Financial calender

1996 13 May Annual General Meeting 1995 15 May 1. quarter 1996 22 August 2. quarter 1996 6 November 3. quarter 1996 medio March 1997 Annual results 1996

Contents

This is UNI Storebrand 2 Key Figures 3

Report of the Board of Directors 1995 4 Profit and loss account and balance sheet of UNI Storebrand Group and UNI Storebrand ASA 8 Auditor’s report 12

From strategy to implementation 13

Business Areas 16

Interplay for welfare 22 Improvements in personal injury settlement 24

UNI Storebrand Group Analytical information 26

UNI Storebrand Life Insurance 27

UNI Storebrand Non-life Insurance 36

Shareholder matters 44 Terms and expressions 48 Directors and Officers 50

Notes UNI Storebrand 51 Contents Cashflow analysis 86 Reconciliation of differences in the income and equity between N GAAP and US GAAP 87

Companies in UNI Storebrand at 31.12.1995 91 Addresses 92

1 This is UNI Storebrand

UNI Storebrand is Norway’s largest Key figures: insurance company in both life and Customers non-life insurance. The company ser- Non-life insurance: 1,000,000 ves around 40% of the Norwegian non- Life and pension insurance: 345,000 life insurance market and around 30% Man-years: 4,042 of the life insurance market. UNI Offices: 260 Storebrand is Norway’s largest mana- Shareholders: 77,872 ger of private savings in the securities Shares: 376,418,702 market. Customer base in non-life insurance: Snowmelting led to flood in The business • 896,000 individual customers the river Glomma May/June The insurance activities are organized • 110,000 business customers 1995. in two wholly-owned subsidiaries under Number of policies: the holding company UNI Storebrand • 997,000 motor vehicles ASA: UNI Storebrand Skadeforsikring • 1,056,000 houses, cottages, etc. AS and UNI Storebrand Livsforsikring • 1,228,000 people insured against AS. During 1995 UNI Storebrand accident introduced a new model for group • 466,000 people insured against management and organized the activi- occupational injury and sickness ties in 10 business areas with profit • 40% of the country’s business Partner agreement regarding responsibility. An application was insurance. joint effort for preventing made during 1995 for a licence to Customer base in life insurance: claims, was entered into with establish banking activities. The bank’s • 120,000 in private pension insurance the Norwegian Red Cross. name will be Storebrand Bank, a • 250,000 in private life insurance wholly-owned subsidiary of UNI Number insured: Storebrand ASA. The banking activity • 330,000 members in 4,000 group life is expected to commence during the insurance first half of 1996. This means that UNI • 420,000 members in 5,800 collective Storebrand will become an integrated pension insurance finance group with insurance and banking activities under the same Miscellaneous: holding company. • 67,000 individuals and companies The main products are: have invested NOK 3.2 billion in • Non-life insurance UNI Storebrand mutual funds • Life and pension insurance • 38,000 private individuals have bor- • Fund management rowed NOK 10 billion from UNI • Mutual funds A binding intent to integrate Storebrand • Banking activities (from 1996) environmental related issues • 800,000 sports enthusiasts insured The business is mainly directed against accident through their respec- into the business objectives towards the Norwegian market. The tive national associations’ policies. from leading insurance com- company also has a significant position panies was made official on 30 in international marine and oil insu- March 1995, by Elizabeth rance. In Sweden the company opera- Dowdesdell, managers of tes in industrial insurance. In 1995 UNEP, the United Nations UNI Storebrand wound down its activi- Envinonmental Programme. ties in international reinsurance. The Present was among others business was spun off as a separate Group Chief Executive Åge company - Oslo Reinsurance Company ASA - of which the UNI Storebrand Korsvold and Minister of group currently owns 10%. Environment Thorbjørn Berntsen.

2 Key Figures

NOK million 1995 1994 1993 1992 1991

UNI Storebrand Group Gross premium income* 13,558 16,299 15,594 16,269 16,130 Gross operating income** 20,661 21,710 25,493 22,601 21,781 Net premium income 12,442 14,423 13,668 14,263 13,890 Net operating income*** 19,544 19,834 23,567 20,595 19,541 Netto financial income insurance 6,955 5,270 9,778 5,348 5,523 Operating result 4,206 1,985 5,968 -1,738 1,181 Group result 1,451 522 1,397 -3,382 471 Total assets 99,256 97,626 95,606 91,648 92,734 Equity capital 3,806 2,459 2,428 -1,047 2,340 Solvency capital **** 6,912 5,921 5,712 1,856 4,556 Total man-years 4,042 4,100 4,105 4,507 4,670 Capital ratio 15.8% 8.8% 8.7% - 3.6% ****) Gross premium income is reduced from 1994 to 1995 due to the sale of UNI Storebrand International Insurance (was NOK 2,357 mill. in 1994). ****) Includes gross earned premiums non-life, written premiums life, net financial income insurance and other operating income. ****) Includes gross operating income less reinsurance premium. ****) Includes equity and security-, reinsurance-, and administration reserves, natural fund and guarantee reserve non-life. Key figures per share Average total ordinary shares at 31.12 (in 1,000) 276,418 265,962 176,324 71,339 68,555 Result per share (after tax/preference dividends) * 4.94 1.32 4.87 -48.59 6.78 Dividend per ordinary share 0.00 0.00 0.20 0.00 2.60 Dividend per preference share 0.70 0.90 1.10 - - *) Calculated for numbers of shares at 31.12.93, for the other years average shares throughout the year. UNI Storebrand Livsforsikring Group Premiums written 5,271 5,708 4,549 4,779 4,685 Net financial income 5,922 4,549 8,069 4,332 4,250 Insurance benefits due 3,831 3,687 3,709 4,176 3,284 Operating costs 782 796 789 798 785 Operating result 3,342 1,922 5,414 1,891 1,108 Value-adjusted operating result *) 4,472 -1,198 9,682 1,701 960 Policy holders fund 74,549 69,359 66,376 64,397 64,755 Total assets 80,470 75,160 72,460 70,297 69,514 Capital ratio 14.10% 11.22% 11.09% 9.03% 4.61%

UNI Storebrand Livsforsikring AS For allocation 3,337 1,913 5,409 1,885 1,092 – Policyholders 2,755 1,463 4,571 1,644 710 – of which, conditional 1,000 500 2,800 - - – Shareholders 582 434 744 174 379 – Tax 0 16 94 67 3 Interest result 3,195 1,973 5,620 1,743 1,239 Risk result 165 144 94 -81 38 Administration result -80 -124 -159 -179 -158 Miscellaneous 57 -80 -146 402 -27 Return on capital 8.50% 6.87% 13.58% 7.76% 8.47% Value adjusted return on capital excl. fixed bonds 9.90% 2.44% 19.87% 7.49% 8.13% Value adjusted return on capital incl. fixed bonds 10.65% ---- Average rate of interest 8.12% 6.58% 13.07% 7.33% 8.08% Average yield guarantee 4.0% 4.0% 5.1% 5.2% 6.8% Average yield guarantee excl. premium and pension adjustement fund 4.1% 4.2% 4.7% 5.0% 6.0% Operating expenses in % of – Premiums written 13.9% 13.2% 16.6% 16.0% 16.1% – Average policyholders fund 1.02% 1.10% 1.15% 1.18% 1.19% Key Figures *) Exclusive change in unrealized gains fixed bonds.

UNI Storebrand Skadeforsikring Group Gross premiums written 8,302 8,234 7,928 6,879 6,943 Premiums for own account 7,222 6,912 6,283 6,089 6,208 Result before allocations 1,184 712 1,164 270 281 Claims ratio for own account 70.0% 73.7% 77.4% 77.1% 77.3% Cost ratio for own account 28.5% 26.3% 27.9% 31.2% 31.4% Combined Ratio for own account 98.6% 99.9% 105.2% 108.2% 108.7% Solvency capital 4,878 4,694 4,306 4,030 3,453 Solvency margin 67.5% 67.9% 68.5% 66.2% 55.6% Claims reserve ratio for own account 109.5% 112.5% 111.4% 95.8% 90.6% Total assets 18,031 17,251 16,294 13,739 12,800 Number of man-year 2,688 2,882 2,891 3,180 2,920 Average return on solvency capital 24.7% 15.8% 27.9% 7.2% 7.9% Capital ratio 30.3% 25.9% 18.8% 18.3% 16.0% 3 Report of the Board of Directors 1995

combined ratio, which represents the sum of costs and claims, was 98.6 per- cent in 1995 against 99.9 percent in 1994. It is the company’s objective to achieve an average combin- ed ratio of less than 100. Earnings per ordinary share were NOK 4.94 against NOK 1.32 in 1994.

US GAAP In order to make UNI Storebrand’s accounts more accessible for inter- national capital markets, with effect from the 1995 accounting year the group also shows a comparison between the results under The board of UNI Storebrand 1995 produced a good result United States Generally Accepted ASA. Back from left: for UNI Storebrand Accounting Principles (US GAAP) Sigurd P. Laugen, Tom Ruud, • 1995 produced a good result for and Norwegian Accounting Mathias Dannevig, Lennart the group, due to a good technical Principles (N GAAP). The group’s Jeansson. Front from the result and a positive development result for the year under US GAAP left: Brit K. S. Rugland, in the capital markets. was NOK 1,059 million, which is • Capital and management resources Jon R. Gundersen (chairman), NOK 392 million lower than under were concentrated on the group’s Per-Leon Selseth and N GAAP. The group’s equity under core areas through the introduction Sigrun Gjengedal Ruud. US GAAP is NOK 7,309 million, of a new group management which is NOK 3,500 million higher Jens Ulltveit-Moe was not model, the establishment of new than equity based on Norwegian present at the time of the business areas and the disposal of Accounting Principles. See further photograph. businesses outside the core areas. under US GAAP. 1995 was a good year for UNI Storebrand. Good technical results Life insurance and a satisfactory financial return The life group’s operating profit was meant that the group result increased NOK 3,342 million, against NOK by NOK 929 million to NOK 1,451 1,922 million in 1994. The result was million. Gross premium income was divided between NOK 2,755 million NOK 13,558 million, which includes to customers, of which NOK 1,755 a reduction of 7 percent in life and million was allocated unconditionally pension insurance, and an increase to the insurance fund, and NOK 1,000 of just 2 percent in non-life insurance. million which has been conditionally allocated to the additional statutory The group’s results insurance fund, and NOK 588 million The group’s operating profit in 1995 allocated to equity and tax. The gross was NOK 4,206 million before alloca- return on capital was 8.5 percent in tions to life customers, compared 1995, compared with 6.9 percent in with NOK 1,985 million for 1994. the previous year. After allocating the customers’ share The value-adjusted result was NOK of the profit in life and pension insu- 4,472 million, which represents the rance the group result was NOK operating profit plus unrealized capi- 1,451 million, against NOK 522 million tal gains on all securities except bonds in 1994. The technical results in the held to maturity. This is an improve- non-life company measured by the ment of NOK 5,670 million from the 4 previous year. The value-adjusted 1994. The increase is mainly due to The yield on Norwegian government capital return increased to 9.9 percent higher financial income, but is also a bonds fell by 1.5-2.0 percentage from 2.4 percent in 1994. During the consequence of an improved technical points in 1995, while 3 month NIBOR year NOK 10.2 billion of bonds was result. The claims ratio was reduced was reduced during the year from either purchased or reclassified as a from 73.7 to 70.0. Measurable reali- more than 6.0 percent to below 5.3 portfolio to be held to maturity. If zed gains on projects commenced in percent. The Oslo Stock Exchange All unrealized gains on these bonds are claims settlement and tariffs/under- Share Index rose during the year by included, the value-adjusted return writing, as well as sales and marketing 11.6 percent, while the OBX Index, was 10.7 percent. Based on the com- totalled NOK 60-70 million in 1995. which reflects the development in pany’s choice of a low risk profile in This is in line with plans. Run-off the share price of the 25 most traded 1995, this is considered to be satisfac- gains on previous claim years repre- shares, rose by 0.9 percent. tory. The company’s low cost levels sented NOK 347 million in 1995, mean that the average return after which is in line with 1994. The flood For UNI Storebrand Livsforsikring deductions for total costs has been in eastern Norway involved a charge Value-adjusted total assets in the life very competitive in recent years, on the operating result of NOK 135 company increased during the year compared with other life companies. million. from NOK 76.3 billion to NOK 83.3 The company has had a goal The subsidiary Europeiske billion. The proportion held in shares during 1994 and 1995 to increase its Reiseforsikring AS recorded an ope- increased during the year from risk-bearing capacity. The sum of the rating profit of NOK 71 million. The 10.4 percent to 12.3 percent. Of this company’s equity, additional reserves operating result in UNI Storebrand Norwegian shares represented 76 and unrealised gains amounted to Kredittforsikring AS increased from percent at 31.12.1995. The increase NOK 9.2 billion at the year-end, NOK 14 million to NOK 30 million, in the value of the equity portfolio compared with NOK 6.5 billion at mainly due to the run-off portfolio. during the period was 12 percent. the start of 1994. Försäkringsaktiebolaget UNI Store- The proportion held in bonds brand Sverige (previously Victoria) amounted to 46.0 percent, of which Market conditions achieved a result of NOK 27 million. bonds held to maturity represented The total market for life and pension 13.4 percent. The return on the insurance products fell by 2.5 percent Market conditions bond fund, which excludes bonds in 1995 and amounted to NOK 18 The total market for land-based non- held to maturity, was the same as the billion. The life company’s market life insurance rose by 3.8 percent to BRIX Bond Index in 1995 at 14.1 share measured in premium income NOK 16.6 billion. The company’s percent. Duration (see Terms and fell from 30.7 percent to 29.1 percent. premium volume for own account in expressions) of the bond fund during Aggregate premium income was UNI Storebrand Skadeforsikring AS the period increased from 3.4 to 4.6. NOK 5,271 million, which is a reduc- increased by 5.3 percent to NOK The portfolio of business loans total- tion of 7.7 percent from 1994. In the 7,170 million. This is partly due to a ling NOK 4,287 million was sold at collective market premium income is greater proportion of premium the end of the year to Postbanken. in line with the previous year, but for volume being retained for own group life there has been a reduction account, and partly to increased For UNI Storebrand Skadeforsikring of 7.5 percent. The life company has volume and premiums in car insu- Total assets of UNI Storebrand endeavoured to shift sales in the rance. The market share for land- Skadeforsikring at 31.12.95 amounted private market from single premium based non-life insurance measured as to NOK 18.0 billion. The company policies to annually paid policies and a proportion of gross volume has has adapted the risk profile of the fund products. A fall in premium fallen from 40.9 percent in 1994 to portfolio to the insurance risk, and income for individual life and pension 40.6 percent in 1995. In the private during the year increased both the insurance of 21 percent was largely a lines market shares have increased volume and duration of the bond Board of Directors result of reduced sales of single pre- slightly, but there was a slight reduc- portfolio. At the same time the mium annuity policies. This fall has tion in the corporate market. company has established a portfolio been more than outweighed by of bonds to be held to maturity of expansion in the mutual fund savings Fund management NOK 1.1 billion. market. During the year sales of The development in the capital SPAR funds increased by 86 percent markets in 1995 was characterised by Storebrand Bank to NOK 1,597 million. a slowdown in economic growth in the The group wishes to extend its pro- USA and Europe. In Norway inflation duct range and reinforce its involve- Non-life insurance was lower than expected in 1995, ment in the savings market through The operating profit was NOK 1,184 which contributed to a fall in both establishing a bank. The bank will be million against NOK 712 million in short and long-term interest rates. a customer-oriented and cost-efficient 5 bank focused on selected customer and management resources. The gramme Declaration on the insuran- groups in the Norwegian market. agreement will provide for the cont- ce industry’s environmentally related The bank will exploit the opportuni- inued sale and marketing of credit obligations. During 1995 the group ties provided by new technology and and guarantee insurance products has signed a cooperation agreement telephone distribution. Norges Bank through UNI Storebrand. with the Norwegian Red Cross to and the Banking, Insurance and increase efforts in prevention work. Securities Commission have recom- Personnel and organization mended the grant of a licence and The number of man-years in the New head office the matter is being considered by the organization totalled 4,100 at the The group has signed a building con- Ministry of Finance. For further com- start of the year and 4,042 at the end tract for a new head office at Filipstad ments on the group’s expansion in of the year. Of 4,100 man-years at the Brygge, which will be divided into five banking see the section Storebrand start of the year, some 170 were invol- buildings. The buildings will provide Bank. ved in the international reinsurance in total some 65,000 square metres, business. The group management of which 40,000 square metres will be Other subsidiaries model has been introduced and offices. The buildings will be comple- UNI Storebrand Finans AS had a experience so far has been positive. ted at the 1997/98 year-end. The result of NOK 20 million. The com- As part of the group’s need to present office buildings in Vika will pany is in the process of being wound change, an extensive management be further rehabilitated and form part down and the business mainly consists development programme has been of the group’s real estate portfolio. of debt collection cases. implemented. A separate restructu- UNI Storebrand SPAR AS had a ring unit has also been established to Board of Representatives, profit of NOK 1.6 million. assist individual business areas and Board of Directors and UNI Storebrand Nybygg AS incur- staffs in restructuring work, and indi- shareholder matters red planning costs in connection with vidual employees in what for many is At the year-end UNI Storebrand ASA the new head office and recorded a a difficult phase. Provisions for had 77,872 shareholders against loss of NOK 4.5 million. restructuring measures in 1995 81,687 one year earlier. At the year- increased to NOK 100 million from end 48 percent of shares were owned Sale of subsidiaries NOK 30 million in 1994. Consider- by foreign shareholders. During the The group’s outgoing reinsurance able efforts were made by employees year the share price has increased by business was hived off as a separate on behalf of the group throughout 67 percent from NOK 21.05 to NOK company under the name Oslo Norway in 1995. The board wishes to 35.15, and the market capitalization Reinsurance Company ASA (Oslo Re), express its thanks to all employees for has thus increased from NOK 6.9 bil- with effect from 1.1.95. Following a their efforts. lion to 10.8 billion. secondary offering with preferential During the year Berit Klemetsen, rights for UNI Storebrand’s sharehol- Health, environment and Erik L. Flinder and Per-Inge Søreng ders, Oslo Re was listed on the Oslo safety have resigned from the board. Stock Exchange on 9 May 1995. Health, environment and safety are Lennart Jeansson and Brit K. S. Following this transaction UNI an important part of the company’s Rugland have been appointed new Storebrand has an interest of 10 per- work, both internally and in relation shareholder-elected representatives, cent in Oslo Re. The group has also to our customers. Absence of illness and Sigurd P. Laugen as one of the provided two subordinated loans in the group has fallen further from employees’ representatives. In the totalling almost NOK 150 million, 3.35 percent in 1994 to 3.12 percent Board of Representatives Stein and provided a guarantee for a dra- in 1995. The company does not pol- Wessel-Aas, Borger A. Lenth, Kåre wing facility of up to NOK 150 million. lute the external environment beyond Hagel and Jan G. Andersen have At the start of 1996 UNI that customary for insurance activities. resigned, and Erling Steigum, Harald Storebrand Skadeforsikring AS signed The company’s environmental work Tyrdal and Kristian Zachariassen an agreement with Gerling Konzern is based on a number of projects have become new members. The on the sale of UNI Storebrand which are aimed at improving the Board wishes to express its thanks to Kredittforsikring AS. The background company’s own environmental the retiring members of the Board to the sale is a continuing restructu- approach, as well as stimulating our and the Board of Representatives for ring process in credit insurance inter- customers to loss and environmental their efforts on behalf of the company. nationally, a greater need for larger prevention measures. UNI Store- Reference is made to note 3 and and more extensive credit assessment brand participated in the initiative to note 16 with regard to remuneration systems, and an increasingly internati- establish and, together with 45 other to the President of UNI Storebrand onal customer base. In addition the companies from around the world, ASA, the auditor and officers, and sale will contribute to releasing capital signed the FN’s environmental pro- 6 obligations in the event of termination the distribution network, continuing Oslo, 6 March 1996 or a change in management employ- strategy processes will be very impor- Translation, not to be signed. ment contracts. The shares in UNI tant for future competitiveness. An Storebrand ASA owned by officers agreement reached with Postbanken and group management are stated in provides UNI Storebrand with good the section Officers and management. opportunities to sell insurance pro- ducts to the bank’s customers. Jon R. Gundersen Capital situation In line with increasing competition Chairman The group’s capital ratio in accor- in both the private and corporate dance with the capital adequacy rules market, the need for a flexible and is 15.8 percent at 31.12.95, against cost-efficient organisation will grow. 8.8 percent one year earlier. The This imposes new requirements on its statutory minimum requirement at capacity to change and to remain Jens Ulltveit-Moe 31.12.95 was 6.75 percent, gradually close to the market. With the group increasing to 8 percent at 31.12.97. management model which has been The capital ratio in the life and non- established the conditions for this are life groups at the year-end was 14.1 in place. percent and 30.3 percent respectively. Increased competition also creates During the year the group has new requirements for simpler pro- Tom Ruud carried out two transactions to further ducts and greater openness towards strengthen its future financing. The customers, which should be taken agreements have been signed on into account in the ongoing evaluati- terms which indicate the group has on of the regulations applicable to regained the confidence of the inter- the insurance sector. national debt market. UNI Norwegian society faces important Per-Leon Selseth Storebrand Livsforsikring AS raised a challenges with regard to financing new subordinated loan of USD 120 and organisation of future welfare million with a term of 10 years. The benefits. The Norwegian Parliament’s amount was partly used to repay an consideration of Report to Parliament outstanding subordinated loan of no. 35 (1994-95) The Welfare Report, Brit K. S. Rugland USD 50 million. UNI Storebrand ASA will set the fundamental premises has signed an agreement on a com- around the operating parameters of mitted drawing facility with a term of life and pension insurance in the 5 years and with a limit of USD 150 coming years. UNI Storebrand belie- million. ves private welfare arrangements At the year-end liquid assets in should play a more important role in Lennart Jeansson UNI Storebrand ASA amounted to the coming years, in combination NOK 1,170 million. The interest with public schemes. See further the charge on the holding company’s article Interaction with welfare. debt during the year amounted to NOK 224 million. Application of profit Mathias Dannevig UNI Storebrand ASA recorded a Future prospects profit for the year of NOK 798 million. UNI Storebrand will continue its It is proposed to allocate the profit targeted measures to improve future for the year as follows: Board of Directors competitiveness. Through focus on – Dividend NOK 70 million implementing projects which have – Legal reserve NOK 80 million Sigrun Gjengedal Ruud already been commenced, the main – Contingency reserve NOK 648 challenge in future will be to obtain million the gains which have already been For further information on the identified. Under the plan, realization group’s dividend policy reference is of the gains from core projects in the made to the section Shareholder mat- non-life company will increase in ters. Sigurd P. Laugen 1996. Gains from this will be allocated to increasing competitiveness. Within

