D.118 / Direct Life Insurance Operations Conducted in Belgium

64859/Perm.Tech./CV Brussels, January 18, 1994

COMMUNICATION D. 118

Subject: Direct Life Insurance Operations Conducted in Belgium

• Statistical Statement
• Profitability of Insurance Product Categories

I INTRODUCTION.
This communication does not call into question the principles set out in communications D.100 and D.104. It aims to provide some clarifications or corrections that have been taken into account in the preparation of the "electronic reporting." Furthermore, we wish to remind companies that they are required to transmit to the Office, on computer media, the statistics relating to 1993 (for annual accounts, see communication D.113). Tables C and Q3, however, are to be completed only starting from the 1994 fiscal year. Companies will find, in the annex, a modified statistical statement.

II MODIFICATIONS

A. Tables A1, A2 and A3

1) Compared to the statistical statement attached to communication D.100
The number of columns in the statistical statement has been reduced following discussions regarding the draft Royal Decree relating to the classification of branches of the "Life" activity group. Thus, there are now only eight products or product categories instead of the thirteen mentioned in communication D.100. The profitability study will be conducted on the seven products or product categories initially planned. Consequently, Annex 1 attached to communication D.100 is replaced by the attached Annex A.1.

2.-

2) Compared to Annex A of communication D.104
The modifications made at the level of items are purely formal and are included in Annex A.2. Annex A.3 provides a comparative table of the differences between Annex A in communication D.104 and Annex A2 attached to this communication.

B. Other tables compared to the statistical statement attached to communication D.100

1) Table D1
suppression of the last two columns

2) Table D2
suppression of the last three columns

3) Tables B1 - B2 - R
For insurance linked to an investment fund, the label "Branches 23-26" is replaced by "Branch 23"

4) Table C

• For insurance not linked to an investment fund, the label "Branches 21-22-26-27" is replaced by "Branches 21-22-26"
• For insurance linked to an investment fund, the label "Branches 23-26-27" is replaced by "Branch 23"

5) Tables Q1 - Q2 - Q3

• For insurance not linked to an investment fund, the label "Branches 21-22-26" is replaced by "Branches 21-22"
• For insurance linked to an investment fund, the label "Branches 23-26" is replaced by "Branch 23"

C. Annexes C1 and C2 of communication D.104 (only in the French language version)
C1 charges replace in IV: code 059 by code 075 replace in V: code 075 by code 076 C2 charges replace in X: code 085 by code 089

III PROFITABILITY

Furthermore, the columns relating to the product groups subject to profitability no longer appear in dark background in the "electronic reporting." We therefore wish to specify that there is no change in principle and that the product groups concerned correspond to columns (1)+(2), (3), (4), (5), (6), (7), (8) of the basic statistics.

3.-

IV SCHEDULE

The signature of the actuary is no longer to be mentioned at the bottom of tables D1, D2 and T, and that of the agent (the business owner or their delegate) is no longer to be mentioned at the bottom of table T. However, when sending statistics to the Office, companies will attach a schedule (see Annex A4). They will ensure that it is signed by the business owner or their delegate as well as by the actuary (tables D1 and D2).

V. CONCORDANCE BETWEEN ANNUAL ACCOUNTS AND STATISTICS

Given that the concordance tests between annual accounts and statistics will not be blocking until the new annual account schemes enter into force, companies are invited to correct themselves the discrepancies signaled by the system or to explain them.

VI. TRANSMISSION OF DOCUMENTS TO THE OFFICE

1) Tables A1, A2 and A3 must reach the Office at the same time as the annual accounts but no later than June 30 of the fiscal year following that to which these statistics relate.

