17 Information on business segments
The Group provides reinsurance and insurance throughout the world through its business segments. The business segments are determined by the organisational structure and by the way in which management reviews the operating performance of the Group.
The Group presents four core operating business segments: Property & Casualty Reinsurance, Life & Health Reinsurance, Corporate Solutions and Admin Re®. The presentation of each segment’s balance sheet is closely aligned to the segment legal entity structure. The assignment of assets and liabilities for entities that span more than one segment are determined by considering local statutory requirements, legal and other constraints, the economic view of duration and currency requirements of the reinsurance business written, and the capacity of the segments to absorb risks. Interest expense is incurred from the segment’s capital funding position. The tax position of the operating segments is derived from legal entity tax obligations, subject to Group tax considerations.
Accounting policies applied by the business segments are in line with those described in the summary of significant accounting policies (please refer to Note 1 to the Group’s annual consolidated financial statements).
The Group operating segments are outlined below.
Property & Casualty Reinsurance and Life & Health Reinsurance
Reinsurance consists of two segments, Property & Casualty and Life & Health. The Reinsurance Business Unit operates globally, both through brokers and directly with clients, and provides a large range of solutions for risk and capital management. Clients include insurance companies and mutual as well as public sector and governmental entities. In addition to traditional reinsurance solutions, the Business Unit offers insurance-linked securities and other insurance-related capital market products in both Property & Casualty and Life & Health.
Property & Casualty includes the business lines property, casualty including motor, and specialty. Life & Health includes the life and health sub-segments.
Corporate Solutions
Corporate Solutions offers innovative insurance capacity to mid-sized and large multinational corporations across the globe. Offerings range from standard risk transfer covers and multi-line programmes, to customised solutions tailored to the needs of clients. Corporate Solutions serves customers from over 40 offices worldwide.
Admin Re®
Through Admin Re®, Swiss Re acquires closed blocks of in-force life and health insurance business, either through reinsurance or corporate acquisition, and typically assumes responsibility for administering the underlying policies. The administration of the business may be managed directly or, where appropriate, in partnership with a third party. Since 1998, Swiss Re has acquired more than 50 blocks of business spanning a range of product types. It currently operates in the UK, US and the Netherlands.
Group items
Items not allocated to the business segments are included in the “Group items” column, which encompasses Swiss Re Ltd, the Group holding company, the former Legacy business in run-off, Principal Investments and certain Treasury units. The holding company charges trademark licence fees to the operating segments which are reported as other revenues. Certain administrative expenses of the corporate centre functions that are not recharged to the operating segments are reported as Group items.
Consolidation
Segment information is presented net of external and internal retrocession and other intra-group arrangements. The Group total is obtained after elimination of intra-group transactions in the “Consolidation” column. This includes significant intra-group reinsurance arrangements, recharge of trademark licence fees, and intersegmental funding.
