15 Share-based payments

As of 31 December 2016 and 2017, the Group had the share-based compensation plans as described below.

The total compensation cost for share-based compensation plans recognised in net income was USD 66 million and USD 55 million in 2016 and 2017, respectively. The related tax benefit was USD 14 million and USD 12 million, respectively.

Restricted shares

The Group granted 47 795 and 29 914 restricted shares to selected employees in 2016 and 2017, respectively. Moreover, as an alternative to the Group’s cash bonus programme, 300 382 and 276 483 shares were delivered during 2016 and 2017, respectively, which are generally not subject to forfeiture risk.

A summary of the movements in shares relating to outstanding awards granted under the restricted share plans for the year ended 31 December 2017 is as follows:



Weighted average grant
date fair value in CHF1

  Number of shares


Equal to the market price of the shares on the date of grant.

Non-vested at 1 January 


528 672



306 397



–2 312



–348 913

Outstanding as of 31 December


483 844

Leadership Performance Plan

The Leadership Performance Plan (LPP) awards are expected to be settled in shares, and the requisite service as well as the maximum contractual term are three years. For LPP 2014, LPP 2015, LPP 2016 and LPP 2017 awards, an additional two-year holding period applies for all members of the Group EC and other key executives. At grant date the award is split equally into two underlying components — Restricted Share Units (RSUs) and Performance Share Units (PSUs). The RSUs are measured against a ROE performance condition and will vest within a range of 0–100%. The PSUs are based on relative total shareholder return, measured against a pre-defined group of peers and will vest within a range of 0–200%. The fair values of both components are measured separately, based on stochastic models.

The fair value assumptions in the grant valuations include market estimates for dividends (and an additional special dividend of CHF 4.15 for the LPP 2014 and a special dividend of CHF 3.00 for the LPP 2015, respectively) and the risk-free rate based on the average of the 5-year US government bond rate (for LPP 2014 and LPP 2015) and the average of the 10-year US government bond rate (for LPP 2016 and LPP 2017) taken monthly over each year in the performance period. This resulted in risk-free rates between 1.8% and 3.1% for all LPP awards.

For the year ended 31 December 2017, the outstanding units were as follows:



LPP 2014


LPP 2015


LPP 2016


LPP 2017

Non-vested at 1 January

349 960


320 805


360 787










528 175


–1 650


–10 725


–12 448


–17 034


–348 310







Outstanding as of 31 December



310 080


348 339


511 141

Grant date fair value in CHF
























Non-vested at 1 January

353 670


353 785


489 519










720 025


–1 670


–11 830


–16 891


–23 221


–352 000







Outstanding as of 31 December



341 955


472 628


696 804

Grant date fair value in CHF








Unrecognised compensation cost

As of 31 December 2017, the total unrecognised compensation cost (net of forfeitures) related to non-vested, share-based compensation awards was USD 54 million and the weighted average period over which that cost is expected to be recognised is 1.9 years.

The number of shares authorised for the Group’s share-based payments to employees was 3 665 794 and 4 411 532 as of 31 December 2016 and 2017, respectively. The Group’s policy is to ensure that sufficient treasury shares are available at all times to settle future share-based compensation plans.

Global Share Participation Plan

In June 2013, Swiss Re introduced the Global Share Participation Plan, which is a share purchase plan that was rolled out for the benefit of employees of companies within the Group. Swiss Re makes a financial contribution to participants in the Plan, by matching the commitment that they make during the plan cycle with additional Swiss Re shares.

If the employee is still employed by Swiss Re at the end of a plan cycle, the employee will receive an additional number of shares equal to 30% of the total number of purchased and dividend shares held at that time. In 2016 and 2017, Swiss Re contributed USD 12 million and USD 11 million to the plans and authorised 178 233 and 162 487 shares as of 31 December 2016 and 2017, respectively.