7 UNI Storebrand Group Profit and Loss Account 1 January–31 December 1995

Amounts in NOK million Note 1995 1994

Premiums written – life 21 5,270.7 5,707.7 Net premium earned – non life 22, 32 7,170.2 8,715.2 Net financial – insurance 23, 24 6,954.7 5,269.9 Other operating income 25 148.8 141.5

Total operating income 19,544.4 19,834.3

Benefits and statutory allocations – life 21 -7,081.7 -7,533.7 Net claims incurred – non-life 22, 32 -5,021.2 -6,606.2 Operating expenses 26, 27, 28, 29 -3,122.0 -3,428.4

Total expenses -15,224.9 -17,568.3

Other expenses/ceded life insurance -73.7 -92.3 Net financial items, other activities 30 -43.4 -192.0 Result, associated companies 31 3.5 3.0

Operating profit 20 4,205.9 1,984.7

Conditional additional allocations – life 34 -1,000.0 -500.0 Profit allocated to policyholders – life 34 -1,754.7 -962.8

Group result 20, 33, 34 1,451.2 521.9

Allocations – non-life 35 -14.7 -179.0

Result before tax 1,436.5 342.9

Taxes 36 -15.3 -80.7

Minority interests’ share of result 37 -5.5 -9.4

Result for the year 1,415.7 252.8

8 UNI Storebrand Group Balance Sheet 31 December 1995

Amounts in NOK million Note 1995 1994

Assets Current assets Cash, bank and post 4,724.1 8,318.1 Receivables from other insurance companies 38 380.4 1,277.0 Receivables from agents and policyholders 1,281.4 1,366.6 Shares 39, 40, 44, 54 8,948.0 7,025.8 Interests in partnerships 41, 54 28.4 29.0 Bonds 42, 43, 54 31,262.5 35,839.8 Certificates 45, 54 22,041.3 17,431.1 Other current assets 2,238.0 2,743.0

Total current assets 70,904.1 74,030.4

Fixed assets Loans, insurance 46, 47, 48, 49 10,487.1 17,145.9 Investments in associated companies 50 22.1 18.8 Other shares 39 22.7 11.0 Interests in partnerships 41 114.7 123.0 Bonds 42, 43, 54 11,312.3 0.0 Real estate 51, 52, 53 5,515.2 5,506.9 Operating assets 51, 52 223.9 232.0 Deferred tax allowances 55, 56 43.2 44.5 Prepaid pensions 27 372.3 299.2 Other assets 57 238.1 214.4

Total fixed assets 28,351.6 23,595.7

Total assets 99,255.7 97,626.1

Liabilities and equity capital Current liabilities Due to insurance companies 38 537.9 1,149.6 Due to agents and policyholders 181.3 183.7 Other current liabilities 1,506.0 1,678.6

Total current liabilities 2,225.2 3,011.9

Technical reserves Allocations insurance liabilities – life 58 75,140.5 69,997.5 Allocations – non-life 59 13,678.6 17,656.2

Total technical reserves 88,819.1 87,653.7

Long-term liabilities Deferred tax 55 43.2 44.5 Accured pension liabilities 27 592.4 795.1 Other long-term liabilities 13 2,065.5 2,103.9

Total long-term liabilities 2,701.1 2,943.5

1,319.6 Subordinated loan capital 60 1,105.4 Accounts

Guarantee allocations 383.1 335.5

Minority interests’ share of equity capital 61 1.2 117.2

Equity capital 62 3,806.3 2,458.9

Total liabilities and equity capital 99,255.7 97,626.1

Financial instruments: See note 43

9 UNI Storebrand ASA Profit and Loss Account 1 January-31 December 1995

Amounts in NOK million Note 1995 1994

Operating income Dividends from subsidiaries 346.1 Group transfer from subsidiaries 1 1,140.2 499.2 Rental income – real estate 1.3 1.0

Total operating income 1,141.5 846.3

Operating expenses Salaries and personnel expenses 2, 3 -474.8 -204.1 Depreciation -26.5 -13.1 Operating expenses – real estate -1.1 -0.2 Other operating expenses 314.9 158.0

Total operating expenses -187.5 -59.4

Financial income and financial expenses Interest income, securities 89.9 73.6 Other interest income 9.4 16.8 Interest expenses, bond loan -153.0 -153.0 Interest expenses, subsidiaries 17 -62.0 -74.3 Other interest expenses -9.0 -6.3 Write-down/loss shares in subsidiaries -330.0 Gain/loss on sale for share -9.3 4.5 Write-down securities -6.3 -18.1 Other financial items -15.5 -31.1

Total net financial items -155.8 -517.9

Profit before tax 798.2 269.0

Taxes 4 0.0 0.0

Result for the year 798.2 269.0

Revaluations and transfers Allocation to dividend -70.0 -90.0 Legal reserve -79.8 -26.9 Contingency reserve -648.4 -152.1

Total transfers -798.2 -269.0

10 UNI Storebrand ASA Balance Sheet 31 December 1995

Amounts in NOK million Note 1995 1994

Assets Currents assets Cash, bank and post 182.5 148.7 Intra-group receivables 17 1,182.0 508.6 Bonds 5 396.0 539.6 Certificates 7 591.4 702.7 Other current assets 56.2 53.8

Total current assets 2,408.1 1,953.4

Fixed assets Shares in subsidiaries 11 4,426.3 4,416.4 Subordinated loans to subsidiaries 144.8 101.4 Other shares 12 12.0 0.0 Interests in partnerships 41 0.7 0.7 Real estate 8, 9 15.4 14.3 Operating assets 8, 9 73.1 48.9 Prepaid pensions 2 44.7 14.9 Other fixed assets 6 0.0 106.7

Total fixed assets 4,717.0 4,703.3

Total assets 7,125.1 6,656.7

Liabilities and equity capital Current liabilities Intra-group debt 17 1.0 0.4 Allocation to dividend 70.0 90.0 Other current liabilities 332.7 324.0

Total current liabilities 403.7 414.4

Long-term liabilities Intra-group debt 17 980.2 1,322.4 Bond loan 13 1,800.0 1,800.0 Accured pension obligations 2 58.4 67.3 Other long-term 102.0 0.0

Total long-term liabilities 2,940.6 3,189.7

Share capital 14, 18 1,882.1 1,882.1 Legal reserve 14 1,142.4 1,062.6 Contingency reserve 14 756.3 107.9

Total equity capital 3,780.8 3,052.6

Total liabilities and equity capital 7,125.1 6,656.7

Financial instruments: See note 6 Guarantees: See note 19 Accounts

11 UNI Storebrand ASA

(Translation from Norwegian)

Audit report 1995* We have audited the annual report and accounts of UNI Storebrand ASA for 1995, which show a profit for the year of NOK 798,2 million for the parent company and a consolidated profit for the year of NOK 1.415,7 million. The annual report and accounts, which consists of the annual report from the Board of Directors, profit and loss account, balance sheet, cashflow statement, notes to the accounts and consolidated accounts, are presented by the company's Board of Directors and its Managing Director. Our responsibility is to examine the company's annual report and accounts, its accounting records and other related matters. We have conducted our audit in accordance with relevant laws, regulations and Norwegian generally accepted auditing standards. We have performed those audit procedures which we considered necessary to confirm that the annual report and accounts are free of material misstatements. In accordance with auditing standards, we have examined selected parts of the evidence supporting the accounts and assessed the accounting principles applied, the estimates made by management, and the content and presentation of the annual report and accounts. To the extent required by Norwegian generally accepted auditing standards, we have reviewed the company's internal control and the management of its financial affairs. The Board of Directors' proposal for the appropriation of the profit is in accordance with the requirements of the Companies Act. In our opinion, the annual report and accounts have been prepared in accordance with relevant legislation and regulati- ons for financial institutions and financial groups and present fairly the financial position of the company and the Group as of 31 December 1995 and the result of its operations for the financial year, in accordance with the regulations of the Banking, Insurance and Securities Commission and Norwegian generally accepted accounting principles.

Oslo, 6 March 1996 KPMG as

Translation, not to be signed Translation, not to be signed Ole M. Klette Arne Giertsen State Authorised Public Accountant State Authorised Public Accountant

*Includes the official annual accounts appearing on pages 4 through 11 and pages 51 through 90

Control Committee’s statement 1995 The Control Committee of UNI Storebrand ASA has reviewed the Board of Directors’ proposed annual accounts for 1995 for the UNI Storebrand Group. With reference to the auditor’s report of 6 March 1996, the Control Committee recommends that the profit and loss account and balance sheet are adopted as the accounts of UNI Storebrand ASA for 1995.

Oslo, 14 March 1996 Translation, not to be signed.

Nils Erik Lie Chairman of the Control Committee

Board of Representatives’ statement 1995 The Board of Directors’ proposal for the annual report and accounts, in addition to the Auditor’s report and the Control Committee’s statement has, in the manner required by law, been presented to the Board of Representatives. The Board of Representatives recommends the Annual General Meeting to approve the Board of Directors’ proposal for the profit and loss account for 1995 and balance sheet at 31 December 1995 for UNI Storebrand ASA and for the Group. The Board of Representatives supports the Board’s proposal regarding dividend and allocation to legal reserve for 1995.

Oslo, 19 March 1996 Translation, not to be signed.

Sven Ullring Chairman of the Board of Representatives 12 From strategy to implementation by Åge Korsvold, Group Chief Executive Officer

UNI Storebrand is in the middle of an resources, know-how and systems will group is resource demanding and expansive restructuring phase. The determine our future competitiveness. intensive, we will maintain the funda- good results from 1995 provide us with A lot has been accomplished and the mental organisational form at the same greater financial strength to further main features of our plans are establis- time as endeavouring to improve our develop our competitiveness. hed. We know what direction we are model based on the experience we Confidence in the company has been heading and the requirements deman- have had. reestablished among customers, share- ded by us to secure and reinforce the holders, the authorities and among position we already hold in our main Distribution challenge our employees. Plans for the future markets. The challenge going ahead UNI Storebrand’s extensive distribution have been made, and in 1996 we will rests primarily in our ability to imple- network has built up over many years put the main emphasis on implemen- ment the set plans. the strong market position the group ting the strategies. has today. This network has laid the Competition has increased consi- Group management model foundation for the good relationships derably in the Norwegian financial The group’s operating organisation we have with our customers. But we market. The introduction of new tech- was fundamentally restructured at the also recognise that the sales strength nology and major changes in custo- beginning of 1995. A main element of and cost-efficiency of our form of mers’ requirements and needs is lea- the new group management model, distribution will be challenged by both ding to extensive structural changes. based on a belief that focused compa- new and traditional competitors. Our The changes are taking place in all nies will be the most successful in the widespread local network represents a industrialised countries, but there are future, is a division into 10 business competitive advantage for serving several signs that the pace of change in areas. Each of these has separate profit customers locally. At the same time it is Scandinavia may be greater than other responsibility and a relatively high the customers themselves who deter- places due to the good market infra- degree of freedom with regard to mine which combination of “old” and structure and relatively large number buying common services from internal “new” distribution technology will win of competing institutions. or external suppliers. Experience from in the future. We also know the cost During the last couple of years we the first year has been good. The orga- differences between distribution chan- have devoted substantial resources to nisation has become more market and nels will probably increase, at the same change processes and analysis of exter- profit oriented and the implemen- time as the larger units will strengthen nal and internal operating parameters. tation ability appears to be increasing. their position through economies of Organisation of working methods, Even though cooperation across the scale. This has made it possible to

Business Areas in UNI Storebrand 4. March 1996

Investment management Riulf Rustad

Large customers life Per Myklestu

Corporate life Accounts Jørgen Bredesen and Centralized Product Life/Person Services Paul Høiness From strategy to implementation Storebrand Bank* Executive Group Sverre Bjerkeli Management Spar (savings) Knut E. Larsen

Distribution Regions Lars Petter Ørving Strategic Staff Product Non-Life Gunn Ovesen

Marine and Energy Morten Hjemsæter

Corporate Non-Life * Concession is being considered by the Ministry of Finance Jørgen Bredesen

13 think through the distinction between make it easier to compare both betwe- production - or the “factory” - and en insurance providers and between “distribution”, as many other industries competing financial institutions such have already done. In the case of UNI as banks and mutual funds. The rele- Storebrand the first specific example vant measurement term for the savings of such thinking is the agreement sig- element in the insurance product is ned with Postbanken, which maintains the net return on policyholders’ funds competition between the two instituti- after deducting total costs. It is plea- ons at the same time as enabling both sing, but not surprising, that UNI Group Chief Executive Officer to benefit from each others relative Storebrand, which is the largest com- and President UNI Storebrand cost advantages on the product side. pany, is the most cost-efficient life com- Livsforsikring AS, Åge Korsvold pany. This should not, however, lead Potential gains in non-life us to relax. It is still possible to both insurance improve products and reduce costs In the business area non-life insurance substantially in Norwegian life insu- improvements in claims settlement, rance. underwriting and sales and marketing have been given priority. Progress in Expansion in the savings the claims settlement project has been market satisfactory, but tariffs/underwriting As a result of targeted measures we and sales/marketing need more time have increased sales of our SPAR pro-

President, UNI Storebrand in order to reach the implementation ducts substantially during the last year. Skadeforsikring AS, Knut W. phase. The goal of annual cost savings In total SPAR sales have increased by Francke of NOK 300 - 500 million by the end of 86% to a total of assets under manage- 1997 remains. The results so far are ment of NOK 3.5 billion at the end of ahead of schedule. A special feature of 1995. We were also the first to introduce 1996 has also been that costs have combined funds in the Norwegian increased due to investments in know- market. These have been a big success how and capacity. This is already lea- and are now being copied by our com- ding to better profitability through, petitors. On the other hand we did not among other things, a lower claims manage to maintain our market shares ratio. The rest of the gain can, howe- in the market for tax exempt savings ver, only be achieved if we are able to products, in which the banks had a implement the necessary restructuring stronger position. Executive Vice President, processes. This imposes heavy We expect to be able to start Personnel and Organization, demands on the organisation in a peri- Storebrand Bank during the first half Svein Hagen od in which we are experiencing much of 1996. This will complement our pro- sharper competition. duct range and strengthen our positi- on in the Norwegian market for Costs in life insurance savings products. UNI Storebrand is putting efforts into making life insurance easier for custo- Increased risk-bearing mers. The present products are difficult capacity to understand, and detailed and exten- UNI Storebrand Livsforsikring has in sive regulation of the life insurance recent years had as its overall objective sector has made product development to strengthen its solvency and risk a demanding and lengthy process. We bearing ability, so that the life company Executive Vice President, have taken several initiatives which will should over time have greater capacity Marketing and information, make it easier for customers to under- to assume a higher financial risk. As a Knut N. Kjær stand our products, and above all long-term investor on behalf of our 14 pension customers, it is an important Financial and structural objective for us to secure as high a challenges return as possible at an acceptable risk. UNI Storebrand has not been involved Among several measures taken to in the major mergers and acquisitions increase the risk bearing ability we that have taken place in the financial chose a lower risk profile during 1994 sector in recent months. This is a natu- and 1995 than we want for the future. ral position for us because our assess- The return on the life insurance ment is that we can achieve the highest company’s funds in 1995 is also a result return on equity through managing Executive Vice President, of the chosen risk profile. Good results the resources we already control. The Accounting and Finance, and large transfers to supplemental establishment of our own bank illu- Idar Kreutzer reserves have contributed to UNI strates this. Through improving our Storebrand Livsforsikring constituting competitiveness and extending our a very solid life insurance company in product range we will contribute to 1996, with greater financial risk capa- an increase in competition in the city than previously. Our investment Norwegian market for financial approach in the future will reflect this. services. Foreign institutional investors An interaction between increased their holding in UNI private and public systems Storebrand’s ordinary shares from less The operating parameters for life insu- than 20% to 48% during 1995, and the rance companies have changed consi- share price rose 67% to NOK 35. More Executive Vice President, derably during the last five years. Some correctly priced equity has many Investment Management, changes have been constructive and to advantages and contributes in itself to Riulf Rustad the benefit of our customers, while UNI Storebrand becoming a more other regulations have contributed to competitive group. Foreign share pur- complicating products and making chases and a rising share price are them more expensive for customers. both a vote of confidence in the group The overall parameters for life and and a reflection of the positive deve- pension insurance will once again be lopment in the Norwegian economy. debated when the Norwegian With more demanding financial Parliament considers the Welfare ownership, the requirements to focus Report this spring. Because this debate on a businessoriented corporate cultu- is important - for our customers and re and the return on equity have been for UNI Storebrand - we have prepared reinforced. Executive Vice President, a report for our customers in which we This means in practice for UNI Centralized Office Services, discuss and explain the interaction Storebrand that the existing plans will Jørgen Bredesen between public and private welfare be implemented. This means that mea- schemes. One of the important conclu- sures which reinforce UNI

sions is that private welfare schemes Storebrand’s competitiveness will be From strategy to implementation should play a more important role in given high priority. the coming years in interplay with both the overall pension policy objectives and with the major changes relating to the long-term financing of public welfare schemes.

Leader of the Group legal department, Executive Vice President, Hans Henrik Klouman

15 Investment Management

UNI Store- tion most of the funds in the non-life Strengthened risk bearing capacity brand company and other group companies means that UNI Storebrand is able to Investment are invested in securities. In total the withstand greater fluctuations and thus Management securities portfolios and mutual funds increase the expected return for the (USIM) mana- managed by the group amount to group’s life and pension insurance cus- ges the securi- NOK 83 billion. This makes UNI tomers. This means that we expect a ties portfolios Storebrand the largest private sector greater part of customers’ funds on the for the insu- investor in Norway. In 1995 external life side will be placed in securities. Manager of the rance compa- pension funds totalling NOK 959 milli- The development in the savings and Business Area: nies in the on were managed. investment markets in other respects Riulf Rustad group and Actual portfolio management is also shows that an increasingly larger those of private subject to various legislative and proportion of savings in general are pension funds. USIM also has regulatory provisions which apply to being invested in securities. responsibility for sales/marketing of the individual product areas, and to Fund management is therefore the group’s asset management pro- separate portfolio management expected to represent a more and ducts/services, as well as customer environments, pursuant to which more important part of the group’s follow-up with large investors. An management for the insurance compa- wealth creation in the coming years. important part of this is the fund nies in the group is grouped in a joint A larger part of the portfolio is management which is integrated in unit under the life company. expected to be invested in interna- the collective pension insurance Particular emphasis is given, how- tional securities markets, and in this product. ever, to coordinating investment philo- regard the company has begun to use Fund management is offered by UNI sophy, management and monitoring established foreign investment mana- Storebrand through three main structure for all portfolios managed by gers as sub-contractors, at the same product areas; mutual funds, active the group, as well as utilising synergies, time as strengthening its own exper- fund management and as an integra- among other things, in terms of system tise. ted part of UNI Storebrand’s life and development, investment reporting, pension insurance products. In addi- etc.