a) Business segments – income statement
For the year ended 31 December
| Download |
|
2012 |
Property & Casualty Reinsurance |
Life & Health Reinsurance |
Corporate Solutions |
Admin Re® |
Group items |
Consolidation |
Total |
|
Revenues |
|
|
|
|
|
|
|
|
Premiums earned |
12 329 |
9 050 |
2 284 |
992 |
6 |
|
24 661 |
|
Fee income from policyholders |
|
72 |
|
713 |
|
|
785 |
|
Net investment income – non-participating |
1 451 |
1 365 |
109 |
1 548 |
18 |
–18 |
4 473 |
|
Net realised investment gains/losses – non-participating |
259 |
562 |
142 |
–89 |
73 |
|
947 |
|
Net investment result – unit-linked and with-profit |
|
222 |
|
2 348 |
|
|
2 570 |
|
Other revenues |
95 |
1 |
1 |
3 |
385 |
–297 |
188 |
|
Total revenues |
14 134 |
11 272 |
2 536 |
5 515 |
482 |
–315 |
33 624 |
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
Claims and claim adjustment expenses |
–6 306 |
|
–1 448 |
|
–14 |
5 |
–7 763 |
|
Life and health benefits |
|
–6 787 |
|
–2 086 |
|
–5 |
–8 878 |
|
Return credited to policyholders |
|
–271 |
|
–2 688 |
|
|
–2 959 |
|
Acquisition costs |
–2 316 |
–1 787 |
–300 |
–142 |
–3 |
|
–4 548 |
|
Other expenses |
–1 325 |
–833 |
–449 |
–457 |
–403 |
250 |
–3 217 |
|
Interest expenses |
–111 |
–586 |
|
–53 |
–51 |
65 |
–736 |
|
Total expenses |
–10 058 |
–10 264 |
–2 197 |
–5 426 |
–471 |
315 |
–28 101 |
|
|
|
|
|
|
|
|
|
|
Income before income tax expense |
4 076 |
1 008 |
339 |
89 |
11 |
0 |
5 523 |
|
Income tax expense/benefit |
–934 |
–231 |
–143 |
101 |
82 |
|
–1 125 |
|
Net income before attribution of non-controlling interests |
3 142 |
777 |
196 |
190 |
93 |
0 |
4 398 |
|
|
|
|
|
|
|
|
|
|
Income attributable to non-controlling interests |
–134 |
|
|
–7 |
|
|
–141 |
|
Net income after attribution of non-controlling interests |
3 008 |
777 |
196 |
183 |
93 |
0 |
4 257 |
|
|
|
|
|
|
|
|
|
|
Interest on contingent capital instruments |
–18 |
–38 |
|
|
|
|
–56 |
|
Net income attributable to common shareholders |
2 990 |
739 |
196 |
183 |
93 |
0 |
4 201 |
|
|
|
|
|
|
|
|
|
|
Claims ratio in % |
51.2 |
|
63.4 |
|
|
|
53.1 |
|
Expense ratio in % |
29.5 |
|
32.8 |
|
|
|
30.0 |
|
Combined ratio in % |
80.7 |
|
96.2 |
|
|
|
83.1 |
|
Management expense ratio in % |
|
7.9 |
|
|
|
|
|
|
Operating margin in % |
|
8.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 |
Property & Casualty Reinsurance |
Life & Health Reinsurance |
Corporate Solutions |
Admin Re® |
Group items |
Consolidation |
Total |
|
Revenues |
|
|
|
|
|
|
|
|
Premiums earned |
14 542 |
9 967 |
2 922 |
844 |
1 |
|
28 276 |
|
Fee income from policyholders |
|
56 |
|
486 |
|
|
542 |
|
Net investment income – non-participating |
1 098 |
1 442 |
98 |
1 180 |
150 |
–21 |
3 947 |
|
Net realised investment gains/losses – non-participating |
184 |
269 |
150 |
201 |
–38 |
|
766 |
|
Net investment result – unit-linked and with-profit |
|
249 |
|
3 098 |
|
|
3 347 |
|
Other revenues |
61 |
|
2 |
1 |
307 |
–347 |
24 |
|
Total revenues |
15 885 |
