the increase in direct deposits of the Banca Reale subsidiary.
Interbank payables refer to three refinancing operations of the European Central Bank (Targeted Long Term Refinancing Operations), each for € 66.0 million, to which the Banca Reale subsidiary adhered on December 17, 2014, March 25, 2015 and December 10, 2015.
The fair value of these items is aligned with their respective carrying values.
(thousands of euro)
351
5. PAYABLES
Payables amounted to € 441,638 thousand; the detail of this item and changes in relation to the previous year are set forth below:
According to IVASS Regulation No. 7, liabilities for termination benefits have been stated under other payables.
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(in thousands of euro) 31.12.2015 31.12.2014 Change
Payables arising out of direct insurance operations 179,258 210,046 -30,788 Payables arising out of reinsurance operations 16,287 18,247 -1,960 Other payables 219,093 209,359 9,734 Total 414,638 437,652 -23,014
Payables arising out of direct insurance operations:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Payable to agents 152,202 181,739 -29,537
Payable to policyholders 21,708 21,741 -33
Guarantee funds 0 0 0
Payable to companies c/a 5,348 6,566 -1,218
Total 179,258 210,046 -30,788
Payables arising out of reinsurance operations:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Payable to reinsurance companies 13,172 13,548 -376
Payable to reinsurance intermediaries 3,115 4,699 -1,584
Total 16,287 18,247 -1,960
Other payables:
(in thousands of euro) 31.12.2015 31.12.2014 Change
Employee termination indemnities 15,496 17,550 -2,054 Payables for taxes on behalf of policyholders 67,623 66,097 1,526 Payables for miscellaneous taxes 8,394 9,325 -931 Contributions to welfare and social security institutes 10,361 9,565 796 Payables to suppliers 73,323 66,182 7,141 Tenants’ caution money 7,835 8,545 -710 Personnel management 22,328 20,352 1,976 Miscellaneous payables 13,733 11,743 1,990 Total 219,093 209,359 9,734
352 REPORTS AND ACCOUNTS 2015
With regard to this liability, in accordance with Law No. 296 of December 27, 2006, enterprises with at least 50 employees are required to pay, on a monthly basis and as selected by the employee, termination benefits accrued after January 1, 2007, to the supplementary pension funds established by Legislative Decree No. 252/05 or to a specific Fund for payment to private sector employees of termination benefits under art. 2120 of the Civil Code (hereinafter Treasury Fund) established at INPS.
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The actuarial assessment of the part of termination benefits accrued al December 31, 2006 is based on demographic and economic-financial assumptions.
The main hypotheses are illustrated below:
Main actuarial hypotheses 31.12.2015
Probability of termination 0.57%
Life table ISTAT 2013
Frequency of termination benefit paid in advance
Reale Mutua 2.00%
Italiana 2.88%
Blue Assistance 2.04%
Reale Immobili 1.14%
Banca Reale 1.00%
Reale Ites 2.00%
Percentage of termination benefit paid in advance 70.00%
Discount rates Euro Composite AA curve as at December 31, 2015
Rate of inflation 1.50%
It should also be noted that with the entry into effect of the new IAS 19 as from January 1, 2013, actuarial gains and losses in relation to obligations deriving from defined benefit plans for employees are now taken directly to equity.
The changes in such liabilities in the last two years are summed up as follows:
(in thousands of euro)
31.12.2015 31.12.2014 Change
Carrying value at start of period 17,550 16,158 1,392
Provisions for the year 0 0 0
Interest expense 23 63 -40
Actuarial (gains)/losses -958 2,284 -3,242
Benefits paid -1,119 -955 -164
Carrying value at end of period 15,496 17,550 -2,054
The following information is provided in accordance with the new provisions of IAS 19:
- classification of actuarial (gains)/losses for amendments due to demographic hypotheses and financial hypotheses:
353
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(in thousands of euro)
Breakdown of actuarial (gains)/losses
(a) Actuarial (gains)/losses due to changes in financial hypotheses -250
(a) Actuarial (gains)/losses due to changes in demographic hypotheses -41
(c) Actuarial (gains)/losses due to past experience (deviation of hypotheses from reality) -667
Total -958
- average duration of the financial obligation for each Group company:
Duration of termination benefit fund at 31.12.2015
Reale Mutua 8.60
Italiana 7.10
Blue Assistance 16.70
Reale Immobili 6.80
Banca Reale 16.70
Reale Ites 11.20
- indication of future cash flows:
(in thousands of euro)
Termination benefit pro rated cash flows
1 year 1,093
2 years 995
3 years 875
4 years 939
more than 4 years 14,215
- sensitivity analysis for each relevant actuarial hypothesis at the end of the year stating the effects in the case of variations in the actuarial hypotheses that would have been reasonably possible at that date, in absolute terms (with respect to a carrying value of liabilities equal to € 15,496 thousand):
(in thousands of euro)
Discount rate 0.5% increase in rate 0.5% decrease in rate
14,845 16,180
Rate of inflation 0.5% increase in rate 0.5% decrease in rate
15,914 15,081
Probability of termination of employment
contract
+50% prob. term. -50% prob. term.
15,500 15,479
Percentage of termination benefit paid in
advance
+50% in advance -50% in advance
15,504 15,474
354 REPORTS AND ACCOUNTS 2015
6. OTHER LIABILITIES
This item amounted to € 357,397 thousand and is detailed below:
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(in thousands of euro)
31.12.2015 31.12.2014 Change
Liability of an HFS disposal group 0 0 0
Current tax liabilities 2,365 30,425 -28,060
Deferred tax liabilities 266,785 331,747 -64,962
Other liabilities 88,247 106,724 -18,477
Total 357,397 468,896 -111,499
Deferred tax liabilities, equal to € 266,785 thousand, reflect the fiscal effect of all temporary differences of a financial or economic nature that are expected to reverse in future years.
This item includes around € 156 million referring to the differences between the carrying and fiscal values of real estate investments, around € 52 million referring to adjustments to the value of financial assets as a consequence of application of IAS/IFRS, and around € 42 million referring to adjustments to the value of provisions for catastrophic risks, equalisation and other special provisions due to application of IAS/IFRS.
Other liabilities: (in thousands of euro)
31.12.2015 31.12.2014 Change
Liabilities for employee benefits 41,435 44,959 -3,524
Commissions on premium payments 9,041 9,309 -268
Miscellaneous liabilities 37,771 52,456 -14,685
Total 88,247 106,724 -18,477
In accordance with IVASS Regulation No. 7, liabilities relating to defined benefits and other long-term employee benefits, other than termination benefits, have been stated under other liabilities. As detailed in the table, these refer in particular to health coverage for retired directors, seniority bonuses paid to employees according to the National Collective Bargaining Agreement, and also the additional Company Pension Fund set up at the Parent Company.
(in thousands of euro)
31.12.2015 31.12.2014 Change
Coverage of managers' medical expenses 12,690 14,608 -1,918
Long-service bonuses 11,403 12,070 -667
Parent Company pension fund 17,342 18,281 -939
Total 41,435 44,959 -3,524
The amount of such liabilities is determined according to actuarial methods. In particular, the economic-financial hypotheses adopted in determining seniority bonuses comply fully with those adopted for the disclosure of termination benefits, while as regards health coverage of retired directors, the hypotheses adopted as regards inflation and discount rates remaining unchanged, the growth rate of future reimbursements has been assumed, analysing the historical data of the Parent Company and breaking down the increase into inflation adjustments and increases due to ageing of the population.
355
It should also be noted that with the entry into effect of the new IAS 19 as from January 1, 2013, actuarial gains and losses in relation to obligations deriving from defined benefit plans for employees are now taken directly to equity.
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In accordance with the new provisions of IAS 19, the results of sensitivity analysis considering a change of +/- 50 basis points in the discount rate with regard to health cover for managers are provided below (against a carrying value of € 12,690 thousand):
(in thousands of euro)
Discount rate 0.5% increase in rate 0.5% decrease in rate
11,149 14,793
With regard to the additional pension fund of the Parent company, specific assets hedging the pension plan for an amount equal to the liability stated are recognised under AFS financial assets.
356 REPORTS AND ACCOUNTS 2015
PART D – INFORMATION REGARDING THE CONSOLIDATED INCOME STATEMENT
1.1 NET PREMIUMS
Net premiums written amounted to € 3,526,244 thousand compared with € 3,444,245 thousand in the previous year. Gross premiums written by the Group amounted to € 3,847,151 thousand with an upswing of 1.52% compared with 2014. The component of premiums ceded in reinsurance amounted to € 301,133 thousand compared with € 336,140 thousand in the previous year.
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(in thousands of euro)
2015 2014 Change
Gross premiums Life business 1,118,407 1,111,104 7,303
Gross premiums Non-life business 2,728,744 2,678,431 50,313
Total gross premiums written 3,847,151 3,789,535 57,616
(-) Change in the gross provision for unearned premiums 21,840 8,705 13,135
Gross premiums earned 3,825,311 3,780,830 44,481
Premiums ceded Life business 22,815 28,135 -5,320
Premiums ceded Non-life business 278,318 308,005 -29,687
Total premiums ceded 301,133 336,140 -35,007
(-) Change in the provision for unearned premiums, reinsurers’ share 2,066 -445 2,511
Premiums earned ceded in reinsurance 299,067 336,585 -37,518
Net premiums 3,526,244 3,444,245 81,999
It should be noted that adoption of IFRS 4 regarding insurance contracts did not reveal the existence of non-insurance contracts in the Group Non-life business portfolio. With regard to Life business, premiums written relating to insurance contracts amounted to € 301,688 thousand, those relating to financial contracts with discretionary participation features amounted to € 816,719 thousand, whereas there were no premiums relating to financial contracts without discretionary participation features.
The breakdown of premiums by company is set forth below: (in thousands of euro)
Company Non-life business Life business Total Total Change
direct indirect direct indirect 2015 2014
Italy:
Reale Mutua Assicurazioni 1,413,636 564 813,448 308 2,227,956 2,195,066 1.5% Italiana Assicurazioni S.p.A. 529,097 180 274,222 0 803,499 816,441 -1.6% Total 1,942,733 744 1,087,670 308 3,031,455 3,011,507 0.7% Spain:
Reale Seguros Generales S.A. 785,142 125 0 0 785,267 752,536 4.3% Reale Vida y Pensiones S.A. 0 0 30,429 0 30,429 25,492 19.4% Total 785,142 125 30,429 0 815,696 778,028 4.8% Carrying value 2,727,875 869 1,118,099 308 3,847,151 3,789,535 1.5%
1.2 COMMISSIONS RECEIVABLE
Commissions receivable amounted to € 13,754 thousand compared with € 11,953 thousand in the previous year. They comprise bank commissions for € 4,710 thousand and commissions on unit and index-linked products for € 9,044 thousand.
357
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1.3 NET INCOME ON FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE THROUGH THE INCOME STATEMENT
The table below sets forth the composition of income and expense on investments and on financial liabilities.
(in thousands of euro) Net
interests Other net
income Realised
gains Realised
losses Valuation
gains Valuation
losses 2015 2014 Change
68 0 69 -2 195 -19 311 510 -199
Arising on:
Financial assets held for trading Financial assets measured at fair value though the income statement 26,700 -6,482 20,675 -10,366 20,234 -23,094 27,667 68,939 -41,272
Financial liabilities held for trading 898 0 0 0 3,426 0 4,324 -6,464 10,788 Financial liabilities measured at fair value through the income statement
0 0 0 0 0 0 0 0 0
Total 27,666 -6,482 20,744 -10,368 23,855 -23,113 32,302 62,985 -30,683
1.4 - 1.5 FINANCIAL INCOME AND EXPENSE ON EQUITY INVESTMENTS IN SUBSIDIARIES, ASSOCIATES AND JOINT VENTURES, ON OTHER FINANCIAL INSTRUMENTS AND ON REAL ESTATE INVESTMENTS
(in thousands of euro)
Net interests
Other net income
Realised gains
Realised losses
Valuation
gains
Valuation losses 2015 2014 Change
Arising on:
Real estate investments 0 66,305 21,629 0 86 -10,363 77,657 51,215 26,442 Equity investments in subsidiaries, associates and joint ventures 0 31,300 0 0 0 0 31,300 11,060 20,240
Loans and receivables 9,845 -36 0 -1,012 125 -884 8,038 8,177 -139
AFS financial assets 191,653 5,399 101,886 -10,348 0 -2,491 286,099 256,243 29,856
Miscellaneous receivables 2,341 107 0 0 0 0 2,448 1,112 1,336
Cash and cash equivalents 359 0 0 0 0 0 359 670 -311
Other financial liabilities -3,415 0 0 -344 0 0 -3,759 -4,545 786
Miscellaneous payables -1,268 -1 0 0 0 0 -1,269 -1,530 261
Total 199,515 103,074 123,515 -11,704 211 -13,738 400,873 322,402 78,471
Valuation losses on AFS financial assets reflect permanent impairments of value resulting from impairment tests. Reference should be made to the commentary in the Notes in the assets section.
No interest income accrued during the year on financial assets affected by a permanent impairment of value.
With regard to income from equity investments in subsidiaries, associates and joint ventures, the other net income item, equal to € 31,300 thousand, comprises Group interest in the result of companies consolidated by the equity method.
358 REPORTS AND ACCOUNTS 2015
1.6 OTHER REVENUESThis item totalled € 114,158 thousand in relation to € 138,956 thousand in the previous year. The breakdown is as follows:
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(in thousands of euro)
2015 2014 Change
Other technical income 1,982 2,796 -814
Commissions cancelled 7,299 4,703 2,596
Withdrawals from funds 61,837 58,642 3,195
Recovery of administrative expenses and costs 3,839 3,729 110
Realised gains/write-ups of property, plant and equipment 1,035 271 764
Positive exchange differences 8,287 10,728 -2,441
Other income and refunds 19,569 14,510 5,059
Other out-of-period income 10,310 43,577 -33,267
Total 114,158 138,956 -24,798
The change in other out-of-period income was due to the recognition in 2014 of the extraordinary income of the Parent for the refund of sanctions and interest pursuant to the settlement agreement with the Tax Office concerning tax disputes related to tax year 2006, for € 26,605 thousand.
