ANNUAL REPORT AND ACCOUNTS 2012 - RSA, Annual Report ...

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FINANCIAL CALENDAR 27 February 2013 Ex dividend date for the first preference share dividend for 2013. 1 March 2013 Record date for the first preference dividend for 2013. 2 April 2013 Payment date for the first preference dividend for 2013. 3 April 2013 Ex dividend date for the ordinary final dividend for 2012. 5 April 2013 Record date for the ordinary final dividend for 2012. 10 April 2013 Announcement of the scrip dividend price for the ordinary final dividend for 2012. 2 May 2013 Q1 2013 interim management statement. 3 May 2013 Deadline for the receipt of scrip dividend mandates by Equiniti in relation to the ordinary final dividend for 2012. 15 May 2013 Annual General Meeting. 24 May 2013 Payment date for the ordinary final dividend for 2012 (subject to shareholder approval at the AGM). 1 August 2013 * Announcement of the half year results for the six months ended 30 June 2013, the ordinary interim dividend for 2013 and the second preference dividend for 2013. 7 August 2013 * Ex dividend date for the second preference dividend for 2013. 9 August 2013 * Record date for the second preference dividend for 2013. 25 September 2013 * Ex dividend date for the ordinary interim dividend for 2013. 27 September 2013 * Record date for the ordinary interim dividend for 2013. 1 October 2013 * Payment date for the second preference dividend for 2013. 2 October 2013 * Announcement of the scrip dividend price for the ordinary interim dividend for 2013. 25 October 2013 * Deadline for the receipt of scrip dividend mandates by Equiniti in relation to the ordinary interim dividend for 2013. 7 November 2013 * Q3 2013 interim management statement. 22 November 2013 * Payment of the ordinary interim dividend for 2013. * Provisional date 150 | RSA | Annual Report and Accounts 2012
OTHER INFORMATION JARGON BUSTER Below is a simple explanation of some of the key technical terms used within this report. Term Affinity Bancassurance Capacity Capital Claims Frequency Claims Handling Expenses Claims Ratio (Loss Ratio) Claims Reserve (Provision for Losses and Loss Adjustment Expenses) Claims Severity Combined Operating Ratio (COR) Commission Commission Ratio Current Year Result Earned Premium Economic Capital Expense Ratio Exposure Financial Services Authority (FSA) Gross Written Premium (GWP) IBNR (Incurred but Not Reported) IGD Capital Requirement Insurance Result Net Asset Value (NAV) Definition • Selling insurance through a partner’s distribution network, usually to a group of similar customers, e.g. store card holders, alumni groups, unions and utility company customers. • Selling insurance through a bank’s distribution network. • Largest amount of insurance available from a company • Can also refer to the largest amount of insurance or reinsurance available in the marketplace. • The money invested in the Group. This includes the money invested by shareholders and profits retained within the Group. • Average number of claims per policy over the year. • The administrative cost of processing a claim (salary costs, costs of running claims centres, etc. and allocated shares of the costs of head office units). Not the cost of the claim itself. • Percentage of Net Earned Premiums which is paid out in claims and Claims Handling Expenses. • Reserve established by the Group to reflect the estimated cost of claims payments and related expenses that we estimate we will ultimately be required to pay. • Average cost of claims incurred over the period. • The sum of the Claims Ratio and Expense Ratio • Measures how much we pay out in claims and expenses for each unit of net premium received • A COR of less than 100% indicates that we are writing profitable business • Calculated as: Net Incurred Claims + Expenses (including commissions) % % Net Earned Premiums Net Written Premiums • An amount paid to an intermediary such as a broker for generating business. • Ratio of net commission costs to Net Written Premiums. • The underwriting profit or loss earned from business for which protection has been provided in the current financial period. • The portion of an insurance premium for which we have already provided protection. • The Group’s assessment of the capital we must hold to have a high confidence of meeting our obligations given our risk appetite. • Percentage of Net Written Premiums which is paid out in operating expenses e.g. salaries, premises costs, etc. The ratio does not include claims related expenses but can include or exclude commissions. • A measurement of risk we are exposed to through the premiums we have written. For example, in motor insurance one vehicle insured for one year is one unit of exposure. • The regulatory authority for the UK financial services industry (or its successor(s) for the UK insurance industry). • Total premium written or processed in the period, irrespective of whether it has been paid. • A reserve for accidents or incidents that have occurred but which have not yet been reported to us. • Insurance Groups Directive capital is the capital the Group is required to hold based on standard calculations defined by the FSA under the EU Solvency 1 directive. • This is a measure of how well we have done, including both our underwriting result and investment performance. • The value of the Group calculated by subtracting our total liabilities including loan capital from our total assets. This represents the funds that would be available to ordinary shareholders if the Group were wound up. Annual Report and Accounts 2012 | RSA | 151
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ANNUAL REPORT AND ACCOUNTS 2012
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INTRODUCTION This Annual Report and
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INTRODUCTION CANADA 19% of 2012 Gro
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INTRODUCTION PAY CLAIMS INVEST PRUD
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BUSINESS REVIEW 8 Chairman’s Stat
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BUSINESS REVIEW This striving for e
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BUSINESS REVIEW OUR STRATEGY I am c
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BUSINESS REVIEW • Can we differen
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BUSINESS REVIEW FINANCIAL HIGHLIGHT
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BUSINESS REVIEW INVESTMENT RESULT 2
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BUSINESS REVIEW CUSTOMER We are com
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BUSINESS REVIEW MARKET CONDITIONS C
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BUSINESS REVIEW European Specialty
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BUSINESS REVIEW MARKET CONDITIONS I
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BUSINESS REVIEW PRINCIPLES Simple o
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BUSINESS REVIEW PRINCIPAL UNCERTAIN
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BUSINESS REVIEW analysis by Forum f
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BUSINESS REVIEW Our Impacts We unde
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CORPORATE GOVERNANCE 36 Board of Di
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CORPORATE GOVERNANCE NOEL HARWERTH
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CORPORATE GOVERNANCE MIKE HOLLIDAY-
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CORPORATE GOVERNANCE The attendance
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CORPORATE GOVERNANCE operational pe
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CORPORATE GOVERNANCE European Econo
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CORPORATE GOVERNANCE Substantial Sh
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CORPORATE GOVERNANCE The Group is c
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CORPORATE GOVERNANCE The Directors
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CORPORATE GOVERNANCE SECTION 1 - GR
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CORPORATE GOVERNANCE 4. Other mater
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CORPORATE GOVERNANCE SECTION 7 - AU
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CORPORATE GOVERNANCE Options 1999 E
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CORPORATE GOVERNANCE Sharebuild The
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FINANCIAL STATEMENTS 74 Directors
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FINANCIAL STATEMENTS INDEPENDENT AU
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FINANCIAL STATEMENTS CONSOLIDATED S
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FINANCIAL STATEMENTS CONSOLIDATED S
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FINANCIAL STATEMENTS Associates Ass
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FINANCIAL STATEMENTS and the revers
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FINANCIAL STATEMENTS financial liab
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FINANCIAL STATEMENTS Unless otherwi
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FINANCIAL STATEMENTS Uncertainties
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FINANCIAL STATEMENTS Foreign exchan
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FINANCIAL STATEMENTS Reserves - an
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FINANCIAL STATEMENTS The following
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FINANCIAL STATEMENTS At 31 December
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