11 983 |
3 172 |
5 810 |
420 |
–368 |
36 902 |
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
Claims and claim adjustment expenses |
–7 884 |
|
–1 773 |
|
2 |
|
–9 655 |
|
Life and health benefits |
|
–8 075 |
|
–1 506 |
|
|
–9 581 |
|
Return credited to policyholders |
|
–286 |
|
–3 392 |
|
|
–3 678 |
|
Acquisition costs |
–2 761 |
–1 698 |
–406 |
–30 |
|
|
–4 895 |
|
Other expenses |
–1 472 |
–946 |
–601 |
–441 |
–356 |
308 |
–3 508 |
|
Interest expenses |
–207 |
–544 |
–1 |
–46 |
–22 |
60 |
–760 |
|
Total expenses |
–12 324 |
–11 549 |
–2 781 |
–5 415 |
–376 |
368 |
–32 077 |
|
|
|
|
|
|
|
|
|
|
Income/loss before income tax expense |
3 561 |
434 |
391 |
395 |
44 |
0 |
4 825 |
|
Income tax expense/benefit |
–249 |
–30 |
–111 |
28 |
50 |
|
–312 |
|
Net income/loss before attribution of non-controlling interests |
3 312 |
404 |
280 |
423 |
94 |
0 |
4 513 |
|
|
|
|
|
|
|
|
|
|
Income attributable to non-controlling interests |
–1 |
|
–1 |
|
|
|
–2 |
|
Net income/loss after attribution of non-controlling interests |
3 311 |
404 |
279 |
423 |
94 |
0 |
4 511 |
|
|
|
|
|
|
|
|
|
|
Interest on contingent capital instruments |
–19 |
–48 |
|
|
|
|
–67 |
|
Net income/loss attributable to common shareholders |
3 292 |
356 |
279 |
423 |
94 |
0 |
4 444 |
|
|
|
|
|
|
|
|
|
|
Claims ratio in % |
54.2 |
|
60.6 |
|
|
|
55.3 |
|
Expense ratio in % |
29.1 |
|
34.5 |
|
|
|
30.0 |
|
Combined ratio in % |
83.3 |
|
95.1 |
|
|
|
85.3 |
|
Management expense ratio in % |
|
8.3 |
|
|
|
|
|
|
Operating margin in % |
|
5.2 |
|
|
|
|
|
Business segments – balance sheet
As of 31 December 2012
| Download |
|
2012 |
Property & Casualty Reinsurance |
Life & Health Reinsurance |
Corporate Solutions |
Admin Re® |
Group items |
Consolidation |
Total |
||
|
|||||||||
|
Assets |
|
|
|
|
|
|
|
||
|
Fixed income securities |
31 115 |
31 366 |
4 616 |
21 608 |
143 |
|
88 848 |
||
|
Equity securities |
2 360 |
303 |
578 |
3 |
530 |
|
3 774 |
||
|
Other investments |
11 893 |
3 178 |
107 |
1 774 |
6 180 |
–7 088 |
16 044 |
||
|
Short-term investments |
10 005 |
5 053 |
1 549 |
1 557 |
481 |
|
18 645 |
||
|
Investments for unit-linked and with-profit business |
|
842 |
|
24 659 |
|
|
25 501 |
||
|
Cash and cash equivalents |
6 904 |
1 412 |
978 |
1 472 |
71 |
|
10 837 |
||
|
Deferred acquisition costs |
1 103 |
2 713 |
219 |
2 |
2 |
|
4 039 |
||
|
Acquired present value of future profits |
|
1 358 |
|
1 665 |
|
|
3 023 |
||
|
Reinsurance recoverable |
5 583 |
2 447 |
9 440 |
469 |
|
–7 830 |
10 109 |
||
|
Other reinsurance assets |
12 419 |
8 631 |
2 901 |
3 459 |
3 |
–2 639 |
24 774 |
||
|
Goodwill |
2 018 |
2 057 |
17 |
|
|
|
4 092 |
||
|
Other1 |
10 059 |
4 554 |
927 |
1 165 |
132 |
–5 020 |
11 817 |
||
|
Total assets |
93 459 |
63 914 |
21 332 |
57 833 |
7 542 |
–22 577 |
221 503 |
||
|
|
|
|
|
|
|
|
|
||
|
Liabilities |
|
|
|
|
|
|
|
||
|
Unpaid claims and claim adjustment expenses |
48 465 |
9 505 |
12 258 |
1 247 |
21 |
–7 826 |
63 670 |
||
|