Large Customers Life

The Large private sector with more than 250 emplo- Management measures to increase Customers Life yees, the public sector (municipalities customer satisfaction are being given provides advi- and state companies) and the pension particular emphasis. In 1995 the com- sory services in funds market through the subsidiary pany carried out a customer satisfacti- the sale of pen- Aktuar-Consult AS. In addition insurance on survey and the result showed a mar- sion insurance solutions are offered to expatriate ked improvement from 1994. The solutions and employees and multinational companies. challenge in the future is to succeed related additio- The market developed positively last with further improvements in areas Manager of the nal services for year, with a net inflow of customer funds which are most important for custo- Business Area: large compa- of NOK 56 million. Total premium mers. Per Myklestu nies and the income was NOK 2.1 billion and funds In addition to establishing a position public sector. under management NOK 20 billion. as market leader in the private large The business area places emphasis on The largest new customers in 1995 customer market, during 1996 we will high quality customer service, insuran- were Follum Fabrikker and Glamox. further develop the company’s strong ce solutions which are adapted to The subsidiary Aktuar-Consult AS took position in the pension fund market requirements and a cost-efficient and over technical administration of the and the market for associated services, market-oriented product development. pension funds of Telenor and as well as securing a real breakthrough The business area’s most important Sparebanken Midt-Norge. Odda Smelte- in the market for public sector service customer segments are companies in the verk and Selmer left the company. pension schemes.

16 Corporate Life

The Corporate ted to making Corporate Life a more in order to strengthen Corporate Life’s Life serves the expansive and customer oriented orga- long-term competitiveness. This work market for nisation. A positive change in the is supported by extensive know-how medium-sized trend involving the sale of collective development. Our customers’ satisfac- and small pension insurance, including an incre- tion depends on high quality in our companies in ase in the transfer of funds, has contri- advice and service, in addition to insu- personal buted to a considerable improvement rance solutions adjusted to needs, a insurance. in profits from the middle of the year. secure long-term return on pension Manager of the Corporate Life In addition we are recording, more funds and cost-efficiency. Targeted Business Area: has a professi- new members and fewer departures in profitability management and reducti- Jørgen Bredesen* onal advisory the insurance schemes, which is an ons in operating costs will lead to lower system which important signal regarding the devel- prices for customers and improved provides individual insurance soluti- opment in the labour market. competitiveness. ons for the companies, as well as Our sales and market targets for 1996 Health, Environment and Safety will collective pension, group life insuran- will be obtained by taking a greater pro- be an important area of focus for ce, personal insurance, early retire- portion of the personal insurance mar- Corporate Life in the coming years. ment pensions, key-man insurance ket in competition with other insurance Know-how in risk reducing working and supplemental pensions, etc. companies and pension funds. At the environment measures and internal Corporate Life had a total premium same time transfers from the company controls will be passed on to corporate volume in 1995 of NOK 1.3 billion and will be reduced. The cost advantage customers through an extended range NOK 27 billion under management. over our competitors will be maintained of services and training. At the same Corporate Life has changed its focus and the market position in group life time underwriting will be considerably from a portfolio management orienta- insurance will be strengthened. strengthened, which will secure the tion to a business orientation. Cost Change and improvement processes company a further improvement in controls have been improved and orga- directed by customer and market profitability control. nisational adjustments have contribu- requirements have been implemented

* Untill medio 1996.

Product Life/Person

Product Life/- compensalion, group life and other UNI Storebrand Liv had 330,000 Person was additional cover), accident insurance, customers in the individual market at established as well as individual and group-based the end of 1995, with a total of NOK March 1996 insurances in all parts of the private 26 billion under management. In 1995 and constitutes market. aggregate premium volume was NOK a merger of the Product Life/Person will also have 1.8 billion. During 1995 UNI previous responsibility for the marketing and Storebrand shifted sales from single busines areas, sale of products focused on the private premium policies towards more annu-

Manager of the Business Areas Private Life market. Sale of these products takes ally paid policies and fund products. Business Area: and Product place through underwriters and advi- Sale of annuities were reduced in 1995 Paul Høiness Life. Following sors in Distribution Regions, as well as as the Welfare Report has led to uncer- the merger the through external sales channels inclu- tainty regarding future tax advantages new Product Life/Person business area ding organisations and banks. of this product. The market share of has total product responsibility for the Product Life/Person has devoted premiums written for pension and group’s personal insurances, both for considerable efforts in 1995 to deve- endowment insurance including the corporate market and public sector lopment projects in its area. During annuities, has been reduced from and for the private market. Product the year previously separate product 35.2% in 1994 to 34.3% in 1995. responsibility includes group pension environments have been grouped In 1995 UNI Storebrand launched a insurance, personal insurance (workers under a common management. completely new product in Norway,

17 Critical Illness, in which the customer competitive savings and risk products In the private market the main chal- agrees an insurance sum to be paid in which provide financial security in the lenge is to strengthen competitiveness the event of suffering a defined serious form of agreed payments under old further. As the clear cost leader in its illness. This insurance has so far been age and early retirement pensions, in market, UNI Storebrand has a good purchased by more than 5,000 custo- the event of death or disability, and in basis. Marketoriented product develop- mers. The need for financial security the event of accidents and illness. In ment will be another success factor. In in the event of illness will continue to addition we will contribute to business addition, it is a goal in 1996 to achieve be an important core area in future. volume and profitability through follo- increased sales strength and volume The business area’s most important wing up the distribution channels, through the company’s own sales orga- task in future will be to manage and underwriting, professional support and nisation and through Postbanken’s implement product and system continuous adaptation of products and network. developments in order to meet market prices. The unit will continue to build requirements. We will offer simple and up its expertise.

Spar (savings)

SPAR offers The launch of the UNI Storebrand SPAR will manage and further private custo- SPAR 2000 funds continued in 1995 develop the group’s strong position in mers and firms and these accounted for approximately the financial savings market and will various types 60% of total sales in the market for continue to increase market shares. of savings pro- combination funds. Assets under SPAR will secure and further develop ducts and is management in our combination UNI Storebrand’s position in the responsible for funds increased from NOK 95 billion market. This will be done through pro- the group’s to NOK 255 million in 1995, giving an fessional customer service, as efficient Manager of the positioning increase in market share from 11% to distribution as possible through inter- Business Area: and expansion 26%. nal and external channels, and Knut E. Larsen in the finan- In 1995 the SPAR Academy, an through ensuring that the market at all cial savings expertise development programme for times is offered the products it requi- market. The product range includes the group’s representatives involved in res. Customers’ needs will be met at all the SPAR 2000 series, money market customer contact, was established in times. funds, equity funds and bond funds. conjunction with Norges Handels- It is also a goal to provide more SPAR is organised in UNI Storebrand høyskole. As a result of this, expertise people in the group with the expertise SPAR AS, a wholly owned subsidiary in the group’s distribution network has available from the SPAR Academy to of UNI Storebrand ASA. increased significantly and has led to ensure that customer services is as UNI Storebrand SPAR increased its gross sales of securities funds through professional as possible, and to build aggregate market share from 7.5% to UNI Storebrand’s distribution network out the expertise development 8.1% in 1995. Gross sales of NOK 1.6 increasing from NOK 80 million in programme. billion represent an increase of 85.7% 1994 to NOK 800 million in 1995. compared with 1994.

18 Business Areas 19 The Capital Management Account The Capital Management The Capital Management Account A bridge to mutual funds A bridge Bank’s “Capital Manage- Storebrand in will form the hub ment Account” finances. the customer’s personal to easily achieve Customers will be able savings, with a high return on their time. limited use of their own a com- statement will give customers bank deposits, plete overview of their and loans. mutual funds, securities have access to a The customer will also highly qualified designated group of customer service representatives. will contribute to differentiate Storebrand Bank from our competi- tors. We will be the bank which actively helps customers to move savings from low interest bank deposits to savings vehicles with a higher expected return. The bank will mainly target the retail The bank will mainly phone from early in the morning till early in the morning phone from evening every day through- late in the able to Customers will be out the year. and monitor access payment services a day, either by their accounts 24 hours be possible to telephone or PC. It will VISA or our bank withdraw cash using teller machines card in all automated and in stores. in particular customer market, and custo- UNI Storebrand’s insurance type of account mers. We will offer one which customers can use either as a checking account or a savings account. A low-cost operating concept means that we can offer very competitive deposit rates with no minimum balan- ce requirement. Therefore we will also apply the principle that we will charge for the use of bank services baced on what they cost. The bank will also offer mortgage loans and certain other loan products. A complete range of savings products UNI Store- brand is esta- blishing a bank: Store- brand Bank. This will enable the company to

With Storebrand Bank we can utilise The establishment of Storebrand Sverre Bjerkeli. The bank of tomorrow participants in the As one of the first “new” banking sector, Storebrand Bank will not have branches in the traditional sense. Our offices around the country will represent the bank, but will not provide regular teller servi- customer service ces. A well qualified centre will serve customers by tele-

President, Storebrand Bank Storebrand UNI Storebrand’s position as the coun- try’s largest manager of private savings capital in the securities market. The size and quality of our funds manage- ment operation provide a basis to develop the market’s best savings and mutual fund products. The bank will exploit the platform and brand loyalty which UNI Storebrand has developed over generations. Bank will further the company’s strategy for the sale of savings and risk products. As a complete supplier we are better able to focus on customer products. individual needs, rather than satisfy most customer needs in the satisfy most customer savings market. It represents a natu- ral step following the establishment of the unit UNI Storebrand SPAR in 1994 with a view to strengthening sales of mutual fund products. Product Non-Life

Product Non- industry/business, and average premi- obtain synergy effects (see separate Life has ums on a number of lines have fallen article). The claims handling operati- responsibility during the year. This development is ons have also been strengthened for technical expected to continue in 1996. through the addition of more medical insurance In the business related lines a new and legal expertise. This year UNI matters and format for policy conditions was Storebrand was the first insurance product deve- introduced in 1995, which provides company to introduce an inspection lopment in customers with a better overview of the function in claims handling for con- Manager of the non-marine contents of the insurance cover. This tents losses. Business Area: lines. The pro- work will be continued in 1996 to also In the coming year Product Non- Gunn Ovesen duct range include private related lines. The Life will place emphasis on the imple- mainly inclu- floods in Eastern Norway in May and mentation of the results from the stra- des fire/comprehensive insurances to June 1995 were a major challenge for tegy projects Tariffs/Underwriting and the private- and corporate market, the company’s claims handling system. Claims Handling, and continue to together with motor-, liability-, trans- Several businesses were hit by a lack of focus on building up expertise in the port-, and travel insurances. The insurance cover for business interrupti- core areas; claims handling, under- business area sells most of its products on losses as a result of natural perils. writing and market know-how. This through the business areas UNI Storebrand decided to cover this expertise will contribute to securing a Distribution Regions and Large loss and has now introduced business business oriented organisation with the Customers and Corporate Non-Life. interruption losses as a consequence of right balance between volume growth Plus Forsikring and Europeiske natural perils as standard cover. and profitability. Reiseforsikring AS are also included There has been a strong focus on Further development of the IT sys- in Product Non-Life. claims handling this year and two tems will ensure quality and flexibility ´ The market has been characterised claims handling operations in personal towards customers and markets and by rising competition in 1995, particu- injury have been merged to strengthen increase efficiency/reduce costs in the larly in the lines private motor and the professional environment and company’s own system.

Distribution Regions

The business and non-life insurance for private savings. The launch of the SPAR area has individuals and companies. products with associated training and responsibility The distribution system handled 2/3 authorisation of the sales team means for the sale of the company’s aggregate premium that we now have regionally an exten- and service of income in non-life insurance in 1995, sive product range and very skilled UNI Store- roughly 85% of the company’s premi- personnel. brand’s pro- um income in private life insurance, We have experienced increased ducts to the 55% of the company’s total sales in the competition over several years. This Manager of the private market SPAR funds and some life insurance trend is expected to intensify and we Business Area: and to small for the corporate market. will respond to the challenge by main- Lars Petter Ørving and medium- An extensive programme to improve taining close relationships with custo- sized compa- the core business was begun in 1995. mers through our extensive local pre- nies. In total the business area has Focus on operation of the office net- sence. Combined with the company’s 1.2 million private customers and work, a more efficient claims handling economies of scale this gives us consi- 105,000 corporate customers. These organisation, and the establishment of derable competitive advantages. are served by some 2,100 employees regional technical centres in non-life Cost-efficient operations, continuous from 270 local offices, including insurance have led to good results and improvements in all our customer rela- agents. In addition the unit is to improved customer service. It is tions and higher targets regarding responsible for claims handling, important for us to be able to satisfy all sales results will be the main measures technical and marketing functions for customers’ needs for insurance against in reducing relative distribution costs, non-life insurance. The product range unexpected events regarding life and and thus further strengthening our includes private life products, savings health, as well as management of competitiveness.

20 Marine and Energy

The business tal and fishing vessels, satellites, air- and leads to tough competition and area covers craft and energy insurance. lower premium volumes. marine insu- UNI Storebrand maintained its positi- The satellite insurance business, rance for ship- on as one of the world’s leading marine which began in the 1970s, has made a ping compani- and energy insurance companies in positive contribution to our business es and energy 1995. Following large losses in marine and did so as well in 1995. insurance on insurance at the beginning of the 1990s Through selection of quality consci- offshore oil with subsequent premium increases, the ous customers it is our goal to main- Manager of the installations results in 1995 have shown good profita- tain an insurance portfolio which over Business Area: throughout the bility. The same trend is apparent in time can provide us with the opportu- Morten Hjemsæter world. The energy insurance. This has led to strong nity to offer our customers good and marine insu- competition in the insurance markets. stable prices. Continued over-capacity rance customers are Norwegian and The energy insurance market has is expected, however, to lead to contin- international shipping companies been affected by the fact that the oil uing price pressure and falling profita- which give priority to quality operati- companies are buying less insurance. bility. ons, manning and maintenance. The large platforms, particularly in the The insurance companies’ ability to Within shipbuilding, customers inclu- North Sea, are approaching the end of meet claims is coming increasingly into de shipyards, where loss prevention their production lives. New technology focus. The company’s strong solvency, measures form an integrated part of enables the oil industry to choose diffe- good customer relationships and rapid vessel construction. The main pro- rent and cheaper solutions for the claims settlement process are competi- ducts are marine insurance, insuran- fields to be developed in future. This tive advantages which provide access to ce of ships under construction, coas- reduces the need for coverage capacity the main part of the market.

Corporate Non-Life

The Corporate undertake loss prevention activities In the corporate and industrial Non-Life unit towards its customers. The subsidiary market we experienced a clear increase serves the mar- UNI Storebrand Sverige is included in in gross claims volume in 1995. This is ket for large the business area. due to increased capacity utilisation corporate cus- We have a strong market position in and economic growth in several parts tomers, power segments of the Norwegian business, of the Norwegian industry. generation with market shares which vary from It is a clear objective to strengthen companies, around 40% to 80%. The business the market position in future. This will Manager of the housing coope- area’s aggregate premium volume in be achieved through further develop- Business Area: ratives, indus- Norwegian insurance was approxi- ment of the distribution channels’ Jørgen Bredesen trial organisa- mately 20% of the non-life company’s brokers, agents and direct service, a tions, the sta- total premium volume in 1995, which strong cost focus, as well as measures te’s business interests and all pro- is at the same level as in 1994. based on systematic measurement of

ducts provided through brokers. In In Sweden UNI Storebrand is today customer satisfaction. In order to limit Business Areas addition the business area has respon- a small niche player with a clear the volume of claims, loss prevention sibility for the corporate and munici- growth strategy. In 1995 the company will be an important part of further pal market in Oslo and Akershus, achieved a breakthrough with the measures in product development, and including agency business. The most main Swedish brokers, which has led to our loss prevention courses and trai- important product areas are business the inclusion of UNI Storebrand on ning programs at Hobøl and Starum comprehensive, fire and machinery the bidders list for all major tenders. will be further developed. insurance, as well as liability, occu- UNI Storebrand Sverige AB recorded pational injury and accident insu- volume growth in premiums earned of rance. It is also an important part of 27% from 1994 to 1995. the business area’s responsibility to

21 Interplay for welfare UNI Storebrand’s report on the division of work between state and market in the welfare state

The government’s Welfare Report has saving in Norwegian companies as an On the other hand, proposals in the once again brought up the question of example in the contribution from UNI Welfare Report mean that the differen- the future welfare state. UNI Storebrand to the debate on the welfare ce in treatment between private and Storebrand has therefore prepared a state of the future. public sector employees will be main- report which focuses on how the wel- tained and reinforced in several areas. fare state’s schemes and rules can best Freedom of choice and equal The possibility of retiring before nor- be organised in order to ensure the treatment mal pension age varies today due to future welfare provision. In most areas of society the individual’s special age limits and AFP. No solution The basis of the report is that we wish for freedom of choice and indivi- to this problem is proposed. To the must utilise in a better way the many dual treatment is increasing. This is contrary it is proposed to introduce 40 opportunities to be found in an impro- the case both for companies who years earnings for private service pensi- ved interplay between public and organise welfare schemes for their ons, against 30 for schemes in the private schemes. In a situation where employees and for the individuals. public sector. the welfare state hardly can increase Nevertheless the Welfare Report has More examples of restrictions on tax level and demand for welfare responded very little to the desire for product requirements could be given, services rises, it is a challenge to avoid a increased freedom of choice. To the but the point is nevertheless clear: split welfare state in which public and contrary the government proposes Rules have not been established for private schemes are alternatives, rather tightening the rules for collective supplementary security schemes which than supplements. The government’s pensions. Among other things, further provide equal treatment and flexibility Welfare Report, however, discusses the- restrictions are placed on the total for the individual. The Welfare Report se challenges only to a small extent pension level and the earnings period similarly does not discuss what could and does not make any proposals on is proposed to be increased from 30 to be said to be a desirable or natural fundamental changes in the present 40 years. No opportunity is given to level of pension coverage outside the division of work. UNI Storebrand include early retirement pensions in social security system, even though it would argue that market-based the normal pension scheme, contribu- appears to be a premise that social schemes can both be spearhead for tion-based schemes are not accepted security will not cover the needs of all. the development of welfare services within the tax rules and the authorities Overall this means that we will not and serve as tools for broader social have turned down investment choice have a uniform policy for the interplay political goals. (free choice for asset allocation) for between public and private schemes in Insurance schemes do not create a companies. pension policy private market in themselves. When an A lack of freedom of choice means extensive private range of health and that companies, which are not able to Tax deferral and product social services is available the insurance establish a comprehensive benefit- requirements - is an important schemes will, however, have a positive based service pension scheme, will not pension policy tool weakened? effect in that services will be made be able to offer a simpler scheme. As The many requirements imposed on generally available, and thus contribute a result the opportunities for more collective pension schemes are based to opening the market for large groups employees in the private sector to on the desire to achieve socio-political of the population. obtain access to pensions outside the goals. Among other things, all employ- UNI Storebrand seeks through its social security system will be reduced. ees in a company must be covered by a involvement to contribute to providing We do not need to go further than service pension scheme and be secured individual customer and companies Denmark to find examples of contribu- the same relative pension benefits in with flexible and cost-efficient welfare tion-based schemes being an important order for the scheme to be entitled to arrangements, at the same time as con- part of the collective pension market. tax deductions. The authorities can tributing in the longer term to creating This lack of choice contributes to per- impose requirements on the companies’ sustainable social and economic deve- petuating the great differences in pen- pension schemes because the compa- lopment. In this article we have revie- sion coverage in Norwegian industry. nies are given a benefit in the form of wed certain aspects of private pension A lack of freedom of choice on the tax deductions. The rules on tax defer- investment side may also increase ral are thus an important pension policy pension costs for the companies.

