Annual Report 2010 - Hannover Re

In addition, we held indirect real estate investments in the
year under review in an amount of EUR 90.7 million (EUR
54.2 million).
The fair value of investment property amounted to EUR 305.4
million (EUR 167.3 million) as at the balance sheet date.
The market value of the real estate was determined using the
discounted cash flow method.
The additions to this item are attributable in large part to the
sharply increased investment activities of Hannover Re Real
Estate Holdings, Inc., and Hannover Re Euro RE Holdings
GmbH.
Other invested assets
The other invested assets consisted largely of participating
interests in partnerships measured at fair value in an amount
of EUR 779.5 million (EUR 522.6 million). The amortised cost
of these participations amounted to EUR 536.5 million (EUR
424.7 million); in addition, unrealised gains of EUR 244.5
million (EUR 98.7 million) and unrealised losses of EUR 1.5
million (EUR 0.8 million) were recognised from these participations.
Short-term investments
This item comprises investments with a maturity of up to one
year at the time of investment.
Fair value hierarchy
For the purposes of the disclosure requirements pursuant to
IFRS 7 “Financial Instruments: Disclosures”, the financial instruments
recognised at fair value in the balance sheet are to
be assigned to a three-level fair value hierarchy. This hierarchy,
which reflects characteristics of the price data and inputs
used for measurement purposes, is structured as follows:
– Level 1: Quoted prices (unadjusted) in active markets for
identical assets and liabilities.
– Level 2: Inputs used for measurement that are based on
observable market data and are not included within level 1.
This level includes, in particular, prices for comparable assets
and liabilities, prices on markets that are not considered
active as well as inputs derived from such prices or market
data.
– Level 3: Inputs used for measurement that are not based on
observable market data.
The following table shows the breakdown of the financial
instruments recognised at fair value into the three-level fair
value hierarchy.
Fair value hierarchy of financial instruments recognised at fair value
in EUR thousand
Notes
2010
Level 1 Level 2 Level 3 Total
Fixed-income securities 7,068,695 8,944,072 82,464 16,095,231
Equity securities 536,059 685 11 536,755
Other financial assets – at fair value
through profit or loss – 54,756 – 54,756
Other invested assets – 90,547 779,592 870,139
Short-term investments 1,557,049 13,453 – 1,570,502
Total assets measured at fair value 9,161,803 9,103,513 862,067 19,127,383
Other liabilities 1,755 75,451 – 77,206
Total liabilities measured at fair value 1,755 75,451 – 77,206
Hannover Re Group annual report 2010
5.1 investments under own management Notes
143