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Annual Report 2024
Annual Report 2024
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16 Insurance and Investment Contracts with Discretionary Participation

Insurance contracts and investment contracts with DPF issued presented in the consolidated balance sheet

In CHF million
    Assets   Liabilities
    31.12.2024   31.12.2023   31.12.2024   31.12.2023
VFA life   5   4   –158 279   –155 676
of which prepaid acquisition costs and premiums   5   4   3   0
BBA life   –   –   –1 132   –1 148
of which prepaid acquisition costs and premiums, prepaid deposits under reinsurance issued   –   –   –   –
PAA life   –   9   –2 767   –2 213
of which prepaid acquisition costs and premiums, prepaid deposits under reinsurance issued   –   –   –2   –1
PAA health and protection   –   –   –303   –198
of which prepaid acquisition costs and premiums, prepaid deposits under reinsurance issued   –   –   116   133
PAA non-life   –   –   –597   –595
of which prepaid acquisition costs and premiums, prepaid deposits under reinsurance issued   –   –   –   –
Total   5   13   –163 079   –159 830
of which prepaid acquisition costs and premiums, prepaid deposits under reinsurance issued   5   4   117   132

Reinsurance contracts held presented in the consolidated balance sheet

In CHF million
    Assets   Liabilities
    31.12.2024   31.12.2023   31.12.2024   31.12.2023
BBA   403   623   –24   –17
PAA   1 677   1 456   0   –1
Total   2 080   2 079   –24   –18
Contractual service margin

The following table shows the contractual service margin of insurance contracts and investment contracts with DPF broken down by measurement model.

Contractual service margin of insurance contracts and investment contracts with DPF issued

In CHF million
    31.12.2024   31.12.2023
VFA life   13 639   14 753
BBA life   715   650
BBA reinsurance contracts held   –87   –69
Total   14 267   15 333

The following tables illustrate when the Group expects to recognise the remaining CSM in profit or loss.

In CHF million
    1–5 years   6–10 years   11–15 years   16–20 years   21–30 years   More than 30 years   Total
                             
For the year 2024                            
VFA life   4 030   3 023   2 216   1 606   1 946   817   13 639
BBA life   225   159   118   87   90   37   715
Reinsurance contracts held   –39   –20   –12   –8   –7   –2   –87
Total   4 215   3 162   2 323   1 686   2 029   852   14 267
                             
For the year 2023                            
VFA life   4 536   3 277   2 349   1 681   2 034   875   14 753
BBA life   212   146   107   78   80   26   650
Reinsurance contracts held   –32   –16   –9   –6   –5   –1   –69
Total   4 716   3 407   2 448   1 753   2 109   900   15 333

The following table shows total net finance income/expenses from insurance and investment contracts with DPF and reinsurance contracts held. These amounts are primarily recognised in relation to the fair value return of underlying items of the VFA contracts.

In CHF million
    Net finance income/expenses from insurance contracts and investment contracts with DPF   Net finance income/expenses from reinsurance contracts held
    2024   2023   2024   2023
Recognised in profit or loss   –5 372   –4 757   49   38
Recognised in OCI   –422   –5 272   43   74
Total   –5 794   –10 029   93   112

The following reconciliations show how the net carrying amounts of insurance and reinsurance contracts changed during the year as a result of cash flows and amounts recognised in the statement of profit or loss and other comprehensive income. For each measurement model, the Group presents a table that separately analyses movements in the liabilities for remaining coverage and movements in the liabilities for incurred claims and reconciles these movements to the line items in the consolidated statement of income and the consolidated statement of other comprehensive income. A second reconciliation is presented for contracts not measured under the PAA, which separately analyses changes in the estimates of the present value of future cash flows, the risk adjustment for non-financial risk and the CSM.

Life insurance contracts and investment contracts with DPF issued under VFA – analysis by measurement component for the year 2024