359
2.1 COST OF CLAIMS
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Net cost of claims totalled € 2,805,060 thousand in relation to € 2,679,866 thousand in the previous year.
The total of claims paid and the change in technical provisions, relating to direct business and inward reinsurance, amounted to € 3,004,820 thousand in relation to € 2,898,028 thousand in the previous year.
The detail is as follows: (in thousands of euro)
2015 2014 Change
Non-life business:
Amounts paid 1,865,455 1,875,984 -10,529
Change in the provision for outstanding claims -62,603 -178,770 116,167
Change in recoveries 55,520 65,998 -10,478
Change in other technical provisions 604 -366 970
Total Non-life 1,747,936 1,630,850 117,086
Life business:
Amounts paid 653,142 587,158 65,984
Change in the provision for sums to be paid 37,716 6,994 30,722
Change in the mathematical provision 502,413 611,460 -109,047
Change in technical provisions where the investment risk is borne by
the policyholders and deriving from the administration of pension
funds
67,803 45,060 22,743
Change in other technical provisions -4,190 16,506 -20,696
Total Life 1,256,884 1,267,178 -10,294
Total amounts paid and change in technical provisions 3,004,820 2,898,028 106,792
The reinsurers’ share amounted to a total of € 199,760 thousand in relation to € 218,162 thousand in the previous year and is detailed as follows:
(in thousands of euro)
2015 2014 Change
Non-life business:
Amounts paid 174,043 208,663 -34,620
Change in the provision for outstanding claims 5,637 -16,536 22,173
Total Non-life 179,680 192,127 -12,447
Life business:
Amounts paid 18,924 14,850 4,074
Change in the provision for sums to be paid 2,619 2,163 456
Change in the mathematical provision -418 9,068 -9,486
Change in technical provisions where the investment risk is borne by
the policyholders and deriving from the administration of pension
funds
-1,209 -360 -849
Change in other technical provisions 164 314 -150
Total Life 20,080 26,035 -5,955
Total reinsurers' share 199,760 218,162 -18,402
360 REPORTS AND ACCOUNTS 2015
2.5 OPERATING EXPENSES The composition of operating expenses, divided into Life and Non-life, is set forth in the table below.
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2015 2014 Change
Non-life business:
Gross commissions and other acquisition costs: 703,789 688,401 15,388
Acquisition commissions 385,497 391,100 -5,603
Other acquisition costs 189,399 174,648 14,751
Change in deferred acquisition costs 0 0 0
Collecting commissions 128,893 122,653 6,240
(-) Reinsurance commissions and profit-sharing 62,335 68,072 -5,737
Total Non-life 641,454 620,329 21,125
Life business:
Gross commissions and other acquisition costs: 44,633 45,548 -915
Acquisition commissions 24,815 26,331 -1,516
Other acquisition costs 17,200 15,674 1,526
Change in deferred acquisition costs 0 0 0
Collecting commissions 2,618 3,543 -925
(-) Reinsurance commissions and profit-sharing 3,271 4,934 -1,663
Total Life 41,362 40,614 748
Investment management expenses 52,650 48,218 4,432
Other administrative expenses 130,616 134,790 -4,174
Total operating expenses 866,082 843,951 22,131
(in thousands of euro)
361
2.6 OTHER COSTS This item amounted to € 196,288 thousand compared with € 203,408 thousand in the previous year. The item is detailed in the table below:
3. TAXES
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2015 2014 Change
Other technical charges 22,452 19,590 2,862 Cancellation of receivables from policyholders for premiums 35,046 24,848 10,198 Provisions to reserves 55,471 78,421 -22,950 Administrative costs and expenses on behalf of third parties 3,839 3,729 110 Depreciation of tangible assets 8,619 7,543 1,076 Amortisation of intangible assets 31,655 30,177 1,478 Realised losses/value reductions on property, plant and equipment 2,698 4,859 -2,161 Realised losses/value reductions on intangible assets 0 4,421 -4,421 Negative exchange differences 505 399 106 Sundry taxes 8,788 4,283 4,505 Real estate and service company costs 8,345 8,747 -402 Miscellaneous charges 4,250 3,009 1,241 Other out-of-period expense 14,620 13,382 1,238 Total 196,288 203,408 -7,120
(in thousands of euro) 2015 2014 Change
Costs for current taxes 64,339 97,916 -33,577 Decreases in net deferred taxes due to reduction in IRES rate -5,869 0 -5,869 Deferred tax liabilities arising during the year 12,288 6,354 5,934 (-) Deferred tax liabilities utilised during the year -9,411 -12,816 3,405 (-) Deferred tax assets arising during the year -19,459 -37,351 17,892 Deferred tax assets utilised during the year 13,630 22,880 -9,250 Total 55,518 76,983 -21,465
Taxes for the year amounted to € 55,518 thousand and comprise current taxes of € 64,339 thousand and a change in deferred tax assets and liabilities for € -8,821 thousand.
The net value of production for the purposes of IRAP was determined, for the Italian Companies, taking into account the substantial change introduced by Law No. 190/2014 (2015 Stability Law) whereby personnel costs paid under permanent employment contracts are fully deductible from the taxable base.
Current Italian taxes and the taxes of foreign subsidiaries were determined applying the nominal rates in force at the balance sheet date to the respective tax bases.
Deferred tax assets and liabilities have been calculated applying the rates that will presumably be in force on the date when these will reverse. Specifically, deferred tax assets and liabilities for IRES have been adjusted in view of the reduction of the tax rate to 24% as from 2017 (art. 1(61) of the 2016 Stability Law). This adjustment led to an increase of € 5,869 thousand in the result for the year.
Movement on deferred tax liabilities reflects a negative net balance of € 2,877 thousand. Amounts arising during the year refer to the provision for adjustments to the accounting values of financial assets, pursuant to IAS 39, for some € 4 million, and the division into instalments of gains realised on property for around € 7 million. Utilisations of deferred tax liabilities, on the other hand, mainly refer to gains on property realised in previous years and taxed in the current year.
(in thousands of euro)
362 REPORTS AND ACCOUNTS 2015
Deferred tax assets arising during the year, net of those reversed, determined a lower tax charge of € 5,829 thousand. These are stated if the correlated timing differences are likely to be reversed in subsequent years.
Deferred tax assets arising during the year mainly refer to the increase due to provisions for future risks and charges for around € 8 million and the allowance for bad and doubtful accounts for around € 9 million.
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Utilisations of deferred tax assets stated in previous years include reversal to subsequent years of the change in the claims provision for around € 4 million and provisions for future risks and charges for around € 8 million.
The reconciliation between the tax charges recorded in the financial statements and the theoretical tax charge, calculated on the basis of IRES charged at the nominal rate of 27.5% in force for 2015 is the following:
(in thousands of euro) 2015
Amount Rate
Pre-tax result for the year 214,819 Theoretical income taxes (excluding IRAP) 59,075 27.50% Tax effect of permanent differences 3,746 1.74% Tax effect of foreign tax rates -535 -0.25% Tax effect of consolidated companies on Shareholders’ equity -8,608 -4.01% Tax effect of differences in IRES rates -5,869 -2.73% IRES income tax (excluding IRAP) 47,809 22.26% IRAP income tax 7,709 3.59% Total income tax recognised in the financial statements 55,518 25.84%
Since the IRAP tax has a taxable basis that is different from income before taxes, it generates distortions between one year and another. Accordingly, in order to render the reconciliation between income taxes recognised and theoretical income taxes more meaningful, IRAP tax is not taken into consideration.
The tax effect due to permanent differences amounted to € 3,746 thousand and mainly related to the increase in the IMU tax paid by the Group's Italian companies, the non-deductible component of the increase in provisions for policy liabilities of the Italian insurance companies (1.5%) and other non-deductible Group costs. The reduction mainly related to the recognition of prepaid taxes relating to previous years following the Parent's acceptance of the Official Tax Audit Report for tax years 2010-2013 as explained in section 1.5 "Litigation" of the Report on Operations.
363
PART E: SEGMENT REPORTING The items of the balance sheet and income statement according to sector of business are detailed in the tables below. The sectors identified comprise Non-life and Life insurance, the real estate and services sector and banking sector.
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364 REPORTS AND ACCOUNTS 2015
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2.31
0.00
0
5M
ISC
ELLA
NEO
US
DEB
TOR
S79
5.29
7.19
085
2.07
8.00
013
7.41
8.66
712
1.00
1.00
032
.195
.611
30.5
90.0
007.
537.
619
2.80
0.00
0-1
2.07
0.06
7-1
1.13
8.00
096
0.37
9.02
099
5.33
1.00
06
OTH
ER A
SSET
S27
2.94
5.35
330
6.73
9.00
063
.969
.556
61.3
23.0
008.
089.
839
21.1
86.0
006.
707.
600
11.5
34.0
00-1
0.29
5.44
9-1
0.19
2.00
034
1.41
6.89
939
0.59
0.00
06.
1D
efer
red
acqu
isiti
on c
osts
00
00
00
00
00
00
6.2
Oth
er a
sset
s27
2.94
5.35
330
6.73
9.00
063
.969
.556
61.3
23.0
008.
089.
839
21.1
86.0
006.
707.
600
11.5
34.0
00-1
0.29
5.44
9-1
0.19
2.00
034
1.41
6.89
939
0.59
0.00
07
CAS
H A
ND
CAS
H E
QU
IVAL
ENTS
153.
064.
684
107.
980.
000
65.4
97.3
0784
.105
.000
25.3
93.0
419.
752.
000
10.8
94.1
219.
525.
000
-147
.177
.059
-94.
572.
000
107.
672.
094
116.
790.
000
TOTA
L AS
SETS
6.82
9.29
6.48
26.
947.
716.
000
7.30
1.87
8.15
06.
707.
530.
000
1.23
9.00
5.34
41.
099.
220.
000
693.
425.
640
599.
059.
000
-1.8
44.0
86.3
75-1
.755
.642
.000
14.2
19.5
19.2
4113
.597
.883
.000
1SH
AREH
OLD
ERS'
EQ
UIT
Y2.
325.
646.
715
2.24
5.49
8.00
02
PRO
VISI
ON
S76
.265
.129
85.7
86.0
0014
.860
.241
13.5
78.0
004.
196.
360
1.26
0.00
01.
371.
862
982.
000
00
96.6
93.5
9210
1.60
6.00
03
TEC
HN
ICAL
PR
OVI
SIO
NS
4.02
4.60
2.04
24.
064.
746.
000
6.44
8.17
4.82
25.
767.
296.
000
00
00
00
10.4
72.7
76.8
649.
832.
042.
000
4FI
NAN
CIA
L LI
ABIL
ITIE
S27
.314
.678
26.8
90.0
0055
.095
.177
62.1
06.0
003.
028.
880
4.30
4.00
061
4.73
9.58
151
5.41
2.00
0-1
47.8
10.1
06-9
6.52
3.00
055
2.36
8.21
051
2.18
9.00
04.
1Fi
nanc
ial l
iabi
litie
s m
easu
red
at fa
ir va
lue
thro
ugh
prof
it an
d lo
ss0
024
.101
.792
23.4
48.0
000
00
00
024
.101
.792
23.4
48.0
004.
2O
ther
fina
ncia
l lia
bilit
ies
27.3
14.6
7826
.890
.000
30.9
93.3
8538
.658
.000
3.02
8.88
04.
304.
000
614.
739.
581
515.
412.
000
-147
.810
.106
-96.
523.
000
528.
266.
418
488.
741.
000
5C
RED
ITO
RS
311.
225.
389
344.
631.
000
43.7
44.4
0859
.520
.000
62.4
41.4
6936
.278
.000
9.29
6.12
28.
477.
000
-12.
071.
209
-11.
254.
000
414.
636.
179
437.
652.
000
6O
THER
LIA
BIL
ITIE
S16
8.29
6.70
622
8.15
2.00
029
.062
.607
57.8
83.0
0016
6.91
2.15
218
5.65
0.00
06.
181.
577
10.0
64.0
00-1
3.05
5.36
1-1
2.85
3.00
035
7.39
7.68
146
8.89
6.00
0TO
TAL
LIAB
ILIT
IES
AND
SH
AREH
OLD
ERS'
EQ
UIT
Y4.
607.
703.
944
4.75
0.20
5.00
06.
590.
937.
255
5.96
0.38
3.00
023
6.57
8.86
122
7.49
2.00
063
1.58
9.14
253
4.93
5.00
0-1
72.9
36.6
76-1
20.6
30.0
0014
.219
.519
.241
13.5
97.8
83.0
00
(*) T
o be
exp
licitl
y re
porte
d, a
lso
by a
ddin
g co
lum
ns, i
n re
latio
n to
the
sign
ifica
nce
of th
e ac
tiviti
es c
arrie
d ou
t in
each
sec
tor
(1) S
ecto
r cod
e:N
on-li
fe b
usin
ess
Life
bus
ines
sO
ther
sec
tors
code
= 0
1co
de =
02
Cod
e de
term
ined
by
the
com
pany
: eac
h se
ctor
mus
t be
iden
tifie
d by
a s
peci
ficse
quen
tial n
umbe
r hig
her t
han
or e
qual
to 5
0 an
d lo
wer
than
90
Tran
s-se
ctor
al
canc
ella
tions
code
= 9
0To
tal
code
= 9
9
Tota
lSe
ctor
01
(1)
Sect
or 0
2 (1
)Se
ctor
50
(1)
Sect
or 5
1 (1
)Se
ctor
90
(1)
365
BILANCIO REALE MUTUA 2015.indd 383BILANCIO REALE MUTUA 2015.indd 383 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny: S
OC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Inco
me
Stat
emen
t by
busi
ness
sec
tor
(Val
ue in
Eur
o)
Tota
l Yea
r nTo
tal Y
ear n
-1To
tal Y
ear n
Tota
l Yea
r n-1
Tota
l Yea
r nTo
tal Y
ear n
-1To
tal Y
ear n
Tota
l Yea
r n-1
Tota
l Yea
r nTo
tal Y
ear n
-1To
tal Y
ear n
Tota
l Yea
r n-1
1.1
Net
pre
miu
ms
2.43
0.65
1.13
02.
