Performance

	Total		Life		Accident & Health		Motor		Marine, aviation, transport		Property		Casualty		Miscellaneous
CHF millions	2016	2017	2016	2017	2016	2017	2016	2017	2016	2017	2016	2017	2016	2017	2016	2017
Premiums written gross	22 976	22 529	4 444	4 431	3 053	2 925	4 019	3 702	803	714	6 217	6 769	3 057	2 626	1 383	1 362
Premiums written retroceded	–4 207	–3 822	–687	–810	–398	–436	–1 059	–639	–170	–120	–1 564	–1 573	–193	–103	–136	–141
Premiums written net	18 769	18 707	3 757	3 621	2 655	2 489	2 960	3 063	633	594	4 653	5 196	2 864	2 523	1 247	1 221
Change in unearned premiums gross	–1 112	–918	2	–3	–95	10	–269	–94	–25	–15	–33	–936	–451	119	–241	1
Change in unearned premiums retroceded	–77	–368	–2	1	26	–9	–45	–216	–18	–17	–53	–91	2	–45	13	9
Premiums earned	17 580	17 421	3 757	3 619	2 586	2 490	2 646	2 753	590	562	4 567	4 169	2 415	2 597	1 019	1 231
Other reinsurance revenues	1 003	1 439	710	1 172	197	192	8	23	1	2	47	–20	21	42	19	28
Allocated investment return	297	383	25	32	27	48	47	68	14	16	58	79	112	125	14	15
Total revenues from reinsurance business	18 880	19 243	4 492	4 823	2 810	2 730	2 701	2 844	605	580	4 672	4 228	2 548	2 764	1 052	1 274
Claims paid and claim adjustment expenses gross	–2 523	–10 547	–54	–2 983	–316	–1 732	77	–1 667	–132	–350	–1 944	–1 968	212	–1 370	–366	–477
Claims paid and claim adjustment expenses retroceded	2 375	–2 189	483	–3 460	128	–639	559	573	135	146	896	998	108	125	66	68
Change in unpaid claims gross	–8 545	–6 289	–431	–977	–1 626	246	–2 651	–1 074	–236	–236	–1 499	–3 463	–1 880	–459	–222	–326
Change in unpaid claims retroceded	304	1 112	–24	125	118	823	4	–151	–30	–16	256	368	–51	–65	31	28
Life and health benefits net	–3 653	3 492	–2 839	3 799	–814	–307
Change in equalisation provision		1 323										1 323
Claims incurred	–12 042	–13 098	–2 865	–3 496	–2 510	–1 609	–2 011	–2 319	–263	–456	–2 291	–2 742	–1 611	–1 769	–491	–707
Acquisition costs gross	–5 373	–5 421	–783	–938	–719	–763	–1 284	–1 197	–155	–147	–1 308	–1 193	–780	–783	–344	–400
Acquisition costs retroceded	1 223	1 088	76	84	87	103	536	436	52	48	356	321	80	55	36	41
Acquisition costs net	–4 150	–4 333	–707	–854	–632	–660	–748	–761	–103	–99	–952	–872	–700	–728	–308	–359
Operating costs	–804	–707	–205	–113	–89	–93	–39	–43	–42	–22	–289	–301	–44	–101	–96	–34
Other reinsurance expenses	–646	–878	–354	–735	–223	–120	–9	–5	–1	–2	–18	–15	–41	–1
Reinsurance result	1 238	227	361	–375	–644	248	–106	–284	196	1	1 122	298	152	165	157	174
Investment income	1 779	3 246
Investment expenses	–695	–317
Allocated investment return	–297	–383
Investment result	787	2 546
Other financial income	1 906	2 300
Other financial expenses	–2 254	–2 559
Operating result	1 677	2 514
Interest expenses on debt and subordinated liabilities	–418	–408
Other income	247	73
Other expenses	–405	–552
Extraordinary income and expenses		–226
Income before income tax expense	1 101	1 401
Income tax expense	–226	–192
Net income	875	1 209

Reinsurance result

Reinsurance result amounted to CHF 227 million in 2017, compared to CHF 1 238 million in 2016. Property and Casualty Reinsurance result decreased from CHF 1 522 million in 2016 to CHF 354 million in 2017, significantly impacted by large natural catastrophe losses and the deterioration on large casualty transactions in the US, partly absorbed by a subsequent release of the equalisation provision. Life & Health Reinsurance result experienced a loss of CHF 127 million in 2017, compared to a loss of CHF 284 million in 2016. This loss in 2017 was driven by negative impacts from Swiss Re Life & Health Australia Ltd, due to a true-up of the modified coinsurance balance as at 31 December 2016, as well as by a large transaction in Europe.

Premiums earned decreased from CHF 17 580 million in 2016 to CHF 17 421 million in 2017. Property and casualty premiums earned increased from CHF 11 237 million in 2016 to CHF 11 312 million in 2017. The increase was predominantly driven by the growth in the US casualty business, partly offset by a volume decrease in the agriculture business in Asia as well as negative cedent updates in Europe. Life and health premiums earned decreased from CHF 6 343 million in 2016 to CHF 6 109 million in 2017. This stemmed from the lower business volume renewed in Europe, as well as the impact of the business novated to Swiss Re Life Capital Reinsurance Ltd in 2017.