In CHF million
    Estimates of present value of future cash flows   Risk adjustment for non-financial risk   CSM: Contracts under modified retrospective approach   CSM: Other contracts   Total
Opening insurance contract assets   0   –   –   –   0
Opening insurance contract liabilities   –140 646   –278   –13 283   –1 470   –155 676
Net opening balance   –140 646   –278   –13 283   –1 470   –155 676
Cash flows incurred before or at initial recognition   4   –   –   –   4
Changes that relate to current services                    
CSM recognised for services provided   –   –   960   112   1 072
Change in risk adjustment for non-financial risk for risk expired   –   16   –   –   16
Changes that relate to future services                    
Contracts initially recognised in the year   644   –17   –   –628   –
Changes in estimates that adjust the CSM   –6 286   13   5 312   961   –
Changes in estimates that result in losses or reversal of losses on onerous contracts   0   –   –   –   0
Changes that relate to past services                    
Adjustments to liabilities for incurred claims   –180   –   –   –   –180
Insurance service result   –5 822   12   6 273   445   907
Net finance income/expenses from insurance contracts   2   –   –4 323   –1 229   –5 550
Foreign currency translation differences   –543   –1   –49   –3   –596
Total changes in the statement of profit or loss and OCI   –6 363   10   1 901   –787   –5 239
Cash in- and outflows for the period   2 629   –   –   –   2 629
Net closing balance   –144 376   –267   –11 383   –2 256   –158 282
Closing insurance contract assets   0   –   –   –   0
Closing insurance contract liabilities   –144 376   –267   –11 383   –2 256   –158 282

Life insurance contracts and investment contracts with DPF issued under VFA – analysis by measurement component for the year 2023

In CHF million
    Estimates of present value of future cash flows   Risk adjustment for non-financial risk   CSM: Contracts under modified retrospective approach   CSM: Other contracts   Total
Opening insurance contract assets   0   –   –   –   0
Opening insurance contract liabilities   –136 363   –290   –15 075   –742   –152 470
Net opening balance   –136 363   –290   –15 075   –742   –152 470
Cash flows incurred before or at initial recognition   5   –   –   –   5
Changes that relate to current services                    
CSM recognised for services provided   –   –   1 164   67   1 231
Change in risk adjustment for non-financial risk for risk expired   –   18   –   –   18
Changes that relate to future services                    
Contracts initially recognised in the year   616   –15   –   –601   –
Changes in estimates that adjust the CSM   –9 770   2   8 905   863   –
Changes in estimates that result in losses or reversal of losses on onerous contracts   0   –   –   –   0
Changes that relate to past services                    
Adjustments to liabilities for incurred claims   –69   –   –   –   –69
Insurance service result   –9 223   4   10 068   331   1 180
Net finance income/expenses from insurance contracts   2   –   –8 521   –1 101   –9 620
Foreign currency translation differences   2 999   8   246   43   3 296
Total changes in the statement of profit or loss and OCI   –6 222   12   1 793   –727   –5 145
Cash in- and outflows for the period   1 934   –   –   –   1 934
Net closing balance   –140 646   –278   –13 283   –1 470   –155 676
Closing insurance contract assets   0   –   –   –   0
Closing insurance contract liabilities   –140 646   –278   –13 283   –1 470   –155 676

Life insurance contracts and investment contracts with DPF issued under VFA – analysis by remaining coverage and incurred claims for the year 2024

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component        
Opening insurance contract assets   0   –   –   0
Opening insurance contract liabilities   –154 329   0   –1 347   –155 676
Net opening balance   –154 329   0   –1 347   –155 676
Cash flows incurred before or at initial recognition   4   –   –   4
Changes in the statement of profit or loss and OCI                
Insurance revenue                
Contracts under the modified retrospective approach   4 203   –   –   4 203
Other contracts   350   –   –   350
Insurance service expenses                
Incurred claims and other insurance service expenses   –   –   –3 189   –3 189
Amortisation of insurance acquisition cash flows   –276   –   –   –276
Losses and reversal of losses on onerous contracts   –   0   –   0
Adjustments to liabilities for incurred claims   –   –   –180   –180
Insurance service result   4 276   0   –3 369   907
Net finance income/expenses from insurance contracts   –5 550   –   –   –5 550
Foreign currency translation differences   –594   0   –3   –596
Total changes in the statement of profit or loss and OCI   –1 867   0   –3 371   –5 239
Investment components   14 252   –   –14 252   –
Cash flows                
Premiums received   –15 580   –   –   –15 580
Claims and other insurance service expenses paid   –   –   17 631   17 631
Insurance acquisition cash flows   579   –   –   579
Total cash flows   –15 001   –   17 631   2 629
Net closing balance   –156 942   0   –1 340   –158 282
Closing insurance contract assets   0   –   –   0
Closing insurance contract liabilities   –156 942   0   –1 340   –158 282

Life insurance contracts and investment contracts with DPF issued under VFA – analysis by remaining coverage and incurred claims for the year 2023