Liabilities for life and health policy benefits |
|
17 439 |
216 |
18 469 |
|
–7 |
36 117 |
||
|
Policyholder account balances |
|
1 466 |
|
27 883 |
|
|
29 349 |
||
|
Other reinsurance liabilities |
12 543 |
1 709 |
4 913 |
713 |
8 |
–3 106 |
16 780 |
||
|
Short-term debt |
3 799 |
1 529 |
|
634 |
1 245 |
–3 595 |
3 612 |
||
|
Long-term debt |
3 779 |
12 461 |
|
|
46 |
|
16 286 |
||
|
Other1 |
12 503 |
11 466 |
903 |
2 225 |
2 562 |
–7 996 |
21 663 |
||
|
Total liabilities |
81 089 |
55 575 |
18 290 |
51 171 |
3 882 |
–22 530 |
187 477 |
||
|
|
|
|
|
|
|
|
|
||
|
Shareholders’ equity |
12 356 |
8 339 |
3 032 |
6 662 |
3 660 |
–47 |
34 002 |
||
|
|
|
|
|
|
|
|
|
||
|
Non-controlling interests |
14 |
|
10 |
|
|
|
24 |
||
|
Total equity |
12 370 |
8 339 |
3 042 |
6 662 |
3 660 |
–47 |
34 026 |
||
|
|
|
|
|
|
|
|
|
||
|
Total liabilities and equity |
93 459 |
63 914 |
21 332 |
57 833 |
7 542 |
–22 577 |
221 503 |
||
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
|
2013 |
Property & Casualty Reinsurance |
Life & Health Reinsurance |
Corporate Solutions |
Admin Re® |
Group items |
Consolidation |
Total |
||
|
Assets |
|
|
|
|
|
|
|
||
|
Fixed income securities |
24 986 |
29 588 |
4 644 |
20 014 |
64 |
|
79 296 |
||
|
Equity securities |
4 017 |
1 333 |
981 |
|
1 360 |
|
7 691 |
||
|
Other investments |
10 080 |
3 179 |
169 |
1 800 |
5 561 |
–5 905 |
14 884 |
||
|
Short-term investments |
13 297 |
4 113 |
1 595 |
1 474 |
510 |
|
20 989 |
||
|
Investments for unit-linked and with-profit business |
|
988 |
|
26 227 |
|
|
27 215 |
||
|
Cash and cash equivalents |
5 288 |
166 |
562 |
1 748 |
308 |
|
8 072 |
||
|
Deferred acquisition costs |
1 591 |
2 845 |
319 |
1 |
|
|
4 756 |
||
|
Acquired present value of future profits |
|
1 451 |
|
2 086 |
|
|
3 537 |
||
|
Reinsurance recoverable |
4 752 |
1 756 |
8 228 |
323 |
|
–6 732 |
8 327 |
||
|
Other reinsurance assets |
11 457 |
9 286 |
2 422 |
3 475 |
3 |
–1 967 |
24 676 |
||
|
Goodwill |
2 057 |
2 035 |
17 |
|
|
|
4 109 |
||
|
Other |
8 938 |
3 759 |
988 |
919 |
207 |
–4 843 |
9 968 |
||
|
Total assets |
86 463 |
60 499 |
19 925 |
58 067 |
8 013 |
–19 447 |
213 520 |
||
|
|
|
|
|
|
|
|
|
||
|
Liabilities |
|
|
|
|
|
|
|
||
|
Unpaid claims and claim adjustment expenses |
45 578 |
9 869 |
11 549 |
1 205 |
15 |
–6 732 |
61 484 |
||
|
Liabilities for life and health policy benefits |
|
17 392 |
232 |
18 415 |
|
–6 |
36 033 |
||
|
Policyholder account balances |
|
1 595 |
|
29 582 |
|
|
31 177 |
||
|
Other reinsurance liabilities |
11 591 |
2 116 |
4 355 |
620 |
6 |
–2 433 |
16 255 |
||
|
Short-term debt |
798 |
3 730 |
|
646 |
1 285 |
–2 641 |
3 818 |
||
|
Long-term debt |
4 700 |
10 627 |
|
|
|
–605 |
14 722 |
||
|
Other |
10 523 |
8 940 |
1 010 |
1 795 |
1 775 |
–6 989 |
17 054 |
||
|
Total liabilities |
73 190 |
54 269 |
17 146 |
52 263 |
3 081 |
–19 406 |
180 543 |
||
|
|
|
|
|
|
|
|
|
||
|
Shareholders’ equity |
13 256 |
6 230 |
2 771 |
5 804 |
4 932 |
–41 |
32 952 |
||
