01 Gothaer Konzern_E_09_Umschl - Gothaer Allgemeine ...

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01 Gothaer Konzern_E_09_Umschl - Gothaer Allgemeine ...

Performance

of the companies

Management Report

Due to the lower investment result, reductions were seen in both the operating result for

the segment, which decreased from €218.1 million to €116.8 million, and net profit for

the year after transfer of profit, which fell from €64.1 million to €–15.3 million. However,

the profit transferred by Gothaer Finanzholding to Group parent Gothaer Versicherungsbank

VVaG remained on a par with the prior year at €121.0 million (PY: €118.0 million).

Gothaer Finanzholding AG (German Commercial Code) €million

2009 2008

Gross premiums written 0.5 0.6

Earned premiums net of reinsurance 0.5 0.6

Investments incl. deposits retained on assumed business 1,585.9 1,613.1

Investment result 148.7 152.6

Net yield 9.3 % 9.4 %

Net profit for the year prior to transfer of profit 121.0 118.0

Equity 764.9 724.9

Underwriting reserves 283.8 318.2

Gothaer Finanzholding AG is responsible for the financial management of the Gothaer

Group. In this capacity, it holds the shares in joint-stock insurance companies and other

major Group subsidiaries and associates. Since the suspension of active reinsurance

operations and the merger of Gothaer Rückversicherung AG with Gothaer Finanzholding

AG in 2004, the company has also been responsible for run-off liabilities and obligations

in connection with reinsurance treaties.

Gross premiums written decreased as anticipated to €0.5 million (PY: €0.6 million).

Earned premiums from retained business, at €0.5 million, remained at the same level

(PY: €0.6 million). These premiums mostly comprised pipeline premiums.

Owing to our conservative reserving policy, the run-off result net of reinsurance was

positive, totalling €1.7 million Euro (PY: €–1.4 million). As in prior years, the adequacy

of the loss reserves was verified and confirmed by actuarial methods.

Gross underwriting expenses consisted mainly of bonuses and internal administrative

costs, decreased sharply again in line with premiums. Bonus and commission expenses

totalled €1.0 million (PY: €0.1 million). As a result of further reductions in HR and

material costs, internal administrative costs decreased to €1.7 million (PY: €2.1 million).

The underwriting result net of reinsurance before adjustment of equalization reserves

was €0.7 million (PY: €–1.8 million). With the approval of the Federal Financial Supervisory

Authority, the equalization reserves are being reversed evenly over a period of

five years. In 2009, they were reduced accordingly for the fifth time by the sum of

€12.3 million, which was recognized in income. As a result, the underwriting account

showed income of €13.0 million net of reinsurance (PY: €10.5 million).

Gothaer Group Annual Report 2009 59

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