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component        
Opening insurance contract assets   0   –   –   0
Opening insurance contract liabilities   –151 254   –   –1 216   –152 470
Net opening balance   –151 254   –   –1 216   –152 470
Cash flows incurred before or at initial recognition   5   –   –   5
Changes in the statement of profit or loss and OCI                
Insurance revenue                
Contracts under the modified retrospective approach   4 244   –   –   4 244
Other contracts   516   –   –   516
Insurance service expenses                
Incurred claims and other insurance service expenses   –   –   –3 228   –3 228
Amortisation of insurance acquisition cash flows   –283   –   –   –283
Losses and reversal of losses on onerous contracts   –   0   –   0
Adjustments to liabilities for incurred claims   –   –   –69   –69
Insurance service result   4 477   0   –3 297   1 180
Net finance income/expenses from insurance contracts   –9 620   –   –   –9 620
Foreign currency translation differences   3 282   0   14   3 296
Total changes in the statement of profit or loss and OCI   –1 862   0   –3 283   –5 145
Investment components    12 669   –   –12 669   –
Cash flows                
Premiums received   –14 442   –   –   –14 442
Claims and other insurance service expenses paid   –   –   15 821   15 821
Insurance acquisition cash flows   555   –   –   555
Total cash flows   –13 888   –   15 822   1 934
Net closing balance   –154 329   0   –1 347   –155 676
Closing insurance contract assets   0   –   –   0
Closing insurance contract liabilities   –154 329   0   –1 347   –155 676

Life insurance contracts issued under BBA – analysis by measurement component for the year 2024

In CHF million
    Estimates of present value of future cash flows   Risk adjustment for non-financial risk   CSM: Contracts under modified retrospective approach   CSM: Other contracts   Total
Opening insurance contract assets   –   –   –   –   –
Opening insurance contract liabilities   –461   –36   –439   –211   –1 148
Net opening balance   –461   –36   –439   –211   –1 148
Cash flows incurred before or at initial recognition   –   –   –   –   –
Changes that relate to current services                    
CSM recognised for services provided   –   –   39   15   54
Change in risk adjustment for non-financial risk for risk expired   –   2   –   –   2
Experience adjustments   18   –   –   –   18
Changes that relate to future services                    
Contracts initially recognised in the year   70   –5   –   –65   0
Changes in estimates that adjust the CSM   1   5   –7   1   –
Changes in estimates that result in losses or reversal of losses on onerous contracts   1   0   –   –   1
Changes that relate to past services                    
Adjustments to liabilities for incurred claims   –43   0   –   –   –43
Insurance service result   48   1   33   –50   32
Net finance income/expenses from insurance contracts   –77   2   –12   –4   –91
Foreign currency translation differences   13   –2   –22   –10   –21
Total changes in the statement of profit or loss and OCI   –16   2   –1   –64   –80
Cash in- and outflows for the period   95   –   –   –   95
Net closing balance   –382   –35   –439   –276   –1 132
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   –382   –35   –439   –276   –1 132

Life insurance contracts issued under BBA – analysis by measurement component for the year 2023

In CHF million
    Estimates of present value of future cash flows   Risk adjustment for non-financial risk   CSM: Contracts under modified retrospective approach   CSM: Other contracts   Total
Opening insurance contract assets   0   –   –   –   0
Opening insurance contract liabilities   –395   –33   –394   –173   –995
Net opening balance   –395   –33   –394   –173   –995
Changes that relate to current services                    
CSM recognised for services provided   –   –   42   11   53
Change in risk adjustment for non-financial risk for risk expired   –   2   –   –   2
Experience adjustments   71   –   –   –   71
Changes that relate to future services                    
Contracts initially recognised in the year   42   –3   –   –40   –1
Changes in estimates that adjust the CSM   118   –1   –96   –21   –
Changes in estimates that result in losses or reversal of losses on onerous contracts   –2   0   –   –   –2
Changes that relate to past services                    
Adjustments to liabilities for incurred claims   –36   0   –   –   –36
Insurance service result   193   –2   –55   –49   87
Net finance income/expenses from insurance contracts   –64   –3   –10   –2   –79
Foreign currency translation differences   18   2   21   12   53
Total changes in the statement of profit or loss and OCI   146   –3   –44   –39   61
Cash in- and outflows for the period   –213   –   –   –   –213
Net closing balance   –461   –36   –439   –211   –1 148
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   –461   –36   –439   –211   –1 148

Life insurance contracts issued under BBA – analysis by remaining coverage and incurred claims for the year 2024

