Since 2008 and the financial crisis, both analysts and investors have faced increased difficulty in assessing insurance groups’ performance due to current business environment conditions, such as:
- Stagnation within the main developed countries;
- European sovereign debt crisis;
- Low interest rates;
- Prolonged decline in the stock markets;
- High market volatility; and
- Solvency II framework implementation in progress.
In this context, we have performed an analysis of the financial statement disclosures based on the 2011 year-end IFRS financial statements of several of the largest insurance and reinsurance groups looking at issues:
- From an accounting perspective, considering compliance with IFRS especially regarding topics that we consider to be particularly sensitive; and
- From a financial and regulatory perspective, as we focus on the insurers’ and reinsurers’ financial disclosures regarding key indicators and capital management.
This year, the survey has focused on the following topics:
- Goodwill and associated tests regarding recoverability;
- Financial instruments and associated risks;
- Communication of Embedded Value and other key performance indicators; and
- Information related to capital management.