|
|
|
|
|
|
|
|
|
||
|
Non-controlling interests |
17 |
|
8 |
|
|
|
25 |
||
|
Total equity |
13 273 |
6 230 |
2 779 |
5 804 |
4 932 |
–41 |
32 977 |
||
|
|
|
|
|
|
|
|
|
||
|
Total liabilities and equity |
86 463 |
60 499 |
19 925 |
58 067 |
8 013 |
–19 447 |
213 520 |
||
b) Property & Casualty Reinsurance business segment – by line of business
For the year ended 31 December
| Download |
|
2012 |
Property |
Casualty |
Specialty |
Total |
|
Premiums earned |
5 795 |
4 630 |
1 904 |
12 329 |
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
Claims and claim adjustment expenses |
–2 832 |
–2 818 |
–656 |
–6 306 |
|
Acquisition costs |
–781 |
–1 128 |
–407 |
–2 316 |
|
Other expenses |
–687 |
–406 |
–232 |
–1 325 |
|
Total expenses before interest expenses |
–4 300 |
–4 352 |
–1 295 |
–9 947 |
|
|
|
|
|
|
|
Underwriting result |
1 495 |
278 |
609 |
2 382 |
|
|
|
|
|
|
|
Net investment income |
|
|
|
1 451 |
|
Net realised investment gains/losses |
|
|
|
259 |
|
Other revenues |
|
|
|
95 |
|
Interest expenses |
|
|
|
–111 |
|
Income before income tax expenses |
|
|
|
4 076 |
|
|
|
|
|
|
|
Claims ratio in % |
48.9 |
60.9 |
34.4 |
51.2 |
|
Expense ratio in % |
25.3 |
33.1 |
33.6 |
29.5 |
|
Combined ratio in % |
74.2 |
94.0 |
68.0 |
80.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
2013 |
Property |
Casualty |
Specialty |
Total |
|
Premiums earned |
6 945 |
5 366 |
2 231 |
14 542 |
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
Claims and claim adjustment expenses |
–3 342 |
–3 563 |
–979 |
–7 884 |
|
Acquisition costs |
–883 |
–1 408 |
–470 |
–2 761 |
|
Other expenses |
–764 |
–495 |
–213 |
–1 472 |
|
Total expenses before interest expenses |
–4 989 |
–5 466 |
–1 662 |
–12 117 |
|
|
|
|
|
|
|
Underwriting result |
1 956 |
–100 |
569 |
2 425 |
|
|
|
|
|
|
|
Net investment income |
|
|
|
1 098 |
|
Net realised investment gains/losses |
|
|
|
184 |
|
Other revenues |
|
|
|
61 |
|
Interest expenses |
|
|
|
–207 |
|
Income before income tax expenses |
|
|
|
3 561 |
|
|
|
|
|
|
|
Claims ratio in % |
48.1 |
66.4 |
43.9 |
54.2 |
|
Expense ratio in % |
23.7 |
35.5 |
30.6 |
29.1 |
|
Combined ratio in % |
71.8 |
101.9 |
74.5 |
83.3 |
c) Life & Health Reinsurance business segment – by line of business
For the year ended 31 December
| Download |
|
2012 |
Life |
Health |
Total |
||
|
|||||
|
Revenues |
|
|
|
||
|
Premiums earned |
6 176 |
2 874 |
9 050 |
||
|
Fee income from policyholders |
72 |
|
72 |
||
|
Net investment income – non-participating |
899 |
466 |
1 365 |
||
|
Net investment income – unit-linked and with-profit |
32 |
|
32 |
||
|
Net realised investment gains/losses – unit-linked and with-profit |
190 |
|
190 |
||
|
Net realised investment gains/losses – insurance-related derivatives |
–147 |
|
–147 |
||
|
Other revenues |
1 |
|
1 |
||
|
Total revenues before non-participating realised gains/losses |
7 223 |
3 340 |
10 563 |
||
|
|
|
|
|
||
|
Expenses |
|
|
|
||
|
Life and health benefits |
–4 625 |