22 tool. A particular aspect of the proposals rences in treatment of financial saving Terms of trade between require- in the Welfare Report is that product and the fact that those with the highest ments to product and value of tax g requirements are being tightened at income and wealth are largely favoured. deferral the same time as the authorities appe- UNI Storebrand has, however, calcula- ar to have a fundamentally negative ted that the value of allowing tax defer- view on the ability to allow tax deferral. ral would actually be positive for the There are, however, limits as to how state. Under reasonable conditions the far the authorities can reduce freedom present value is so high that we can of choice. Once a company finds that characterize tax deferral by pension- the value of the tax advantage is redu- savings as a profitable way of saving for ced, it is no longer certain that it will the state. More important than this is choose universal schemes within the maybe that tax deferrals means to push RequirementsKrav til produkt to productSkatteutsettelse Tax deferrals tax rules. A company which operates a the tax income to a time when the • Contribution•Ytelsebasert based • Life•Livsvarig annuity utbetaling pension scheme outside the Taxes Act state finances probably is under a far • Ceiling•Tak on på pensionbase p. grunnlag can choose more freely which employ- stronger pressue than today, due to the • Proportionality•Forholdsmessighet • Membership•Medlemskap •Investeringer ees will be covered, set a lower age increased number of older people and • Investments limit than 67 years, etc. The authorities a decrease in the oil revenues. The sta- will thus not achieve the objectives te could thus cede revenues while oil which motivated the product require- revenues are at their highest and “har- ments, for example that all employees vest” tax revenues when oil income Comparison of pensions earnings should be covered by a pension sche- falls and pension costs rise some way period in public and private sector me. UNI Storebrand would emphasise into the next century. that the proposed tightening of the The report shows that the differential % 100 rules for service pension schemes treatment for tax purposes of pension means that companies to a greater saving is not in conflict with the inten- 80 extent will evaluate schemes outside tions behind the tax reform, because the Taxes Act. A greater freedom of pension saving is not identical to other 60 choice on the investment side could savings products (due to differences in also provide an additional return liquidity risk and the insurance ele- 40 which balances the loss of tax benefits. ment). In addition measures to stimu- If this development continues, the late private and long-term pension 20 socio-political effects could be extensive. saving will increase the supply of equity in Norway. This has positive effects on 0 Should private pension schemes real investments and the development 37 43 49 55 61 67 receive tax incentives? of Norwegian industry. The Welfare OffentligPublic sector sektor In spite of the scepticism expressed on Report does not place any emphasis on PrivatPrivate sektor sector the principle of tax deferral for collec- the special role which pension capital tive pension saving, the government and the life companies play in the has nevertheless chosen to maintain Norwegian equity market.

the arrangement. The argument The interplay between public and the objectives of pension policy. A lack Interplay for welfare appears to be that it does not wish to private pension schemes can in other of analysis of the interplay between the disturb a well established part of the words be regarded as significantly state and the market in pension policy overall pension system. At the same different from the conclusions in the may result in the authorities reaching time a removal of tax deferral would Welfare Report. This is the case both erroneous conclusions. Inadequate also require a corresponding in relation to tax losses, the allocation reforms can lead to greater differences reorganisation of pension schemes for of income and the effect on private and economic inefficiency in the future public employees. savings. In addition tax incentives are a pensions system. The arguments against tax incentives necessary means of ensuring that include the loss of tax revenues, diffe- private pension schemes develop within

23 Improvements in personal injury settlement An open approach and a high professional standard are essential to create confidence in a sensitive area

UNI Storebrand pays out more than respect - even when UNI Storebrand Why is disability settlement so NOK 1 billion each year in compensa- considers the claim to be invalid. demanding? tion to more than 10,000 injuries. As Consistent and fair treatment will be Why aren’t disability settlements as part of the general improvement in the ensured through professional expertise straightforward as settlements for core processes we are now undertaking and uniform procedures. As a conce- damage to motor vehicles? In most an extensive reorganisation of the per- quence the departments’ medical cases they are! Of more than 10,000 sonal injuries settlement unit. In this resources are being developed and the When, however, a personal injury work we are also taking into account legal environment strengthened. disagreement settlements yearly the increasing criticism of the insu- In disability insurance claims the arises, a disability less than 1 percent rance companies’ handling of disabi- insurance companies need to obtain settlement is end up in court. lity cases and allegations of alliances expert reports from medical consul- more likely to with consultants in medicine. In the tants. Because the companies also dis- woke emotions than a motor insurance future we will put effort into creating burse the doctors, allegations have settlement. Damaged cars can always better direct contact with those inju- been made of alliances between the be put back into the pre-damage con- red and help them in handling pro- consultants and the companies. By dition, even if for financial reasons we blems arising as a result of the injury, now employing its own doctors it could may decide differently. A car is valued including assistance with rapid exa- be argued that UNI Storebrand is based on a set of objective criteria. In mination, diagnosis and treatment if strengthening the basis for such allega- the case of an injured person, however, necessary. Definite rules and routines tions rather than weakening them. Our subjective pain or trouble (the symp- will ensure an independent professio- consultants, however, will mainly esta- toms) are very often the most impor- nal assessment. blish quality management procedures tant assessment basis for compen- for the processes and not determine sation. Life can change dramatically as a result the degree of disability or causal relati- Cars with reduced compression are of an injury. If income capability is onship. We will offer the claimant the not asked about their state of mind. A permanently reduced, an insurance opportunity of damaged car is only considered objec- payment may heavily influence a per- tively . Searching long enough always rapid and profes- Independence and son’s future standard of living. Because will several the problems. A person’s sional indepen- integrity the settlement is so important, it is not dent examination ability to function must be viewed in at surprising that conflicts arise. The and diagnosis and Voluntary approach least three perspectives: company should set very high stan- in particular cases Independent tribunal dards for case handling and contact voluntary treat- 1. Objective signs are often clearly and for disputes with those injured. ment and rehabi- directly related to disability, but can In the autumn of 1994 an extensive litation. also have uncertain indicative value. analytical programme was started to UNI Storebrand believes that esta- 2. The symptoms - the patient’s subjec- identify the improvement potential in blishing a publicly appointed indepen- tive complaints - often have an the claims settle- dent tribunal is an efficient manner to underlying objective explanation,

ment process. Focus on the injured resolve disputes on causal relationship but may as well lack this. So far no- This has resulted and disability assessments. This is in one has succeeded in formulating in changes in Sympathy and offers line with a proposal in the Løderup practical rules for weighting subjec- both policy and of help and support Committee report on personal injury tive complaints in a compensation practical case compensation (NOU 1994:20), which context. High professional handling. The has been circulated for consultation. 3. Disability also has social implications standard focus will be on – commanly referred to as sickness.

the injured per- Quality control As a rule sickness will lead to certain son who will restrictions in life activities, but can always be treated with empathy and

24 sjekk forsikringen The Swedish Får million-erstatning insurance compa- During 1995 UNI Whiplash-skadd vant mot forsikringsgigant ny Folksam, Storebrand offered through its wholly 19 people injured in traffic accidents owned subsidiary rehabilitation at UNI beklager Hälsoinvest, has the Åre Clinic in etterforskningen UNI NEKTER built up a rehabi- -trosser Sweden. Slepphendte leger Rikstrygde- litation clinic in verket Åre in mid- At the end of the får attest-forbud Sweden. In line year 14 of the 19 with UNI were either wholly -SEIG Storebrand’s or partly back at approach, focus is work, and all were KAMP very satisfied with for seier SJOKKTALL directed on the om legenes vurderinger patient. UNI Storebrand’s initiative and Diagnoses and UNI kj¿per"Snille" del leger av sykehusovervåkes approach. symptoms are eva-

luated in a family, UNI Storebrand A selection of facsimiles of newspaper headings related to claimants, doctors and insurance com- local environ- will focus on panies in the claim process. ment, workplace rehabilitation and and social per- consider different 3. also provide release from responsi- UNI Storebrand has never payd doc- spective. The pro- models for bilities and obligations. If such tors to provide favourable reports. A gramme is charac- development and release feels more attractive than professional report must be correct, terised by a scien- operations. the limitations appear frightening, and a correct report is one that as far tific approach one may easily fall into the sickness as possible represents the most up- both to content and evaluation. role. In a compensation case one dated knowledge within medicine and During 1995 UNI Storebrand offered has to conclude upon whether, and other relevant branches of science and 19 patients assessment and treatment if so to what extent, the choice of a practical diagnosis and treatment. at the Åre Clinic. Of these 14 were eit- sickness role has influenced the her fully or partly back at work by the symptoms. Insurance and rehabilitation end of the year. Final evaluation of the Any medical specialist’s evaluation of Return to a normal working life after project is not yet completed, but so far the latter two health parameters will be an injury is desirable both for the inju- we consider the results very promising. affected by value considerations in red person, for UNI Storebrand and The experience gained through this addition to experience and scientific for society as such. Many different cooperation provides a basis for the facts. The doctor’s stance in settlement rehabilitation development of a corresponding facili- cases often represents a viewpoint rat- models have been Swedish Folksam ty in Norway. We are working with the her than scientific truth. There is no and are being has specialised in Red Cross Clinic to implement these reason to be surprised or offended by tested. Only in rehabilitation. plans. Once again it should be empha-

divergent conclusions from different recent years have sised that the offer will be voluntary for Personal injury doctors. They do disagree, but they are the results been evaluated seriously, the injured and professional indepen- no more dishonest or unethical than but this has also proved difficult. dence will be ensured as far as the lawyers with different views on questi- medical expertise is concerned. ons of guilt and punishment.

25 UNI Storebrand Group Analytical information

NOK million 1995 1994 1993

Value-adjusted operating result Unrealised gains 31.12 *) 2,624 1,241 4,592 Unrealised gains 1.1. 1,241 4,592 43

Change in unrealised gains 1,383 -3,351 4,549 Booked result UNI Storebrand Skadeforsikring Group 1,184 712 1,164 UNI Storebrand Livsforsikring Group 3,342 1,922 5,414 UNI Storebrand Finans AS 20 0 -15 UNI Storebrand SPAR AS 3 14 8 UNI Storebrand ASA 798 269 198 Elimination/Other companies -1,141 -932 -801

Total value-adjusted operating result 5,589 -1,366 10,517

*) In the value adjusted operating result unrealized gains for fixed bonds is not included.

Solvency capital Equity capital according to the accounts 3,806 2,459 2,428 Statutory additional reserves Security reserve – non-life insurance 1,475 1,735 1,828 Reinsurance reserve – non-life insurance 69 130 151 Administration reserve – non-life insurance 557 638 493 Natural perils reserve – non-life insurance 622 624 451 Guarantee reserve – non-life insurance 383 335 361

Total 6,912 5,921 5,712

Unrealised gains on securities by sub-group (incl. fixed bonds) UNI Storebrand Skadeforsikring 321 55 241 UNI Storebrand Livsforsikring 2,867 1,184 4,304 Others 13 247

Total 3,201 1,241 4,592

Unrealised gains by assets class Shares/interests held as current assets 1,671 1,265 2,687 Certificates 160 61 -7 Bonds 887 -202 1,915 Foreign exchange and forward contracts -204 71 -101 Miscellaneous -10 24 Shares/interests held as fixed assets 16 32 Fixed bonds 577 Real estate 94 53 72

Total 3,201 1,241 4,592

Taxable loss carried forward UNI Storebrand Nybygg AS 5 UNI Storebrand Forsikringsmegling AS 2 UNI Storebrand Finans AS 841 UNI Storebrand ASA 1,552

Total 2,400

26 UNI Storebrand Livsforsikring

Main features of the 1995 Development in premiumvolum and result market shares 1995 was a good year in result terms Premiumvolume Change last year Total Market shares US Liv for UNI Storebrand Livsforsikring. The US Liv Totalmarket NOK mill. At 31.12.95 At 31.12.94 At 31.12.93 development in the finance market has All*) (excl. David og Norske Liv -7.7% -2.5% 18,083 29.1% 30.7% 29.6% been positive and the company has Of which private -21.4% -19.3% 4,809 34.3% 35.2% 34.6% maintained its leading position. The Of which corporate 0.4% 5.4% 13,274 27.2% 28.6% 27.1% company’s cost advantages, together *) Excl. transferred premium reserves with the establishment of satisfactory Source: Norwegian Association of Ins. Companies risk bearing capacity, means that it has a very strong position. The booked operating profit for Annual accounts During 1995 there has been a net 1995 was NOK 3,342 million. This is an Premium income inflow of premium reserve assets and improvement of NOK 1,420 million in Total premium income in life and pen- premium funds to UNI Storebrand of relation to the previous year. NOK sion insurance of UNI Storebrand NOK 48 million, compared with a net 2,755 million of the result was alloca- Livsforsikring was NOK 5,721 million outflow in 1994 of NOK 598 million. ted between customers, with an alloca- in 1995. This is 7.7% lower than in tion of 1,000 million to the additional 1994. Financial income statutory insurance fund. The financial In the case of collective pension Gross booked financial income return on policyholders’ funds, toget- insurance premium income was in line amounted to NOK 6,175 million, an her with a low level of costs at 1.02% of with the previous year. In group life increase of 29% from the previous policyholders’ funds, provided the insurance premium income was 7.5% year. The good figure for financial basis, for the good result for lower in 1995 than the previous year. income is due to substantial realised customers. The remainder of the In individual insurance (the private capital gains on securities. In 1995 booked result has been retained in the market) uncertainty attaching to the these amounted net to NOK 912 mil- company to service equity. parameters for saving in life and pen- lion. During 1995 bond yields fell and The financial income contributed to sion insurance meant that the market it was a good year in the stockmarket. the total result (interest result) in 1995 has been significantly reduced. In indi- In total over the year interest rates fell with NOK 3,195 million. In 1994 the vidual insurance the premium income by 1.6% points, compared with a rise interest result was NOK 1,973 million. was redused with about 21% in 1995. It in interest rates the previous year of The administration result improved is mainly sales of single premium annu- 2.5% points. Unrealised capital gains by NOK 44 million from 1994. In indi- ity insurance which decreased in 1995. increased in 1995 by NOK 1.1 billion vidual insurance the administration Efforts to sell funds-based savings pro- (excluding bonds held until maturity). premium still does not cover total ducts in UNI Storebrand Spar AS have This also explains the difference bet- costs, even though the administration produced good results in 1995, and ween the booked capital return of result has improved considerably from more than compensated for the fall in 8.5% and the value-adjusted return of previous years. In collective pension annuity premiums. The sales increase 9.9%. During 1995 a portfolio of insurance excess costs in 1995 were was NOK 737 million (86%). bonds amounting to NOK 10.2 billion only NOK 1 million. The life insurance market fell in was bought or reclassified as fixed

The aggregate risk result was NOK 1995 by 2.5% to NOK 18 billion. In a assets to be held to maturity. Including Life Insurance 165 million. falling private market the company’s unrealised gains on these at the year- market share has been reduced by end of NOK 552 million, the value- 0.9%. In the corporate market the adjusted return on capital was 10.7%. market share in 1995 was 1.4% lower than in 1994

27 Current and price-dependent Financial income can be split folio is booked at acquisition value and financial income between current and price dependent is to be amortised to par value over the finance income. individual securities’ remaining term 31.12 1995 7000 Interest income from the portfolio of until redemption. There were unreali- 31.12 1994 bonds, money market instruments and sed gains on that part of the portfolio 6000 loans, together with net rental income of NOK 552 million at the end of 1995. 5000 from real estate operations and share The accounting principles for real 4000 dividends, represents current financial estate are the same in 1995 as in 1994.

3000 income, while net losses or gains on the No revaluations, write-downs or depre- sale of securities, real estate, etc. and ciation have been charged in the real 2000 write-downs are defined corresponding- estate portfolio in 1995. 1000 ly as price-dependent financial income. The loan portfolio has been reduced 0 Current financial income is affected in 1995 by NOK 6,515 million. The

-1000 over time by interest rates in general, portfolio of business loans of NOK while price-dependent financial 4,287 million was sold at the end of the Total Total

Current income reflects the development in year to Postbanken. The remaining Løpende the capital market at the relevant time decrease in volume is due to a combi- Kursavhengig

Price-dependent and the company’s ongoing adaptation nation of fewer new loans being appro- to this. ved, particularly commercial loans, Price dependent financial income and the fact that customers have cho- amounted in total in 1995 to NOK 938 sen to redeem their loans prior to the million. This consists of realised net agreed maturity date. An important capital gains of NOK 912 million, reason for the development in the reversed write-downs of NOK 51 milli- portfolio is that the company has not on, foreign exchange items of NOK -29 made any loans in 1995 at fixed inte- million and a book gain on the sale of rest rates, at the same time as a conser- real estate of NOK 4 million. Last year vative lending policy has been maintai- price-dependent income was NOK -293 ned. million. 94% of the present loan portfolio in That part of the securities portfolio the private market is secured by mort- which is classified as current assets is gages over real estate. The current valued on the basis of the lowest value level of lending is equivalent on average principle. The surplus value of NOK to 45% of original loan valuations, so 2,314 million is divided between NOK that the risk of loss on the portfolio is 1,581 million in shareholdings and low. Realised losses and net reversals of NOK 733 million in interest-bearing loss provisions resulted in NOK 181 securities. During 1995 the company million being booked to income in booked parts of the bond portfolio as 1995. This figure in 1994 was NOK 49 fixed assets to be held until maturity in million. On the sale of the commercial order, among other things, to be able loan portfolio a total of NOK 256 milli- to maintain an acceptable exposure to on was booked to income in respect of the stockmarket. Reclassification from premiums and the release of loss provi- current assets is based on the lowest sions. value principle at the date of reclassifi- cation. This part of the securities port-

28 Insurance benefits amounted to 5.6% of the premium Return on capital 1991–1995 During 1995 insurance benefits total- reserve. The maximum allocation to ling NOK 3,831 million were paid out additional statutory insurance funds % 20 compared with NOK 3,687 million in represents the difference between the the previous year. This is a normal net premium reserve calculated on the 16 increase viewed in relation to the insu- basis of an interest rate of 3.5%, and rance volume. Insurance benefits con- the net premium reserve calculated 12 sisted of pensions paid totalling NOK using the actual base interest rate in 2,061 million, compensation on death the insurance policies. The maximum 8 and disability of NOK 846 million and permitted allocation at 31.12.95 on reaching payment age NOK 437 amounted to NOK 9,185 million. 4 million. Reinsurance received amoun- In the disposition of the results, etc. ted to NOK 6 million and withdrawals for 1994, NOK 580 million was trans- 0 and terminations on life accounts ferred from Other reserves to the poli- 1991 1992 1995 1994 amounted to NOK 481 million. cyholders’ premium fund. The applica- 1993

tion of the result for 1995 has involved ValueVerdijustert adjusted Allocations to the insurance a preliminary transfer to the premium (Excl.(Ekskl. fixed obligasjoner bonds) holdt til forfall) BookedBokført fund fund of NOK 890 million. After credi- Statutory allocations to the premium ting interest and other payments and reserve amounted to NOK 3,401 million withdrawals, the premium and pension against NOK 3,338 million in the previ- adjustment fund totalled NOK 8,797 ous year. In addition NOK 557 million million at the end of the year. Cost ratio has been transferred to the premium NOK 47 million has been released reserve from Other reserves in prepa- from the security fund. The fund has % 1,5 ring accounts, etc. for 1994. The year’s thus been reduced to NOK 592 million. aggregate allocation to the premium The policyholders’ share of the reserve amounted to NOK 4,822 profit for the year will be allocated in million and the premium reserve at accordance with the provisions in the 1,0 31.12.1995 stood at NOK 61,725 regulations on accounting for 1995, million. and notified through account state-

In 1995 an allocation of NOK 1,000 ments which will be despatched by the 0,5 million was made to additional statu- end of May. Correspondingly the tory allocation in the insurance fund. account statements will show their During the year additional statutory share of the additional statutory alloca- 0 allocation were reduced by NOK 161 tion in the insurance fund and also 1991 1993 1994 1992 million in respect of policyholders’ their share of the change. The account 1995 shares of additional statutory insurance statements will also show the custo- OperatingDriftskostnader expenses i in funds on transfer, surrender and insu- mer’s share of unrealised gains on percentprosent ofav averagegjennom- policyholderssnittlig kundefond fund rance settlement. Following this the securities at 31.12.1995.

