6 Deferred acquisition costs (DAC) and acquired present value of future profits (PVFP)

As of 31 December, the DAC were as follows:

Download

2014
USD millions

Property & Casualty Rein­surance

Life & Health Rein­surance

Corporate Solutions

Admin Re®

Total

Opening balance as of 1 January

1 591

2 845

319

1

4 756

Deferred

3 563

490

507

 

4 560

Effect of acquisitions/disposals and retrocessions

 

–28

 

 

–28

Amortisation

–3 332

–448

–463

 

–4 243

Effect of foreign currency translation

–66

–136

–3

 

–205

Closing balance as of 31 December

1 756

2 723

360

1

4 840

Download

2015
USD millions

Property & Casualty Rein­surance

Life & Health Rein­surance

Corporate Solutions

Admin Re®

Total

Opening balance as of 1 January

1 756

2 723

360

1

4 840

Deferred

4 132

1 053

486

 

5 671

Effect of acquisitions/disposals and retrocessions

7

2

 

 

9

Amortisation

–3 793

–594

–459

 

–4 846

Effect of foreign currency translation

–51

–152

 

 

–203

Closing balance as of 31 December

2 051

3 032

387

1

5 471

Retroceded DAC may arise on retrocession of reinsurance portfolios, including reinsurance undertaken as part of a securitisation. The associated potential retrocession recoveries are determined by the nature of the retrocession agreements and by the terms of the securitisation.

As of 31 December, the PVFP was as follows:

Download

 

2014

2015

USD millions

Life & Health Rein­surance

Admin Re®

Total

Life & Health Rein­surance

Admin Re®

Total

Opening balance as of 1 January

1 451

2 086

3 537

1 294

2 003

3 297

Effect of acquisitions/disposals and retrocessions

 

165

165

 

2

2

Amortisation

–156

–261

–417

–159

–191

–350

Interest accrued on unamortised PVFP

44

103

147

40

84

124

Effect of foreign currency translation

–45

–90

–135

–41

–77

–118

Effect of change in unrealised gains/losses

 

 

0

 

9

9

Closing balance as of 31 December

1 294

2 003

3 297

1 134

1 830

2 964

Retroceded PVFP may arise on retrocession of reinsurance portfolios, including reinsurance undertaken as part of a securitisation. The associated potential retrocession recoveries are determined by the nature of the retrocession agreements and by the terms of the securitisation.

The percentage of PVFP which is expected to be amortised in each of the next five years is 9%, 9%, 8%, 8% and 7%.