–2 162 |
–6 787 |
||
|
Return credited to policyholders |
–271 |
|
–271 |
||
|
Acquisition costs |
–1 299 |
–488 |
–1 787 |
||
|
Other expenses |
–613 |
–220 |
–833 |
||
|
Total expenses before interest expenses |
–6 808 |
–2 870 |
–9 678 |
||
|
|
|
|
|
||
|
Operating income |
415 |
470 |
885 |
||
|
|
|
|
|
||
|
Net realised investment gains/losses – non-participating and excluding insurance-related derivatives |
|
|
709 |
||
|
Interest expenses |
|
|
–586 |
||
|
Income before income tax expenses |
|
|
1 008 |
||
|
|
|
|
|
||
|
|
|
|
|
||
|
Management expense ratio in % |
8.6 |
6.6 |
7.9 |
||
|
Operating margin1 in % |
5.9 |
14.1 |
8.6 |
||
|
|
|
|
|
||
|
|
|
|
|
||
|
2013 |
Life |
Health |
Total |
||
|
Revenues |
|
|
|
||
|
Premiums earned |
6 678 |
3 289 |
9 967 |
||
|
Fee income from policyholders |
56 |
|
56 |
||
|
Net investment income – non-participating |
915 |
527 |
1 442 |
||
|
Net investment income – unit-linked and with-profit |
39 |
|
39 |
||
|
Net realised investment gains/losses – unit-linked and with-profit |
210 |
|
210 |
||
|
Net realised investment gains/losses – insurance-related derivatives |
–123 |
6 |
–117 |
||
|
Other revenues |
|
|
0 |
||
|
Total revenues before non-participating realised gains/losses |
7 775 |
3 822 |
11 597 |
||
|
|
|
|
|
||
|
Expenses |
|
|
|
||
|
Life and health benefits |
–5 216 |
–2 859 |
–8 075 |
||
|
Return credited to policyholders |
–286 |
|
–286 |
||
|
Acquisition costs |
–1 207 |
–491 |
–1 698 |
||
|
Other expenses |
–685 |
–261 |
–946 |
||
|
Total expenses before interest expenses |
–7 394 |
–3 611 |
–11 005 |
||
|
|
|
|
|
||
|
Operating income |
381 |
211 |
592 |
||
|
|
|
|
|
||
|
Net realised investment gains/losses – non-participating and excluding insurance-related derivatives |
|
|
386 |
||
|
Interest expenses |
|
|
–544 |
||
|
Income before income tax expenses |
|
|
434 |
||
|
|
|
|
|
||
|
|
|
|
|
||
|
Management expense ratio in % |
9.0 |
6.8 |
8.3 |
||
|
Operating margin1 in % |
5.1 |
5.5 |
5.2 |
||
d) Net premiums earned and fee income from policyholders by geography
Net premiums earned and fee income from policyholders by regions for the years ended 31 December
| Download |
|
USD millions |
2012 |
2013 |
|
Americas |
9 579 |
11 468 |
|
Europe (including Middle East and Africa) |
10 686 |
11 347 |
|
Asia-Pacific |
5 181 |
6 003 |
|
Total |
25 446 |
28 818 |
Net premiums earned and fee income from policyholders by country for the years ended 31 December
| Download |
|
USD millions |
2012 |
2013 |
|
United States |
7 493 |
9 084 |
|
United Kingdom |
3 316 |
3 466 |
|
Australia |
1 705 |
2 056 |
|
China |
1 880 |
2 045 |
|
France |
2 110 |
1 624 |
|
Canada |
1 196 |
1 379 |
|
Germany |
1 063 |
1 296 |
|
Ireland |
591 |
832 |
|
Japan |
714 |
764 |
|
Italy |
439 |
547 |
|
Netherlands |
448 |
457 |
|
Other |
4 491 |
5 268 |
|
Total |
25 446 |
28 818 |
Net premiums earned and fee income from policyholders are allocated by country based on the underlying contract.