HSBC 2012 Annual Report Download - page 244

HSBC HOLDINGS PLC
Report of the Directors: Operating and Financial Review (continued)
Risk > Risk management of insurance operations > Financial risks / PVIF
242
Reinsurers’ share of liabilities under insurance contracts
(Audited)
Neither past due nor impaired Past due
Strong Good
Satisfactory
Sub-
standard
but not
impaired
Total
US$m US$m US$m US$m US$m US$m
At 31 December 2012
Linked insurance contracts ................................. 55 400 – – – 455
Non-linked insurance contracts .......................... 936 4 6 – 6 952
Total64 ................................................................. 991 404 6 – 6 1,407
Reinsurance debtors ............................................ 19 133 – – 8 160
At 31 December 2011
Linked insurance contracts ................................. 45 858 – – – 903
Non-linked insurance contracts .......................... 782 10 104 3 – 899
Total64 ................................................................. 827 868 104 3 – 1,802
Reinsurance debtors ............................................ 18 2 9 1 12 42
For footnote, see page 249.
Liquidity risk
(Audited)
The following tables show the expected
undiscounted cash flows for insurance contract
liabilities and the remaining contractual maturity of
investment contract liabilities at 31 December 2012.
A significant proportion of our non-life insurance
business is viewed as short-term, with the settlement
of liabilities expected to occur within one year of the
period of risk. There is a greater spread of expected
maturities for the life business where, in a large
proportion of cases, the liquidity risk is borne in
conjunction with policyholders (wholly borne by the
policyholder in the case of unit-linked business).
The profile of the expected maturity of the
insurance contracts at 31 December 2012 remained
comparable with 2011.
Expected maturity of insurance contract liabilities
(Audited)
Expected cash flows (undiscounted)
Within 1 year 1-5 years 5-15 years Over 15 years Total
US$m US$m US$m US$m US$m
At 31 December 2012
Non-life insurance .......................................... 78 3 – – 81
Life insurance (non-linked) ............................ 4,176 12,199 23,420 27,836 67,631
Life insurance (linked) ................................... 1,243 3,761 10,446 13,497 28,947
Total64 ............................................................. 5,497 15,963 33,866 41,333 96,659
At 31 December 2011
Non-life insurance .......................................... 742 704 176 13 1,635
Life insurance (non-linked) ............................ 2,006 12,243 21,332 25,990 61,571
Life insurance (linked) ................................... 920 3,262 9,070 15,546 28,798
Total64 ............................................................. 3,668 16,209 30,578 41,549 92,004
For footnote, see page 249.