In accordance with the guidance issued by the European Insurance [CFO] Forum in October 2005 the table below shows the effect of alternative assumptions on the long term embedded value and new business contribution.
(Download XLS:)  |
|
Effect on embedded value as at 31 December 2009 | ||||||
|---|---|---|---|---|---|---|
|
|
As published |
1% lower risk discount rate |
1% higher risk discount rate |
1% lower interest rate |
1% higher interest rate |
1% higher equity/ property yields |
|
UK |
6,267 |
376 |
(328) |
28 |
(51) |
106 |
|
International |
1,446 |
107 |
(97) |
11 |
(25) |
3 |
|
Total covered business |
7,713 |
483 |
(425) |
39 |
(76) |
109 |
|
|
|
|
|
|
|
|
|
|
As published |
10% lower equity/ property values |
10% lower maintenance expenses |
10% lower lapse rates |
5% lower mortality (UK annuities) |
5% lower mortality (other business) |
|
UK |
6,267 |
(149) |
77 |
75 |
(157) |
59 |
|
International |
1,446 |
(6) |
13 |
54 |
n/a |
89 |
|
Total covered business |
7,713 |
(155) |
90 |
129 |
(157) |
148 |
| (Download XLS:) |
|
Effect on new business contribution for the year | ||||||
|---|---|---|---|---|---|---|
|
|
As published |
1% lower risk discount rate |
1% higher risk discount rate |
1% lower interest rate |
1% higher interest rate |
1% higher equity/ property yields |
|
UK |
305 |
45 |
(39) |
7 |
(12) |
16 |
|
International |
23 |
17 |
(14) |
– |
(2) |
– |
|
Total covered business |
328 |
62 |
(53) |
7 |
(14) |
16 |
|
|
|
|
|
|
|
|
|
|
As published |
10% lower equity/ property values |
10% lower maintenance expenses |
10% lower lapse rates |
5% lower mortality (UK annuities) |
5% lower mortality (other business) |
|
UK |
305 |
(19) |
11 |
14 |
(12) |
6 |
|
International |
23 |
– |
1 |
10 |
n/a |
12 |
|
Total covered business |
328 |
(19) |
12 |
24 |
(12) |
18 |
Opposite sensitivities are broadly symmetrical.