361.
276.
000
1.09
5.59
2.48
31.
082.
969.
000
00
00
00
3.52
6.24
3.61
33.
444.
245.
000
1.1.
1G
ross
pre
miu
ms
earn
ed2.
706.
903.
828
2.66
9.72
6.00
01.
118.
407.
278
1.11
1.10
4.00
00
00
00
03.
825.
311.
106
3.78
0.83
0.00
01.
1.2
Prem
ium
s ce
ded
in re
insu
ranc
e-2
76.2
52.6
98-3
08.4
50.0
00-2
2.81
4.79
5-2
8.13
5.00
00
00
00
0-2
99.0
67.4
93-3
36.5
85.0
001.
2C
omm
issi
ons
rece
ivabl
e0
09.
044.
187
8.22
6.00
00
016
.930
.034
14.4
24.0
00-1
2.22
0.33
5-1
0.69
7.00
013
.753
.886
11.9
53.0
001.
3In
com
e an
d ch
arge
s on
fina
ncia
l ins
trum
ents
mea
sure
d at
fair
valu
e th
roug
h pr
ofit
and
loss
55.0
3633
7.00
031
.425
.115
60.7
99.0
0071
2.58
11.
435.
000
109.
754
414.
000
00
32.3
02.4
8662
.985
.000
1.4
Inco
me
on e
quity
inve
stm
ents
in s
ubsi
diar
ies,
ass
ocia
tes
and
join
t ven
ture
s20
.254
.559
28.1
55.0
0018
.251
.153
10.4
56.0
000
00
0-7
.206
.190
-10.
854.
000
31.2
99.5
2227
.757
.000
1.5
Inco
me
on o
ther
fina
ncia
l ins
trum
ents
and
real
pro
perty
inve
stm
ents
130.
247.
090
98.4
79.0
0017
7.34
8.80
316
7.85
8.00
090
.431
.807
71.8
55.0
0017
.872
.153
20.4
21.0
00-8
24.0
93-1
.175
.000
415.
075.
760
357.
438.
000
1.6
Oth
er re
venu
es95
.903
.258
127.
077.
000
5.70
9.99
63.
952.
000
135.
882.
535
32.2
90.0
002.
299.
514
2.15
4.00
0-1
25.6
37.2
06-2
6.51
7.00
011
4.15
8.09
713
8.95
6.00
01
TOTA
L R
EVEN
UES
AN
D IN
CO
ME
2.67
7.11
1.07
32.
615.
324.
000
1.33
7.37
1.73
71.
334.
260.
000
227.
026.
923
105.
580.
000
37.2
11.4
5537
.413
.000
-145
.887
.824
-49.
243.
000
4.13
2.83
3.36
44.
043.
334.
000
2.1
Net
cha
rges
for c
laim
s-1
.573
.746
.122
-1.4
38.7
23.0
00-1
.236
.805
.013
-1.2
41.1
43.0
000
00
05.
490.
957
0-2
.805
.060
.178
-2.6
79.8
66.0
00
2.1.
2Am
ount
s pa
id a
nd c
hang
e in
tech
nica
l pro
visi
ons
-1.7
53.4
26.9
55-1
.630
.850
.000
-1.2
56.8
84.2
76-1
.267
.178
.000
00
00
5.49
0.95
70
-3.0
04.8
20.2
74-2
.898
.028
.000
2.1.
3R
eins
urer
s' s
hare
179.
680.
833
192.
127.
000
20.0
79.2
6326
.035
.000
00
00
00
199.
760.
096
218.
162.
000
2.2
Com
mis
sion
s pa
yabl
e0
0-1
.189
.702
-997
.000
00
-3.8
92.6
55-2
.640
.000
00
-5.0
82.3
57-3
.637
.000
2.3
Cha
rges
on
equi
ty in
vest
men
ts in
sub
sidi
arie
s, a
ssoc
iate
s an
d jo
int v
entu
res
0-1
6.69
7.00
00
00
00
00
00
-16.
697.
000
2.4
Cha
rges
on
othe
r fin
anci
al in
stru
men
ts a
nd re
al p
rope
rty in
vest
men
ts-1
8.22
5.62
4-1
2.08
2.00
0-1
.680
.284
-1.5
95.0
00-2
0.01
8.62
0-2
5.57
7.00
0-5
.661
.370
-7.0
00.0
0082
.468
158.
000
-45.
503.
430
-46.
096.
000
2.5
Man
agem
ent c
osts
-778
.641
.802
-743
.420
.000
-72.
656.
736
-68.
637.
000
-33.
693.
487
-28.
400.
000
-21.
617.
452
-18.
608.
000
40.5
26.9
9915
.114
.000
-866
.082
.478
-843
.951
.000
2.6
Oth
er c
osts
-140
.477
.790
-179
.611
.000
-9.7
83.2
61-1
1.01
6.00
0-1
36.2
74.7
62-3
3.90
0.00
0-2
.433
.110
-1.7
58.0
0092
.682
.741
22.8
77.0
00-1
96.2
86.1
82-2
03.4
08.0
002
TOTA
L C
OST
S AN
D C
HAR
GES
-2.5
11.0
91.3
38-2
.390
.533
.000
-1.3
22.1
14.9
96-1
.323
.388
.000
-189
.986
.869
-87.
877.
000
-33.
604.
587
-30.
006.
000
138.
783.
165
38.1
49.0
00-3
.918
.014
.625
-3.7
93.6
55.0
00PR
OFI
T (L
OSS
) FO
R T
HE
YEAR
BEF
OR
E TA
XES
166.
019.
735
224.
791.
000
15.2
56.7
4110
.872
.000
37.0
40.0
5417
.703
.000
3.60
6.86
87.
407.
000
-7.1
04.6
59-1
1.09
4.00
021
4.81
8.73
924
9.67
9.00
0
(1) S
ecto
r cod
e:N
on-li
fe b
usin
ess
Life
bus
ines
sO
ther
sec
tors
code
= 0
1co
de =
02
Cod
e de
term
ined
by
the
com
pany
: eac
h se
ctor
mus
t be
iden
tifie
d by
a s
peci
ficse
quen
tial n
umbe
r hig
her t
han
or e
qual
to 5
0 an
d lo
wer
than
90
Tran
s-se
ctor
al
canc
ella
tions
code
= 9
0To
tal
code
= 9
9
Tota
lSe
ctor
01
(1)
Sect
or 0
2 (1
)Se
ctor
50
(1)
Sect
or 5
1 (1
)Se
ctor
90
(1)
366 REPORTS AND ACCOUNTS 2015
PART F: INFORMATION REGARDING RISKS
BILANCIO REALE MUTUA 2015.indd 384BILANCIO REALE MUTUA 2015.indd 384 14/04/16 16:0514/04/16 16:05
1 Reale Group risk management1
Foreword
Recent changes in the insurance market, oriented towards ever increasing attention to policyholder protection and market stability, have ushered in various regulations, also at Community level, regarding internal control and risk management systems.
While prioritising regulatory issues and sound, prudent management criteria, Reale Group’s risk management policy also takes into account the mutualistic nature of the Parent. Accordingly, constant upgrading of the risk management system, essential in promoting continuing development and continuity of each Group company, is a pivotal aspect of Group strategy, also with regard to maintaining full autonomy and independence from external centres of control and capitalisation.
1.1. The risk management organisational model
Reale Group's risk management system is directed towards maintaining risks at an acceptable level, consistent with the capital assets of each company and of the entire Group.
To achieve this objective, the Group risk management system establishes the following roles and responsibilities for each Group company:
- the Board of Directors is responsible for defining risk management directives (the suite of most significant risk strategies and underwriting, measurement and management policies), for defining risk appetite and tolerance (RAF - Risk Appetite Framework) and for checking correct application of the risk management system by Top Management, in order to guarantee the safeguarding of company assets, including in the medium and long term;
- the Group Internal Control Committee provides consulting and puts forward proposals and is responsible for assisting the Board of Directors with regard to the internal control and risk management system;
- Top Management is responsible for risk management system application, maintenance and monitoring;
- the Chief Risk Officer (CRO) guarantees the soundness of overall risk management by the Company and by the Group in Italy, within the framework of the system of internal controls. The CRO is accountable for the centralised governance and coordination of all issues related to the monitoring of business risks and for ensuring consistency in the implementation of the related guidelines defined by the administrative body. For that purpose, the CRO is responsible for:
coordination of second level control functions (Anti-money laundering, Compliance and RiskManagement) and guidance of the Legal function, in order to create a single pool of expertise onregulatory matters and thus eliminate any overlapping of roles;
coordination of regulatory and technical risk monitoring-related issues in order to gain an overallvision and guarantee the integrated management thereof;
- the Risk Management function, set up at the Parent, assists the Board of Directors and Top Management in defining assessment methodologies and drawing up analyses for risk evaluation, measurement and control and also for coordinating risk monitoring activities;
- the Compliance function, set up at the Parent, is responsible for assessing the adequacy of corporate organisation and procedures with regard to preventing the risk of incurring judicial or administrative sanctions, capital losses and reputational damage deriving from infringement of the regulations, laws, regulations or orders of the Supervisory Authorities or self-regulation norms and for assisting the Board of Directors and Top Management with regard to the risk of non-compliance with regulations;
1 The definition of Group and related scope of analysis has been determined in accordance with ISVAP Regulation No. 15/2008, setting up the Register of Insurance Groups.
367
BILANCIO REALE MUTUA 2015.indd 385BILANCIO REALE MUTUA 2015.indd 385 14/04/16 16:0514/04/16 16:05
- The Anti-money laundering function is responsible for controlling, preventing and countering money laundering and funding of terrorist activities.
- The Internal Audit function is responsible for verifying and assessing risk management system effectiveness and efficiency.
Each competent function is responsible for operational risk management according to their area of responsibility in the business processes controlled.
The Board of Directors of the Parent is also assisted by specific bodies set up within this, such as the Group Investment Committee and Commission whose task is to verify particular aspects of Company and Group performance also as regards management of risks.
Top Management at each company resorts to joint work groups, set up at Group level, that investigate and analyse specific aspects; these include, in particular, the Investment Management Committee, the Life Risk Committee, the Motor Business Committee and the Non-life Technical Committee.
In 2015 the Reale Mutua Parent continued its efforts, under Group-wide projects launched in 2010, to adapt to the new Solvency II regime, which comes into force on January 1, 2016. Particular attention was paid to establishing new principles of evaluation in decision-making and policy processes. The new evaluation criteria have been incorporated into the following processes:
- evaluation of new products;
- investment choices;
- evaluation of strategic operations;
- definition of the risk appetite framework;
- strategic planning.
Moreover, the Company has started the pre-application process in order to obtain the Supervisory Authority's regulatory approval for the internal model applicable at Group level. The Company continued to assess prospective risks (ORSA) in 2015, and submitted its report to the Supervisory Authority in June 2015. It undertook a review of its risk management policies and of its actions to improve the governance of its risk management system.
In working to fulfil the new Pillar III reporting requirements, the Company continued to implement the systems for producing the qualitative and quantitative disclosures envisaged under EIOPA guidelines. Specifically, the Company prepared and submitted its annual report with data as at December 31, 2014 and its report for the third quarter of 2015 as required by the interim measures. The Parent sent its annual report to IVASS by June 3, 2015 and its quarterly report by November 25, 2015. The respective reports with data for the Group were submitted on July 15, 2015 and January 6, 2016.
1.2. Risk management policies
Within the framework of the risk management system and in accordance with regulatory provisions, the Board of Directors has formulated risk identification, measurement, management and control criteria in the Risk management policies document.
This document sets forth guidelines for management of internal and external risks inherent in the business of Group companies, defining strategies and objectives, analysis, control and measurement methods, roles and responsibilities of the company functions involved. More generally, the document is also intended to promote deployment of a culture of risk control and management throughout the Group.
Compliance with and application of the guidelines set out in the document are guaranteed by the System of Internal Controls which comprises a set of rules, procedures, control techniques and organisational structures intended to ensure correct functioning and performance of the Group.
368 REPORTS AND ACCOUNTS 2015
1.3. Risk measurement and reporting
BILANCIO REALE MUTUA 2015.indd 386BILANCIO REALE MUTUA 2015.indd 386 14/04/16 16:0514/04/16 16:05
Risks are constantly monitored by the Risk Management function and by the individual competent functions; risk trends are notified to the Board of Directors, to Top Management and to the competent operating structures.
2 Risk Analysis
2.1. Market risks2
In assessing market risk, reference is made to all risks that result in downgrading of financial or real estate investments due to adverse changes in major market variables such as share prices, interest rates, the value of real estate, exchange rates and credit rating.
Market risk management policies define:
- limits on investments according to type, with particular attention to risk/yield trade-off;
- limits on investments in foreign currency;
- integrated asset-liability management strategies (ALM) combined with cash flow matching valuations, in particular for securities to hedge separately managed funds;
- guidelines on the use of derivatives;
- guidelines regarding investment property;
- guidelines and restrictions for control of the credit risk of financial investments.
The limits on investments are constantly verified and monitored by the competent corporate functions, and their findings are notified periodically to the Group Investment Commission.
As regards interest rate risk, financial activities are managed according to a prudent approach based on joint management of assets and liabilities using ALM (Asset Liability Management) type management techniques.
The overall duration of the portfolio is around 4.6 years. Financial management has determined an effective average yield to maturity of the bonds portfolio of approx. 0.8%.
With regard to equity risk, equity exposure accounts for 1.2% of the entire portfolio and comprises € 114 million of other shares, of which Banca d’Italia for € 12.5 million and Credito Emiliano for € 9.6 million.