company’s aggregate additional statu- Life Insurance tory allocations in the insurance fund Operating expenses amount to NOK 4,027 million, equiva- Operating expenses of UNI Store- lent to 6.5% of the premium reserve. brand Livsforsikring AS amounted to At the end of 1994 aggregate NOK 733 million against NOK 749 additional statutory insurance funds million in 1994. Measured in relation

29 to average customer funds the cost Result analysis ratio was 1.02% against 1.10% in the Group Grouplife Individual Individual Total Total previous year. In relation to premium pension insurance endowment pension 1995 1994 income the cost level has changed to NOK million insurance insurance insurance 13.9% from 13.2% in the previous 1. Gross financial income 4,000 35 535 1,605 6,175 4,796 2. Guaranteed rate of interest -1,907 -3 -252 -818 -2,980 -2,823 year. 3. Interest result 2,093 32 283 787 3,195 1,973

4. Risk premium a) 269 231 198 35 733 614 Allocation of the result for the 5. Risk bonus a) -173 -247 -137 28 -529 -470 year 6. Net reinsurance -26 -8 -4 -1 -39 7. Risk result 70 -24 57 62 165 144 The Board resolved to transfer NOK 400 million as a group contribution to 8. Administration premium 316 52 148 137 652 626 9. Administration expenses -317 b) -53 -194 -165 b) -732 -750 the group parent company, and to 10. Administration result -1 -1 -46 -32 -80 -124 strengthen the life company’s equity by 11. Total (3+7+10) 2,162 7 294 818 3,279 1,993 retaining NOK 182 million for equity 12. Change premium reserve -57 -4 73 12 and tax. Following this the life group’s 13. Change security reserve 44 3 47 -24 capital ratio at 31.12.1995 was 14.10%. 14. Total (11+12+13) 2,162 -6 290 894 3,339 1,969 The capital requirement at the end of 15. Other expenses -2 -56 1995 was 6.75%, increasing to 7.5% at 16. Result to allocation prior to taxes (14+15) 3.337 1.913 the end of 1996. The requirement will 17. To equity be increased to 8% at the end of 1998. - Return on capital, equity c) -216 -149 On 11.05.95 a new subordinated - Operating expenses 5 - Change security reserve -47 24 loan of USD 120 million was raised - 0.45% of policyholders fund d) -324 -309 with a term of 10 years. The loan satis- 17. Total equity -582 -434 fies the requirements of the Banking, 18. Taxes 0 0 Insurance and Securities Commission 19. Result to policyholders fund - c) (16+17+18) 2.755 1.463 on subordinated loans for capital adequacy purposes. A loan of USD 50 Tabellen viser rente-, risiko- og administrasjonsresultatet fordelt på bransjer. million was repaid on the same date. a) Risk premiums and risk bonuses are partly based on estimates In addition a loan of NOK 206 million b) Includes administration of premium and pension adjustment fund c) Includes: Security reserve, subordinated loan capital and equity was redeemed on maturity on d) Premium reserve, additional statutory insurance fund, premium and pension 20.12.1995. At 31.12.95 the company adjustment fund and other insurance fund had booked subordinated loans total- ling NOK 1,320 million. In the addition to the Financial made for the conditional portion of cation must be regarded as conditional income generated by the company’s profits in the form of supplemental until the final accounting entries have capital. NOK 324 million of the profit allocations, the unconditional return been completed. generated from policyholders’ funds to policyholders was 6.6% against 5.8% The accounting result for the year of has been retained. This corresponds to for the previous year. NOK 2,337.3 million was allocated as a reduction in the yield to policyhol- Policyholders’ share of the profit for follows: ders of 0.45% points against 0.47% in the year (additional to the supplemen- 1994. The average for the period 1991 tal allocation of NOK 1,000 million) To Premium Reserve 864.5 - 1995 was 0.53%. amounted to NOK 1,755 million, To Premium Fund 890.2 The average yield after this, calcula- which is to be transferred to the policy- To contingency reserve 182.6 ted on the basis of rules issued by the holders’ premium reserve and premi- Group contribution Banking, Insurance and Securities um fund. The allocation will not be to UNI Storebrand ASA 400.0 Commission is 8.12%. If a deduction is finally known until accounting has Total allocated 2,337.3 been completed and the profit allo-

30 Matters after the balance she- bution in 1994 to the aggregate result et date of NOK 3,195 million. An agreement has been signed to pur- The risk result arises as a consequence chase 11 shopping centres from Steen of mortality and disability during the og Strøm Invest. The purchase will period differing from that assumed in increase exposure in the real estate the premium tariffs. The aggregate risk market from 6% to 9% of total assets. result was NOK 165 million in 1995. Interest rate development in long The agreement is based on a real Apart from group life insurance, the term government bonds 1995 return requirement of 8%. risk result is positive in all lines. In (Eff. interest for Norwegian government 2004) As part of a planned reduction in group life insurance there has, how- the loan portfolio of UNI Storebrand ever, been a strengthening of technical Eff.Eff renteinterest Skadeforsikring AS, loans totalling reserves for older compensation claims 10.0 NOK 160 million have been trans- of NOK 57 million. In the case of indi- 9.5 ferred to UNI Storebrand vidual annuity and pension insurance 9.0 Livsforsikring AS. the premium reserve for previous years 8.5 Svein R. Hagen, who has been has been increased by NOK 73 million. 8.0 President of UNI Storebrand The administration result shows the 7.5

Livsforsikring AS since September difference between cost supplements 7.0 1992, has resigned from his position in the premium tariffs and the actual 6.5 on health grounds. He will continue as costs. This improved from 1994 by 6.0 a member of the group management. NOK 44 million, but is still negative by 5.5

Åge Korsvold, Group Chief Executive, NOK 80 million. In individual insurance 5.0 will from mid-February 1996 onwards the administration premiums still do Juni June Mars also act as President of UNI March

not cover the total costs, even though Januar January December Desember Storebrand Livsforsikring AS. September

the administration result has improved September from previous years. Future prospects The Norwegian Parliament will consi- Financial development 1995 der the Government’s Welfare Report There has been stability in the regulati- during the Spring. The result of the ons applicable to life insurance compa- Development Oslo Stock debate will probably have consequen- nies during 1995, with few new chang- Exchange all share Index 1995 ces for the future development of es. Most important was the clarification private pension insurance. announced in 1994 that the life com- Total-Total- indexindeks Even though the company has built panies could book bonds as fixed 750 749 733 up a satisfactory risk bearing capacity assets if the intention was to own the 730 against price fluctuations, the overall bond until maturity. 710 development in results will continue to Following solvency measures in 1993 690 depend on the development in the the life companies were allowed to 670 656 finance market. build up risk capital against price fluc- 650

tuation risk in the investment portfolio 630 Life Insurance Result analysis 1995 by establishing supplemental reserves. 610

The interest result is the difference The supplemental reserve belongs to 590 604 between the booked return and the the customer but gives the life com- 570 guaranteed return on policies. The pany financial flexibility, which is 550 average guaranteed return on policies essential in order to be able to achieve June Juni Mars March Januar in 1995 was 4.1%. The guaranteed an acceptable return on customers’ January December Desember September return on premium funds has been 3% funds over time. September since 1 February 1994. The interest result also gave the greatest contri-

31 Asset allocation and return 1994 and 1995 Asset allocation Return Investment funds 1995 1994 1995 1994

Share fund 14.2% 10.4% 12.0% 2.3% Bond fund 37.7% 37.8% 14.1% -0.4% Money market fund 27.2% 23.6% 6.3% 5.7% Real estate fund 6.7% 5.8% 7.1% 2.8% Loan fund 14.2% 22.4% 10.3% 7.7%

The Share Fund The company’s objective during and only to a limited extent as an Market value at 31.12. 1995: 1994 and 1995 has been to increase its alternative to investment in the under- NOK mill. 9.967 (7.775) in percent of total share risk bearing capacity. The total of the lying securities. The new financial fund (1994 in brackets) company’s equity, supplemental reser- instruments are valued daily in relation ves and unrealised gains amounted to to market movements and are inclu- NOK 9.2 billion at the year-end, com- ded in the portfolio valuation of the pared with NOK 6.5 billion in 1994. securities portfolio for accounting pur- The company undertakes continu- poses. ous adjustments and is increasing the price fall risk on the asset side as risk Asset management bearing capacity increases over the The capital markets were characterised CashLikv. bank 6% (7%)deposits 6% (7%) ConvertibleKonvertible bonds obl. 2% 2% (3%) (3%) year. The proportion held in shares in 1995 by falling interest rates and a ForeignUtenlandske listed 23% 23% (11%) (11%) NorwegianNorske 69% listed (79%) 69% (79%) (market values) was increased from rising stockmarket. 10.4% to 12.3%, i.e. a change during Weaker economic growth and low the year of NOK 2.2 billion. At the inflation led to a fall in interest rates same time interest rate sensitivity incre- worldwide. Yields on the longer-term ased. By interest rate sensitivity is Norwegian government bonds fell by meant the amount by which interest- between 1.5 and 2% points, and at the bearing securities change in value if end of the year were around 6.4%. interest rate levels rise or fall by 1% Norwegian money market interest point. Interest rate sensitivity was NOK rates (3 months) fell by around 0.7% 1.1 billion at the end of the year points and were roughly 5.3% at the against NOK 850 million one year ear- end of the year. lier. The proportion held in bonds has The stockmarkets recorded signifi- increased from 37.8% to 46.0%. 13.4% cant regional differences in returns. of these are bonds booked as fixed The American stockmarket (represen- assets to be held until maturity. Money ted by Morgan Stanley’s (MS) North market investments were at the same American Index) rose by 27.1%, MS level as the previous year, i.e. 23.6%. Europe showed a development in The company has used derivatives value of 13.6%, while the markets in (new financial instruments) mainly as the Far East fell by 4.0% (MS Pacific). part of its continuous risk positioning, The world index rose in comparison by 18.3% (MS World). The Oslo Stock

32 Exchange largely followed the average pressure on margins. As a result of the The Bond Fund for the European markets with a sale of the business loan portfolio to Market value at 31.12.95: NOK mill. 26,353 return of 11.6% (Oslo Stock Exchange Postbanken the composition of the (28,146) in percent of total fund (1994 in brackets) All Share Index). portfolio changed significantly in 1995. The value-adjusted return of the Due to the sale of the business loan 31.12 1995 % 31.12 1994 60 investment funds in aggregate in 1995 portfolio to Postbanken, the share of was 10.1% against 2.7% in 1994. the fund represented by the housing 50 loan portfolio increased from around Share fund 62% to around 96%. 40 During the year the proportion held in 30 foreign investments (shares and other) The real estate fund rose from 13.9% to 24.1%. The rental market level for office 20 The value of an interest in the Share premises in the Oslo region was again Fund increased during the year by maintained in 1995. Similarly, else- 10 12.0%. The Oslo Stock Exchange All where in Norway the rental market was 0 Share Index rose by 11.6%. The OBX relatively stable in 1995 with few Index, which at any time consists of the changes. There is still some over- 25 most traded shares, rose by 0.9%. capacity for commercial premises. Norsk Stat

Gross rental income as a percentage Andre Norske Other Norwegian The bond fund of the real estate portfolio’s value gives Utenlandsk Stat Foreign government

The proportion of government/- a return of 9.5%. Net rental income Norwegian government government guaranteed bonds, both after deducting operating costs gives a Norwegian and foreign, increased return of 7.5% and adjusted for net during the year from 70% to 80%. gains on sales the return was 7.1%. International investments have increa- The occupancy level (by area) in the The money market fund sed from 20% to 33% and must be company’s portfolio was 94.6%. The Market value at 31.12.95: NOK mill. 19,057 viewed in the context of a reduction in average term on existing contracts is 4- (17,600) in percent of total fund (1994 in brackets) interest rate sensitivity and bond debt 5 years, which means that on average overall. The portfolio’s duration was 20-25% of the contracts mature each 31.12 1995 % 31.12 1994 increased from 3.4 to 4.6. year. Aggregate rental income of NOK 60 381 million is virtually at the same level 50 The money market fund as the previous year. The size of the money market fund is 40 the same at the end of 1995 as at the The Board of UNI Storebrand previous year-end. 3-month NIBOR Livsforsikring AS 30 interest rates have been reduced from The Board in 1996 consists of Knut N. 20 above 6% at the beginning of the year Kjær (Chairman), Øyvin Brøymer, to less than 5.3% at the year-end. Tom Vidar Rygh, Hans Henrik 10 Competition for housing and com- Klouman, Aase Fagerhaug and Trond 0 mercial loan customers was again high Wilhelmsen. Åge Korsvold is acting as Life Insurance in 1995, which led to even stronger President of UNI Storebrand Livs- forsikring AS in succession to Svein R. Hagen. Norsk Stat Andre Norske Other Norwegian Utenlandsk Stat Foreign government Norwegian government

33 UNI Storebrand Livsforsikring Group Profit and Loss Account 1 January - 31 December 1995

Amounts in NOK million Note 1995 1994

Premiums written 21 5,270.7 5,707.7

Interest income 4,789.8 4,736.4 Interest costs -153.0 -135.9 Dividends on shares and interests 158.8 186.4 Gain/loss on securities 912.6 -86.2 Result from real estate 309.9 182.5 Other financial income/expenses -23.8 -136.8 Loan losses/reversals of loss provisions 24 180.7 49.3 Interest transferred to premium fund -253.1 -246.4

Net financial income 23 5,921.9 4,549.3

Other income 84.2 84.5

Total income 11,276.8 10,341.5

Claims -3,349.9 -3,195.7 Cancelled policies/withdrawals on life accounts -481.2 -490.9

Insurance benefits 21 -3,831.1 -3,686.6

To/from premium reserve -3,400.8 -3,337.5 To/from additional statutory allocations -944.8 -387.7 To/from security reserve 46.7 -24.1

Statutory technical allocations 21 -4,298.9 -3,749.3

Transferred premium reserve, etc. 21 48.3 -597.8

Operating expenses UNI Storebrand Livsforsikring AS 26, 27 -732.5 -749.4 Operating expenses subsidiaries 26, 27, 28 -49.1 -46.3

Other expenses -73.7 -92.3

Total operating expenses -8,937.0 -8,921.7

Share of result associated companies/group transfers received 31 2.7 2.2

Result before tax 2,342.5 1,422.0

Taxes -0.8 -17.3

Result before year UNI Storebrand Livsforsikring Group 2,341.7 1,404.7

Transfers and allocation of result i Uni Storebrand Livsforsikring AS Transfers policyholders funds To premium reserve -556.9 -1,232.6 From/to premium and pension adjustment funds -580.2 -435.1 From/to other funds 1,031.2 1,724.9 From/to statutory insurance fund 105.9 From/to contingency reserve -57.3

Result before allocation 2,337.3 1,397.0

To policyholders Premium reserve -864.5 Premium and pension adjustment funds -890.2 Other insurance funds -962.8 To shareholders: Contingency reserve -182.6 -84.2 Submitted group contributions -400.0 -350.0

34 Life Insurance 35 0.5 6.2 1.6 19.3 37.1 23.2 18.8 63.0 49.2 81.8 12.4 21.1 63.7 10.1 26.0 -39.1 -13.6 -48.3 169.4 279.3 468.0 638.6 707.6 380.2 100.5 123.9 309.9 370.3 491.1 432.2 -134.7 1,105.4 1,361.2 2,105.9 4,101.8 1,482.7 3,187.7 8,238.2 1,031.2 5,971.6 1,681.9 9,898.9 6,139.9 1,829.4 1,767.5 75 159.5 21,350.6 75,159.5 56,901.8 68,327.7 69,358.9 29,606.0 53,808.9 15,088.7 14,914.9 0.0 1.0 0.0 2.5 0.8 -9.7 -8.6 40.6 67.0 48.2 77.5 26.5 13.2 52.1 22.0 62.3 34.3 22.1 -10.4 -24.0 890.2 290.6 399.9 330.9 524.8 128.4 141.5 291.9 591.8 270.5 131.3 115.7 599.4 566.8 1,319.6 1,361.2 2,292.0 4,521.3 1,425.9 4,026.6 8,797.2 3,260.4 1,444.8 8,014.1 9,621.0 9,600.9 80,469.9 25,472.7 80,469.9 61,724.9 74,548.7 74,548.7 15,309.7 26,467.3 54,997.2 10,239.3 60 53 41 57 Note 1995 1994 45, 54 42, 54

Premium reserve Subordinated loan capital Due, unpaid financial income Due, unpaid financial Fixed bonds (held to maturity)Unspecified loss provisions Unspecified loss provisions Total other loans Real estate Premiums paid, not yet due Due, unpaid insurance benefits 42 Accrued pension liability Mortgage/guarantees/residual liability Total liabilities, policyholders funds and equity capital Off balance liabilities Other equity Total equity Policyholders’ funds Insurance fund Other insurance funds Long-term liabilities Premium and pension adjustment fund Other long-term debt Other current liabilities Current liabilities Total assets capital Liabilities, policyholders’ funds and equity pay Accrued tax deductions, social security and holiday Prepaid pensions Total fixed assets Written, unpaid premiums Due from insurance companies Earned, unpaid interest Interest in associated companiesShares and interest Mortgage loans advanced Due other group companies income Prepaid financial Due to insurance companies 50 Taxes payable Total current assets Other current assets Cash, bank deposits Amounts in NOK million Amounts in NOK UNI Storebrand Livsforsikring Group Livsforsikring Storebrand UNI Balance Sheet 31 December 1995 Assets Additional statutory insurance fund Security fund Goodwill Specific loss provisions Other loans Share capital Contingency reserve Operating assets Mortgage debt Receivable from group companies Receivable from group Certificates Shares and interestsBonds Total mortgage loansSpecific loss provisions Group receivables 39, 40, 41, 54 46, 47, 48, 49 UNI Storebrand Skadeforsikring

Main features of the 1995 more important causes of the improve- insured items in car insurance. The result ment in technical operations over the total market in Norwegian land-based UNI Storebrand Skadeforsikring AS 5-year period. In addition, during the insurance has experienced annual and subsidiaries reported an operating last year it has been possible to see the growth during the last three years of at profit in 1995 of NOK 1,184 million, effect on the claims ratio of the core least 3 percent. UNI Storebrand’s mar- which is NOK 472 million higher than projects which are being undertaken ket share has been virtually the same the previous year. The improvement in in claims handling and tariffs/- throughout the period and stood at the result is mainly due to the increase underwriting. The flood in eastern 40.6 percent at the year-end. in financial income of NOK 367 milli- Norway in May-June led to a charge on Competition is becoming tougher. on, but the technical result also impro- the operating result of NOK 135 This has been particularly noticeable ved to a surplus of NOK 88 million million, representing 1.5 percentage towards the end of 1995. compared with NOK -19 million in points of the claims ratio. 1994. The technical result consists of During the last three years, run-off Premiums in NOK million 1995 1994 1993 1992 premiums for own account, claims for gains in respect of previous claims own account and costs for own years have been booked totalling NOK Total market for Norwegian non-marine account related to the insurance busi- 347 million in 1995, NOK 313 million business - gross ness. The combined ratio which in 1994 and NOK 278 million in 1993 volum 16,648 16,032 15,378 15,053 reflects the sum of costs and claims in respectively. Without the run-off gains UNI Storebrand Skadeforsikring - relation to premiums improved from the claims ratios would have been 4-5 gross volume 99.9 in 1994 to 98.6, mainly as a result percentage points higher. Costs were non-marine 6,762 6,563 6,207 6,147 Market share of the claims ratio being reduced from reduced by 10 percent from 1991 to % 40.6 40.9 40.3 40.5 73.7 to 70.0. With the present interest 1993 as a consequence, in the first Premiums earned and yield levels the company considers instance, of an extensive cost-cutting for own account that a combined ratio of 100 repre- programme following the merger (all lines) 7,170 6,812 6,265 6,092 sents a satisfactory normal result for between UNI and Storebrand. The the insurance business. reduction in the cost ratio from 1993 Claims The results of the non-life insurance to 1994 is due to the introduction of a The decrease in the claims ratio for business during the 5-year period 1991- new accounting standard for pension own account from 1991 to 1995 mainly 1995 have fluctuated considerably. costs, and thus does not reflect a real relates to profitability improvements in This has been caused in the first decline in relative costs. Relative costs Motor insurance. Otherwise there has instance by fluctuations in the securiti- increased by approximately 2 percen- been a development towards an equali- es market. Technical operations have tage points from 1994 to 1995, of sation of claims ratios between insuran- shown a clear improvement in result which half relates to non-recurring ce lines. Portfolio processing, better terms. The results in 1991 and 1992 items. The remainder relates to invest- underwriting routines, claims preven- were characterised by a downturn in ments in know-how and capacity rela- tion and price adjustments have led to the securities market and relatively ted to sales/marketing, distribution, improved results in lines which previ- weak technical results. 1993 produced tariffs/underwriting and claims settle- ously had poor results. Lines which in very high financial income, but a still ment, and will form the basis for future recent years have had low claims ratios, somewhat weak technical result. 1994 savings in claims and operating costs. including Industry, Business Comp- gave moderate financial income, but a rehensive and Private Comprehensive, good technical result. Viewed against Technical result now have more normal results. This is the background of the fact that the Premium income due both to lower prices and to a general interest rate level was higher in Premiums earned for an account rose somewhat more normal level of claims 1993 than in 1995, the operating result by 5 percent in 1995. Around half the than in previous years. for 1995 can be considered the ’best’ increase is due to the fact that the com- Similarly the results from the run-off of the 5-year period, even though in pany holds a greater proportion of the of older claims years have had an nominal terms it is relatively the same portfolio for own account, i.e. has impact on the total claims ratio. as in 1993. Profitability improvements ceded less premiums to reinsurers. Fluctuations in run-off results can part- in motor insurance and a general The remainder is due to slightly higher ly be attributed to the extension of the reduction in relative cost levels are the prices and an increased number of claim-handling period, involving

