ING Direct 2008 Annual Report Download - page 132

2.1 Consolidated annual accounts
Notes to the consolidated balance sheet of ING Group (continued)
ING Group had an outstanding balance of EUR 52 million as at 31 December 2008 (2007: EUR 66 million) relating to environmental and
asbestos claims of the insurance operations. In establishing the liability for unpaid claims and claims adjustment expenses related to
asbestos related illness and toxic waste clean-up, the management of ING Group considers facts currently known and current legislation
and coverage litigation. Liabilities are recognised for IBNR claims and for known claims (including the costs of related litigation) when
sufficient information has been obtained to indicate the involvement of a specific insurance policy, and management can reasonably
estimate its liability. In addition, liabilities are reviewed and updated regularly.
Where discounting is used in the calculation of the claims provisions, based on weighted averages, the rate is within the range of 3.0% to
4.0% (2007: 3.8% to 4.3%).
Changes in investment contracts liabilities
2008 2007
Opening balance 23,652 20,750
Changes in the composition of the group –548 –277
23,104 20,473
Current year liabilities 8,635 12,890
Prior year provisions
– payments to contract holders –8,472 –9,697
– interest accrual 268 408
– valuation changes investments –1,535 576
–9,739 – 8,713
Exchange rate differences –1,111 –1,147
Other changes 196 149
Closing balance 21,085 23,652
Gross claims development table
Underwriting year
2004 2005 2006 2007 2008 Total
Estimate of cumulative claims:
At the end of underwriting year 2,023 1,891 1,889 1,898 2,851
1 year later 1,785 1,754 1,821 1,798
2 years later 1,594 1,620 1,708
3 years later 1,537 1,568
4 years later 1,520
Estimate of cumulative claims 1,520 1,568 1,708 1,798 2,851 9,445
Cumulative payments –1,153 –1,077 –1,072 –833 –1,343 –5,478
367 491 636 965 1,508 3,967
Effect of discounting –35 –51 –63 –82 –125 –356
Liability recognised 332 440 573 883 1,383 3,611
Liability relating to prior underwriting years 1,931
Total amount recognised in the balance sheet 5,542
The Group applies the exemption provided for in IFRS-EU not to present Gross claims development for annual periods beginning before
1 January 2004 (the date of transition to IFRS-EU) as it is impracticable to obtain such information.
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