Overall, during the year, the equity portfolio reflected an annual volatility of 27.2%, with investments in equities mainly steered towards the industrial, financial and banking sectors, as indicated in the table below:
Market sector Composition (%) 45.0% 23.0% 12.6%
8.7% 7.6% 3.0%
Finance and Banking Consumer goods Industry Telecommunications Centre Technological Energy 0.1% Total 100.0%
2 Unlisted strategic investments in Sara Assicurazioni and Credem are not included in the analysis of market risk. Reale Immobili and IGAR are included in the real property compartment.
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As regards exchange rate risk, investments in foreign currency amounted to around 0.3% of the entire portfolio. Details are as follows:
(in thousands of euro) Currency Composition (%) Market value USD 0.2% 16,833 AUD 0.1% 4,104 CHF 0.0% 1,609 GBP 0.0% 751 Total 0.3% 23,297
With regard to credit risk, debt securities in the portfolio have an average rating of Baa1 according to Moody’s. Positions with non-investment grade rating represent less than 1.3% of the portfolio.
The breakdown of the bonds portfolio (both Government and Corporate) according to rating class is set forth below:
Level Rating class (*) Composition (%)
Prime/High Grade Aaa 12.2% Aa1-Aa2-Aa3 7.9%
Medium Grade A1-A2-A3 10.3% Baa1-Baa2-Baa3 68.3%
Speculative Ba1-Ba2-Ba3 1.3% B1-B2-B3 0.0%
Extremely Speculative Caa1-Caa2-Caa3 0.0% Ca 0.0% C 0.0% NR 0.0%
100.0% Total (*) according to Moody’s rating scale
The quantitative assessment of the impact of adverse risk factor trends is determined on a potential maximum loss basis using the SCR model. The calculation of the Group SCR takes into account effects deriving from diversification at individual company level.
Market risks tend to impact not only financial assets but also liabilities. Life liabilities in particular, in relation to minimum guaranteed rates, are particularly exposed to interest rate risk. Therefore, assessment of Life business market risks imposes consolidated measurements of assets and liabilities in view of the typical risk absorption mechanism of Life contracts. This absorption capacity depends on the minimum guaranteed rates and type of profit sharing.
370 REPORTS AND ACCOUNTS 2015
2.2. Default risk
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Default risk is tied to insolvency of counterparties (reinsurers, banks, insureds, intermediaries and agents).
As far as reinsurance counterparties are concerned, the Group has defined policies for the management and control of this risk in terms of guidelines and restrictions.
With regard to the default risk of reinsurance counterparties, exposure is concentrated towards reinsurers with a rating of A or higher expressed by the Standard&Poor’s agency, specialised in the insurance and re-insurance sector (percentage incidence of around 91.3%).
2.3. Liquidity risk
Liquidity risk refers to the ability to comply promptly with payment obligations by the times established by the contract.
The Group adopts limitations on the use of financial assets in order to constantly monitor the portfolio liquidity risk.
Liquidity risk is also constantly monitored on the basis of run-off of provisions relating to Non-Life business, of flows of expiry established for Life business and cash flows referring to loans received by the Group.
Bonds, according to maturity, are set forth in the table below.
(in thousands of euro) Debt securities by expiry Government Corporate Total
<= 1 year 1,687,649 167,490 1,855,139 >1 <=3 years 1,414,481 362,629 1,777,109 >3 <=5 years 997,676 491,757 1,489,433 >5 <=7 years 688,071 311,122 999,193 >7 <=10 years 908,136 418,575 1,326,710 >10 years 1,332,901 218,023 1,550,924 Total 7,028,914 1,969,596 8,998,508
Information regarding reserve flows according to contractual expiry referring to run-off of the entire Life portfolio is provided in the table below.
(in thousands of euro) Year Reserve by expiry 2016 321,046 2017 206,567 2018 232,608 2019 223,632 2020 300,474 2021 144,156 2022 308,884 2023 307,685 after 2024 3,656,370 Total 5,701,422
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The expected run-off coefficients of Motor TPL and Non-motor TPL provisions are set forth in the table below.
2.4. Underwriting risks
2.4.1. Life
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Year Motor TPL Non-motor TPL 2016 47.3% 24.7% 2017 20.0% 18.4% 2018 11.6% 14.6% 2019 7.7% 12.2% 2020 5.4% 9.8% 2021 3.3% 7.8% 2022 2.3% 5.5% after 2022 2.5% 6.8% Total 100.0% 100.0%
Cash flows (amortisation plan of principal) of loans received by the Group referring to investment property, with a value of around € 2 million, are indicated in the table below.
(in thousands of euro) Year Principal 2016 958 2017 958 2018 479 Total 2,395
The main sources of underwriting risks inherent in Life contracts are tied to demographic trend, surrender frequency and suspension of premium payments, frequency of exercise of the option of conversion into guaranteed annuity and coverage of costs.
With regard to demographic risks, mortality statistics are updated periodically and suitable reinsurance plans are adopted in order to reduce exposure to this factor of risk; for other underwriting risks, particular attention is also paid to checking and controlling the frequencies of exercise of such options with regard to the respective market data.
Specific non-proportional covers are acquired for catastrophic risks.
Guidelines have been established for the assumption of death cover contracts relating to health and financial requirements.
Total technical provisions amount to € 5,901,778 thousand and their fair value is equal to € 5,851,168 thousand.
The composition of the Life portfolio is detailed below.
Class Insurance contracts Financial instruments with DPF Total
Not revaluable 2.1% 0.0% 2.1% Revaluable 11.8% 72.6% 84.4% Unit-linked 13.5% 0.0% 13.5% Index-linked 0.0% 0.0% 0.0% Total 27.4% 72.6% 100.0%
Assessments of maximum potential loss have been made using the SCR model in order to assess the effects deriving from the main insurance underwriting risks, such as mortality, surrender rate and costs.
372 REPORTS AND ACCOUNTS 2015
2.4.2. Non-life
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The risks associated with the Non-life portfolio are technical risks, determined by underwriting policies (underwriting risks) and provisioning polices relating to the acquired portfolio (provisioning risks).
For underwriting risks, the Group has drawn up an Underwriting Rules Manual which provides technical guidance regarding underwriting policy for each Group company, with particular reference to non-standard products.
For fire catastrophic covers, for earthquake risks, the RMS, EQECAT and AIR models have been used in order to simulate various possible scenarios and to quantify the necessary catastrophic provisions necessary to withstand an event, considering a time horizon of at least 200 years. Reinsurance covers have been acquired, giving preference to the approach of the RMS model, currently more prudent and conservative.
Information regarding the development of Motor and Non-motor TPL business claims is provided in the tables below, with reference to the provisions of IFRS 4.
Each diagonal of the triangle represents the accounting data at 31/12 of the year of observation of the total cost of claims per individual year of occurrence. The following are indicated in the detail for each year of occurrence and for each claim duration:
- incremental payments;
- cumulative payments;
- risks retained on claims open and on late claims;
- the final cost, consisting of the sum of cumulative amount paid and the amount of the provision.
It has been considered advisable to represent the evolution of claims of only TPL business lines in view of their significance and “long tail” characteristics.
These businesses are characterised by a longer run-off due to delays that drag out over the years, especially Non-motor TPL.
Development of the ultimate cost is therefore more liable to changes, thereby undermining the stability of the estimate in time.
For both TPL businesses the trend in reserves at ultimate cost generated a positive result, determined by the positive trend in the reserve for settlement costs.
It should be noted that, in developing the data of previous years of both Motor TPL and Non-motor TPL, the effect of revaluation of reserves due to the new tables of the Court of Milan is included.
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Motor TPL business
Group Class 10 Claim durationOccurrence 0 1 2 3 4 5 6 7
amount paid 452,928 304,932 100,361 43,582 23,511 18,814 8,864 9,106cumulative amount 452,928 757,861 858,222 901,805 925,315 944,129 952,993 962,098reserved 577,888 256,923 138,655 103,292 76,193 52,990 40,902 29,729total 1,030,816 1,014,784 996,877 1,005,097 1,001,508 997,119 993,895 991,828amount paid 461,072 300,211 105,087 43,484 22,321 21,166 8,900cumulative amount 461,072 761,283 866,369 909,853 932,174 953,340 962,240reserved 544,021 252,371 164,544 113,413 82,020 54,634 34,128total 1,005,093 1,013,653 1,030,914 1,023,266 1,014,195 1,007,974 996,368amount paid 454,319 317,281 100,443 42,267 23,032 18,518cumulative amount 454,319 771,600 872,043 914,309 937,341 955,859reserved 574,343 284,971 172,143 116,842 89,603 58,692total 1,028,662 1,056,571 1,044,185 1,031,151 1,026,944 1,014,551amount paid 432,090 293,228 83,264 40,265 20,819cumulative amount 432,090 725,318 808,582 848,848 869,667reserved 588,892 257,866 148,498 102,780 72,395total 1,020,983 983,184 957,081 951,627 942,063amount paid 380,657 251,129 77,682 32,132cumulative amount 380,657 631,786 709,468 741,600reserved 509,543 206,787 110,737 75,024total 890,199 838,573 820,205 816,624amount paid 365,186 240,040 68,913 Integrazioni su 2007 e precedenticumulative amount 365,186 605,225 674,138reserved 486,331 204,122 108,360total 851,517 809,347 782,498 -4,441,821 0amount paid 363,794 227,159cumulative amount 363,794 590,953reserved 439,600 186,968total 803,394 777,921amount paid 398,930cumulative amount 398,930reserved 480,102total 879,033
Non-motor TPL business
Group Class 13 Claim durationOccurrence 0 1 2 3 4 5 6 7
amount paid 30,164 44,574 21,973 16,579 12,939 10,126 9,028 7,094cumulative amount 30,164 74,737 96,711 113,290 126,229 136,355 145,383 152,477reserved 175,736 146,815 125,734 106,897 92,166 79,339 66,169 52,477total 205,899 221,552 222,445 220,187 218,395 215,695 211,552 204,954amount paid 29,697 36,215 20,911 15,375 9,316 10,786 12,282cumulative amount 29,697 65,912 86,823 102,198 111,514 122,300 134,583reserved 177,754 132,222 111,083 92,348 83,870 69,849 51,910total 207,451 198,134 197,906 194,546 195,384 192,149 186,492amount paid 27,714 36,690 21,938 11,700 13,356 10,410cumulative amount 27,714 64,404 86,341 98,041 111,397 121,808reserved 165,872 129,406 105,169 92,638 85,495 63,338total 193,585 193,810 191,511 190,679 196,892 185,146amount paid 27,176 40,970 20,648 11,083 12,689cumulative amount 27,176 68,146 88,794 99,877 112,566reserved 172,316 124,764 103,553 86,515 73,095total 199,491 192,910 192,347 186,392 185,662amount paid 29,468 42,350 19,165 12,833cumulative amount 29,468 71,819 90,984 103,818reserved 170,490 133,699 105,219 90,265total 199,959 205,518 196,203 194,082amount paid 27,345 37,151 17,429 Integrazioni su 2007 e precedenticumulative amount 27,345 64,497 81,926reserved 185,614 131,609 116,695total 212,959 196,105 198,621 -4,441,821 0amount paid 27,923 34,351cumulative amount 27,923 62,274reserved 162,861 139,790total 190,784 202,064amount paid 27,580cumulative amount 27,580reserved 162,146total 189,726
2012
2013
2014
2015
2008
2009
2010
2011
2014
2015
2008
2009
2010
2011
2012
2013
374 REPORTS AND ACCOUNTS 2015
The results of the inflation sensitivity analysis are shown in the table below; in particular, the percentage variation in the estimate of the claims provision relating to increases in the inflation rate is indicated.
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Inflation rate Motor TPL Non-motor TPL 2.00% 2.17% 2.55% 4.00% 6.69% 7.95% 6.00% 11.49% 13.80%
2.5. Operational risks, legal and regulatory risks, reputational risk and Group membership risks
With regard to operational, legal and regulatory, reputational and Group membership risks, a new edition of the Risk Assessment project was launched in 2015 for qualitative assessment of these types of risk.
Risk Assessment, based on a general mapping of the processes within Group companies, is managed by Risk Management, for aspects concerning operational risks, and Compliance. The scope of analysis includes the Italian insurance and instrumental companies of the Group (Reale Mutua Assicurazioni, Italiana Assicurazioni, Blue Assistance, Reale Immobili and Reale ITES).
Activities are performed using the Risk Assessment and Macro Check List methods:
- Risk assessment methodology envisages measurement at qualitative level of risks and controls tied to company activities. For each process, it involves the identification of operational risks with their risk factors, and the risks of non-compliance with legal requirements, assessing their impact and frequency in order to determine the gross risk. The net risk of each process is then determined based on the subsequent identification and evaluation of the controls put in place to reduce the risk. Risk assessment also involves identifying the causes of risks and the shortcomings in on-going controls in order to define a risk management plan (retention of the risk, transfer or mitigation through specific remedial actions). Risk factors are classified internally, according to Basel II.
- The Macro Check List is a self-assessment tool used by Top Management for the qualitative assessment of the company risk profile, with particular reference to operational, reputational, non-compliance, group membership and strategic risks.
The Group has drawn up a Contingency Plan, which is periodically reviewed. The aim of the Plan is to safeguard persons and assets and guarantee continuity of business in an emergency linked to a potentially disastrous event. The Contingency Plan includes a Disaster Recovery Plan, which is a specific strategic plan designed to minimise loss of information and recovery times in particularly critical situations. This plan sets out the technological measures to restore systems, data and infrastructures necessary to deliver business services in case of a catastrophic event.
In accordance with the provisions of ISVAP Regulations No. 20 and No. 25, the Group has drawn up a procedure for controlling the exchange of information and a system for monitoring intra-group transactions and identifying the functions concerned.
2.6. Risk mitigation instruments
The Group adopts risk mitigation instruments in order to reduce its exposure to the risks underwritten, through recourse to reinsurance, and adopting hedge derivatives to restrict possible impairments of assets.
