Where audited financial statements are not required by the supervisor given the nature, scale and complexity of an insurer (for example, for a small local branch office of a foreign insurer), the supervisor may require that similar information is made publicly available by other means.

• easily accessible and up-to-date;
• comprehensive, reliable and meaningful;
• comparable between different insurers operating in the same market;
• consistent over time so as to enable relevant trends to be discerned; and
• aggregated or disaggregated so that useful information is not obscured.

Information should be disseminated in ways best designed to bring it to the attention of policyholders and market participants, but taking into account the relative effectiveness and costs of different methods of dissemination (for example, printed versus digital methods).

Information should be provided with sufficient frequency and timeliness to give a meaningful picture of the insurer to policyholders and market participants. The need for timeliness will need to be balanced against that for reliability.

Disclosure requirements may also have to balance the interests of reliability against those of relevance or usefulness. For example, in some long-tail classes of insurance, realistic projections as to the ultimate cost of incurred claims are highly relevant. However, due to uncertainties, such projections are subject to a high degree of inherent errors of estimation. Qualitative or quantitative information can be used to convey to users an understanding of the relevance and reliability of the information disclosed.

• well-explained so that it is meaningful;
• complete so that it covers all material circumstances of an insurer and, where relevant, those of the group of which it is a member; and
• both appropriately aggregated so that a proper overall picture of the insurer is presented and sufficiently disaggregated so that the effect of distinct material items may be separately identified.

Information should, so far as practicable, reflect the economic substance of events and transactions as well as their legal form. The information should be neutral (ie, free from material error or bias) and complete in all material respects..

The overall aim for the company profile disclosure is for insurers to provide a contextual framework for the other information required to be made public.

Disclosures on the nature of the insurer’s business and its external environment should assist policyholders and market participants in assessing the strategies adopted by the insurer.

Disclosures may include information about the insurer’s corporate structure, which should include any material changes that have taken place during the year. For insurance groups, where provided, such disclosures should focus on material aspects, both in terms of the legal entities within the corporate structure and the business functions undertaken within the group. In the event of differences in the composition of a group for supervisory purposes and for public reporting purposes, it would be useful if a description of the entities constituting those differences was also provided.

Disclosures may include information on the key business segments, main trends, factors and events that have contributed positively or negatively to the development, performance and position of the company.

Disclosures may include information on the insurer’s competitive position and its business models (such as its approach to dealing and settling claims or to acquiring new business) as well as significant features of regulatory and legal issues affecting its business.

Key resources available may include both financial and non-financial resources. For non-financial resources the insurer may, for example, provide information about its human and intellectual capital.

Disclosures should include the manner in which key business activities and control functions are organised, and the mechanism used by the Board to oversee these activities and functions, including for changes to key personnel and management committees. Such disclosures should demonstrate how the key activities and control functions fit into an insurer’s overall risk management framework.

Where a material activity or function of an insurer is outsourced, in part or in whole, disclosures may include the insurer’s outsourcing policy and how it maintains oversight of, and accountability for, the outsourced activity or function.

Disclosures may include a quantitative analysis of the insurer’s sensitivity to changes in key factors both on a gross basis and taking into account the effect of reinsurance, derivatives and other forms of risk mitigation on that sensitivity. For example, disclosures may include a sensitivity analysis by life insurers to the changes in mortality and disability assumptions or sensitivities to increased claim inflation by non-life insurers.

Where an insurance group includes legal entities in other sectors, disclosures may include the risk exposure of the insurance legal entities from those other entities and procedures in place to mitigate those risks.

Disclosures may include a description of the insurer’s risk appetite and its policies for identifying, measuring, monitoring and controlling insurance risks, including information on the models and techniques used.

Disclosures may include information on the insurer’s use of derivatives to hedge risks arising from insurance contracts. This information may include a summary of internal policies on the use of derivatives.

Disclosure of how an insurer uses reinsurance and other forms of risk transfer may enable policyholders and market participants to understand how the insurer controls its exposure to insurance risks.

Description of the insurer's risk concentrations may include, at least, information on the geographical concentration of insurance risk, the economic sector concentration of insurance risk, the extent to which the risk is reduced by reinsurance and other risk mitigating elements and, if material, the risk concentration inherent in the reinsurance cover.

• the credit quality of the reinsurers (for example, by grouping reinsurance assets by credit rating);
• credit risk concentration of reinsurance assets;
• the nature and amount of collateral held against reinsurance assets;
• the development of reinsurance assets over time; and
• the ageing of receivables from reinsurers on settled claims.

It may be useful if disclosures include the impact and planned action when the expected level or scope of cover from a reinsurance/risk transfer contract is not obtained.

These ratios should be calculated from the profit and loss account of the reporting year and be gross of reinsurance in order to neutralize the effect of mitigation tools on the technical performance of the direct business. Gains on reinsurance cannot be expected to continue indefinitely without price adjustments from reinsurers. Disclosure on reinsurance is described in Guidance 20.7.2. If the net ratios are materially different from the gross ratios, then both ratios should be disclosed. The ratios should be measured either on an accident year or an underwriting year basis.

Disclosures may include the geographical concentration of premiums. The geographical concentration may be based on where the insured risk is located, rather than where the business is written.

If material, disclosures may include the number of reinsurers that it engages, as well as the highest concentration ratios. For example, it would be appropriate to expect an insurer to disclose its highest premium concentration ratios, which shows the premiums ceded to an insurer’s largest reinsurers in aggregate, as a ratio of the total reinsurance premium ceded.

For the purposes of disclosure, an insurer may group assets and liabilities with similar characteristics and/or risks into classes and then disclose information segregated by those classes.

Where investment management objectives, policies and processes differ between segments of an insurer’s investment portfolio, disclosures should be sufficient to provide an understanding of those differences.

When providing disclosures around the uncertainty of reported values of financial instruments and other investments, it may be useful if the effect of derivatives on that uncertainty is also disclosed.