2) The other tables must reach the Office no later than June 30 of the fiscal year following that to which these statistics relate

The President,
J.M. DELPORTE

64860/Perm.Tech./CV

ANNEX A.1.
INSURANCE NOT LINKED TO AN INVESTMENT FUND (*)

I INDIVIDUAL INSURANCE
A. Statistical Statement

1. Branches 21-22: (1)
2. Branch 26: (2)
3. Supplementary insurance (branches 21-22): (3)
   B. Profitability
   I. Branches 21-22 -26: (1) + (2)
   II. Supplementary insurance (branches 21-22): (3)

II GROUP INSURANCE
A. Statistical Statement
4. Branches 21--22: (4)
5. Supplementary insurance (branches 21-22): (5)
B. Profitability
III. Branches 21--22: (4)
IV. Supplementary insurance (branches 21-22): (5)

INSURANCE LINKED TO AN INVESTMENT FUND (*)

I INDIVIDUAL INSURANCE
A. Statistical Statement
6. Branch 23: (6)
B. Profitability
V. Branch 23: (6)

II GROUP INSURANCE
A. Statistical Statement
7. Branch 23: (7)
B. Profitability
VI. Branch 23: (7)

(*) the figures in parentheses refer to the figures mentioned in the columns of tables A1, A2

2.-

Branch 27 on behalf of third parties (*) A. Statistical Statement
8. Branch 27 (on behalf of third parties): (8)
B. Profitability
VII. Branch 27 (on behalf of third parties): (8)

(*) the figures in parentheses refer to the figures mentioned in the columns of table A3.

64861/Perm.Tech./CV.

ANNEX A.2.
TABLES A1 and A2
LABEL Code

----------------------------------------- Allocation of accounts annual accounts-chap. II, sect.II)

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I. PREMIUMS AND ACCESSORIES ( I = 1.1 + 1.2 )
1.1. premiums issued and outstanding 002+004-005
1.2. policy and endorsement fees 006
II. BENEFITS, RECOVERIES AND CLAIMS MANAGEMENT
( II = 2.1 + 2.2 + 2.3 - 2.4 )
2.1. direct benefits to beneficiaries 032+062
2.2. external claims settlement costs 033
2.3. internal claims settlement costs (149)-(148)
2.4. recovery of technical charges 021
III. TECHNICAL PROVISIONS AND ESTIMATED RECOVERIES
( III = - 3.1.A + 3.1.Z. - 3.2.A. + 3.2.Z. - 3.3.T.a + 3.3.T.b. - 3.4.T.a + 3.4.T.b. + 3.5.A. - 3.5.Z. - 3.6A. + 3.6.Z. )
3.1. mathematical provisions (including provisions for profit sharing
distributed and undistributed but excluding provisions for profit sharing for the fiscal year) 3.1.A. at 31/12/(t-1) () 047 3.1.Z. at 31/12/(t) () 046 (*) t: fiscal year of annual accounts t -1: previous fiscal year

2.-
TABLES A1 and A2
LABEL Code

----------------------------------------- Allocation of accounts annual accounts-chap. II, sect.II)

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3.2. provisions for benefits to be settled
3.2.A. at 31/12/(t-1) () 041
3.2.Z. at 31/12/(t) () 040
3.3.T mathematical provisions and provisions for benefits to be settled, transferred (external) 3.3.T.a a. received 056 3.3.T.b b. ceded 055 3.4.T mathematical provisions and provisions for benefits to be settled, transferred (internal) 3.4.T.a a. received ----- 3.4.T.b b. ceded -----
3.5. estimation of recovery of technical charges
3.5.A. at 31/12/(t-1) () 024
3.5.Z. at 31/12/(t) () 023
3.6. reconstruction fund ()
3.6.A. at 31/12/(t-1) () 050
3.6.Z. at 31/12/(t) () 049
IV. OTHER TECHNICAL CHARGES AND PRODUCTS
( IV = 4.1.-4.2. )
4.1. other technical charges 065
4.2. other technical products ( )
V. PROVISIONS AND PROFIT SHARING
( V = 5.1. + 5.2. )
5.1. provisions for the fiscal year to profit sharing provisions
058
5.2. provisions to the reserve fund for "legal pension" management
059
(*) t: fiscal year of annual accounts t -1: previous fiscal year () only for individual insurance not linked to an investment fund

3.-
TABLES A1 and A2
LABEL Code

----------------------------------------- Allocation of accounts annual accounts-chap. II, sect.II)