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component        
Opening insurance contract assets   –   –   –   –
Opening insurance contract liabilities   –858   –16   –274   –1 148
Net opening balance   –858   –16   –274   –1 148
Cash flows incurred before or at initial recognition   –   –   –   –
Changes in the statement of profit or loss and OCI                
Insurance revenue                
Contracts under the modified retrospective approach   428   –   –   428
Other contracts   301   –   –   301
Insurance service expenses                
Incurred claims and other insurance service expenses   –   –   –617   –617
Amortisation of insurance acquisition cash flows   –38   –   –   –38
Losses and reversal of losses on onerous contracts   –   1   –   1
Adjustments to liabilities for incurred claims   –   –   –43   –43
Insurance service result   692   1   –660   32
Net finance income/expenses from insurance contracts   –88   0   –3   –91
Foreign currency translation differences   –5   –1   –15   –21
Total changes in the statement of profit or loss and OCI   599   0   –679   –80
Investment components   10   –   –10   –
Cash flows                
Premiums received   –598   –   –   –598
Claims and other insurance service expenses paid   –   –   653   653
Insurance acquisition cash flows   40   –   –   40
Total cash flows   –558   –   653   95
Net closing balance   –807   –16   –309   –1 132
Closing insurance contract assets   –   –   –   –
Closing insurance contract liabilities   –807   –16   –309   –1 132

Life insurance contracts issued under BBA – analysis by remaining coverage and incurred claims for the year 2023

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component        
Opening insurance contract assets   0   –   –   0
Opening insurance contract liabilities   –709   –14   –273   –995
Net opening balance   –709   –14   –273   –995
Changes in the statement of profit or loss and OCI                
Insurance revenue                
Contracts under the modified retrospective approach   375   –   –   375
Other contracts   403   –   –   403
Insurance service expenses                
Incurred claims and other insurance service expenses   –   –   –615   –615
Amortisation of insurance acquisition cash flows   –37   –   –   –37
Losses and reversal of losses on onerous contracts   –   –3   –   –3
Adjustments to liabilities for incurred claims   –   –   –36   –36
Insurance service result   741   –3   –651   87
Net finance income/expenses from insurance contracts   –74   0   –5   –79
Foreign currency translation differences   38   1   14   53
Total changes in the statement of profit or loss and OCI   706   –2   –643   61
Investment components   12   –   –12   –
Cash flows                
Premiums received   –923   –   –   –923
Claims and other insurance service expenses paid   –   –   655   655
Insurance acquisition cash flows   56   –   –   56
Total cash flows   –868   –   655   –213
Net closing balance   –858   –16   –274   –1 148
Closing insurance contract assets   –   –   –   –
Closing insurance contract liabilities   –858   –16   –274   –1 148

Life insurance contracts issued under PAA – analysis by remaining coverage and incurred claims for the year 2024

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component   Present value of future cash flows   Risk adjustment for non-financial risk    
Opening insurance contract assets   35   –   –26   –   9
Opening insurance contract liabilities   74   –   –2 281   –5   –2 212
Net opening balance   109   –   –2 307   –5   –2 203
Cash flows incurred before or at initial recognition   0   –   –   –   0
Changes in the statement of profit or loss and OCI                    
Insurance revenue   1 456   –   –   –   1 456
Insurance service expenses                    
Incurred claims and other insurance service expenses   –   –   –1 250   –5   –1 255
Amortisation of insurance acquisition cash flows   –73   –   –   –   –73
Adjustments to liabilities for incurred claims   –   –   13   2   15
Insurance service result   1 384   –   –1 236   –3   144
Net finance income/expenses from insurance contracts   –   –   –122   0   –122
Foreign currency translation differences   –3   –   –16   0   –19
Total changes in the statement of profit or loss and OCI   1 380   –   –1 375   –3   3
Cash flows                    
Premiums received   –1 519   –   –   –   –1 519
Claims and other insurance service expenses paid   –   –   880   –   880
Insurance acquisition cash flows   73   –   –   –   73
Total cash flows   –1 446   –   880   –   –566
Net closing balance   44   –   –2 801   –8   –2 765
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   44   –   –2 801   –8   –2 765

Life insurance contracts issued under PAA – analysis by remaining coverage and incurred claims for the year 2023