36 somewhat greater uncertainty on claim Reinsurance Development in key figures estimates. There has been a tendency The reinsurance result consists of the to increase the claims portion on long premium the company pays for the % tail lines, i.e. insurance lines where purchase of reinsurance less the com- 120 many years can pass from the loss mission the company receives in return 100 occurring to final settlement taking and the claims paid by reinsurers. A place. For this reason claims reserves minus result means that premiums 80 increased in relation to premiums ceded are higher than return commis- from 63 percent in 1989 to 112.5 per- sions and claim payments. 60 cent in 1994, before levelling out at The reinsurance result in 1995 was 40 109 at 31.12.1995. In addition certain NOK -214 million against NOK -588 high court judgements have affected million in the previous year. Of this 20 operating conditions by setting prece- UNI Storebrand Kredittforsikring dents for the determination of com- represented NOK -97 million against 0 pensation measurements/levels. The NOK -23 million in 1994. The change 1991 1992 1995 1994 1993 run-off result must also be viewed in in 1995 is due to final settlement with ClaimsSkadereserveprosent reserve ratio the light of the fact that total claims previous shareholders in Norsk Kausjon. Combined ratioratio reserves amount to close to NOK 8 bil- Adjusted for the reinsurance result ClaimsSkadeprosent ratio CostKostnadsprosent ratio lion. Normally one can expect a devia- in UNI Storebrand Kredittforsikring, tion of a few percentage points from there has been an increase of around original estimates as claims years run NOK 270 million in the claims charged previous year, mainly due to the run- off. The development in the claims on to reinsurers. This is due mainly to off portfolio. In addition NOK 45 milli- ratio should therefore be viewed in a flood damage in eastern Norway in on of security reserves have been relea- somewhat longer time perspective May-June, which overall represented a sed so that the contribution to the than from one year to the next. charge on reinsurers of around NOK annual profit is NOK 75 million. 250 million. Försäkringsaktiebolaget UNI Costs The company has purchased less Storebrand Sverige (previously The development in costs in 1995 has reinsurance than previously, i.e. retai- Victoria) in Stockholm had a result for been as planned. The cost ratio increa- ned a greater portion of business for 1995 of NOK 27 million against NOK sed from 26.3 to 28.5. In 1995 conside- own account. This will continue in 20 million in 1994. Price competition rable investments have been made in 1996. Commissions the company in Sweden continues to be tough, but know-how and capacity in relation to receives in return from reinsurers have several years of experience with the improvement measures in sales/mar- thus also been reduced. target customer group provided a bet- keting, tariffs/underwriting and claims ter claims result that the sector has handling, which represents roughly Subsidiaries otherwise obtained. Cooperation with half the increase in the cost ratio. The The three subsidiaries consolidated in UNI Storebrand’s large customer unit remaining increase is of a non-recur- UNI Storebrand Skadeforsikring’s has been successful. Gross premiums ring nature and mainly relates to pen- accounts showed an improvement in earned increased by some 30 percent sion costs and a change in practice for operating results in 1995 in relation to to NOK 175 million. During the year a the accrual of reinsurance commissions. the previous year. Europeiske major campaign was carried out in Non-life Insurance Two-thirds of costs are personnel Reiseforsikring AS had a very satisfac- connection with the change of name. costs. Staffing has for the first time in tory result of NOK 71 million against many years increased and rose last year NOK 67 million in the previous year. Results and market develop- by around 3 percent. This represents a Gross premiums earned increased by ment in insurance lines stronger expansion in the core insu- almost 10 percent, mainly as a result of Private excl. Motor rance areas and in the build up of increased sales. This meant that the Private comprehensive including expertise to meet future challenges - market share also rose slightly. UNI agriculture among other things it will provide a Storebrand Kredittforsikring AS had a The private comprehensive lines such basis for obtaining productivity gains result in 1995 of NOK 30 million, an as home and contents and cottage in the coming years. increase of NOK 14 million from the insurance recorded a slightly weaker 37 Market shares development in results in 1995 than addition measures related to underwri- previously, and the gross claims ratio ting and claims settlement have begun 1994 % for the last claims year rose from 79 to to give results which are slightly in 1995 45 81. This is mainly due to payments excess of what was expected. As an 40 relating to fires having increased. A example, a review of the large vehicle 35 large price increase on building mate- portfolio has led to the claims ratio in 30 rials and higher labour costs have led this segment falling from 92 to 76

25 to higher average payments per claim during two years.

20 without there being a corresponding In addition to measures on the increase on the premium side. Indexa- claims side, price increases have also 15 tion increases will, however, have an contributed to an improvement in pro- 10 impact on the premium tariff for 1996. fitability. Average price increases over 5 The results in agriculture insurance the last year amounted to 5 percent. 0 also deteriorated, mainly due to a The number of insurances increased salmonella epidemic among livestock slightly so that aggregate premium Motor Motor Privat Private Ulykke Industri Industry Accident Business in the summer and autumn of 1995. income rose by 6 percent. The total

Yrkesskade In spite of tougher competition in market recorded the same increase. comprehensive comprehensive Mellommarked the private market with the continuing Run-off gains were again recorded in Occupational injury fall in real average premiums, UNI motor insurance in 1995 at roughly the Storebrand Skadeforsikring further same level as the previous year. increased its market share. Premiums Business Claims ratio by line earned, however, were the same as the previous year. Sales campaigns were Industry again carried out in 1995 focused on Industry insurance, which includes 1994 % 1995 140 the home insurance market. combined fire and machinery insurance for large and medium-sized trading 120 Accident and industrial companies, showed 100 Results in accident insurance (which good results. There has, however, been a slight increase in the number of 80 also covers personal insurance cover for companies apart from occupational major losses. The gross claims ratio for 60 injury insurance) was weaker than last the last claims year was 70, which is hig- her than the last 2 - 3 claims years. 40 year. The gross claims ratio for the last claims year was 94 against 78 in the Because this is an insurance line where 20 previous year. Since there can in some a large part of the gross premium is used to buy reinsurance, there are sig- 0 cases be a long tail in this line, the claims ratio for the last claims year is nificantly smaller fluctuations in the Motor Natur Motor

Marine result for own account than in the gross Marine somewhat uncertain. 1995 showed run- Business result. Competition for industrial custo- Næringsliv off losses on previous claims years. Natural perils Premiums earned have been reduced mers continues to be fierce, which is

Privat eks. motor reflected in strong price pressure and Private .excl. motor Ingoing reinsurance by 10 percent as a result of lower sales lower premium rates. Tendering arran-

Inngående reassuranse and higher terminations. The total market increased by some 1 percent. gements and broking activities are becoming more and more common, Motor together with increased activity from Claims results in motor insurance other companies: both Norwegian and further improved over the last year and foreign. The market share has been the claims ratio for the last claims year reduced from 43.2 to 39.7 percent. has fallen from 77 to 72. This is due to Business comprehensive a continued favourable development The business comprehensive lines with regard to personal injuries. In include landlords, housing cooperati- 38 ves, shops, offices and other small busi- last claims year was 47 against 51 in the Premium(1994 allocation i parentes) nesses. Profitability is at the same good previous year. The company’s premi- (1994 in brackets) level as the previous 5-6 years. The last um income has increased by some 5 year’s claims ratio was 68. The level of percent. major losses continues to be low. Competition is also reflected in this Marine lines segment in falling premium rates, and Marine premium volume fell by 4 percent last The line covers insurance of ocean- year. Through increased focus on risk going vessels for Norwegian and inter- IngoingInngående reinsurance reassuranse 4% 4%(4%) (4%) evaluation and improved routines for national owners, and insurance of NaturalNatur 4% perils (5%) 4% (5%) PrivatePrivat eks. excl. motor motor 21% 21% (20%) (20%) insurance transfers/underwriting, bad ships under construction. The line was Motor 35%35% (33%) (33%) risks are avoided and profitability charged with few major losses in 1995. BusinessNæringsliv 26% 26 % (27%) (27%) Marine 10%10% (11%) (11%) maintained despite the reduction in This, together with increased focus on premium levels. risk evaluation and the shipping com- panies’ operating routines, has meant Liability that the claims ratio for own account main reason is that the company has The claims result for 1995 was satisfac- has been reduced from 83 percent in not renewed such a large direct inte- tory, both gross and for own account. 1994 to 72 percent in 1995. The impro- rest where it has had 100 percent of The gross claims ratio was 58 for the vement has also benefited reinsurers. the policy but at the same time a large last claims year against 78 for the previ- Gross premiums earned have been level of outgoing reinsurance. Instead ous year. Fewer major claims have reduced by 9.5 percent in 1995. The the same policy has been renewed with been reported than expected. In addi- reason is mainly increased competition, a smaller direct interest. In addition, tion there have been substantial run- with reduced prices for insurance in extensive competition in the market off gains on older claims years. The the ocean-going portfolio. Continued has put rates under pressure. The company has increased its premium strong competition is expected and reduction in premiums for own volume in liability lines by 5 percent, thus pressure on rates. With regard to account is 9.5 percent. partly as a result of a slightly larger the insurance of ships under construc- portfolio and partly as a result of pre- tion the company has increased its Satellite mium adjustments. The market share exposure, however, and in this seg- The line covers the insurance of satelli- has been stable throughout the year. ment premiums earned rose by 12%. tes during launch and while in orbit. There was a high level of activity in the Occupational injury insurance Energy satellite market in 1995. This led to an Strong competition has led to the pre- The sector mainly covers direct offsho- increase in premiums of 19 percent in mium level in occupational injury insu- re oil installations throughout the 1995. The gross claims ratio has been rance continuing to fall. The total mar- world. In connection with legal procee- reduced from 92 percent in 1994 to 82 ket has been reduced by some 10 per- dings following a major loss in 1989, percent in 1995, while the claims ratio cent. UNI Storebrand’s premium volu- claims reserves for this claims year have for own account has been reduced me has fallen by 14%. The gross claims been increased substantially. This has from 96 percent to 79 percent in 1995. ratio for the last claims year is 99. Due been based on prudential considerati- Fluctuations in the claims ratio are par- to the long tail business in this line, a ons and has involved an increase in the

ticularly affected by individual losses. Non-life Insurance large part of the result is based on allo- gross claims ratio from 55 percent in cations for losses reported in subse- 1994 to 89 percent in 1995. This insu- Coastal all risks quent years, and the final result for a rance is mostly reinsured so that the The line covers insurance of claims year is not finally established claims ratio for own account has not Norwegian coastal tonnage including until 10-15 years later. The company is been affected by the increase in reser- the fishing fleet. The good trend from further developing its expertise within ves. Apart from this particular loss, the 1994 has been maintained. Gross pre- health, the environment and safety. development in claims in 1995 was miums earned increased by 6 percent, good. Transport mainly as a result of new policies. The Gross premiums earned have been The business avoided major losses in gross claims ratio was 63 percent, reduced by 27 percent in 1995. The 1995, and the gross claims ratio for the roughly the same as the previous year. 39 Premiums for own account have incre- Main figures for asset management: ased by at least 30 percent which is Asset class Market value Yield due, in addition to volume growth, to a (value-adjusted) 31.12.95 31.12.94 1995 1994 lower level of reinsurance purchases. Shares 995 7% 832 6% 14.2 2.2 Natural perils Bonds* 5,444 37% 2,513 19% 12.0 0.0 Certificates, etc. 5,685 39% 6,753 51% 5.9 5.8 The flood in eastern Norway in May- Deposits 1,107 8% 1,343 10% 5.3 5.6 June was the dominant event with Loans 313 2% 455 4% 8.2 8.7 Real estate 1,004 7% 1,291 10% 6.9 6.8 regard to natural perils insurance in Total 14,548 100% 13,186 100% 8.4 3.8 1995. The aggregate level of claims Of which unrealised gains 312 52 after the flood, which is covered by the Booked financial assets Norwegian Natural Perils Reserve, is UNI Storebrand Skadeforsikring AS 14,236 13,134 estimated at NOK 800 million. UNI Other assets and subsidiaries 3,795 4,117 Storebrand’s share of this is 40%, i.e. Total assets and subsidiaries 18,031 17,251 NOK 320 million. In addition there are business interruption claims cau- * Of which held to maturity 1,113, 8% sed by the flood which are not covered by the natural perils arrangement, but 181 million in 1994. In addition unrea- Gunnerusgt. 3 ANS, with a book value which the company nevertheless has lised gains on the securities portfolio of NOK 242 million, being sold to UNI chosen to meet. Business interruption of NOK 226 million were built up Storebrand Livsforsikring AS. losses are estimated at NOK 63 million. during 1995. Otherwise properties with an aggregate As a result of reinsurance cover in the The strong development in results book value of NOK 85 million have natural perils reserve and the compa- which began during the first part of been sold. The occupancy level on the ny’s own reinsurance agreements, the 1994 created a basis for an increase in company’s real estate portfolio was 95 charge on the company’s operating the company’s risk capital, and thus percent in 1995, which was slightly result was NOK 135 million. greater risk-bearing capacity. higher than the previous year. The One year’s profit or loss on the natu- Therefore the company has been able loan portfolio continues to be reduced ral perils scheme is covered through once again to increase the risk on the and now amounts to only 2% of the transfers to or from the natural perils investment portfolio after a couple of total investment portfolio. reserve. Last year’s premium income in years with a lower risk profile. This has natural perils has largely covered the been done by both increasing the Capital situation, solvency and cost of the flood, and as there other- volume and duration of the bond port- liquidity wise have not been any major natural folio. Interest rate sensitivity at the Total assets at 31.12.95 were NOK 18.0 perils in the last year, the natural perils year-end was NOK 200 million against billion, an increase of NOK 0.7 million reserve is roughly unchanged in 1995. NOK 60 million at the previous year- from the previous year. The increase is end. Stability and predictable financial mainly an effect of the result for the Financial income and asset income have important advantages for period. management the management of the business. The Equity totals NOK 1,773 million. Financial income company has therefore decided to esta- This represents a capital ratio of 30.3 The development in the securities blish a bond portfolio which will be percent. The statutory requirement on market has a considerable impact on held until maturity because this redu- capital adequacy is 6.75 percent, rising the results of UNI Storebrand ces the risk of fluctuations in accoun- to 8 percent at the end of 1997. The Skadeforsikring. Over the last year ting terms. Investments in shares have equity has risen by NOK 203 million prices in the equity and bond markets also been increased slightly during the since 31.12.94. Changes on this side have risen. Aggregate financial income last year, while it was mainly the port- are mainly caused by the result for the was NOK 1,096 million, an increase folio of deposits and other liquid assets period (NOK 1,151 million), while from NOK 729 million in 1994. In which was reduced over the last year - a NOK 950 million has been provided 1995 book gains on the sale and rever- reduction of approximately NOK 1 bil- for group transfers and dividends and sed write-downs of securities totalled lion. The real estate portfolio has been NOK 13 million for tax. NOK 156 million against a loss of NOK reduced mainly through Biskop Solvency capital, which in addition

40 to equity capital includes security reser- accounts of NOK 40 million. A loss existing and new competitors. Those ves, reinsurance reserves, administra- event should at most charge the who achieve success in this market will tion reserves, the natural perils reserve accounts with some NOK 150 million be characterised by efficient distribu- and the guarantee reserve, totalled for own account. This represents tion concepts and a high level of NOK 4,878 million at the end of 1995. approximately 2% points of the com- expertise in risk evaluation/price This represents a solvency margin of bined ratio. During a 3-year period the determination and claims settlement. 67.5 percent. At the end of 1994 the company will adjust its reinsurance UNI Storebrand has, during the last solvency margin was 67.9 percent. The programme so that the maximum couple of years, prepared and imple- solvency margin is an expression of the exposure on a loss event is increased to mented extensive and targeted impro- capital base in relation to the insuran- 6 percent. vement measures in these areas. This ce risk to which the company is expo- Interest rate sensitivity relating to work will be maintained and reinfor- sed, and is calculated as solvency capi- the company’s bond portfolio is such ced during 1996 with a view to develo- tal in relation to premiums written for that a 1 percent change in interest rate ping substantial permanent cost advan- own account. Solvency capital is NOK levels would change the market value tages. It is the company’s objective to 184 million higher than it was one year of the portfolio by around NOK 200 achieve an aggregate annual result ago, but rising premium volumes million. In the case of the share port- effect from improvement measures of mean that the solvency margin never- folio the situation is such that, for NOK 300-500 million, of which around theless has not increased. example, a 10 percent change in prices NOK 60-70 million represents measu- The company’s liquidity position is would lead to a change in value of rable gains achieved in 1995. To the very satisfactory. approximately NOK 90 million. With extent these gains are not reinvested in the unrealised gains the company greater competitiveness, the gains will Profit sensitivity holds in the portfolio there is, howe- be reflected in lower claims ratios. The profit sensitivity in non-life insu- ver, some room for a possible decrease In addition the company is prepa- rance can be illustrated by studying in value before this has a direct impact ring extensive measures in its distribu- changes in the technical elements on the booked result. tion network in order to respond to expressed through the combined ratio Changes in premium income, such future market requirements. A signifi- and the changes in the return on as where the company loses or obtains cant reduction in the cost ratio is an investment assets. UNI Storebrand new business, will lead to changes in overall objective for this work. Skadeforsikring has a premium volume market shares. In the short-term this for own account of in excess of NOK 7 would have few consequences in Important events since the billion and yield generating assets of purely result terms if the portfolio’s end of the accounting period approximately NOK 15 billion. risk composition is unchanged. A Subject to satisfactory licence terms, an decline in market share of, for exam- agreement has been signed on the sale The change in profit would be as ple, 1 percentage point - which repre- of the subsidiary UNI Storebrand follows: sents a loss of NOK 160 million in Kredittforsikring AS to the German Change in Change in yield premiums written - would lead to a Gerling Konzern. The sale will give rise Combined Ratio -1% 0% 1% slight fall in the result. After taking to a gain in the 1996 accounts of -1% -80 70 220 into account the reduction in variable approximately NOK 125 million as a 0% -150 0 150 1% -220 -70 80 costs and the effect on investment result of higher financial income. capital, the effect would be approxima- Non-life Insurance The effect of various individual events tely NOK 10 million in the first year The Board of Directors of UNI can illustrate this further. and approximately NOK 30 million in Storebrand Skadeforsikring AS The present reinsurance programme each subsequent year. The Board consists of Åge Korsvold with regard to the assumption of risk is (Chairman), Yngve Astrup, Anders M. that the charge on the accounts for Future prospects Liaaen, Hans Henrik Klouman, own account from a loss event The non-life insurance market is relati- Richard A. Zimowski and Ingvar (a loss can result in several individual vely mature and no significant growth Brotnov. claims) should not exceed 4% of sol- is expected beyond that in gross natio- The company’s Managing Director is vency capital. An individual claim nal product. Our strong market positi- Knut W. Francke, who took over from should at most involve a charge on the on is expected to be challenged by Bjørn Formo in mid-October 1995.

