Actuarial reserves

Actuarial reserves are the reserves set aside to cover current life insurance policies.

Annual premium equivalent

The annual premium equivalent (APE) is the insurance industry standard for measuring the volume of new life insurance business. It is calculated as the sum of the annual premiums earned from new business plus 10 per cent of the single premiums received during the reporting period.

Assets managed for third parties

These are assets held in trust for clients and partners.


“Baloise” stands for “the Baloise Group”, and “Bâloise Holding” means “Bâloise Holding Ltd”. Baloise shares are the shares of Bâloise Holding Ltd.


Insurance brokers are independent intermediaries. These are firms or individuals who are not restricted to any particular insurance companies when selling insurance products. They are paid commission for the insurance policies that they sell.

Business volume

The total volume of business comprises the premium income earned from non-life and life insurance and from investment-linked life insurance policies during the reporting period. The accounting principles used by the Baloise Group do not allow premium income earned from investment-linked life insurance to be reported as revenue in the consolidated financial statements.

Claims incurred

Claims incurred comprise the amounts paid out for claims during the financial year, the reserves set aside to cover unsettled claims, the reversal of reserves for claims that no longer have to be settled or do not have to be paid in full, the costs incurred by the processing of claims, and changes in related reserves.

Claims ratio

The total cost of claims settled as a percentage of total premiums.

Claims reserve

A reserve for claims that have not been settled by the end of the year.

Combined ratio

A non-life insurance ratio that is defined as the sum of the cost of claims settled (claims ratio), total expenses (expense ratio) and profit sharing (profit-sharing ratio) as a percentage of total premiums. This ratio is used to gauge the profitability of non-life insurance business.

Deferred taxes

Probable future tax expenses and tax benefits arising from temporary differences between the carrying amounts of as- sets and liabilities recognised in the consolidated financial statements and the corresponding amounts reported for tax purposes. The pertinent calculations are based on country-specific tax rates.

Embedded value

The market-consistent embedded value (MCEV) measures the value of a life insurance portfolio for shareholders at the balance sheet date. Please also refer to the separate MCEV report.

Expense ratio

Non-life insurance business expenses as a percentage of total premiums.

Fixed-income securities

Securities (primarily bonds) that yield a fixed rate of interest throughout their term to maturity.


The gross figures shown on the balance sheet or income statement in an insurance company’s annual report are stated before deduction of reinsurance.

Group life business

Insurance policies taken out by companies or their employee benefit units for the occupational pension plans of their entire workforce.

International Financial Reporting Standards

Since 2000 the Baloise Group has been preparing its consolidated financial statements in compliance with International Financial Reporting Standards (IFRS), which were previously called International Accounting Standards (IAS).


An asset write-down that is recognised in profit or loss. An impairment test is carried out to ascertain whether an asset’s carrying amount is higher than its recoverable amount. If this is the case, the asset is written down to its recoverable amount and a corresponding impairment loss is recognised in the income statement.

Insurance benefit

The benefits provided by the insurer in connection with the occurrence of an insured event.


Investments comprise investment property, equities and alternative financial assets (financial instruments with characteristics of equity), fixed-income securities (financial instruments with characteristics of liabilities), mortgage assets, policy loans and other loans, derivatives, and cash and cash equivalents. Precious metals in connection with investment-linked insurance are reported as “other assets”.

Investment-linked life insurance

Life insurance policies under which policyholders invest their savings for their own account and at their own risk.

Investment-linked premium

Premium income from life insurance policies under which the insurance company invests the policyholder’s savings for the latter’s own account and at his or her own risk. The International Financial Reporting Standards applied by the Baloise Group do not allow the savings component of this premium income to be recognised as revenue on the income statement.

Legal quota

A legally or contractually binding percentage requiring life insurance companies to pass on a certain share of their profits to their policyholders.

Minimum interest rate

The minimum guaranteed interest rate paid to savers under occupational pension plans.

Operating segments

Similar or related business activities are grouped together in operating segments. The Baloise Group’s operating segments are Non-Life, Life, Banking (which includes asset management), and Other Activities. The “Other Activities” operating segment includes equity investment companies, real estate firms and financing companies.