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component   Present value of future cash flows   Risk adjustment for non-financial risk    
Opening insurance contract assets   –   –   –   –   –
Opening insurance contract liabilities   –21   –   –1 786   –4   –1 811
Net opening balance   –21   –   –1 786   –4   –1 811
Cash flows incurred before or at initial recognition   –36   –   –   –   –36
Changes in the statement of profit or loss and OCI                    
Insurance revenue   1 341   –   –   –   1 341
Insurance service expenses                    
Incurred claims and other insurance service expenses   –   –   –1 134   –2   –1 136
Amortisation of insurance acquisition cash flows   –62   –   –   –   –62
Adjustments to liabilities for incurred claims   –   –   –36   0   –36
Insurance service result   1 280   –   –1 170   –1   108
Net finance income/expenses from insurance contracts   –   –   –113   0   –113
Foreign currency translation differences   –1   –   110   0   109
Total changes in the statement of profit or loss and OCI   1 279   –   –1 173   –1   104
Cash flows                    
Premiums received   –1 174   –   –   –   –1 174
Claims and other insurance service expenses paid   –   –   653   –   653
Insurance acquisition cash flows   61   –   –   –   61
Total cash flows   –1 113   –   653   –   –459
Net closing balance   109   –   –2 307   –5   –2 203
Closing insurance contract assets   35   –   –26   –   9
Closing insurance contract liabilities   74   –   –2 281   –5   –2 212

Health and protection insurance contracts issued under PAA – analysis by remaining coverage and incurred claims for the year 2024

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component   Present value of future cash flows   Risk adjustment for non-financial risk    
Opening insurance contract assets   –   –   –   –   –
Opening insurance contract liabilities   215   –10   –527   –9   –331
Net opening balance   215   –10   –527   –9   –331
Cash flows incurred before or at initial recognition   73   –   –   –   73
Changes in the statement of profit or loss and OCI                    
Insurance revenue   1 563   –   –   –   1 563
Insurance service expenses                    
Incurred claims and other insurance service expenses   –   –   –1 381   0   –1 382
Amortisation of insurance acquisition cash flows   –187   –   –   –   –187
Losses and reversal of losses on onerous contracts   –   –1   –   –   –1
Adjustments to liabilities for incurred claims   –   –   –40   –1   –41
Insurance service result   1 375   –1   –1 421   –1   –48
Net finance income/expenses from insurance contracts   –   –   –22   0   –22
Foreign currency translation differences   2   0   –5   0   –3
Total changes in the statement of profit or loss and OCI   1 378   –1   –1 448   –2   –72
Cash flows                    
Premiums received   –1 556   –   –   –   –1 556
Claims and other insurance service expenses paid   –   –   1 343   –   1 343
Insurance acquisition cash flows   124   –   –   –   124
Total cash flows   –1 431   –   1 343   –   –88
Net closing balance   234   –11   –632   –10   –419
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   234   –11   –632   –10   –419

Health and protection insurance contracts issued under PAA – analysis by remaining coverage and incurred claims for the year 2023

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component   Present value of future cash flows   Risk adjustment for non-financial risk    
Opening insurance contract assets   –   –   –   –   –
Opening insurance contract liabilities   203   –17   –456   –8   –278
Net opening balance   203   –17   –456   –8   –278
Cash flows incurred before or at initial recognition   72   –   –   –   72
Changes in the statement of profit or loss and OCI                    
Insurance revenue   1 547   –   –   –   1 547
Insurance service expenses                    
Incurred claims and other insurance service expenses   –   –   –1 389   0   –1 389
Amortisation of insurance acquisition cash flows   –186   –   –   –   –186
Losses and reversal of losses on onerous contracts   –   5   –   –   5
Adjustments to liabilities for incurred claims   –   –   –13   –1   –13
Insurance service result   1 361   5   –1 401   –1   –35
Net finance income/expenses from insurance contracts   –   –   –27   0   –27
Foreign currency translation differences   –13   1   32   1   20
Total changes in the statement of profit or loss and OCI   1 348   6   –1 396   0   –43
Cash flows                    
Premiums received   –1 522   –   –   –   –1 522
Claims and other insurance service expenses paid   –   –   1 326   –   1 326
Insurance acquisition cash flows   114   –   –   –   114
Total cash flows   –1 409   –   1 326   –   –83
Net closing balance   215   –10   –527   –9   –331
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   215   –10   –527   –9   –331

Non-life insurance contracts issued under PAA – analysis by remaining coverage and incurred claims for the year 2024

