talanx group annual report 2011 en

176
Financial statements Notes
General information
Talanx Group. Annual Report 2011
Accounting principles
and policies
Segment reporting Consolidation,
business combinations
Non-current assets held for
sale and disposal groups
Retrocessions and insurance-linked securities (ILS)
Since 2010, as part of its extended insurance-linked securities (ILS) activities, Hannover Re has
written so-called collateralised fronting arrangements under which risks assumed from ceding
companies are passed on to institutional investors outside the Group using special purpose entities.
The purpose of such transactions is to directly transfer clients’ business. Due to the lack of a controlling
influence over the special purpose entities involved, there is no consolidation requirement for
Hannover Re with respect to these structures.
A major transaction, “FacPool Re”, under which Hannover Re transferred a portfolio of facultative
reinsurance risks to the capital market from September 2009 until January 2011, is in run-off as at
the balance sheet date. A number of special purpose entities participated in the reinsurance cessions
within “FacPool Re”; Hannover Re did not hold any shares in these special purpose entities and
did not bear the majority of the economic benefits or risks arising out of their activities through any
of its business relations.
In connection with the sale of the operational companies of the subgroup Clarendon Insurance
Group, Inc. (CIGI), Wilmington, to Enstar Group Ltd., Hamilton/Bermuda, a partial portfolio of CIGI
was retroceded to a special purpose entity. The retrocession arrangement became effective along
with the entire disposal transaction upon approval by the US regulatory authorities (“closing condition”).
Approval was granted on 8 July 2011; the transaction commenced with the closing of the
disposal and the simultaneous deconsolidation of the operational companies. Since Hannover Re
is not the major beneficiary of the special purpose entity and does not exercise either indirect or
direct control over it, there is no requirement to consolidate this special purpose entity.
Associated companies valued at equity
Associated companies are those over which the Group exercises a significant but not controlling
influence. In the year under review 13 (12) were valued using the equity method in accordance with
IAS 28 “Investments in Associates.” A further nine (six) associated companies are not recognised at
equity owing to their subordinate importance for the presentation of the net assets, financial position
and net income (please see here our remarks in the chapter “Accounting policies” from page 136
onwards).
HDI-Direktversicherung AG, Hannover, acquired a participation of 21,1% in Aspect Online AG,
Augsburg, as part of a consortium by subscribing to a capital increase on 1 July 2011 and concluding
a share purchase and transfer agreement on 15 July 2011. Aspect Online AG is the operator of
the online comparison portal “Transparo” for all types of insurance, energy and financial services.
In the third quarter of 2011 we included this participating interest in the consolidated financial
statement for the first time as an associated company due to its significant influence (see also our
information on the relevant balance sheet item in the Notes).