talanx group annual report 2011 en

Nature of risks Notes on the balance
sheet – assets
Notes on the balance
sheet – liabilities
Notes on the
statement of income
Other information List of shareholdings
The accounts receivable from insurance business that were overdue but not impaired at the balance
sheet date can be broken down as follows:
Figures in EUR million
31.12.2011 31.12.2010
>3 months
< 1 year > 1 year
>3 months
< 1 year > 1 year
Accounts receivable from policyholders 64 24 59 14
Accounts receivable from insurance intermediaries 34 7 44 22
Accounts receivable from reinsurance business 103 278 445 305
Total 201 309 548 341
The overdue receivables from insurance business are composed of accounts receivable that had
not been paid by the due date and were still outstanding as at the balance sheet date. In view of the
different processes used throughout the Group, the presentation dispenses with the short duration
range of “1 day to 3 months.” Responsibility for receivables management within the Group rests
with the local subsidiaries. The receivables management process – following the underlying business
risks – varies accordingly (e.g. different treatment of receivables at risk of default (derecognition
or value adjustment); different points in time when receivables management is activated, and
different tools used for receivables management). Only once a receivable is overdue by more than
90 days do the associated procedures converge, making Group-wide observations possible.
At the balance sheet date, the primary insurers had accounts receivable that were overdue by more
than 90 days from policyholders and insurance intermediaries in primary insurance business totalling
EUR 61 (73) and 42 (66) million, respectively. This is equivalent to a ratio of 6 (9)% and 5 (9)%,
respectively. The combined average default rate over the past three years was 1.5 (2.3)%. The annual
default rate is 1.6 (1.0)%. The accounts receivable from outward reinsurance business with arrears
of more than 90 days amounted to altogether EUR 178 (325) million, corresponding to a level of
41 (41)%.
As regards the major companies in the Non-Life Reinsurance and Life/Health Reinsurance segments
(the Hannover Re Group), EUR 277 (247) million of our accounts receivable from reinsurance
business totalling EUR 3.1 (2.8) billion were older than 90 days and in some cases impaired at the
balance-sheet date. This represents a proportion of 8.8 (8.7)%. The average default rate over the past
three years is 0.1 (0.1)%.
38.8% of non-life reinsurance recoverables were secured by deposits or letters of credit – virtually
unchanged from the previous year. We also act as reinsurer to most of our retrocessionaires, so we
would normally be able to offset any defaults against our own liabilities.
No value adjustments have been taken on accounts receivable from insurance business where the
default risk associated with the assets is reduced by collateral (such as letters of credit, cash deposits,
securities deposits).
Talanx Group. Annual Report 2011
195