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component   Present value of future cash flows   Risk adjustment for non-financial risk    
Opening insurance contract assets   –   –   –   –   –
Opening insurance contract liabilities   0   –   –589   –6   –595
Net opening balance   0   –   –589   –6   –595
Cash flows incurred before or at initial recognition   –   –   –   –   –
Changes in the statement of profit or loss and OCI                    
Insurance revenue   377   –   –   –   377
Insurance service expenses                    
Incurred claims and other insurance service expenses   –   –   –300   0   –299
Amortisation of insurance acquisition cash flows   –63   –   –   –   –63
Adjustments to liabilities for incurred claims   –   –   17   2   20
Insurance service result   315   –   –283   3   35
Net finance income/expenses from insurance contracts   –   –   –20   0   –20
Foreign currency translation differences   0   –   –7   0   –7
Total changes in the statement of profit or loss and OCI   315   –   –309   2   8
Cash flows                    
Premiums received   –376   –   –   –   –376
Claims and other insurance service expenses paid   –   –   304   –   304
Insurance acquisition cash flows   62   –   –   –   62
Total cash flows   –313   –   304   –   –10
Net closing balance   1   –   –595   –3   –597
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   1   –   –595   –3   –597

Non-life insurance contracts issued under PAA – analysis by remaining coverage and incurred claims for the year 2023

In CHF million
    Liabilities for remaining coverage   Liabilities for incurred claims   Total
    Excluding loss component   Loss component   Present value of future cash flows   Risk adjustment for non-financial risk    
Opening insurance contract assets   –   –   –   –   –
Opening insurance contract liabilities   –1   –   –610   –6   –617
Net opening balance   –1   –   –610   –6   –617
Cash flows incurred before or at initial recognition   –   –   –   –   –
Changes in the statement of profit or loss and OCI                    
Insurance revenue   370   –   –   –   370
Insurance service expenses                    
Incurred claims and other insurance service expenses   –   –   –276   0   –276
Amortisation of insurance acquisition cash flows   –54   –   –   –   –54
Adjustments to liabilities for incurred claims   –   –   –24   0   –25
Insurance service result   315   –   –301   0   14
Net finance income/expenses from insurance contracts   –   –   –31   0   –32
Foreign currency translation differences   0   –   37   0   37
Total changes in the statement of profit or loss and OCI   315   –   –295   0   20
Cash flows                    
Premiums received   –369   –   –   –   –369
Claims and other insurance service expenses paid   –   –   316   –   316
Insurance acquisition cash flows   54   –   –   –   54
Total cash flows   –315   –   316   –   1
Net closing balance   0   –   –589   –6   –595
Closing insurance contract assets   –   –   –   –   –
Closing insurance contract liabilities   0   –   –589   –6   –595

The table below illustrates how estimates of cumulative claims for the Group’s non-life business have developed over time for each accident year and reconciles the cumulative claims to the amount included in the consolidated balance sheet. Balances have been translated at the exchange rates prevailing at the reporting date.

Development of claims under non-life insurance contracts

In CHF million
    2015   2016   2017   2018   2019   2020   2021   2022   2023   2024   Total
                                             
Estimates of undiscounted cumulative claims gross of reinsurance
At end of accident year   296   267   297   331   304   295   321   227   203   226   n/a
One year later   322   331   317   352   369   298   270   218   215   -   n/a
Two years later   322   276   282   325   306   211   205   234   -   -   n/a
Three years later   291   259   269   279   229   186   219   -   -   -   n/a
Four years later   273   255   241   219   205   186   -   -   -   -   n/a
Five years later   266   228   193   198   211   -   -   -   -   -   n/a
Six years later   227   185   173   203   -   -   -   -   -   -   n/a
Seven years later   184   162   169   -   -   -   -   -   -   -   n/a
Eight years later   187   165   -   -   -   -   -   -   -   -   n/a
Nine years later   185   -   -   -   -   -   -   -   -   -   n/a
Cumulative gross claims paid   –163   –150   –151   –175   –178   –155   –172   –180   –152   –78   n/a
Gross liabilities – for the current and 9 previous years   22   16   18   27   33   31   47   54   63   148   458
Gross liabilities – for prior years beyond 10 years                                           194
Effect of discounting                                           –54
Gross liabilities for incurred claims                                           598

Reinsurance contracts held under BBA – analysis by measurement component for the year 2024

In CHF million
    Estimates of present value of future cash flows   Risk adjustment for non-financial risk   CSM: Contracts under modified retrospective approach   CSM: Other contracts   Total
Opening reinsurance contracts held – assets   590   2   25   5   623
Opening reinsurance contracts held – liabilities   –56   1   37   2   –17
Net opening balance   534   3   62   7   606
Changes that relate to current services                    
CSM recognised for services provided   –   –   –8   6   –2
Change in risk adjustment for non-financial risk for risk expired   –   0   –   –   0
Experience adjustments   3   –   –   –   3
Changes that relate to future services                    
Contracts initially recognised in the year   –1   0   –   1   –
Changes in estimates that adjust the CSM   –15   0   9   6   –
Changes in losses and reversal of ceded losses   –6   –   –   –   –6
Changes that relate to past services                    
Changes to incurred claims component   27   –   –   –   27
Net expenses from reinsurance contracts   7   –1   1   12   21
Net finance income/expenses from reinsurance contracts   14   0   2   0   16
Effect of changes in non-performance risk of reinsurers   0   –   –   –   0
Foreign currency translation differences   6   0   1   0   7
Total changes in the statement of profit or loss and OCI   27   0   5   13   44
Cash in- and outflows for the period   –271   –   –   –   –271
Net closing balance   290   2   67   20   379
Closing reinsurance contracts held – assets   363   2   22   16   403
Closing reinsurance contracts held – liabilities   –73   0   45   4   –24