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2.6.1. Reinsurance
The four interest swap contracts envisage swapping of interest, proportionally to the notional value stipulated maturing on the XS0104009617 Crediop 2.1% 99/25 bond. This bond is carried in the Company's securities portfolio for a total nominal value exceeding the notional value of the interest swap and currently envisages a high annual optional coupon determined with a floor option and leverage tied to a defined amortisation plan: the commitments entered into have therefore been covered.
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Analyses have been conducted in order to optimise reinsurance solutions in accordance with the guidelines defined by the Board of Directors. Expected claims rate distribution curves have been defined through analysis of the historical series of each class of business (in terms of earnings, claims and exposure) and of the objectives defined in the strategic plans of the enterprise. Such valuations have been made separately for basic and peak claims, assessing catastrophe exposure, and specific analyses have been made for business lines with not statistically significant historical series. The analysis, made using quantitative models for valuation of risk capital (VaR and T-VaR), has generated alternative scenarios according to which the optimal reinsurance solutions for each Italian company of the Group have been identified.
2.6.2. Derivatives
Reale Group makes limited use of derivatives; these instruments are used for the purposes that comply with the Group’s strategic plan as defined by each company’s Board of Directors, with ISVAP Regulation No. 36 of 31/01/2011 and with the requirements of the financial instrument portfolio control system.
Derivatives are used for hedging purposes only, to mitigate the risk profile of the assets/liabilities hedged or to optimise the yield risk profile. Moreover, the counterparties of all Group derivatives are leading financial operators of international and national standing.
For each company in Reale Group, details of the derivatives held, for which each company bears the risk, are provided below.
Derivatives held by Reale Mutua:
- approx. 1,254 thousand put options issued by Credito Emiliano on an equal number of quotas of internal funds underlying unit-linked products to hedge the guaranteed capital for a notional value of approx. € 18,814 thousand. The fair value of these derivatives was equal to zero at the end of 2015;
- four interest rate swap contracts to hedge interest rate risk on the Crediop 2.1% 01/09/2025 (XS0104009617) structured bond: two with Royal Bank of Scotland Group Plc for a total notional value of € 7,120 thousand (with a fair value, inclusive of accrued interest, of approx. € -8,720 thousand at the end of 2015); two with Société Générale for a total notional value of € 6,000 thousand (with a fair value, inclusive of accrued interest, of € -7,946 thousand at the end of 2015). Estimated cash flows according to maturity commitments are provided below, based on information available at December 31, 2015.
(in thousands of euro)
Net flows 1 year 3 years 5 years Due after 5 years
-280 -706 -933 -1,069 -1,400 -3,531 -4,663 -5,344 -1,378 -3,449 -4,520 -5,122
Swap SOGEN Crediop – 01/09/2025 OS4044968 SwapSOGEN Crediop – 01/09/2025 0S4044887 Swap RBS Crediop – 01/09/2025 OSRAM18066 Swap RBS Crediop – 01/09/2025 OSRAM17514 -507 -1,263 -1,645 -1,850 Total -3,565 -8,949 -11,761 -13,385
376 REPORTS AND ACCOUNTS 2015
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Derivatives held by Italiana Assicurazioni:
- approx. 78 thousand put options issued by Credito Emiliano on an equal number of quotas of internal funds underlying unit-linked products to hedge the guaranteed capital for a notional value of approx. € 1,174 thousand. The fair value of these derivatives was equal to zero at the end of 2015.
Derivatives held by Reale Immobili:
- derivative to hedge variations in cash flows on the loan granted to Reale Immobili for real estate investments, with a residual capital of approx. € 2.4 million. Cash flows of the hedged transaction are reported on a six-monthly basis deferred in relation to the expiry established in the loan contract (initial value equal to € 11.5 million, expiry 30/06/18). IAS 39, paragraph 74 (a) permits separation of the intrinsic value (the maximum between zero and the value of the option if it were exercised) and the time value (the value of the option based on its residual life) and designation as hedge instrument only in the case of change in the intrinsic value. According to the above assumptions, considering the current interest rates and since the variable part of the interest to maturity established by the loan contract cannot be calculated, the cap option is “out of the money” (the option cannot be exercised as the rate of interest on the loan is lower than the 5.5% cap). Therefore, its intrinsic value is equal to zero and the entire fair value of the hedge instrument is tied to its time value only which has been taken to the income statement for an amount equal to € 28 as it is not effective.
Other information
Solvency II
The aim of the Group-wide "Solvency II" project is to implement the new solvency system and make sure that this becomes a well-established component of all decision-making and policy processes. The main developments in this field are reported below:
- calculation of capital requirements (SCR and MCR) and own funds; - definition of risk management policies, changes to governance, adaptation of processes, assessment of
prospective risks and solvency position (ORSA); - quantitative reporting (QRT) and qualitative reporting (RSR, SFCR).
As part of the Solvency II project, the Group has started the pre-application process in order to obtain the Supervisory Authority's regulatory approval for the internal model.
Banca Reale
Banca Reale, which has not been included in the Insurance group perimeter according to the definition of ISVAP Regulation No. 15/2008, but which is subject to the supervision of Banca d’Italia, operates within Reale Group.
In accordance with its dimensions and the specific characteristics of its business and the type and scope of company risks, Banca Reale has adopted a risk management policy that involves all levels of the company and is implemented via the System of Internal Controls which envisages three types of controls:
- line controls, intended to guarantee correct management of all activities and performed by the operational divisions or incorporated into IT supporting procedures. Line controls cover all of the Bank's activities and include tests, reports and monitoring performed by the people in charge of the respective business units;
377
- control of risks and compliance, the aims of which include ensuring the correct implementation of risk management processes, observance of operational limits by the various functions and legal compliance of corporate procedures, including self-regulatory measures. The functions responsible for these controls operate separately from those involved in production; they contribute to the definition of risk governance policies and risk management processes. The Risk Management function is involved in establishing acceptable levels of risk, developing risk management policies and in the various stages of the risk management process, as well as defining operational autonomy as regards the various types of risks. This function continually verifies the adequacy of such policies, processes and limits, monitors changes in the risks to which the company is exposed and compliance with operating limits when taking the different types of risks.The Compliance and Anti-money laundering function adopts a risk-based approach to manage the risk of non-compliance (risk of incurring judicial or administrative sanctions, substantial capital losses and damage to reputation deriving from infringement of mandatory regulations or self-regulatory norms) and the risk of money laundering (the process of converting funds received from illegal activities into ostensibly clean money to disguise their illegal origin). This risk is managed across all company activities, by ensuring the adequacy of internal procedures to prevent it;
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- internal audits, performed by the Internal Audit function. This function is responsible, on the one hand, for third level controls, including on-site inspections, to verify the correctness of operational procedures and risk trends and, on the other, for assessing the completeness, adequacy, functionality and reliability of the organisational structure and the other components of the system of internal controls, informing the corporate bodies of any needs for improvement.
In 2008, Banca Reale defined the Internal Capital Adequacy Assessment Process (ICAAP) according to the applicable supervisory provisions. The aim is to ensure all-round monitoring of the Bank’s current and projected capital adequacy.
This process is subject to routine controls by the Risk Management function with regard to methodological aspects, by the Compliance function with regard to compliance with the law and by the Internal Audit function, with the support of the operational functions within their specific sphere of competence, with regard to procedural aspects. The process is also subject to extraordinary controls whenever the Bank is potentially exposed to significant new risks to be assessed (e.g. upon entering new markets/areas of operation) and/or when previously identified risks have new characteristics that alter the Bank’s risk exposure.
The main risks to which the Bank is exposed are credit risk, market risk, operational risk (first pillar), concentration risk, interest rate risk of the banking portfolio, liquidity risk, residual risk, strategic risk, reputation, outsourcing and compliance risk (second pillar).
378 REPORTS AND ACCOUNTS 2015
LAT – Liability Adequacy Test
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In carrying out the Liability Adequacy Test (LAT), the “realistic reserve” has been calculated as forecast present value on the reporting date of future cash flows generated by contracts (premiums and benefits). The method of flow projection used is of the deterministic type with revaluation of these equal to the guaranteed minimum. Cash flows have been discounted using the risk-free rates curve. The flows of the contracts were determined considering demographic, surrender and lapse hypotheses based on company experience. The test also took into account projected flows relating to premium loadings and future expenses.
The adequacy of “net technical provisions” was also verified on the basis of a comparison with the “realistic reserve”. The valuation was made considering that “net technical provisions” comprise not only technical provisions stated according to Italian GAAP but also “shadow liabilities”.
The adequacy of technical provisions has been verified for each Group company, identifying separately managed funds as like groups of contracts. The test revealed that provisions are adequate for each similar group analysed.
After the reporting date, no additional information emerged such as to require re-examination of such analyses.
LAT results are set forth in the table below.
(in thousands of euro)
Company Technical provisions, net
Realistic provisions (basic assumption)
4,254,840 3,471,141 Reale Mutua
Italiana Assicurazioni 1,260,513 1,068,129
Total 5,515,353 4,539,270
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PART H: INFORMATION REGARDING BUSINESS WITH RELATED PARTIES
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Transactions between the Parent and its subsidiaries are eliminated in the consolidated financial statements according to the principle of elision of intra-group relations and, therefore, are not discussed below. Such relations mainly reflect reinsurance transactions and the exchange of services between Group companies.
The balances of commercial and financial transactions between Group companies, including the Parent, and related parties are set forth below:
(in thousands of euro)
Counterparty 31.12.2015 31.12.2014
Assets Liabilities Assets Liabilities
Associated companies 0 401 929 31 Other related parties 1,143 4,817 1,043 3,834 Total 1,143 5,218 1,972 3,865
(in thousands of euro)
Counterparty 2015 2014
Income Charges Income Charges
Associated companies 248 248 337 337 Other related parties 3,694 4,772 1,340 4,205 Total 3,942 5,020 1,677 4,542
The underlying transactions were all concluded on an arm’s length basis.
During the year, no allowance was made to cover possible losses on receivables from related parties.
Assets due from other related parties mainly relate to loans granted by the Banca Reale S.p.A. subsidiary, liabilities mainly comprise bonds issued by the Banca Reale S.p.A. subsidiary and current accounts at the same subsidiary.
Income from other related parties mainly refers to insurance premiums collected for € 3,500 thousand and rental on investment property for € 159 thousand.
Payables to other related parties mainly refer to the remuneration of Directors and Statutory Auditors for € 4,297 thousand, claims paid on policies for € 272 thousand and interest on bonds issued by Banca Reale S.p.A. for € 184 thousand.
Fees paid during the year to Directors and Statutory Auditors of the Parent who also carry out the same functions at other Group companies amounted to € 2,522 thousand, compared with € 2,501 thousand in 2014.
380 REPORTS AND ACCOUNTS 2015
PART I: OTHER INFORMATION
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Human resources
At December 31, 2015 the Group workforce included 3,150 persons, 37 more than in the previous year; the breakdown is shown in the table below:
(persons) 31.12.2015 31.12.2014
Senior managers 95 96 Middle managers and Office staff 3,055 3,017 Total 3,150 3,113
381
Disclosure of auditing fees and for services other than auditing
(art. 149.12 of the CONSOB Issuers Regulation)
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Type of service Supplier of the service Recipient Fees (in thousands of euro)
Auditing (*) 560
Auditing Reconta Ernst & Young S.p.A. 153
Auditing Reconta Ernst & Young S.p.A.
Società Reale Mutua di Assicurazioni
Italian subsidiaries 220
Auditing Network Ernst & Young Foreign subsidiaries 144
Auditing Reconta Ernst & Young S.p.A. European Economic Interest Grouping
43
Certification (**) Reconta Ernst & Young S.p.A. Società Reale Mutua di Assicurazioni and Italian subsidiaries
132
Other services Ernst & Young Network Società Reale Mutua di Assicurazioni
68
(*)Note: this type of services does not include the services of the actuary auditor, engaged by the auditors to perform the actuarial evaluation of the technical provisions for the Group’s Italian insurance companies. Fees paid for these services amounted to € 36,038. (**) Note: this item comprises fees for auditing of: Separately Managed Accounts, Internal Insurance Funds, Pension Fund, Bank National Guarantee Fund and Targeted Longer Term Refinancing Operations (TLTRO).