41 UNI Storebrand Skadeforsikring Group Profit and Loss Account 1 January - 31 December 1995

Amounts in NOK million Note 1995 1994

Premium Direct insurance 7,936.4 7,787.5 Reinsurance received 350.2 359.8

Gross premiums 8,286.6 8,147.3 Reinsurance ceded -1,116.4 -1,335.3

Premiums for own account 7,170.2 6,812.1

Financial income and expenses Interest income, net 923.7 813.8 Dividends 24.1 24.5 Gain/loss on sale/redemption/write-down of securities 156.1 -181.1 Net result from real estate 64.4 128.6 Other financial income 20.7 44.2 Other financial expenses -94.0 -103.1 Losses on loans advanced 24 1.2 2.1

Net financial income insurance 23 1,096.2 728.9

Other income 2.2 2.5

Total income 8,268.6 7,543.5

Claims Direct insurance -5,531.8 -5,362.5 Reinsurance received -242.3 -210.6

Gross claims -5,774.1 -5,573.1 Reinsured portion 752.9 555.8

Claims for own account -5,021.2 -5,017.3

Operating expenses Salaries and personell expenses -1,477.6 -1,505.7 Commission on reinsurance received -20.0 -16.4 Other operating expenses -625.7 -387.5 Ordinary depreciation -44.6 -62.2 Commission on reinsurance ceded 149.6 191.4 Bad debts -39.4 -44.0 Write-down of goodwill 28 -5.9 -5.9

Total operating expenses 26 -2,063.6 -1,830.2

Net financial items – other companies - 15.7

Ordinary operating result 1 1,183.8 711.6

Change in security reserves 38.2 -59.2 Change in reinsurance reserve 28.2 53.8 Change in administration reserve -2.2 -61.7 Change in natural perils reserve 2.6 -172.8 Allocation to guarantee scheme -81.6 25.0

Ordinary operating result 2 1,169.1 496.6

Extraordinary income/expenses - - Minority interests 37 -5.5 -15.3

Profit before tax 1,163.6 481.3

Changes in taxes - - Taxes payable -12.8 -61.2

Profit for the year 1,150.8 420.1

Revaluations and transfers Group transfer -950.0 -140.0 Transferred to general allocations - - To/from free equity -200.8 -280.1

42 UNI Storebrand Skadeforsikring Group Balance Sheet 31 December 1995

Amounts in NOK million Note 1995 1994

Assets Cash and bank and deposits 1,219.5 1,685.3 Receivables from group companies 45.5 185.2 Receivables from other insurance companies 377.9 330.5 Receivables from agents and policy-holders 1,010.9 986.4 Other receivables 457.6 648.9 Certificates 45, 54 6,140.1 6,675.7 Shares and interest 39, 40, 41, 54 962.3 859.2 Bonds 42, 54 4,390.7 2,944.4 Other loans - 1.4

Total current assets 14,604.6 14,317.1

Goodwill, shares in subsidiaries 57 8.7 14.6 Receivables from group companies 689.7 735.7 Other shares 39 8.7 9.1 Bonds 42 1,073.0 - Interests in partnerships 41 0.3 0.3 Loans 46, 47, 48, 49 319.4 461.4 Miscellaneous accounts receivable 8.2 7.2 Machinery, furniture, fittings, etc. 80.2 97.1 Deferred tax allowances 42.4 43.6 Prepaid pensions 273.3 216.6 Real estate 922.2 1,348.2 Total fixed assets 3,426.1 2,933.8 Total assets 18,030.7 17,250.9

Liabilities and equity capital Due to other group companies 789.6 143.8 Due to other insurance companies 207.0 273.9 Due to agents and policy-holders 102.7 107.6 Accrued tax deductions, social security, etc 105.9 117.7 Tax payable 7.4 65.5 Allocated to dividend 210.0 Other current liabilities 331.5 383.2 Total current liabilities 1,754.2 1,091.7

Technical allocations f.o.a.: Premium reserve 3,051.0 3,001.0 Claim reserve 7,905.5 7,779.4 Natural perils reserve 621.6 624.2 Security reserve 1,474.9 1,513.1 Reinsurance reserve 69.0 97.2 Administration reserve 556.6 554.6 Total technical allocations 59 13,678.6 13,569.5 Mortgage debt - - Deferred tax 42.4 43.6 Accrued pension liability 398.2 533.7 Other long-term liabilities - 3.0 Total long-term liabilities 440.6 580.3

Other reserves: Non-life Insurance Guarantee reserve 383.1 335.5 Total other reserves 383.1 335.5

Minority interests 61 1.2 104.3 Share capital 1,380.6 1,380.6 Revaluation fund 7.0 7.0 General reserve allocations 9.1 9.1 Free equity 376.2 172.9 Total equity capital 1,772.9 1,569.6 Total liabilities and equity capital 18,030.7 17,250.9

43 Shareholder matters

Sharecapital and shares Subscr. Subscr. Ordinary share Preference shares Number Share price NOK Number of shares after change Number of shares after change of shares capital Dato Type of change NOK mill. Restricted Free Restricted Free total NOK mill

23.05.90 Bonus issue employees 20 17.6 32,113,000 7,827,000 39,940,000 798.8 01.01.91 Merger 58,739,667 7,827,000 66,566,667 1,331.3 11.07.91 International placing 96 458.2 58,739,667 12,599,500 71,339,167 1,426.8 31.12.92 Write down own shares 58,727,965 12,596,157 71,324,122 1,426.5 11.06.93 Write down from par NOK 20 to NOK 5 58,727,965 12,596,157 71,324,122 356.6 11.06.93 Issue 10 2,800 206,939,165 44,384,957 82,339,555 17,660,445 351,324,122 1,756.6 10.05.94 Rights Issue 12.25 307.4 227,601,931 48,816,771 82,339,555 17,660,445 376,418,702 1,882.1 01.01.95 Number of shares after dissolution of restricted and free shares 276,418,702 100,000,000 376,418,702 1,882.1 31.12.95 276,418,702 100,000,000 376,418,702 1,882.1

Share capital and shares The EEA agreement means that The following preference dividends The EEA agreement means that the Norwegian and foreign investors have are to be paid subject to the Annual difference between restricted and free the same rights to acquire shares. General Meeting approving a full divi- shares was abolished with effect from 1 However, the ownership limitation of dend each year to owners of preferen- January 1995. For UNI Storebrand 10% in finance shares for each investor ce shares: ASA this meant a merger of share has been maintained. classes, so that from that date the Foreign investors’ interest in the Accounting year 1995 1996 1997 1998 company has had two share classes - company’s shares rose sharply in 1995. Dividend (NOK) ordinary shares and preference shares. At 31 December 1995 total foreign per share 0,70 0,70 0,50 0,50 At the beginning of 1995 UNI ownership amounted to 36.3%, Storebrand ASA had a share capital of divided between a 48.0% interest in In addition to the preference divi- NOK 1,882.1 million. There were no the ordinary share class and a 3.9% dends, the preference shares will changes during the year in the number interest in the preference share class. receive the same dividends as ordinary of shares issued and thus the share shares. No dividend can be paid on the capital was unchanged. Share price development ordinary shares unless the preference At 31 December 1995 the two share There was a positive development in shares have received a full preference classes consisted of 276.5 million ordi- the company’s ordinary share price in dividend. If for any accounting year a nary shares and 100 million preference 1995. At 31 December 1994 the share full dividend is not paid on the prefe- shares, all of NOK 5 par value. price was NOK 21.05, with a general rence shares, it will not be permitted to rise during 1995 to a final share price pay dividends on the ordinary shares Foreign ownership at 31 December 1995 of NOK 35.15. for the subsequent accounting year. Up to 31 December 1994 Norwegian The price of the company’s prefe- Redemption of the preference concession legislation imposed a rence shares increased from NOK shares can be approved at the Annual maximum limit on foreign ownership 10.50 at 31 December 1994 to NOK General Meeting in 1998 or 1999 and of 33 1/3%. 11.80 at 31 December 1995. should be implemented as soon as pos- At 31 December 1994 the permitted sible thereafter, provided that share- foreign ownership in UNI Storebrand, Preference shares holders shall receive the dividend in accordance with the company’s own The preference shares, established in approved at the relevant general Articles, was 17.7%, of which 16.4% 1993, have preferential rights with meeting. When considering the was utilised at that date. regard to dividends from the company. question of redemption of preference shares, shareholders owning preference

44 Share structure at 31 December 1995 company therefore places particular Shares Share holders Shares emphasis on routines and guidelines Total % Amount in NOK mill. % satisfying the formal requirements

1– 25 48,669 62.5 0.3 0.1 imposed by the authorities on securi- 26– 100 10,439 13.4 0.5 0.1 ties trading. The company has its own 101– 500 9,265 11.9 2.3 0.6 control system which ensures that 501– 1000 3,149 4.0 2.3 0.6 1001– 5000 4,412 5.6 9.7 2.6 routines are complied with. 5001– 10000 754 1.0 5.5 1.5 10001– 50000 749 1.0 16.9 4.5 50001– 100000 173 0.2 13.2 3.5 Investor relations 100001– 500000 175 0.2 39.6 10.5 UNI Storebrand wishes to maintain 500001–1000000 43 0.1 31.2 8.3 and further develop the company’s 1000001 and more 44 0.1 254.8 67.7 good contacts with all participants in 77,872 100.0 376.4 100.0 the national and international capital markets. The company has a separate Investor Relations function within its shares shall have voting rights neither UNI Storebrand ASA has the largest finance department. This function has for their preference shares nor their number of shareholders of those responsibility for establishing and ordinary shares. companies listed on the Oslo Stock coordinating contact between the com- The redemption price will be NOK Exchange. pany and external connections, such as 11.60 per share in 1998 or NOK 11.90 The company’s shareholder analysts, stock exchanges, sharehol- in 1999. structure shows a disproportionate ders, investors, etc. If redemption is not approved by the number of shareholders with small The company has always given parti- Annual General Meeting in 1999 at the share holdings. 52% have fewer than cular emphasis to contacts with the latest, the preference shares are to be 10 shares and 76% have 100 shares or capital markets and encourages indivi- converted to ordinary shares with less. Most of these became sharehol- duals and institutions in these markets effect from the first day after such ders in 1991 due to the distribution of to visit the company for discussions general meeting. shares to policyholders on the conver- and presentations. sion of UNI Livsforsikring from a Stock exchange listing mutual company to a joint stock The shares have been listed on the company. Oslo Stock Exchange since it was The company has shareholders from opened in the last century. Due to the all the municipalities in Norway and company’s financial problems, the from 48 other countries. Price development company’s shares were delisted in the period 27 August 1992 to 21 June Insider trading NOK 36 1993. The officers in the governing bodies Both share classes are listed and and senior employees of UNI 34 have the following symbols: UNS for Storebrand ASA are subject to rules - 30 ordinary shares and UNP for prefe- based on the provisions in the relevant 26 rence shares. legislation and regulations - regarding Shareholder matters

the trading of securities issued by UNI 22 Shareholders Storebrand ASA. 18 At 31 December 1994 the company As one of the country’s leading had 81,687 shareholders. During 1995 financial institutions, UNI Storebrand 14 the number was reduced to 77,872. is dependent on maintaining an 10

orderly relationship with the finance 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 market and control authorities. The FridayFredag week uke KursShare ordinær price restricted aksje ordinary shares KursShare preferanse price restricted aksje preference shares

45 The company holds regular presen- The 20 largest shareholders tations to the financial community in at 31 December 1995 Oslo and London in connection with Shares Total % the publication of quarterly accounts. These presentations consist of both Orkla A.S Lysaker 44,305,522 11.77 Folketrygdfondet Oslo 42,342,898 11.25 larger meetings with a number of Morgan Guaranty Trust Co. Brussels 41,121,277 10.92 analysts and other capital market Stiftelsen UNI Oslo 22,219,625 5.90 connections as well as direct meetings Tiger Management Corp. London 19,232,207 5.11 Morgan Stanley Trust Co. New York 6,907,067 1.83 with individual investors or analysts. Chase Manhattan Bank – clients treaty account Bournemouth 6,074,190 1.61 UNI Storebrand has also held pre- Kommunal Landspensjonskasse Oslo 5,967,104 1.59 Morgan Stanley & Co. Inc London 4,674,785 1.24 sentations in many European countries, AIM Value Fund C. Boston 3,835,000 1.02 as well as in the American market in BSDT-SWB Internal Equity Oslo 3,357,500 0.89 1995, in order to increase understan- Unibank A/S København 3,195,805 0.85 Aksjefondet Avanse Oslo 3,074,165 0.82 ding of the company’s present position A/S Arendals Fossekompani Arendal 2,665,353 0.71 and future development. Both the Chase Manhattan Bank – clients non treaty account Bournemouth 2,372,350 0.63 Aksjefondet Avanse Kapital Oslo 2,266,768 0.60 Group Chief Executive Offices and Citibank N.A. London 2,234,400 0.59 other members of the company’s Norsk Hydro’s Pensjonskasse Oslo 2,177,859 0.58 management have participated in Den Danske Bank A/S København 2,047,428 0.54 CB Capital Bank Zürich 2,010,714 0.53 presentations in Norway and abroad. The company will try in particular to The 20 largest shareholders own together 222,082,017 shares, which is 59.0% of the share capital. strengthen connections with the main international capital markets due to the company’s size in relation to the Norwegian market and in order to Dividend policy ordinary shares rose by approximately create the best possible conditions for The Board of UNI Storebrand ASA will 67% and since 1.1.94 it has risen by trading in the shares. propose to the Annual General some 87%. Meeting that a dividend of NOK 0.70 UNI Storebrand ASA will maintain a Internet per preference share is paid for 1995. dividend policy in the coming years In order to improve the service to the No dividend will be paid on the which takes account of the company’s capital market, UNI Storebrand has ordinary shares for 1995. No dividend primary financial objective, namely to established its own address on was paid on the ordinary shares for redeem the preference capital with Internet: http://www.telepost.no/- 1994 either. free equity. This means that the com- unibrand/. The company’s quarterly UNI Storebrand ASA aims to achieve pany will give priority to building up reports and other important press a competitive return for the company’s free equity rather than pursuing an releases will be available here at the shareholders over time through divi- aggressive dividend policy for the same time as they are published dends and a rise in the share price. ordinary shares. The company believes through traditional channels. During 1995 the share price for the that this is in the shareholders’ interest, so that the dilution which

46 Shareholdings by county at 31 December 1995 manager, so that future dividends can County Numbers of Numbers of be paid in a simple and secure man- shareholders % shares % ner.

Østfold 4,552 5.8 1,427,339 0.4 Shareholders should generally con- Akershus 11,254 14.5 61,869,098 16.4 tact their own share account manager Oslo 12,767 16.4 141,048,620 37.5 with queries and notice of changes Hedmark 2,087 2.7 1,857,750 0.5 Oppland 1,931 2.5 1,320,063 0.4 such as, for example, a new address. In Buskerud 4,861 6.2 2,780,795 0.7 addition, UNI Storebrand’s own share Vestfold 4,736 6.1 3,529,666 0.9 Telemark 2,935 3.8 1,082,865 0.3 office, on tel: 22 31 20 61, can provide Aust-Agder 1,714 2.2 4,810,486 1.3 guidance and information. Vest-Agder 2,651 3.4 692,306 0.2 Rogaland 5,535 7.1 4,290,959 1.1 Hordaland 6,610 8.5 9,001,351 2.4 RISK adjustment Sogn og Fjordane 1,357 1.7 446,342 0.1 The general RISK amount for both the Møre og Romsdal 3,544 4.6 1,910,428 0.5 Sør-Trøndelag 3,417 4.4 1,514,662 0.4 ordinary and preference shares in UNI Nord-Trøndelag 1,338 1.7 251,316 0.1 Storebrand ASA at 01.01.93, 01.01.94 Nordland 2,559 3.3 565,958 0.2 and 01.01.95 has been set at NOK - Troms 1,731 2.2 674,659 0.2 Finnmark 740 1.0 165,177 0.0 2.59, NOK 0.29 and NOK 0.84 per Svalbard 11 0.0 2,034 0.0 share, respectively. Norwegians living a broad 783 1.0 712,403 0.2 Foreign shareholders 759 1.0 136,464,425 36.3 The general RISK amount at 01.01.96 is estimated at NOK -0.30 per Total 77,872 100.0 376,418,702 100.0 share. On a sale of shares, the opening value/purchase price of the shares will would arise if the preference shares Service, Oslo. The register is updated be adjusted by the total of the RISK were converted to ordinary shares can daily with reported changes and share- amounts during the period of owners- be avoided. holders receive written notice from the hip. This is in order to calculate the The company’s aim is to pay a full VPS in the event, for example, of gain/loss for tax purposes. dividend to holders of preference capi- changes in shareholdings tal each year, provided the group’s (purchase/sale). annual profit exceeds the preference In January each year VPS sends an dividend stated in the Articles. “Annual Statement” to shareholders. This is very useful as a basis for comple- Shareholders’ contact with ting tax returns. the company If the annual statement refers to a The share register of UNI Storebrand bank account number for dividends ASA is managed by the Norwegian which is not correct, or there are other Registry of Securities (VPS) through errors, shareholders are recommended the company’s account manager for to contact their own share account shares - Kreditkassen, Securities Shareholder matters

47 Terms and expressions

General Tier 2 capital: Endowment insurance: Tier 2 capital is part of the primary Individual life insurance where the Capital ratio: capital and consists of the revaluation insurance amount is paid out on a Eligible primary capital as a percentage reserve and subordinated loan capital. single occasion on death or the expiry of the risk-weighted balance sheet. In order to be eligible as primary capi- of the insurance period. Such insuran- (Individual assets and off-balance sheet tal, Tier 2 capital cannot exceed Tier 1 ce can be extended to cover disability items are given a risk weighting based capital after deduction of unspecified pensions or insurance. on the estimated credit risk they loss provisions. represent.) Group life insurance: Unspecified loss provisions: Collective life insurance in which the Duration: See accounting principles. insurance sum is paid out on the death The average remaining term of cash- of the insured while he is a member of Life insurance flow on the bond portfolio. the group. Such insurance can be extended to cover disability insurance. Additional statutory allocations: Equity capital: See accounting principles. Interest result: Equity capital consists of restricted The result arising from financial inco- equity capital and free reserves such as Annuity/pension insurance: me deviating from that estimated in the contingency reserve, etc. Individual life insurance where the the premium tariffs. annuity/pension amount is paid in Earnings per share: instalments from an agreed age, if the Other funds: Ordinary group result divided by the insured is alive. Such insurance can be See accounting principles. average number of shares. extended to include spouse, child and Premium fund/pension adjustment disability pensions. General reserve allocations: fund: See accounting principles. Administration result: See accounting principles. The difference between actual costs Premium reserve: Primary capital: and those estimated in the premium See accounting principles. Primary capital is capital eligible to ful- tariffs. fill the capital requirements under the Return on capital: Average yield: authorities’ regulations. Primary capi- The booked return on capital shows Average yield is an expression for the tal may consist of Tier 1 capital, Tier 2 gross financial income expressed as a average return the company has obtai- capital as well as general reserve allo- percentage of the average of the ned on policyholders’ funds during the cations and unspecified loss provisions company’s total assets over the year in course of the year. By policyholders’ (these expire in 1995) during a transi- accordance with rules set by the funds is meant the sum of all technical tional period. Banking, Insurance and Securities reserves and amounts held in premium Commission. The value-adjusted reserves for all classes of insurance writ- Specific loss provisions: return on capital shows gross financial ten by the company. The average yield is See accounting principles. income plus the year’s change in a gross yield before deducting costs and unrealised gains, excluding unrealised will thus not be comparable with interest Subordinated loan capital: gains on bonds held until maturity, from other financial institutions. The Subordinated loan capital is loan capi- expressed as a percentage of the average yield is calculated in accordance tal which ranks after all other debt. average of the company’s total assets with rules set by the Banking, Insurance Subordinated loan capital is part of over the year at market value. Tier 2 capital. To be eligible as primary and Securities Commission. Risk capital: capital, the remaining term must be at Capital adequacy margin: Risk capital consists of unrealised gains, least 5 years. If the remaining term is That part of Tier 1 capital which supplemental allocations, security reser- less, the eligible portion is reduced by exceeds a capital adequacy ratio of 8%. ves above the lower limit, capital adequa- 20% for each year less. Collective pension insurance: cy margin and the share of the result dis- Tier 1 capital: A collective pension insurance scheme tributed unconditionally to customers. Tier 1 capital is a part of primary where pensions are paid in instalments Risk result: capital and consists of equity capital from an agreed age, assuming the insu- The result arising from deaths and/or and general reserve allocations less the red is alive. Such insurance normally disabilities during a period deviating revaluation reserve, after deducting includes spouse, child and disability from that assumed in the premium net prepaid pensions. pensions. tariffs. 48 Security reserve: Guarantee reserve in non-life Reinsured portion of claims: See accounting principles. insurance: The reinsurer’s portion of gross claims. See accounting principles. Non-life insurance Reinsurance received: Administration reserve: Losses (claims) incurred: Insurance risks taken over from See accounting principles. The total of claim payments for losses another insurance company. incurred during the period. Claims (losses) for own account: Reinsurance reserve: That part of claims which are carried Natural perils fund: See accounting principles. by the company, i.e. gross claims, less See accounting principles. the reinsurers’ share. Run-off results (gains/losses): Premiums earned: The amount is related to losses which Claims ratio: Premiums for the risk the company has have occurred in previous years and Claims incurred as a percentage of incurred during the accounting period. represents the difference between premiums earned for own account. Premiums earned are the same as actual and expected claim amounts premiums written in the period after paid on settled losses, as well as Claims reserve: deducting allocations to cover risks changes in expected claim payments See accounting principles. which extend beyond the accounting for unsettled losses. period (premium reserves) and adding Claims reserve ratio: the corresponding allocation which was Security reserve: The claims reserve for own account as made at the end of the previous period. See accounting principles. a percentage of premiums written for Premiums for own account (net own account. Solvency capital: premiums): Solvency capital consists of that part of That part of the premiums retained by Combined ratio: the company’s capital which does not the company to cover its part of the The sum of the cost ratio and the represent continuing obligations and risk. claims ratio. is an expression of the company’s solidity. The elements included in Premiums for reinsurance ceded: Cost portion: solvency capital are restricted and free That part of the gross premiums which Operating expenses as a percentage of equity capital, the guarantee reserve in are passed on to other insurance com- premiums earned. non-life insurance, security, reinsu- panies (reinsurers) for agreeing to rance and administration reserves and assume part of the risk the company Cost ratio: the natural perils fund. has itself assumed towards its insurance Operating expenses as a percentage of customers. premiums written. Solvency margin: Premium reserve: Solvency capital as a percentage of Direct business: See accounting principles. premiums earned for own account. Insurance business where a direct agreement is entered into between the Premiums written: Solvency margin capital: insurance company and the insurance The sum of all notified (invoiced) pre- The solvency margin capital consist of customer. miums with the main due date in the subordinated capital, allocations in accounting period for direct insuran- excess of 55% of the minimum requi-