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VI. COMMISSIONS AND ACQUISITION FEES
(VI = 6.1. + 6.2. )
6.1. commissions ( 6.1. = 6.1.1. - 6.1.2. + 6.1.3. )
6.1.1. commissions attributed (068)+(069)
6.1.2. commissions attributed carried to the asset 070
6.1.3. amortization of commissions carried to the asset 071
6.2. acquisition fees ( 6.2. = 6.2.1. - 6.2.2. + 6.2.3. )
6.2.1. acquisition fees (149)-(148)
6.2.2. acquisition fees attributed carried to the asset ( )
6.2.3. amortization of acquisition fees carried to the asset ( )
S1 GROSS BALANCE OF INSURANCE ACTIVITY ( S1 = I - II - III - IV - V - VI )
VII. ADMINISTRATION FEES ( VII = 7 )
7. administration fees (149)-(148)
S2 GROSS BALANCE BEFORE INVESTMENT INCOME ( S2 = I - II - III - IV - V - VI - VII )

4.-
TABLES A1 and A2
LABEL Code

----------------------------------------- Allocation of accounts annual accounts-chap. II, sect.II)

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VIII. INVESTMENT INCOME
( VIII = 8.1. + 8.2. + 8.3. + 8.4. )
8.1. income from participations and other investments (144)
8.2. reversals of value corrections on investments (154)
8.3. realized capital gains (162)
8.4. unrealized capital gains () ( )
IX. INVESTMENT CHARGES
( IX = 9.1. + 9.2. + 9.3. + 9.4. + 9.5. )
9.1. interest charges (145)
9.2. investment management charges (149)-(148)
9.3. value corrections on investments (157)
9.4. realized capital losses (165)
9.5. unrealized capital losses () ( )
S3 GROSS TECHNICO-FINANCIAL BALANCE
( S3 = I - II - III - IV - V - VI - VII + VIII - IX )
X. REINSURANCE CEDED ( X = 10)
10. balance of ceded reinsurance 115-130
S4 NET TECHNICO-FINANCIAL BALANCE
( S4 = I - II - III - IV - V - VI - VII + VIII - IX + X ) PM: Variation of Zillmerization value.

• only for insurance linked to an investment fund

5.-
TABLES A1 AND A2
XI. ALLOCATION OF NON-TECHNICAL INCOMES (net of charges) TO
INSURANCE PRODUCT CATEGORIES
XII. ALLOCATION OF UNREALIZED CAPITAL GAINS ON INVESTMENTS TO
INSURANCE PRODUCT CATEGORIES ( * )
XIII. ALLOCATION OF UNREALIZED CAPITAL LOSSES TO
INSURANCE PRODUCT CATEGORIES ( * )
TABLE A3
LABEL Code

----------------------------------------- Allocation of accounts annual accounts-chap. II, sect.II)

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1. remuneration received ( )
2. commissions paid (068+069)
3. acquisition fees (149)-(148)
4. administration fees (149)-(148)
   SA3 BALANCE ( SA3 = 1- 2 - 3 - 4 )
   ( * ) not to be completed for insurance linked to an investment fund

64862/Perm.Tech./CV.

ANNEX A.3.
Correspondence between the revised Annex A.2. and Annex A attached to communication D.104. Revised Annex A.2. Annex A of communication D.104 Code Label Code Label 3.1.A. at 31/12/(t-1) 3.1.1. start of fiscal year 3.1.Z. at 31/12/t 3.1.2. end of fiscal year 3.2.A. at 31/12/(t-1) 3.2.1. start of fiscal year 3.2.Z. at 31/12/t 3.2.2. end of fiscal year 3.3.T. mathematical provisions and provisions for benefits to be settled, transferred (external)
3.3. mathematical provisions and
provisions for benefits to be settled, transferred (external) 3.3.T.a. received 3.3.1. received 3.3.T.b. ceded 3.3.2. ceded 3.4.T. mathematical provisions and provisions for benefits to be settled, transferred (internal)
3.4. mathematical provisions and
provisions for benefits to be settled, transferred (internal) 3.4.T.a. received 3.4.1. received 3.4.T.b. ceded 3.4.2. ceded 3.5.A. at 31/12/(t-1) 3.5.1. start of fiscal year 3.5.Z. at 31/12/t 3.5.2. end of fiscal year 3.6.A. at 31/12/(t-1) 3.6.1. start of fiscal year 3.6.Z. at 31/12/t 3.6.2. end of fiscal year Remark: The modified code numbers as well as the labels are mentioned in grebold characters