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ANNEXES TO THE FINANCIAL STATEMENTS
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384 REPORTS AND ACCOUNTS 2015
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385
BILANCIO REALE MUTUA 2015.indd 413BILANCIO REALE MUTUA 2015.indd 413 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
IFi
nanc
ial:
2015
Det
ail o
f unc
onso
lidat
ed in
tere
sts
(Val
ue in
Eur
o)
Des
igna
tion
Reg
iste
red
offic
eO
pera
tiona
lce
nter
(5)
Activ
ity(1
)Ty
pe (2
)%
Dire
ct in
tere
st
%To
tal i
nter
est
(3)
%
of v
otin
g rig
hts
at O
rdin
ary
Mee
ting
(4)
Car
ryin
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lue
SA
RA
AS
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AZI
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I S.p
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31.4
331
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0
1
63,9
25,4
20C
RE
DE
MA
SS
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RA
ZIO
NI S
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50.0
00
14
,308
,185
386 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 414BILANCIO REALE MUTUA 2015.indd 414 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
IFi
nanc
ial:
2015
Det
ail o
f int
angi
ble
asse
ts a
nd p
rope
rty,
pla
nt a
nd e
quip
men
t(V
alue
in E
uro)
At c
ost
At re
mea
sure
d va
lue
or fa
ir va
lue
Tota
l car
ryin
g va
lue
Inve
stm
ent p
rope
rty96
3,48
7,25
20
963,
487,
252
Oth
er p
rope
rties
231,
893,
918
023
1,89
3,91
8O
ther
pro
perty
, pla
nt a
nd e
quip
men
t30
,712
,869
030
,712
,869
Oth
er in
tang
ible
ass
ets
120,
446,
796
012
0,44
6,79
6
387
BILANCIO REALE MUTUA 2015.indd 415BILANCIO REALE MUTUA 2015.indd 415 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny:
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Det
ail o
f fin
anci
al a
sset
s(V
alue
in E
uro)
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1Ye
ar n
Year
n-1
00
00
23,1
86,3
6218
,277
,000
00
00
23,1
86,3
6218
,277
,000
Equ
ity s
ecur
ities
and
der
ivat
es v
alue
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quity
sec
urie
ties
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ir va
lue
00
00
90,9
82,8
8214
3,95
4,00
00
014
4,36
1,90
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6,53
9,00
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5,34
4,79
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088
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141,
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00
144,
361,
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g lis
ted
secu
ritie
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ebt s
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ities
00
29,2
55,0
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8,91
9,72
6,90
78,
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126,
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070
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404,
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290
406,
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9,35
3,39
1,26
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8,91
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9,38
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209,
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401,
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8,27
8,67
78,
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662,
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00
376,
290,
677
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585,
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271,
225,
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246,
168,
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648,
057,
079
770,
272,
000
00
245,
263,
762
196,
417,
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00
00
00
245,
263,
762
196,
417,
000
00
9,71
0,56
214
,652
,000
00
00
00
9,71
0,56
214
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,000
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5,27
5,94
96,
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000
00
00
00
5,27
5,94
96,
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00
00
00
00
00
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167,
284,
465
168,
461,
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00
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1,71
8,78
61,
589,
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169,
003,
251
170,
050,
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00
00
00
1,09
920
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644,
685
709,
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645,
784
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000
00
00
028
028
00
000
00
00
00
00
incl
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g lis
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ritie
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hare
s of
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ILo
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and
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ivab
les
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k cu
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Inte
rban
ks lo
ans
and
rece
ivab
les
Dep
osits
with
ced
ing
ente
rpris
esA
ctiv
e fin
alnc
ial c
ompo
nent
s of
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ranc
e co
ntra
cts
Oth
er lo
ans
and
rece
ivab
les
Non
-hed
ge d
eriv
ativ
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edge
der
ivat
ives
Oth
er fi
nanc
ial i
nves
tmen
tsTo
tal
00
456,
789,
805
412,
551,
000
9,41
0,18
6,82
88,
805,
876,
000
542,
475
70,8
05,0
0082
2,35
9,72
379
1,50
5,00
010
,689
,878
,831
10,0
80,7
37,0
00
Tota
l car
ryin
g va
lue
Fina
ncia
l ass
ets
held
for t
radi
ngFi
nanc
ial a
sset
s m
easu
red
at fa
ir va
lue
thou
gh p
rofit
and
loss
Inve
stm
ents
hel
d to
mat
urity
Loan
s an
d re
ceiv
able
sFi
nanc
ial a
sset
s av
aila
ble
for s
ale
Fina
ncia
l ass
ets
at fa
ir va
lue
thro
ugh
prof
it an
d lo
ss
388 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 416BILANCIO REALE MUTUA 2015.indd 416 14/04/16 16:0514/04/16 16:05
(Val
ue in
Eur
o)
Year
nYe
ar n
- 1
Year
nYe
ar n
- 1
Year
nYe
ar n
- 1
Ass
ets
on th
e ba
lanc
e sh
eet
584.
856.
496
533.
716.
000
177.
690.
598
157.
145.
000
762.
547.
094
690.
861.
000
Infr
a-gr
oup
asse
ts*
00
00
00
Tota
l Ass
ets
584.
856.
496
533.
716.
000
177.
690.
598
157.
145.
000
762.
547.
094
690.
861.
000
Fin
. lia
bilit
ies
on th
e ba
lanc
e sh
eet
5.81
8.14
01.
964.
000
1.61
6.86
81.
318.
000
7.43
5.00
83.
282.
000
Tec
hnic
al p
rovi
sion
s on
the
bala
nce
shee
t58
0.82
7.11
153
3.26
7.00
017
6.06
5.24
715
5.82
2.00
075
6.89
2.35
868
9.08
9.00
0In
fra-
grou
p lia
bilit
ies*
00
00
00
Tota
l Lia
bilit
ies
586.
645.
251
535.
231.
000
177.
682.
115
157.
140.
000
764.
327.
366
692.
371.
000
*A
sset
s an
d lia
bilit
ies
elim
inat
ed in
the
cons
olid
atio
n pr
oces
s
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
IFi
nanc
ial:
2015
Det
ailo
fas
sets
and
liabi
litie
sre
latin
gto
cont
ract
sw
ritte
nby
insu
ranc
eco
mpa
nies
whe
reth
ein
vest
men
tris
kis
born
eby
the
cust
omer
and
aris
ing
on th
e m
anag
emen
t of p
ensi
on fu
nds
Ope
ratio
ns li
nked
to in
vest
men
ts
fund
s an
d m
arke
t ind
exes
Ope
ratio
ns c
onne
cted
with
the
man
agem
ent o
f pen
sion
fund
sTo
tal
389
BILANCIO REALE MUTUA 2015.indd 417BILANCIO REALE MUTUA 2015.indd 417 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny:
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Det
ail o
f rei
nsur
ers’
sha
re o
f tec
hnic
al p
rovi
sion
s(V
alue
in E
uro)
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1
Non
-life
pro
visi
ons
32
5,0
80
,06
93
28
,68
7,0
00
2,5
92
,10
02
,88
7,0
00
32
7,6
72
,16
93
31
,57
4,0
00
Prov
isio
ns fo
r une
arne
d pr
emiu
ms
73,7
96,9
8773
,371
,000
102,
528
105,
000
73
,89
9,5
15
73
,47
6,0
00
Prov
isio
ns fo
r cla
ims
outs
tand
ing
251,
283,
082
255,
316,
000
2,48
9,57
22,
782,
000
25
3,7
72
,65
42
58
,09
8,0
00
Oth
er re
serv
es0
00
00
0
Life
pro
visi
ons
63
,71
3,9
59
61
,54
5,0
00
2,8
97
,37
93
,41
6,0
00
66
,61
1,3
38
64
,96
1,0
00
Prov
isio
n fo
r sum
s to
be
paid
6,89
7,92
34,
273,
000
00
6,8
97
,92
34
,27
3,0
00
Prov
isio
ns fo
r pol
icy
liabi
litie
s47
,547
,345
47,4
52,0
002,
897,
379
3,41
6,00
05
0,4
44
,72
45
0,8
68
,00
0
Prov
isio
ns fo
r pol
icie
s w
here
the
inve
stm
ent r
isk
is b
orne
by
the
polic
yhol
ders
and
rela
ting
to th
e m
anag
emen
t of p
ensi
on fu
nds
8,18
7,87
78,
903,
000
00
8,1
87
,87
78
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3,0
00
Oth
er re
serv
es1,
080,
814
917,
000
00
1,08
0,81
491
7,00
0To
tal R
eins
urer
s’ s
hare
of t
echn
ical
pro
visi
ons
38
8,7
94
,02
83
90
,23
2,0
00
5,4
89
,47
96
,30
3,0
00
39
4,2
83
,50
73
96
,53
5,0
00
Dire
ct b
usin
ess
Indi
rect
bus
ines
sTo
tal c
arry
ing
valu
e
390 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 418BILANCIO REALE MUTUA 2015.indd 418 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny:
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Det
ail o
f tec
hnic
al p
rovi
sion
s(V
alue
in E
uro)
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1N
on-li
fe p
rovi
sion
s4,0
19,1
75,6
98
4,0
59,1
33,0
00
5,4
26,3
44
5,6
13,0
00
4,0
24,6
02,0
42
4,0
64,7
46,0
00
Prov
isio
ns fo
r une
arne
d pr
emiu
ms
1,12
0,17
5,12
21,
098,
408,
000
237,
258
262,
000
1,1
20,4
12,3
80
1,0
98,6
70,0
00
Prov
isio
ns fo
r cla
ims
outs
tand
ing
2,89
5,99
3,57
12,
958,
334,
000
5,07
8,08
65,
351,
000
2,9
01,0
71,6
57
2,9
63,6
85,0
00
Oth
er re
serv
es3,
007,
005
2,39
1,00
011
1,00
00
3,1
18,0
05
2,3
91,0
00
of w
hic
h p
rovis
ions s
tate
d follo
win
g lib
ility
adequacy test
1,03
3,22
676
0,00
011
1,00
00
1,1
44,2
26
760,0
00
Life
pro
visi
ons
6,4
43,3
52,3
29
5,7
61,9
67,0
00
4,8
22,4
93
5,3
29,0
00
6,4
48,1
74,8
22
5,7
67,2
96,0
00
Prov
isio
n fo
r sum
s to
be
paid
109,
054,
884
71,3
53,0
000
0109,0
54,8
84
71,3
53,0
00
Prov
isio
ns fo
r pol
icy
liabi
litie
s5,
008,
344,
114
4,50
6,21
1,00
02,
971,
670
3,50
3,00
05,0
11,3
15,7
84
4,5
09,7
14,0
00
Prov
isio
ns f
or p
olic
ies
whe
re th
e in
vest
men
t ris
k is
bor
ne b
y th
e po
licyh
olde
rs a
nd
rela
ting
to th
e m
anag
emen
t of p
ensi
on fu
nds
755,
041,
535
687,
263,
000
1,85
0,82
31,
826,
000
756,
892,
358
689,
089,
000
Oth
er p
rovi
sion
s57
0,91
1,79
649
7,14
0,00
00
0570,9
11,7
96
497,1
40,0
00
of w
hic
h p
rovis
ions s
tate
d follo
win
g lib
ility
adequacy test
00
00
00
of w
hic
h d
efe
rred lia
bili
ties tow
ard
s p
olic
yhold
ers
538,
473,
310
466,
141,
000
00
538,
473,
310
466,
141,
000
Tota
l tec
hnic
al p
rovi
sion
s10,4
62,5
28,0
27
9,8
21,1
00,0
00
10,2
48,8
37
10,9
42,0
00
10,4
72,7
76,8
64
9,8
32,0
42,0
00
Dire
ct b
usin
ess
Indi
rect
bus
ines
sTo
tal c
arry
ing
valu
e
391
BILANCIO REALE MUTUA 2015.indd 419BILANCIO REALE MUTUA 2015.indd 419 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny:
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Det
ail o
f fin
anci
al li
abili
ties
(Val
ue in
Eur
o)
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Fina
ncia
l lia
bilit
ies
with
dis
cret
iona
ry p
artic
ipat
ion
feat
ure
00
00
00
00
Sub
ordi
nate
d lia
bilit
ies
00
00
00
00
Liab
ilitie
s on
fina
ncia
l con
tract
s w
ritte
n by
insu
ranc
e co
mpa
nies
der
ivin
g fro
m:
00
7,43
5,00
83,
282,
000
00
7,43
5,00
83,
282,
000
cont
ract
s w
here
the
inve
stm
ent r
isk
is b
orne
by
the
polic
yhol
ders
00
5,81
8,14
01,
964,
000
00
5,81
8,14
01,
964,
000
man
agem
ent o
f pen
sion
fund
s0
01,
616,
868
1,31
8,00
00
01,
616,
868
1,31
8,00
0ot
her c
ontra
cts
00
00
00
00
Dep
osits
rece
ived
from
rein
sure
rs0
00
058
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65,5
48,0
0058
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65,5
48,0
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nanc
ial l
iabi
lity
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pone
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sura
nce
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ract
s0
00
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ities
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ed0
00
093
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ank
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omer
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56,7
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ther
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ceiv
ed0
00
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498
4,67
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542,
498
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on-h
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ivat
ives
16,6
66,7
8420
,166
,000
00
00
16,6
66,7
8420
,166
,000
Hed
ge d
eriv
ativ
es0
00
00
00
0O
ther
fina
ncia
l lia
bilit
ies
00
00
20,3
44,9
3224
,805
,000
20,3
44,9
3224
,805
,000
Tota
l16
,666
,784
20,1
66,0
007,
435,
008
3,28
2,00
052
8,26
6,41
848
8,74
1,00
055
2,36
8,21
051
2,18
9,00
0
Fina
ncia
l lia