The net figures shown on the balance sheet or income statement in an insurance company’s annual report are stated after deduction of reinsurance.

New business margin

The value of new business divided by the annual premium equivalent (APE).

Performance of investments

Performance in this context is defined as the rates of return that Baloise generates from its investments. It constitutes the gains, losses, income and expenses recognised in the income statement plus changes in unrealised gains and losses as a percentage of the average portfolio of investments held.

Periodic premium

Periodically recurring premium income (see definition of “premium”).

Policyholder’s dividend

An annual, non-guaranteed benefit paid to life insurance policyholders if the revenue generated by their policies is higher and / or the risks and costs associated with their policies are lower than the assumptions on which the calculation of their premiums was based.


The amount paid by the policyholder to cover the cost of insurance.

Premium earned

The proportion of the policy premium available to cover the risk insured during the financial year, i.e. the premium minus changes in unearned premium reserves.

Profit after taxes

Profit after taxes is the consolidated net result of all income and expenses, minus all borrowing costs as well as current and deferred income taxes. Profit after taxes includes non-controlling  interests.

Profit-sharing ratio

Total profit sharing as a percentage of total premiums; profit sharing is defined as the reimbursement of amounts to non- life policyholders to reflect the profitability of insurance policies.


If an insurance company itself does not wish to bear the full risk arising from an insurance policy or an entire portfolio of policies, it passes on part of the risk to a reinsurance company or another direct insurer. However, the primary insurer still has to indemnify the policyholder for the full risk in all cases.


A measurement of future insurance benefit obligations arising from known and unknown claims that are reported as liabilities on the balance sheet.

Return on equity

A calculation of the percentage return earned on a company’s equity capital during a financial year; it represents the profit generated in a given financial year divided by the company’s average equity during that period.

Risk scoring

Risk scoring uses analytical statistical methods to derive risk assessments from collected data based on empirical values. Insurance companies use this kind of scoring to ensure that the premiums they charge reflect the risks involved.

Run-off business

An insurance policy portfolio that has ceased to accept new policies and whose existing policies are gradually expiring.


Financial reporting in the Baloise Group is carried out in accordance with International Financial Reporting Standards (IFRSs), which require similar transactions and business activities to be grouped and presented together. These aggregated operating activities are presented in “segments”, broken down by geographic region and business line.

Share buy-back programme

Procedure approved by the Board of Directors under which Baloise can repurchase its own outstanding shares. Companies in Switzerland open a separate trading line in order to carry out such buy-backs.

Shares issued

The total number of shares that a company has issued; multiplying the total number of shares in issue by their face value gives the company’s nominal share capital.

Single premium

Single premiums are used to finance life insurance policies at their inception in the form of a one-off payment. They are mainly used to fund wealth-building life insurance policies, with the prime focus on investment returns and safety.

Swiss Leader Index

The Swiss Leader Index (SLI) comprises the 30 largest and most liquid equities on the Swiss stock market.


Minimum capital requirements that the regulatory authorities impose on insurance companies in order to cover their business risks (investments and claims). These requirements are usually specified at a national level and may vary from country to country.

Technical reserve

Insurers disclose on their balance sheets the value of the benefits that they expect to have to provide in future under their existing insurance contracts. This value is calculated from a current perspective in accordance with generally accepted principles.

Technical result

Baloise calculates its technical result by netting all income and expenses arising from its insurance business. Its technical result does not include income and expenses unrelated to its insurance business or the net gains or losses on its investments.

Unearned premium reserves

Deferred income arising from premiums that have already been paid for periods after the balance sheet date.

Unrealised gains and losses (recognised directly in equity)

Unrealised gains and losses are increases or decreases in value that are not recognised in profit or loss and arise from the measurement of assets. They are recognised directly in equity after deduction of deferred policyholders’ dividends (life insurance) and deferred taxes. These gains or losses are only taken to income if the underlying asset is sold or if impairment losses are recognised.

Value of new business

The value added by new business transacted during the reporting period; this figure is measured at the time the policy is issued.