Erste Bank JPMorgan Merrill Lynch International

Expenses for insurance claims
The following table provides an overview of the expenses for insurance claims for the periods
presented:
Fiscal year ended December 31,
2007 2006
(in EUR million)
2005
Payments for insurance claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,162.6 2,561.6 2,149.0
Change in the provision for outstanding insurance claims . . . . . . . . . . . 225.9 146.9 130.2
Other (1)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,643.0 1,504.8 1,339.2
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,031.5 4,213.3 3,618.4
(1) Includes changes in actuarial reserves, changes in other technical reserves and expenses for
the refund of premiums dependent and not dependent on profit.
The increase in expenditures for insurance claims from EUR 3,618.4 million in fiscal year 2005 to
EUR 4,213.3 million in fiscal year 2006 was primarily due to an increase in payments in the property
and casualty area, which rose from EUR 1,053.9 million to EUR 1,362.0 million. This change resulted
from the expansion of the scope of consolidation, as well as snow-load and flood losses, primarily in
Austria and the Czech Republic. In addition, payments in the life insurance area increased. This was
also primarily due to the expansion of the scope of consolidation. The change in the provision for
outstanding insurance claims in the property and casualty area results from an increased volume of
business and the natural catastrophes mentioned above, while the decrease in the provision for
outstanding claims in the life insurance area was due to a reduction in the number of unsettled loss
events.
The increase in expenses for insurance claims from EUR 4,213.3 million in fiscal year 2006 to
EUR 5,031.5 million in fiscal year 2007 was primarily due to an increase in payments in the life
insurance area, which rose from EUR 996.7 million to EUR 1,424.5 million. This change resulted from
first time full consolidation of BA-CA Versicherung and an increase in expirations of life insurance
contracts in Austria. In addition payments in the property and casualty insurance area increased,
mainly due to the increase in the scope of consolidation and the strong organic growth in the last year.
The change in the provision for outstanding insurance claims in the property and casualty area results
from an increased volume of business and the increase in natural catastrophes. The increase in the
provision for outstanding claims in the life insurance area was due to an increase in the number of
unsettled loss events.
Operating expenses
The following table provides an overview of operating expenses for the periods presented:
Fiscal year ended December 31,
2007 2006
(in EUR million)
2005
Commissions and other acquisition costs . . . . . . . . . . . . . . . . . . . . . . . . 1,194.1 1,026.1 798.6
Administrative costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 334.2 293.8 266.7
Reinsurance commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -183.2 -183.5 -173.5
Operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,345.1 1,136.4 891.8
The increase in operating expenses from EUR 891.8 million in fiscal year 2005 to EUR 1,136.4 million
in fiscal year 2006 was primarily due to higher commission expenses for property and casualty
insurance and life insurance resulting from an increase in new business. In addition, an increase in
personnel expenses was recorded in the property and casualty area due to an expansion of the scope
of consolidation and the field sales force.
The increase in operating expenses from EUR 1,136.4 million in fiscal year 2006 to
EUR 1,345.1 million in fiscal year 2007 was primarily due to higher commission expenses for property
and casualty insurance and life insurance resulting from an increase in new business. In addition, an
increase in administrative costs was recorded in the property and casualty area due to an expansion
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