bilit
ies
at fa
ir va
lue
thro
ugh
prof
it an
d lo
ss
Oth
er fi
nanc
ial l
iabi
litie
s To
tal c
arry
ing
valu
eFi
nanc
ial l
iabi
litie
s he
ld fo
r tra
ding
Fina
ncia
l lia
bilit
ies
mea
sure
d at
fair
valu
e th
roug
h pr
ofit
and
loss
392 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 420BILANCIO REALE MUTUA 2015.indd 420 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
ID
etai
l of o
ther
com
pone
nts
of th
e co
nsol
idat
ed s
tate
men
t of c
ompr
ehen
sive
inco
me
Fina
ncia
l: 20
15
(Val
ue in
Eur
o)
Tota
l Yea
r nTo
tal Y
ear n
-1To
tal Y
ear n
Tota
l Yea
r n-1
Tota
l Yea
r nTo
tal Y
ear n
-1To
tal Y
ear n
Tota
l Yea
r n-1
Tota
l Yea
r nTo
tal Y
ear n
-1at
31-
12-(n
)at
31-
12-(n
-1)
3,18
7,52
3-5
,621
,000
00
3,18
7,52
3-5
,621
,000
00
-16,
951,
477
-20,
139,
000
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
00
3,18
7,52
3-5
,621
,000
00
3,18
7,52
3-5
,621
,000
00
-16,
951,
477
-20,
139,
000
00
00
00
00
00
-39,
421,
577
145,
123,
000
-43,
134,
444
-20,
826,
000
0-8
,665
,000
-82,
556,
021
115,
632,
000
00
106,
793,
979
189,
350,
000
Oth
er in
com
e co
mpo
nent
s w
ithou
t rec
lass
ifica
tion
in th
e in
com
e st
atem
ent
Res
erve
der
iving
from
cha
nges
in th
e sh
areh
olde
rs’ e
quity
of a
ssoc
iate
s
Inta
ngib
le a
sset
s re
valu
atio
n re
serv
e
Tang
ible
ass
ets
reva
luat
ion
rese
rve
Inco
me
and
char
ges
rela
ting
to n
on-c
urre
nt a
sset
s or
of a
dis
posa
l gro
up h
eld
for s
ale
Actu
aria
l gai
ns a
nd lo
sses
and
adj
ustm
ents
aris
ing
from
def
ined
ben
efit
plan
s
Oth
er e
lem
ents
Oth
er in
com
e co
mpo
nent
s w
ith re
clas
sific
atio
n in
the
inco
me
stat
emen
tR
eser
ve fo
r net
exc
hang
e di
ffere
nces
00
00
00
00
00
00
Gai
ns o
r los
ses
on A
FS fi
nanc
ial a
sset
s-4
1,28
1,11
712
6,75
2,00
0-4
3,13
4,44
4-1
9,39
1,00
00
0-8
4,41
5,56
110
7,36
1,00
00
091
,087
,439
175,
503,
000
Gai
ns o
r los
ses
on c
ash
flow
hed
ges
00
00
00
00
00
00
Gai
ns o
r los
ses
on h
edge
s of
net
inve
stm
ents
in fo
reig
n en
titie
s0
00
00
00
00
00
0
Res
erve
der
iving
from
cha
nges
in th
e Sh
areh
olde
rs’ e
quity
of a
ssoc
iate
s1,
859,
540
18,3
71,0
000
-1,4
35,0
000
-8,6
65,0
001,
859,
540
8,27
1,00
00
015
,706
,540
13,8
47,0
00
Inco
me
and
char
ges
rela
ting
to n
on-c
urre
nt a
sset
s or
of a
dis
posa
l gro
up h
eld
for s
ale
00
00
00
00
00
00
Oth
er e
lem
ents
00
00
00
00
00
00
TOTA
L O
THER
CO
MPO
NEN
TS O
F TH
E ST
ATEM
ENT
OF
CO
MPR
EHEN
SIVE
INC
OM
E-3
6,23
4,05
413
9,50
2,00
0-4
3,13
4,44
4-2
0,82
6,00
00
-8,6
65,0
00-7
9,36
8,49
811
0,01
1,00
00
089
,842
,502
169,
211,
000
Bal
ance
Allo
catio
nsAd
just
men
ts fo
r rec
lass
ifica
tion
inth
e in
com
e st
atem
ent
Oth
er c
hang
esTo
tal c
hang
esTa
xes
393
BILANCIO REALE MUTUA 2015.indd 421BILANCIO REALE MUTUA 2015.indd 421 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
I
Fina
ncia
l ass
ets
and
liabi
litie
s m
easu
red
at fa
ir va
lue
at re
curr
ent a
nd n
on-r
ecur
rent
bas
is: b
reak
dow
n by
leve
ls o
f fai
r val
ueFi
nanc
ial:
2015
(Val
ue in
Eur
o)
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1Ye
ar n
Year
n-1
AFS
fina
ncia
l ass
ets
9,08
1,19
8,55
58,
152,
965,
000
242,
474,
719
566,
043,
000
86,5
13,5
5486
,868
,000
9,41
0,18
6,82
88,
805,
876,
000
Fina
ncia
l ass
ets
held
for t
radi
ng54
2,47
570
,804
,000
00
00
542,
475
70,8
04,0
00Fi
nanc
ial a
sset
s m
easu
red
at fa
ir va
lue
thou
gh th
e in
com
e st
atem
ent
727,
792,
580
652,
637,
000
88,4
67,1
4311
4,34
8,00
06,
100,
000
24,5
21,0
0082
2,35
9,72
379
1,50
6,00
0R
eal p
rope
rty in
vest
men
ts0
00
00
00
0P
rope
rty, p
lant
and
equ
ipm
ent
00
00
00
00
Inta
ngib
le a
sset
s0
00
00
00
09,
809,
533,
610
8,87
6,40
6,00
033
0,94
1,86
268
0,39
1,00
092
,613
,554
111,
389,
000
10,2
33,0
89,0
269,
668,
186,
000
Fina
ncia
l lia
bilit
ies
held
for t
radi
ng0
016
,666
,784
20,1
66,0
000
016
,666
,784
20,1
66,0
00Fi
nanc
ial l
iabi
litie
s m
easu
red
at fa
ir va
lue
thro
ugh
the
inco
me
00
7,43
5,00
83,
282,
000
00
7,43
5,00
83,
282,
000
00
24,1
01,7
9223
,448
,000
00
24,1
01,7
9223
,448
,000
Fina
ncia
l ass
ets
and
liabi
litie
s m
easu
red
at fa
ir va
lue
on a
non
-rec
urre
nt b
asis
HFS
non
-cur
rent
ass
ets
or o
f a d
ispo
sal g
roup
00
00
7,76
5,00
07,
765,
000
7,76
5,00
07,
765,
000
Liab
ility
of a
n H
FS d
ispo
sal g
roup
00
00
00
00
Fina
ncia
l ass
ets
mea
sure
d at
fair
valu
e th
roug
h th
e in
com
e st
atem
ent
Tota
l of a
sset
s m
easu
red
at fa
ir va
lue
on a
recu
rren
t bas
is
Fina
ncia
l lia
bilit
ies
mea
sure
d at
fair
valu
e th
roug
h th
e in
com
e st
atem
ent
Tota
l of l
iabi
litie
s m
easu
red
at fa
ir va
lue
on a
recu
rren
t bas
is
Leve
l 1Le
vel 2
Leve
l 3To
tal
Fina
ncia
l ass
ets
and
liabi
litie
s m
easu
red
at fa
ir va
lue
on a
recu
rren
t bas
is
394 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 422BILANCIO REALE MUTUA 2015.indd 422 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
I
Det
ail o
f cha
nges
in le
vel 3
fina
ncia
l ass
ets
and
liabi
litie
s m
easu
red
at fa
ir va
lue
at re
curr
ent b
asis
Fina
ncia
l: 20
15
(Val
ue in
Eur
o)
Fina
ncia
las
sets
hel
d fo
rtr
adin
g
Fina
ncia
l ass
ets
mea
sure
d at
fair
valu
e th
ough
the
inco
me
stat
emen
t
Rea
l pro
pert
y in
vest
men
tsPr
oper
ty, p
lant
an
d eq
uipm
ent
Inta
ngib
le
asse
ts
Fina
ncia
l lia
bilit
ies
held
for
trad
ing
Fina
ncia
l lia
bilit
ies
mea
sure
d at
fair
valu
e th
roug
h th
e in
com
e st
atem
ent
Gro
ss in
itial
bal
ance
86,8
68,0
000
24,5
21,0
00P
urch
ases
/Issu
es11
,265
,183
03,
100,
158
Sal
es/R
epur
chas
es-7
,509
,616
0-2
1,52
1,15
1R
epay
men
ts-2
,110
,295
00
Pro
fit o
r los
s in
the
inco
me
stat
emen
t-2
,199
,391
0-1
58 -
of w
hich
val
uatio
n pr
ofits
/loss
es-2
,199
,391
0-7
8P
rofit
or l
oss
of o
ther
com
pone
nts
of th
e st
atem
ent o
f com
preh
ensi
ve in
com
e19
9,81
10
0Tr
ansf
er in
leve
l 30
00
Tran
sfer
s at
oth
er le
vels
00
0O
ther
cha
nges
-138
015
1C
losi
ng b
alan
ce86
,513
,554
06,
100,
000
Fina
ncia
l ass
ets
mea
sure
d at
fair
valu
e th
roug
h th
e in
com
e st
atem
ent
Fina
ncia
l lia
bilit
ies
mea
sure
d at
fair
valu
eth
roug
h th
e in
com
e st
atem
ent
AFS
finan
cial
ass
ets
395
BILANCIO REALE MUTUA 2015.indd 423BILANCIO REALE MUTUA 2015.indd 423 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
I
Fina
ncia
l ass
ets
and
liabi
litie
s no
t mea
sure
d at
fair
valu
e: b
reak
dow
n by
leve
ls o
f fai
r val
ueFi
nanc
ial:
2015
(Val
ue in
Eur
o)
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1Ye
ar n
Year
n-1
Year
nYe
ar n
-1As
sets
Inve
stm
ents
hel
d to
mat
urity
00
00
00
00
00
Loan
s an
d re
ceiv
able
s45
6,78
9,80
541
2,55
1,00
00
029
,255
,067
27,0
12,0
0042
7,53
4,73
838
5,53
9,00
045
6,78
9,80
541
2,55
1,00
0E
quity
inve
stm
ents
in s
ubsi
diar
ies,
affi
liate
s an
d jo
int v
entu
res
178,
233,
605
145,
032,
000
00
00
228,
973,
005
184,
947,
000
228,
973,
005
184,
947,
000
Rea
l pro
perty
inve
stm
ents
963,
487,
252
946,
569,
000
00
00
1,46
9,13
4,25
21,
415,
736,
000
1,46
9,13
4,25
21,
415,
736,
000
Pro
perty
, pla
nt a
nd e
quip
men
t26
2,60
6,78
721
0,77
7,00
00
00
035
2,04
1,78
728
9,74
1,00
035
2,04
1,78
728
9,74
1,00
0To
tal a
sset
s1,
861,
117,
449
1,71
4,92
9,00
00
029
,255
,067
27,0
12,0
002,
477,
683,
782
2,27
5,96
3,00
02,
506,
938,
849
2,30
2,97
5,00
0Li
abili
ties
Oth
er fi
nanc
ial l
iabi
litie
s52
8,26
6,41
848
8,74
1,00
00
00
052
8,26
6,41
848
8,74
1,00
052
8,26
6,41
848
8,74
1,00
0
Fair
Valu
e
Car
ryin
g va
lue
Leve
l 1Le
vel 2
Leve
l 3To
tal
396 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 424BILANCIO REALE MUTUA 2015.indd 424 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny:
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Det
ail o
f ins
uran
ce te
chni
cal i
tem
s(V
alue
in E
uro)
Gro
ss a
mou
ntR
eins
urer
s' s
hare
Net
am
ount
Gro
ss a
mou
ntR
eins
urer
s' s
hare
Net
am
ount
2,70
6,90
3,82
8-2
76,2
52,6
982,
430,
651,
130
2,66
9,72
6,00
0-3
08,4
50,0
002,
361,
276,
000
aP
rem
ium
s w
ritte
n2,
728,
743,
654
-278
,318
,658
2,45
0,42
4,99
62,
678,
431,
000
-308
,005
,000
2,37
0,42
6,00
0-2
1,83
9,82
62,
065,
960
-19,
773,
866
-8,7
05,0
00-4
45,0
00-9
,150
,000
-1,7
53,4
26,9
5517
9,68
0,83
3-1
,573
,746
,122
-1,6
30,8
50,0
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2,12
7,00
0-1
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70,9
46,6
3917
4,04
4,27
0-1
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,902
,369
-1,8
75,9
84,0
0020
8,66
3,00
0-1
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,321
,000
aA
mou
nts
paid
bC
hang
e in
the
prov
isio
n fo
r cla
ims
outs
tand
ing
62,6
03,1
345,
636,
563
68,2
39,6
9717
8,77
0,00
0-1
6,53
6,00
016
2,23
4,00
055
,520
,264
055
,520
,264
65,9
98,0
000
65,9
98,0
00c
Cha
nge
in re
cove
ries
dC
hang
e in
oth
er te
chni
cal p
rovi
sion
s-6
03,7
140
-603
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366,
000
036
6,00
0
NE
T P
RE
MIU
MS
1,11
8,40
7,27
8-2
2,81
4,79
51,
095,
592,
483
1,11
1,10
4,00
0-2
8,13
5,00
01,
082,
969,
000
-1,2
56,8
84,2
7620
,079
,263
-1,2
36,8
05,0
13-1
,267
,178
,000
26,0
35,0
00-1
,241
,143
,000
aA
mou
nts
paid
-653
,141
,968
18,9
23,8
63-6
34,2
18,1
05-5
87,1
58,0
0014
,850
,000
-572
,308
,000
bC
hang
e in
the
prov
isio
n fo
r sum
s to
be
paid
-37,
715,
811
2,61
8,74
2-3
5,09
7,06
9-6
,994
,000
2,16
3,00
0-4
,831
,000
cC
hang
e in
the
mat
hem
atic
al p
rovi
sion
-496
,783
,599
-418
,408
-497
,202
,007
-619
,909
,000
9,06
8,00
0-6
10,8
41,0
00
dC
hang
e in
tech
nica
l pro
visi
ons
whe
re th
e in
vest
men
t ris
k is
bor
ne b
y th
e po
licyh
olde
rs a
nd re
latin
g to
the
man
agem
ent o
f pen
sion
fund
s-6
7,80
3,15
5-1
,208
,926
-69,
012,
081
-45,
060,
000
-360
,000
-45,
420,
000
eC
hang
e in
oth
er te
chni
cal p
rovi
sion
s-1
,439
,743
163,
992
-1,2
75,7
51-8
,057
,000
314,
000
-7,7
43,0
00
Life
bus
ines
s
CO
ST
OF
CLA
IMS
Year
nYe
ar n
-1
Non
-life
bus
ines
s
NE
T P
RE
MIU
MS
bC
hang
e in
the
non-
life
prov
isio
ns fo
r une
arne
d pr
emiu
ms
CO
ST
OF
CLA
IMS
397
BILANCIO REALE MUTUA 2015.indd 425BILANCIO REALE MUTUA 2015.indd 425 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
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398 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 426BILANCIO REALE MUTUA 2015.indd 426 14/04/16 16:0514/04/16 16:05
Fina
ncia
l: 20
15C
ompa
ny:
SOC
IETA
' REA
LE M
UTU
A D
I ASS
.NI
Det
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Year
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399
BILANCIO REALE MUTUA 2015.indd 427BILANCIO REALE MUTUA 2015.indd 427 14/04/16 16:0514/04/16 16:05
Com
pany
: SO
CIE
TA' R
EALE
MU
TUA
DI A
SS.N
IFi
nanc
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2015
Inte
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s in
unc
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lidat
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truc
ture
d en
titie
s(V
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in E
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Nam
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93
BILANCIO REALE MUTUA 2015.indd 428BILANCIO REALE MUTUA 2015.indd 428 14/04/16 16:0514/04/16 16:05
GROUP SOLVENCY MARGIN
BILANCIO REALE MUTUA 2015.indd 429BILANCIO REALE MUTUA 2015.indd 429 14/04/16 16:0514/04/16 16:05
402 REPORTS AND ACCOUNTS 2015
Model 1
Company SOCIETA' REALE MUTUA DI ASS.NI
BILANCIO REALE MUTUA 2015.indd 430BILANCIO REALE MUTUA 2015.indd 430 14/04/16 16:0514/04/16 16:05
STATEMENT OF ADJUSTED SOLVENCY
Consolidated Financial Statements method
(Annex 1 to the Regulation)
Financial 2015
(in thousands of euro)
403
BILANCIO REALE MUTUA 2015.indd 431BILANCIO REALE MUTUA 2015.indd 431 14/04/16 16:0514/04/16 16:05
Elements forming the solvency margin:Elements A)(1) Capital……………………………………………………….…………....................................……………....................... …………………….60,000(2) Other equity instruments................………………………………...…………………………………………....................................... (3) Capital reserves…………………………………………………………….………………………………………………………………….....………. (4) Retained earnings and other equity reserves......……………........………………...................…………………..........……………………………. 2,016,503(5) Reserve for net exchange differences.....………………………………..........................................................…………………………. (6) Gains or losses on financial assets available for sale......................................................................................................…………………………. 91,087(7) Other gains or losses recognised directly in equity......................................................................................................……………………………. -1,245(8) Third party capital and reserves………………………………...…………………………………………………………………………. (9) Gains or losses recorded directly in third party equities…………………………………………………………………………………………………. (10) Group interest in net profit for the year……...……………………………………………………………………………………………………. 159,301(11) Third party interest in net profit for the year……...…………………………………………..………………………...…………………………. (12) Cumulative preference shares and subordinate liabilities…………………Total from (13) to (15)......................................................