Other reinsurance revenue increased from CHF 1 003 million in 2016 to CHF 1 439 million in 2017. The increase was driven by favourable fair value adjustments in the Canadian life and health business and higher interest income on cash deposit from life and health transactions in the US.

Claims incurred increased from CHF 12 042 million in 2016 to CHF 13 098 million in 2017, mainly due to large natural catastrophe losses, partly absorbed by a subsequent release of the equalisation provision in 2017. The comparison of the individual claims line items was affected by large intra-group restructurings as well as new large life and health transactions, creating substantial changes year-over-year. In aggregate, these various movements fully offset each other.

Property and casualty claims paid and claims adjustment expenses net increased from CHF 389 million in 2016 to CHF 3 922 million in 2017, driven by a new intra-group retrocession agreement with Swiss Re Asia Ltd as well as the growth in motor, accident and health businesses and higher loss ratio in large casualty transactions in the US. The aforementioned restructuring impacts were more than offset in change in unpaid claims net for the property and casualty business, which in consequence decreased from CHF 6 278 million in 2016 to CHF 5 393 million in 2017, despite the large natural catastrophe events mostly in the property business.

As a consequence of property and casualty losses in 2017, driven by the large natural catastrophe events, the equalisation provision was reduced by CHF 1 323 million.

Life and health benefits net changed from a loss of CHF 3 653 million in 2016 to a gain of CHF 3 492 million in 2017, mainly due to the intra-group retrocession restructurings, primarily with Swiss Re Life Capital Reinsurance Ltd and Swiss Re Asia Ltd, as well as large transactions with external cedents. These aforementioned restructuring and large transaction impacts were more than offset in life and health claims paid and claims adjustment expenses net – which changed from a gain of CHF 241 million in 2016 to a loss of CHF 8 814 million in 2017 – as well as in change in unpaid claims, which changed from a loss of CHF 1 963 million in 2016 to a gain of CHF 216 million in 2017.

Acquisition costs net increased from CHF 4 150 million in 2016 to CHF 4 333 million in 2017, mainly in the life and health business, driven by a profit commission adjustment in Australia and new business in the US with exceptionally high commission ratio.

Other reinsurance expenses increased from CHF 646 million in 2016 to CHF 878 million in 2017, driven by interest on cash deposits paid to Swiss Re Life Capital Reinsurance Ltd and an unfavourable day-one impact of a large transaction in Europe in 2017.

Investment result

Investment income increased from CHF 1 779 million in 2016 to CHF 3 246 million in 2017. The increase was mainly driven by the dividend from Swiss Re Reinsurance Holding Company Ltd of CHF 974 million and the distribution of the retained income from shares in investment funds of CHF 568 million. In addition, 2017 benefited by CHF 227 million from one-off value readjustments on fixed income securities up to amortised cost, following the adoption of new accounting policies introduced in 2017.

Investment expenses decreased from CHF 695 million in 2016 to CHF 317 million in 2017, which was mainly related to higher value adjustments on fixed income securities in 2016, driven by market deteriorations.

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CHF millions	Income	Value readjustments	Realised gains	2017 Total
Investment income
Investments in subsidiaries and affiliated companies	978	–	0	978
Fixed income securities	515	226	162	903
Loans	216	0	–	216
Mortgages	5	–	–	5
Equity securities	20	9	173	202
Shares in investment funds	573	63	88	724
Short-term investments	18	–	0	18
Alternative investments	39	19	0	58
Other investments	630	82	88	800
Income from investment services	142	–	–	142
Investment income	2 506	317	423	3 246

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CHF millions	Expenses	Value adjustments	Realised losses	2017 Total
Investment expenses
Investments in subsidiaries and affiliated companies	–	0	–	0
Fixed income securities	–	0	–66	–66
Loans	–	–7	–	–7
Equity securities	–	–19	–9	–28
Shares in investment funds	–	–7	–	–7
Short-term investments	–	–	–2	–2
Alternative investments	–	–11	0	–11
Other investments	–	–18	–2	–20
Investment management expenses	–196	–	–	–196
Investment expenses	–196	–44	–77	–317

Allocated investment return				–383
Investment result				2 546

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CHF millions	Income	Value readjustments	Realised gains	2016 Total
Investment income
Investments in subsidiaries and affiliated companies	290	–	2	292
Fixed income securities	648	115	193	956
Loans	218	–	–	218
Mortgages	6	–	–	6
Equity securities	22	10	61	93
Shares in investment funds	11	–	20	31
Short-term investments	11	–	1	12
Alternative investments	30	7	16	53
Other investments	52	7	37	96
Income from investment services	118	–	–	118
Investment income	1 354	132	293	1 779

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CHF millions	Expenses	Value adjustments	Realised losses	2016 Total
Investment expenses
Investments in subsidiaries and affiliated companies	–	–181	–	–181
Fixed income securities	–	–215	–44	–259
Loans	–	–	–	–
Equity securities	–	–20	–6	–26
Shares in investment funds	–	–28	–	–28
Short-term investments	–	–	–1	–1
Alternative investments	–	–21	0	–21
Other investments	–	–49	–1	–50
Investment management expenses	–179	–	–	–179
Investment expenses	–179	–465	–51	–695

Allocated investment return				–297
Investment result				787

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