Liability for future claims The liability for outstanding claims is measured as the central estimate of the present value of expected future payments against claims incurred at the reporting date, with an additional risk margin to allow for the inherent uncertainty in the central estimate. The expected future payments include those in relation to claims reported but not yet paid, claims incurred but not reported (IBNR), claims incurred but not enough reported (IBNER) and anticipated claims handling costs. Claims handling costs include costs that can be associated directly with individual claims, such as legal and other professional fees, and costs that can only be indirectly associated with individual claims, such as claims administration costs. The expected future payments are discounted to present value using a risk free rate. The effect of an actuarial assessed increase in the outstanding claims liability or changes in the discount rate are included in the of Comprehensive ‘Statement Income’ under expense’. The effect of an actuarial assessed decrease in the ‘Claims outstanding claims liability is included in the of Comprehensive Income’ ‘Statement under ‘Gains’. (p) Superannuation expense Superannuation expense is recognised in the Statement of Comprehensive Income in profit or loss for defined contribution plans, including the concurrent payment of employer contributions to the GSS scheme, as and when the contributions fall due. For defined benefit (the Pension Scheme and the pre-transfer component of the GSS), changes in the defined benefit obligation are recognised in the Statement of Comprehensive Income either in profit or loss, or, other comprehensive income as follows: Profit or loss: current service cost; past service cost; and interest cost. other comprehensive income: actuarial gains and losses. (q) Comparative figures
Liability for future claims The liability for outstanding claims is measured as the central estimate of the present value of expected future payments against claims incurred at the reporting date, with an additional risk margin to allow for the inherent uncertainty in the central estimate. The expected future payments include those in relation to claims reported but not yet paid, claims incurred but not reported (IBNR), claims incurred but not enough reported (IBNER) and anticipated claims handling costs. Claims handling costs include costs that can be associated directly with individual claims, such as legal and other professional fees, and costs that can only be indirectly associated with individual claims, such as claims administration costs. The expected future payments are discounted to present value using a risk free rate. The effect of an actuarial assessed increase in the outstanding claims liability or changes in the discount rate are included in the ‘Statement of Comprehensive Income’ under ‘Claims expense’. The effect of an actuarial assessed decrease in the outstanding claims liability is included in the ‘Statement of Comprehensive Income’ under ‘Gains’. (p) Superannuation expense Superannuation expense is recognised in the Statement of Comprehensive Income in profit or loss for defined contribution plans, including the concurrent payment of employer contributions to the GSS scheme, as and when the contributions fall due. For defined benefit (the Pension Scheme and the pre-transfer component of the GSS), changes in the defined benefit obligation are recognised in the Statement of Comprehensive Income either in profit or loss, or, other comprehensive income as follows: Profit or loss: current service cost; past service cost; and interest cost. other comprehensive income: actuarial gains and losses. (q) Comparative figures
Annual-Report-2014_15-Accessible-Version.docx