of which: (13) subordinate loans with fixed expiry or cumulative preference shares with specified duration(14) loans for which maturity is not fixed..………..…………………………….…………..(15) securities of undetermined duration and other financial instruments, including
cumulative preference shares other than those indicated in line 13 …………………………………(16) Value adjustments on items of the assets and liabilities of the Consolidated Financial Statements ……………………………………………………(17) Adjustments deriving from inclusion of subsidiaries for contractual constraints ………………………………………………………………………… (18) Other adjustments………………………………………………………………………………………………………………………………… (19) Participating financial instruments………………………………………………………………………………………………………(20) Total from (1) to (12) and from (16) to (19)..................... 2,325,646(21) Non-life deferred acquisition commissions............………………….........……………………………………………………...…………. (22) Life deferred acquisition commissions ..........…………....................................……….………………………………….…………..…. (23) Intangible assets...................................………………………...…………............................................................................................... 321,561(24) Shares and interests in controlling companies..............................………………………………………................................................ (25) Own shares or equity interests...................................................................…………………………………...................................……. (26) Company interest in loss for the year...............…………………..............................………………………………............................... (27) Third party interest in loss for the year..............…………………..............................………………………………..……………(28) Value adjustments on items of assets and liabilities of the Consolidated Financial Statements …………………………………………………………(29) Adjustments deriving from inclusion of subsidiaries for contractual constraints……………………………………………………………........……… (30) Other adjustments ………………………………………………………………………………………………………………………………… (31) Cumulative preference shares and subordinate liabilities already inserted in consolidated shareholders' equity ……………………………………….(32) Prudential filter deriving from remeasurement of technical provisions ………………………………………………………………………......………(33) Prudential filter relating to net gains to be deducted…........………………………………………………………………….. 81,682(34) Other prudential filters…........………………………………………………………………………………………………………………… 76,629(35) Total from (21) to (34)....................................................... 479,872(36) Total items A) (20)-(35)..................................................... 1,845,774
Elements B)(37) 50% of future earnings............................…………………………………………….............................................................................. (38) Difference between the amount of the mathematical provision determined
according to the pure premiums resulting from the accounts less theamount of the aforesaid reserve referring to risks ceded………………..…………………………and the amount of the corresponding mathematical provision determinedaccording to the pure premiums increased by the pro-rata amortisationof acquisition cost included in the gross premiums………....………….………………………
(39) Permissible integrations and latent real property gains………...……….………..……………………….………………………….(40) Half of the subscribed of share capital or equivalent fund paid………...……………………………………….………... (41) Total items B) from (37) to (40)......................................... (42) Total items forming the correct solvency margin
of the enterprise……………………………………………………………………(of which % B) elements) 1,845,774
Solvency margin required:(43) Solvency margin of the company whose correct solvency is calculated …………………………………………………………………. 399,623(44) Solvency margin and capital requirements of subsidiary and investee companies...............................................………………………………………. 337,337(45) Amount of the correct solvency margin required …………………………………………………………………………….…………………………………………………………………………………………………………………………………………….
(46) Surplus (deficit) ..........………………………………………………………………..............................................................................… 1,108,814
STATEMENT OF ADJUSTED SOLVENCY
Model 1
736,960
404 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 432BILANCIO REALE MUTUA 2015.indd 432 14/04/16 16:0514/04/16 16:05
Annex A to Model 1 or 2
Company SOCIETA' REALE MUTUA DI ASS.NI
Financial 2015
(Value in thousands of Euro)
Tick the reference box:
Calculation of correct solvency (Annex to Model 1)
Check on solvency of the Parent company (Annex to Model 2)
Detail of subsidiary, associated and affiliated companiesor subject to unitary management
(Consolidated Financial Statements Method)
405
BILANCIO REALE MUTUA 2015.indd 433BILANCIO REALE MUTUA 2015.indd 433 14/04/16 16:0514/04/16 16:05
Annex A to Model 1 or 2
Sec. 1 - Insurance companies with registered offices in the territory of the Republic or in another Member State
a b c d e = a*d
Ord Name State Required Elements Proportional quota
No. code solvency forming the available of the margin
margin solvency margin solvency margin(1) (3) (4) (5) (6) (7) (8)
004 C ITALIANA ASSICURAZIONI S.p.A. 086 146,768 412,426 100.00 100.00 146,768009 C REALE SEGUROS GEN. S.A. 067 116,720 431,956 100.00 100.00 116,720048 P SARA ASSICURAZIONI S.p.A. 086 154,488 474,013 31.43 31.43 48,556012 C REALE VIDA Y PENSIONES S.A. 067 4,440 7,439 100.00 100.00 4,440052 C BANCA REALE S.p.A. 086 18,291 56,283 100.00 100.00 18,291019 P CREDEMASSICURAZIONI S.P.A. 086 5,124 22,360 50.00 50.00 2,562
#### 337,337
(2)
Total
406 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 434BILANCIO REALE MUTUA 2015.indd 434 14/04/16 16:0514/04/16 16:05
Annex A bis to Model 1 or 2
Company SOCIETA' REALE MUTUA DI ASS.NI
Application of prudential filters
(Date of the Consolidated Financial Statements)
Financial 2015
(values in thousands of Euro)
Tick the reference box:
Calculation of correct solvency (Annex to Model 1)
Check on solvency of the Parent company (Annex to Model 2)
407
BILANCIO REALE MUTUA 2015.indd 435BILANCIO REALE MUTUA 2015.indd 435 14/04/16 16:0514/04/16 16:05
Annex A bis to Model 1 or 2
Prudential filter deriving from the remeasurement of the technical provisions(1) Filter relating to technical provisions(2) Filter relating to reinsurers' share of technical provisions(3) Total filter relating to remeasurement of the technical provisions Total (1) + (2) .................................................................................. ......……………........………………...................…………………..
Prudential filter relating to net valuation gains Gains or losses on financial assets available for sale 91,087 - of which gains or losses on debt instruments issued or guaranteed by EU states 375,283 Reserve deriving from changes in the shareholders’ equity of investee companies Property, plant and equipment revaluation reserve Other retained earnings and accumulated losses recorded directly in equity -1,245 Net cumulative gains (see annex) -8,160
(4)(4 bis)(5)(6)(7)(8)(9)(10)
Total net gains.............................................................................................................Total from (4) to (8) 81,682
(11)(12)(13)(14)
Integrations for elements ascribable to real property authorised by ISVAP Integrations for other elements authorised by ISVAP Integrations for elements ascribable to real property allowed by other Authorities Integrations for other elements allowed by other Authorities
(15)(16)
Total integrations for elements permitted at individual level Total from (11) to (14) ……………………….
(17) Latent gains on real property (18) Integrations not covered in the net gains deducted (19)(20)
Integrations for elements ascribable to real property Total permissible latent gains on real property ……………………………………...
(21) Total integrations and permissible latent gains on real property………………...Total (16) + (20) ........................................................
Other prudential filters(22) Capital components posted to shareholders' equity ..............................………………………………………................................................... (23) Catastrophe or equalisation provisions ..............................……………………………………….................................................................................. 76,629
(24) Gains or losses deriving from first-time application of international accounting principles 410,186(25) Gains or losses deriving from first-time application of international accounting principles to be deducte d ..............................……….........
(26)(27)(28)
Gains or losses on cash flow hedges Gains or losses on hedges of net investments in foreign operation Income and expense relating to non-current assets or to a disposal group held for sale
(29)(30)
Other gains and losses recognised directly in equity Total from (26) to (28)Other gains or losses recorded directly in equity to be deducted …………………………………………………………………………..
(31) Effect of modification of the credit rating of the issuer included in the consolidation area (32) Effect of modification of the credit rating of the issuer included in the consolidation area to be deducte d ....................................................
………………………………………...............................................(33) Reserves accrued following adequacy test on liabilities and
deferred liabilities towards policyholders (shadow accounting ) deducted from goodwill…………………………………………………..(34) Assets relating to defined employee benefits and other long-term benefits to be deducted ..............................…………………………......
(35) Total Other prudential filters....................................................................... Total (22)+(23)+(25)+(30)+(32)+(33)+(34) 76,629
Effects of application of prudential filtersto the shareholders' equity reflected in the consolidated accounts prepared in accordance with international accounting standards
Total net gains to be deducted........................................................................................................................................................................ 81,682
Total permissible integrations
408 REPORTS AND ACCOUNTS 2015
BILANCIO REALE MUTUA 2015.indd 436BILANCIO REALE MUTUA 2015.indd 436 14/04/16 16:0514/04/16 16:05
Annex A bis to Model 1 or 2
Technical provisions
Non-life provisions Provision for unearned premiums ………………………. 1,120,412 1,120,412Provision for outstanding claims ……..………………. 2,901,072 2,901,072Other provisions ……..………………...............…………. 3,118 3,118
Life provisions Provision for sums to be paid ………………………………………………………………. 109,055 109,055Mathematical provisions ………………………………………………………………. 5,011,316 5,011,316Other provisions ……..………………...............…………. 1,327,804 1,327,804
Total ………………………………………………..………………………………………………. 10,472,777 10,472,777
Reinsurers’ share of technical provisions
Non-life provisions Provision for unearned premiums ………………………. 73,900 73,900Provision for claims outstanding ……..………………. 253,772 253,772Other provisions ……..………………...............………….
Life provisions Provision for sums to be paid ………………………………………………………………. 6,898 6,898Mathematical provisions ………………………………………………………………. 50,445 50,445Other provisions ……..………………...............…………. 9,269 9,269
Total ………………………………………………..………………………………………………. 394,284 394,284
a b c d = a - b -c e
a b c d = c - a + b e
Total value of the Consolidated
Financial Statements
Deferredtaxes
Total value according to the criteria adopted
for the individual Financial Statements
Difference Value of the filter
Remeasurement of technical provisions
Total value of the Consolidated
Financial Statements
Deferredtaxes
Total value according to the criteria adopted
for the individual Financial Statements
Difference Value of the filter
409
BILANCIO REALE MUTUA 2015.indd 437BILANCIO LE MUTUA 2015.indd 437 14/04/16 16:0514/04/16 16:05
Ann
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13
513
122
122
gFr
om fi
nanc
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sset
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d at
fair
valu
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roug
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2,37
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From
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ies h
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Ass
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mp
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equ
ired
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ly t
he
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mu
lati
on m
ech
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m
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ty in
vest
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ts in
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ciat
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int v
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ther
than
thos
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r whi
ch th
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vest
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k is
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licyh
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rs …
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11
,939
,272
f = a
- b
+ e
Cu
mu
lati
ve n
et g
ain
s
Cum
ulat
iv to
tal Y
ear
n-1
Gai
ns a
nd lo
sses
el
imin
ated
and
pr
ovis
ions
attr
ibui
ted
Yea
r n-1
Val
uatio
n ga
ins a
nd
decr
ease
sin
pro
visi
ons
Val
utat
ion
loss
es a
nd
incr
ease
s in
prov
isio
ns
Tota
l gai
ns, l
osse
s and
ch
ange
s in
prov
isio
nsY
ear n
Cum
ulat
ive
tota
l Y
ear n
ab
cd
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c -
d
From
fina
ncia
l lia
bilit
ies m
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red
at fa
ir va
lue
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ugh
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me
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emen
t not
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endi
ng o
n th
e cr
edit
ratin
g of
the
issu
er in
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ed in
the
cons
olid
atio
n ar
ea…
……
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ult o
f fin
anci
al li
abili
ties r
ecog
nise
d at
fair
valu
e th
roug
h th
e in
com
e st
atem
ent d
epen
ding
on
the
cred
it ra
ting
of th
e is
suer
incl
uded
in th
e co
nsol
idat
ion
area
.…
……
.……
……
……
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......
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...…
……
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……
……
……
..……
……
...…
……
...…
……
……
……
…...
……
…...
...
Am
ount
at D
ecem
ber 3
1Y
ear n
%
BILANCIO REALE MUTUA 2015.indd 438BILANCIO REALE MUTUA 2015.indd 438 14/04/16 16:0514/04/16 16:05
COVER BILANCIO REALE 2015.indd 2COVER BILANCIO REALE 2015.indd 2 14/04/16 15:4914/04/16 15:49