Annual Report 2010 - Hannover Re

Fair value hierarchy of financial instruments recognised at fair value
in EUR thousand
2009
Level 1 Level 2 Level 3 Total
Fixed-income securities 7,449,589 6,459,155 131,453 14,040,197
Equity securities 18,387 620 350 19,357
Other financial assets – at fair value
through profit or loss – 58,273 – 58,273
Other invested assets – – 576,807 576,807
Short-term investments 1,339,985 12,490 – 1,352,475
Total assets measured at fair value 8,807,961 6,530,538 708,610 16,047,109
Other liabilities 1,796 19,333 – 21,129
Total liabilities measured at fair value 1,796 19,333 – 21,129
In the year under review financial instruments with a fair value
of EUR 289.4 million were no longer allocable to level 1 – as
in the previous year – but rather to level 2. The reclassification
was necessary owing to the reduced liquidity of the instruments.
Financial instruments with a fair value of EUR 21.6
million, which in the previous year were recognised as level 2
instruments, were allocated to level 1 in the current reporting
period. The reclassifications principally affected fixed-income
securities carried as available for sale.
The following table provides a reconciliation of the fair values
of financial instruments included in level 3 at the beginning
of the financial year with the fair values as at 31 December of
the financial year.
Development of level 3 financial instruments in EUR thousand 2010
Fixed-income
securities
Equities, equity
funds and other
variable-yield
securities
Other invested
assets
Balance at 1 January of the year under review 131,453 350 576,807
Currency translation at 1 January of the year under review 9,453 1 29,348
Income and expenses
recognised in the statement of income 6,261 (514) (4,676)
recognised directly in shareholders' equity (354) 399 79,456
Additions 18,337 441 152,515
Disposals 78,790 666 56,458
Transfers to level 3 – – –
Transfers from level 3 – – –
Currency translation at 31 December of the year under review (3,896) – 2,600
Net book value at 31 December of the year under review 82,464 11 779,592
144 NOTES 5.1 investments under own management
Hannover Re Group annual report 2010