Annual Report 2011 - R+V Versicherung

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Risk report / Forecast
Strategic risks from IT perspectives exist particularly in carrying
out (large) projects to introduce new insurance products
or to meet new or changed legislative and regulatory requirements.
Wide reaching platform decisions are also dealt with in
the context of strategic risks.
Reputation risk
Reputation risk is the risk of a direct or future loss of business
volumes arising from possible damage to the reputation of the
company or to the whole sector as a result of a negative public
perception (e.g. among customers, business partners, shareholders,
government authorities).
The retention or improvement of the positive image of R+V
within the cooperative financial network and in public is an
important aim of corporate policy.
Trends towards negative assessments and reporting about
insurance products by the media are repeatedly registered
throughout the industry.
In order to prevent any damage to R+V’s image from happening
at all, attention is paid to ensuring a high quality standard in
product development and all other parts of the value creation
chain. Furthermore, R+V corporate communication is coordinated
centrally through the department of the Chairman of
the Board of Management in order to counteract any false
presentations of circumstances effectively and with determination.
Reporting in the media about the insurance industry
in general and R+V in particular is observed throughout all
departments and is continuously analysed. Rating results and
market comparisons of the parameters that are decisive for
customer satisfaction – service, product quality and competence
of advice – are taken into account in the context of a
continual improvement process.
From an IT perspective, incidents that are analysed in particular
are those that could lead to negative perceptions in public.
Examples here include breaching data confidentiality, lack of
availability of IT systems (portals) that can be accessed by end
or business customers, or loss events that are caused by defective
operational security in IT. Therefore the IT security strategy
is continually reviewed and adjusted to current threats. The
validity of the IT security principles is also regularly reviewed.
Risk bearing capacity
The calculation of the risk bearing capacity under supervisory
law (solvency ratio) of R+V Versicherung AG is carried out in
compliance with current, applicable industry-related legislation
and describes the level of coverage of the minimum solvency
margin required under supervisory law by available
capital resources.
The risk bearing capacity of R+V Versicherung AG under supervisory
law exceeded the required minimum solvency margin
as of 31 December 2011. Capital resources that are subject to
approval are not taken into account when calculating the
solvency ratio.
On the basis of the capital market scenarios applied within the
context of internal planning it can be seen that the solvency
ratio of R+V Versicherung AG will also be higher than minimum
statutory requirement as of 31 December 2012.
The measurement of the economic risk bearing capacity of R+V
is carried out using an internal risk capital model. This determines
the capital requirements necessary to be able to compensate
for any fluctuations in value that may occur with a
given probability. In additional to the quarterly identification
of the risk capital requirements and the capital resources
available as risk coverage capital, R+V uses this model for
ad-hoc reporting and planning calculations.
An analysis of the economic risk bearing capital shows that
risk cover capital of R+V Versicherung exceeds the necessary
risk capital.