Page 65 - Suncorp_Review

Suncorp Group Limited Annual Report 2010/11 63

6.2 General Insurance – Net incurred claims

Details of net incurred claims for General Insurance are as follows:

2011 2010

Current year Prior year Total Current year Prior year Total $m $m $m $m $m $m

General Insurance

Direct business

Gross claims undiscounted 10,570 (1,063) 9,507 6,485 (441) 6,044 Discount (518) 315 (203) (327) 222 (105) Gross claims discounted 10,052 (748) 9,304 6,158 (219) 5,939 Reinsurance and other recoveries undiscounted (5,167) 381 (4,786) (1,346) (17) (1,363) Discount 254 (34) 220 49 (7) 42 Reinsurance and other recoveries (4,913) 347 (4,566) (1,297) (24) (1,321) Total direct business 5,139 (401) 4,738 4,861 (243) 4,618 Net inwards reinsurance business 12 19 Total net claims incurred 4,750 4,637

The $401 million reduction (2010: $243 million) in prior year net provisions on the net incurred claims for 2011 is primarily due to decreases in prior year claims cost provisions with better than expected experience, coupled with increases in the discount rate applied to outstanding payments. The sensitivity of net proft to changes in claims assumptions, experience and risk margins is set out in note 6.6.2(e).

6.3 General Insurance – Derivatives

GENERAL INSURANCE

2011 2010 Notional Fair value Notional Fair value value Asset Liability value Asset Liability $m $m $m $m $m $m

Exchange rate-related contracts

Cross currency swaps 291 – (88) 291 – (48)

Interest rate-related contracts

Interest rate swaps 1,675 22 – 1,858 36 (1) Interest rate swaptions 384 1 (1) – – – Interest rate futures 1,321 – – 1,688 – – Interest rate options 47 – (1) 96 – – 3,427 23 (2) 3,642 36 (1) Total derivative exposures – current 3,718 23 (90) 3,933 36 (49)

6.4 General Insurance – Investment securities

GENERAL INSURANCE

2011 2010 $m $m

Financial assets designated at fair value through proft or loss

Interest‑bearing securities

Debentures and corporate bonds 7,057 7,488 Government and semi‑government securities 2,613 2,698 Discounted securities 61 108 9,731 10,294 Unit trusts 1,051 857 Total investment securities – current 10,782 11,151