01 Gothaer Konzern_E_09_Umschl - Gothaer Allgemeine ...

Management Report
Claims The following table shows the changes in Gothaer Allgemeine Versicherung AG loss
ratios and run-off results over the past 10 years across all fields of business and net of
reinsurance on the basis of IFRS.
Risks arising from
reinsurance assumed
Risk management
methods in the
Property/Casualty
segment
Developments as %
Loss ratio
after run-off
Run-off results
of initial reserves
2000 74.3 5.0
2001 68.3 8.9
2002 76.9 1.3
2003 63.8 2.5
2004 59.3 5.4
2005 64.3 –2.3
2006 59.8 4.5
2007 66.9 0.9
2008 59.5 10.0
2009 65.6 3.3
A detailed year-by-year review of the run-off of our gross primary business by year of
occurrence, without allowance for annuity reserves, is provided in the notes to the
consolidated financial statements, in the section devoted to loss reserves.
We act as a reinsurer for a number of cooperation partners. This activity predominantly
involves small business and private client lines. Terms are negotiated annually and are
in line with current market conditions.
Forecast and change risk in the estimation of reserves
Wherever a model is used, there is a risk that actual results will deviate from projections.
In the case of reserves, however, underestimation needs to be avoided, so a safety
margin is applied. To enable the appropriateness of a safety margin to be assessed, the
variability of the estimate is established by bootstrapping. This provides a basis for
quantifying the certainty of the IFRS reserve being enough to cover possible losses,
expenses and annuity payments.
Factors that cannot be adequately assessed by the models used to calculate reserves are
taken into account separately as follows:
• individual major loss analysis: where necessary, individual major loss reserves are
included in the reserve calculation results
• detailed analysis of accumulation loss events, taking account of time of occurrence
and previous run-off and comparing them with such events in the past
• detailed analysis of sublines in areas where portfolio shifts have occurred.
68 Gothaer Group Annual Report 2009