kontinuita - Komunálna Poisťovňa

NOTES TO
THE FINANCIAL
STATEMENTS
ting activities, that may result in earlier or more claims
than expected. For insurance contracts with the insurance
risk being survival, the most significant factors are the
progress in medical sciences and improvements in social
conditions prolonging the length of life. For the time being,
these risks do not affect the Company materially.
In case of contracts with a DPF, a certain portion of the
insurance risk is shared with the insured party, which
is due to the nature of these insurance contracts. The
insurance risk is also affected by the policyholders’ right
to pay lower or no future insurance premiums, to terminate
the contract completely, or to exercise a guaranteed
annuity option. As a result, the amount of the
insurance risk is also subject to policyholder’s behaviour.
Provided that policyholders will make reasonable
decisions, the overall insurance risk may be increased
by such behaviour. For example, it is likely that policyholders
whose health has deteriorated significantly will
be less willing to terminate contracts insuring death benefits
than those staying in good health.
The Company manages these risks through its underwriting
strategy and adequate reinsurance arrangements.
A medical check-up is required, depending on the
amount of the insurance benefit for death or disability
benefits. A check-up is required for an insurance benefit
over SKK 1.5 million. Only a questionnaire is required
if the amounts are lower than this limit.
The underwriting strategy is intended to ensure that
the risks underwritten are well diversified in terms of
the type of risk and the level of insured benefits. For
example, the Company balances death risk and survival
risk through its portfolio. Medical selection is also
included in the Company’s underwriting procedures
with premiums reflecting flexibly the state of health
and the medical history of the applicant.
The Company has a retention limit of SKK 1 million on
any single life insured. The Company reinsures the excess
of the insurance benefit over SKK 1 million for the
death risk. Medically impaired lives are insured at
lower levels. The Company does not have in place any
reinsurance for contracts that insure survival risk.
Concentration of insurance risk
Total amount of insurance coverage
Amount of coverage per insurance contract before reinsurance 2008 2007
Up to SKK 250,000 8,577,197 8,475,407
From SKK 250,001 to SKK 500,000 4,992,493 4,853,124
From SKK 500,001 to SKK 1 million 1,743,900 1,615,619
Over SKK 1 million 788,735 724,091
Total 16,102,325 15,668,241
Total amount of insurance coverage
Amount of coverage per insurance contract after reinsurance 2008 2007
Up to SKK 250,000 6,986,399 6,598,591
From SKK 250,001 to SKK 500,000 3,588,023 3,338,033
From SKK 500,001 to SKK 1 million 1,241,212 1,083,936
Over SKK 1 million 511,234 380,960
Total 12,326,868 11,401,520
KONTINUITA ANNUAL REPORT 125