Reinsurance contracts held under BBA – analysis by measurement component for the year 2023

In CHF million
    Estimates of present value of future cash flows   Risk adjustment for non-financial risk   CSM: Contracts under modified retrospective approach   CSM: Other contracts   Total
Opening reinsurance contracts held – assets   668   3   28   21   721
Opening reinsurance contracts held – liabilities   –50   0   38   –   –12
Net opening balance   618   3   66   21   708
Changes that relate to current services                    
CSM recognised for services provided   –   –   –9   –4   –13
Change in risk adjustment for non-financial risk for risk expired   –   0   –   –   0
Experience adjustments   –35   –   –   –   –35
Changes that relate to future services                    
Contracts initially recognised in the year   –4   0   –   4   –
Changes in estimates that adjust the CSM   7   0   6   –13   –
Changes in losses and reversal of ceded losses   4   –   –   –   4
Changes that relate to past services                    
Changes to incurred claims component   –16   –   –   –   –16
Net expenses from reinsurance contracts   –43   0   –3   –14   –60
Net finance income/expenses from reinsurance contracts   32   0   2   0   35
Effect of changes in non-performance risk of reinsurers   0   –   –   –   0
Foreign currency translation differences   –22   0   –4   –1   –27
Total changes in the statement of profit or loss and OCI   –34   0   –4   –14   –52
Cash in- and outflows for the period   –50   –   –   –   –50
Net closing balance   534   3   62   7   606
Closing reinsurance contracts held – assets   590   2   25   5   623
Closing reinsurance contracts held – liabilities   –56   1   37   2   –17

Reinsurance contracts held under BBA – analysis by remaining coverage and incurred claims

In CHF million
    Remaining coverage component   Incurred claims component   Total
    31.12.2024   31.12.2023   31.12.2024   31.12.2023   31.12.2024   31.12.2023
Opening reinsurance contracts held – assets   610   703   14   18   623   721
Opening reinsurance contracts held – liabilities   –44   –40   27   27   –17   –12
Net opening balance   566   663   41   45   606   708
Changes in the statement of profit or loss and OCI                        
Net expenses from reinsurance contracts   –306   –167   327   107   21   –60
Net finance income/expenses from reinsurance contracts   16   32   1   2   16   35
Effect of changes in non-performance risk of reinsurers   0   0   –   –   0   0
Foreign currency translation differences   7   –24   0   –3   7   –27
Total changes in the statement of profit or loss and OCI   –284   –159   328   107   44   –52
Cash flows                        
Premiums paid   52   62   –   –   52   62
Amounts received   –   –   –323   –111   –323   –111
Total cash flows   52   62   –323   –111   –271   –50
Net closing balance   334   566   45   41   379   606
Closing reinsurance contracts held – assets   386   610   17   14   403   623
Closing reinsurance contracts held – liabilities   –52   –44   28   27   –24   –17

Reinsurance contracts held under PAA – analysis by remaining coverage and incurred claims

In CHF million
    Remaining coverage component   Incurred claims component   Total
    2024   2023   2024   2023   2024   2023
Opening reinsurance contracts held – assets   0   –128   1 455   1 099   1 456   971
Opening reinsurance contracts held – liabilities   –1   –2   1   0   –1   –2
Net opening balance   –1   –130   1 456   1 099   1 455   969
Cash flows incurred before or at initial recognition   –   80   –   –   –   80
Changes in the statement of profit or loss and OCI                        
Net expenses from reinsurance contracts   –626   –817   617   734   –9   –83
Net finance income/expenses from reinsurance contracts   –   –   76   77   76   77
Foreign currency translation differences   0   1   8   –60   8   –58
Total changes in the statement of profit or loss and OCI   –626   –815   702   751   76   –64
Cash flows                        
Premiums paid   659   865   –   –   659   865
Amounts received   –   –   –513   –395   –513   –395
Total cash flows   659   865   –513   –395   145   470
Net closing balance   32   –1   1 645   1 456   1 677   1 455
Closing reinsurance contracts held – assets   32   0   1 645   1 455   1 677   1 456
Closing reinsurance contracts held – liabilities   0   –1   –   1   0   –1
Discount rates

Beyond terms where the market for swap rates is assessed as not sufficiently deep, liquid and transparent, an extrapolation is performed to derive the yield curve. For the extrapolation the Smith-Wilson method is applied. The relevant characteristics are the so-called last liquid point (LLP) at which the extra­polation starts and the ultimate forward rate (UFR) to which the extrapolated yield curves converge.

Last liquid point (LLP) and ultimate forward rate (UFR)

    LLP in years   UFR
         
Currency        
Swiss franc   15   2.45%
Euro   20   3.45%

The same LLP and UFR have been applied for all periods presented.

The liquidity premium for VFA portfolios can be calculated as the difference between the relevant rate for discounting the liabilities and the liquid yield curve, i.e. before the LLP. The following table shows the liquidity premiums for the relevant VFA portfolios.

Liquidity premium

In basis points
    31.12.2024   31.12.2023
Swiss franc   87   73
Euro   88   75

The following spot rates have been applied for the discounting of the insurance and investment contracts with DPF under VFA in Swiss francs and euro.

Discount rates for insurance and investment contracts with DPF under VFA

    Swiss franc   Euro
Maturity in years   31.12.2024   31.12.2023   31.12.2024   31.12.2023
1   0.93%   2.11%   3.21%   4.21%
5   1.05%   1.79%   3.13%   3.17%
10   1.26%   1.89%   3.25%   3.24%
15   1.38%   1.95%   3.31%   3.32%
30   1.76%   2.13%   3.25%   3.28%
Contracts initially recognised in the year

The following tables present the effect on the measurement components of insurance and reinsurance contracts arising from the initial recognition of contracts not measured under the PAA that were initially recognised in the year.

Effect of contracts initially recognised in the year – life

In CHF million
    Profitable contracts issued   Onerous contracts issued   Total contracts initially recognised
    2024   2023   2024   2023   2024   2023
Estimates of present value of future cash outflows                        
Insurance acquisition cash flows   –547   –553   –   –   –547   –553
Claims and other insurance service expenses payable   –9 760   –7 880   –2   –3   –9 762   –7 883
Total estimates of present value of future cash outflows   –10 306   –8 433   –2   –3   –10 309   –8 437
Estimates of present value of future cash inflows   11 025   9 096   2   3   11 027   9 100
Risk adjustment for non-financial risk   –22   –18   0   0   –22   –18
Derecognition of pre-coverage assets   –4   –5   –   –   –4   –5
CSM   –693   –641   –   –   –693   –641
Losses recognised on initial recognition   –   –   0   –1   0   –1

Effect of contracts initially recognised in the year – reinsurance contracts held

In CHF million
    Contracts originated expected to result in net cost   Contracts originated expected to result in net gain   Total contracts initially recognised
    2024   2023   2024   2023   2024   2023
Estimates of present value of cash inflows   6   10   –   –   6   10
Estimates of present value of cash outflows   –7   –14   –   –   –7   –14
Risk adjustment for non-financial risk   0   0   –   –   0   0
CSM   1   4   –   –   1   4
Insurance acquisition cash flows

Insurance acquisition cash flows that the Group pays before the related group of contracts is recognised are presented in the portfolio of insurance contracts to which they relate.

Assets for insurance acquisition cash flows

In CHF million
        2024   2023
Opening insurance contract assets       4   5
Opening insurance contract liabilities       143   132
Net opening balance       147   136
Cash flows incurred before or at initial recognition       63   96
Amounts derecognised and included in the measurement of insurance contracts       –76   –77
Foreign currency translation differences       2   –9
Net closing balance       135   147
Closing insurance contract assets       5   4
Closing insurance contract liabilities       130   143

The cash flows are expected to be included in the insurance contract liabilities as follows:

Expected inclusion of insurance acquisition cash flows

In CHF million
    1–3 months   4–6 months   7–12 months   More than 12 months   Total
    31.12.2024   31.12.2023   31.12.2024   31.12.2023   31.12.2024   31.12.2023   31.12.2024   31.12.2023   31.12.2024   31.12.2023
Direct participating contracts under VFA   18   14   0   0   –   –   –   –   19   14
Other insurance contracts   15   17   15   17   29   33   58   66   116   133
Total   33   31   15   17   29   33   58   66   135   147