F.o.a. ce, together with premiums booked in rement to security reserves, allocation Terms and expressions For own account. the period for insurance taken over in excess of minimum requirement to from other companies (reinsurance). reinsurance- and administration reser- Gross claims: A deduction is made for notified but ve in addition to the natural perils Total losses during the period without cancelled premiums. fund. At 31.12.95 minimum require- deduction for reinsurance. ment to solvency capital was introdu- Reinsurance ceded: ced. Gross premiums: That part of the insurance risk written Used both for premiums written and which, due to the risk being too large Technical result: earned and corresponds to total for own account, is taken over by Premium income, less claims and premiums without deduction for rein- (covered by) another insurance operating expenses. surance ceded. company. 49 Directors and Officers

Numbers of shares 31 December 1995 Elected by the employees: The figures state the number of shares Morten Rambech Dahl 1,216 in UNI Storebrand recorded in the The Board of Directors: Inger Anne Strand 36 share register to each person at 31 Chairman Jorun Elisabeth Erstad 0 december 1995. The shares include Jon R. Gundersen 1,364 Einar Sørensen 652 shares owned by spouses, minor Jens Ulltveit-Moe 1,000,000 John Bang 47 children or companies where the Tom Ruud 87 May Moldenhauer 0 relevant person has such influence as Per-Leon Selseth 0 Tore Clausen 4,071 specified in § 1–2 of the Companies Brit K. S. Rugland 0 Jan G. Andersen 0 Act. Lennart Jeansson 0 Tore Fredriksen 0 Sigrun Gjengedal Ruud 559 Juliane Skare 1,805 Mathias Dannevig 19 Sigurd P. Laugen 0 Auditors: KPMG as Board of Representatives Ole M. Klette 0 Elected by the shareholders: Arne Giertsen 0 Sven Ullring 0 Jens P. Heyerdahl d.y. 9,136 Tore Lindholt 46 Control Committee: Svein Rennemo 0 Nils Erik Lie 0 Reidar Flod Johansen 1,240 Brit Seim Jahre 0 Svein Aaser 16,113 Knut Ro 0 Martin Mæland 314 Harald Moen 422 Kari Broberg 0 Wenche Meldahl 0 Sandra Riise 0 Executive Group Brit Seim Jahre 0 Management 1.3.1996: Jan Magne Heggelund 0 Åge Korsvold 1) 43,882 Ole Enger 0 Svein R. Hagen 62 Erik Braathen 13,760 Knut W. Francke 1,073 Terje Venold 0 Riulf Rustad 0 Kåre Gjønnes 0 Knut Norheim Kjær 150,500 Halvor Stenstadvold 101 Idar Kreutzer 0 Harald Tyrdal 5 Jørgen Bredesen 2)0 Kristian Zachariassen 0 Erling Steigum 0 1) Åge Korsvold has in addition purchased an option to buy 600,000 shares. Regarding the option rela- ting to his employment see note 17. 2) From 1 March 1996

50 Notes UNI Storebrand

Page Page Comments on the accounts ...... 52 Balance UNI Storebrand Group Note 38 Receivables from, and liabilities to, UNI Storebrand ASA insurance companies...... 68 Note 1 Group transfer from subsidiaries ...... 56 Note 39 Shares UNI Storebrand Group ...... 69 Note 2 Pension costs and pension liabilities ...... 56 Note 40 Share options ...... 72 Note 3 Remuneration to officers ...... 57 Note 41 Interests in partnerships ...... 73 Note 4 Tax charge ...... 57 Note 42 Bonds ...... 73 Note 5 Bonds ...... 57 Note 43 Financial instruments ...... 75 Note 6 Financial instruments ...... 57 Note 44 Pledged assets ...... 76 Note 7 Certificates ...... 57 Note 45 Certificates ...... 76 Note 8 Real estate and operating assets ...... 58 Note 46 Loans ...... 77 Note 9 Investment/sale – real estate/operating assets Note 47 Loans by type of debtor ...... 77 (last 5 years) ...... 58 Note 48 Loans with security estate by valuation limits ..... 77 Note 10 Deferred tax allowance and deferred tax ...... 59 Note 49 Loans subject to special provisions ...... 77 Note 11 The parent company’s shares in subsidiaries ..... 59 Note 50 Interests in associated companies ...... 78 Note 12 Sale of subsidiaries ...... 59 Note 51 Real estats and operating assets ...... 78 Note 13 Bond loan ...... 60 Note 52 Investments/sale – real estate/operating Note 14 Change in equity capital ...... 60 assets (last 5 years) ...... 78 Note 15 Loans and guarantees to officers and Note 53 15 largest commercial properties ...... 79 employees ...... 60 Note 54 Market value securities ...... 79 Note 16 Liabilities on termination or change in Note 55 Deferred tax allowances and deferred tax ...... 80 managers’ employment contracts ...... 60 Note 56 Loss carried forward ...... 80 Note 17 Transactions with connected parties ...... 61 Note 57 Intangible assets in subsidiaries ...... 80 Note 18 Share classes...... 61 Note 58 Reserves for insurance liabilities - Note 19 Guarantees ...... 61 Life insurance ...... 81 Note 59 Claims reserves - Non-life insurance ...... 81 Profit and Loss account UNI Storebrand Group Note 60 Subordinated loan capital ...... 82 Note 20 Pro forma accounts 1994 Note 61 Minority’s interest in equity capital ...... 82 (Pro forma accounts for 1994 are exclusive Note 62 Change in equity capital ...... 82 of Oslo Reinsurance Company Group)...... 62 Note 21 Specification of the years’s gross premiums Other notes and insurance benefits – life insurance...... 62 Note 63 Loans and guarantees to employees ...... 82 Note 22 Premiums and claims – Non-Life insurance ...... 63 Note 64 Capital adequacy ...... 83 Note 23 Net financial income insurance ...... 63 Note 65 Disputes ...... 83 Note 24 Loan losses ...... 64 Note 66 Key figures UNI Storebrand Skadeforsikring .... 84 Note 25 Other operating income ...... 64 Note 67 UNI Storebrand Skadeforsikring Note 26 Operating expenses ...... 64 result by sector ...... 85 Note 27 Pension liabilities ...... 64

Note 28 Depreciation of goodwill in subsidiaries ...... 65 Notes Note 29 Remuneration to auditor ...... 65 Note 30 Net financial items, other activities ...... 66 Note 31 Result from associated companies ...... 66 Note 32 Technical result, non-life insurance ...... 66 Note 33 Group result by business areas ...... 67 Note 34 Result from UNI Storebrand Livsforsikring AS ... 67 Note 35 Allocations non-life insurance ...... 67 Note 36 Tax ...... 67 Note 37 Minority interests ...... 68

51 Comments on the accounts

Consolidation principles Translation of foreign The calculation of deferred tax may The UNI Storebrand Group comprises subsidiaries differ at Group level due to additional companies in life insurance, direct The profit and loss accounts of foreign opportunities to set off amounts within non-life insurance and financing. The subsidiaries are translated to NOK at the Group and the possibility of business of the financing companies is the average exchange rates for the making group transfers. being wound up. The accounts for year, whilst the balance sheets are finance companies and insurance translated at the rate ruling at the end Pension costs companies are subject to special of the year. Any translation differences The preliminary Norwegian accoun- regulations laid down by the Banking, are posted against unrestricted equity. ting standard for pension costs was Insurance and Securities Commission. introduced with effect from The accounts of other companies are Elimination of internal 01.01.1994. The transition effect was prepared in accordance with the transactions charged directly against equity at Companies Act. Internal receivables and payables, 01.01.1994. The consolidated accounts comprise internal profits and losses, interest and The net pension cost for the period companies where 50% or more of the dividends, etc., between group is included under “salaries and person- shares are held, directly or indirectly. companies are eliminated in the nel expenses” and consists of the sum Companies where the Group has a consolidated accounts. of the period’s pension earnings, the strategic investment, with a stake in the Gains and losses on internal sales interest charge on the estimated voting capital of between 20% and to/from UNI Storebrand liability and the expected return on 50%, are consolidated in accordance Livsforsikring AS are not eliminated the pension funds. with the equity method. due to the fact that the profit of the Prepaid pensions are the difference The Banking, Insurance and life company is to be divided between between the actual value of the pension Securities Commission has issued customers and shareholders. funds and the present value of estima- regulations requiring the preparation ted pension liabilities and are booked as long-term assets in the balance sheet. of consolidated accounts which Minority interests Correspondingly a long-term liability include life insurance companies. This In the profit and loss account, the arises in the accounts when the pension regulation came into force for 1989. In minority interests’ share of the profit liability is greater than the pension anticipation of detailed regulations after tax is stated. This means that all funds. A distinction is made between regarding consolidated accounts items in the profit and loss account insured and uninsured schemes. The including life insurance companies, include minority interests. uninsured scheme will always be ente- the accounts are primarily based on Minority interests are shown in the red as a liability, as this scheme does recommendations issued by the balance sheet as a separate item between not include pension funds. Association of Norwegian Insurance other reserves and shareholders’ Changes in estimated pension liabili- Companies. The consolidated results funds. Assets and liabilities are thus ties and pension funds as a result of include only the shareholders’ share of shown inclusive of minority interests. the profit from life insurance ope- deviations between calculated and rations. estimated values are not periodised in Accounting principles the accounts before the accumulated The consolidated accounts have been effect of estimate changes and devia- Consolidation of subsidiaries prepared in accordance with the same tions exceeds 10% of the higher of the Elimination of shares in subsidiaries is principles as in 1994. pension liability or pension funds, based on the purchase value method, respectively, at the start of the year where the book value of shares in Deferred tax (“the corridor”). subsidiaries is eliminated against the Calculation of deferred tax in the profit equity capital in the subsidiaries. Any and loss account and balance sheet has Valuation of the portfolio of excess value/deficit is booked direct to been made on the basis of the prelimi- current assets the assets/liabilities in question and nary Norwegian accounting standard The portfolio principle is used on a depreciated/taken as income in line on tax issued by the Norwegian company basis for financial invest- with these. Any excess value which is Accounting Standards Board (NRS). ments in shares, bonds, certificates and not directly related to a specific item is The tax charge in the profit and loss financial instruments, which are capitalised and depreciated in accor- account consists of tax payable and managed as a single group. dance with the provisions of the deferred tax/tax allowances. The valuation is made as a whole for Companies Act. Tax payable is calculated on the all these forms of investment at the The international reinsurance basis of the taxable profit for the year. lower of cost or market value on the business was deconsolidated on Deferred tax/tax allowances are calcu- balance sheet date. 01.01.1995 as a result of the sale of lated on the basis of timing differences Any shortfall in value is written down 90% of the shares in UNI Storebrand between accounting and tax values and and charged to the ordinary result. International Insurance AS (now Oslo the tax effects of the loss carried for- The portfolio principle is not applied Reinsurance Company ASA). ward. to financial investments where long- 52 term falls in value have been identifi- Real estate directly owned by Gains/losses on the sale of real ed. These are considered individually UNI Storebrand Livsforsikring AS estate are treated as ordinary items in and booked at the estimated actual Due to the relationship with life insu- the accounts. value. rance customers the rules for the treat- ment of real estate in the accounts Loans Shares held as fixed assets have been slightly different for the life Loans advanced are carried at nominal Investments in shares in subsidiaries, insurance business and the Group’s values in the balance sheet, reduced by associated companies and partnerships other business. The Banking, allocations for losses. are considered as fixed assets where Insurance and Securities Commission Provisions for losses have been made the investment is of a long-term and has issued similar rules for life and in accordance with the Banking, strategic nature. A corresponding non-life insurance with effect from the Insurance and Securities Commission’s classification is made for strategic 1994 accounting year. These are in regulations. investments in shares. accordance with general accounting Specific loss provisions are intended The book value is the cost price, and principles in the area. In 1995 the to cover calculable losses on facilities write-downs are made on an individual properties were valued on the basis of which are identified as exposed to the basis if these are not due to reasons long-term earnings capacity. risk of loss at the balance sheet date. which are temporary or of an insigni- Under previous rules properties This will include provisions on loans ficant nature. belonging to life insurance companies transferred for legal enforcement, were revalued and written down in line individual provisions made on loans Bonds with estimated developments in value particularly exposed to the risk of loss Bonds are divided for accounting and changes in the result were in the current portfolio and provisions purposes between those held as recorded as an ordinary item in their for the risk of loss on loans where the- accounts. Oridnary depreciation was current assets and bonds held until re has been a payment default not charged on the properties. maturity. The bonds to be held until exceeding 67 days. New accounting rules for insurance maturity are booked at cost price and Unspecified loss provisions are companies have been introduced with premiums/discounts in relation to par booked to cover losses which, due to effect from the 1996 accounting year. value are amortised over the bonds’ matters existing on the balance sheet The treatment of real estate in life remaining term and recorded in the date, must be expected to occur on insurance companies has, however, not profit and loss account as an interest facilities which have not been identified yet been finally clarified. In expectation element. and valued in accordance with the of clarification, ordinary depreciation Bonds in default are valued in line rules for specific loss provisions. This has similarly not been charged in the with the Banking, Insurance and type of provision is made for all cur- 1995 accounting year. Ongoing main- Securities Commission’s guidelines for rent loans where there has not been a tenance has been expensed. loans. If there is no actual dealing payment default exceeding 67 days. price on the balance sheet date, the Other real estate The provision is made on the basis of market value is fixed on the basis of Ordinary depreciation on the real past experience and sector data. available information. estate portfolio is taken as a current Realised losses on facilities are losses expense for the remaining businesses which are considered to be final. Real estate in the Group. Investment properties These include losses arising on bank- Method of valuation are valued applying a portfolio ruptcy, accord or losses where the The company’s real estate portfolio is principle. company considers it is overwhelmingly valued continuously using its own The properties are dealt with in likely that the loss is final. expertise. The properties are valued accordance with the requirements of Realised loan losses are posted individually by discounting estimated the Companies Act. Where there is a directly to reduce nominal values in future net income streams by a rate permanent fall in value, the property is the balance sheet. written down. Write-downs of property General reserve allocations are non- corresponding to the yield require- Notes ment for the relevant investment. The are treated as an ordinary expense and financial allocations intended to cover net income stream takes into account any revaluation as a transfer after the future losses on the portfolio which existing and future losses of income as result for the year. Unrealised gains on could arise as a result of matters which a result of vacancy, necessary invest- the real estate portfolio are stated as are not known on the balance sheet ments and an assessment of the future additional information to the date. development in market rents. The accounts. In the case of loans in default for yield requirement is based on the Companies in the Group together more than 90 days, interest, commission expected future risk-free interest rate own certain properties through unlimi- and fees booked as income, but and an individually determined risk ted companies. These are treated in unpaid, are reversed. premium, dependent on the letting the accounts in the same manner as Changes in realised losses and situation and the building’s location other properties and are thus included allocations for losses are booked under and standard. under the same items in the accounts. financial income. 53 Foreign exchange Interest futures expected claims on losses for own In order to hedge foreign exchange Interest futures are set off daily against account which have been notified but risks, the Group aims to balance recei- bank accounts and booked to the not settled, and for losses which have vables and debt in each currency, or to profit and loss account daily in the case been incurred but not reported at the hedge its position in another way. of contracts included in portfolio date of the accounts. Foreign securities are booked at management. Foreign interest futures The claims reserve consists of their original cost price in foreign cur- are valued on an ongoing basis, but are two parts: rency converted to NOK at the settled and accounted for at expiry. Firstly, a reservation should at all times exchange rate on the date of the trans- The result from futures contracts be made for the best estimate of action (the historical cost price). The which are identified as hedging reported unsettled claims at the date market value is established on the borrowing, is accrued over the term of of payment. For some lines a standard balance sheet date, converted to NOK the loan. amount will be allocated for new losses at the exchange rate on the balance which represents the best estimate sheet date. Interest swaps until further information is obtained. Foreign currency securities are The contracts are valued on the balance In addition, a reserve is to be calcu- normally hedged by forward contracts sheet date and are included in the lated in accordance with statistical which are valued daily on the basis of market value of bonds. Accrued/earned methods for incurred but not reported exchange rates on the balance sheet interest is booked to the profit and loss claims (IBNR) and for changes in date. account. individual loss provisions until they are In the case of current assets, the finally wound up. portfolio principle is used for all FRAs - Future rate agreements Statutory security reserves are allo- currencies, including profits/losses on The contracts are valued on the balance cations to cover fluctuations (possible hedging instruments. sheet date and are included in the catastrophes and extraordinary claims) Securities classified as fixed assets, market value of bonds. The amount in the company’s claim liabilities for including shares in foreign subsidiaries, payable is booked to the profit and loss own account. are booked at the exchange rate at the account on the settlement date. The Banking, Insurance and date of acquisition. In the case of reva- Securities Commission’s requirements luations or write-downs, the exchange Forward foreign exchange contracts on security reserves specify that the rate at the time of valuation is used. Forward foreign exchange contracts inflation element in the claims reserve Liquid assets and other current are mainly used in the financial is covered by the security reserve. In assets/short-term liabilities are conver- management of foreign securities and line with this, the inflation element has ted on the basis of the exchange rate liquid assets held by the Norwegian been transferred from the claims reserve on the balance sheet date. In the case businesses. and added to the security reserve. of long-term receivables/liabilities, the Forward contracts in foreign curren- Statutory reinsurance reserves are alloca- lowest/highest value is used. cies are accounted for on maturity. tions for any expenses which the com- Foreign exchange contracts are pany incurs as a result of its reinsurers valued on the basis of the rates prevai- Financial instruments not covering their portion of total ling on the balance sheet date. UNI Storebrand uses various financial claim liabilities. instruments in the financial manage- Statutory administration reserves are ment of the company’s foreign Non-life insurance allocations to cover administration exchange and interest exposure. Allocations to technical reserves expenses incurred on claim settlement The Banking, Insurance and Securities in the event of the winding-up of the Share options Commission has introduced separate company. Buying and selling options is a normal minimum requirements for five types part of UNI Storebrand’s securities tra- of technical reserves: premium reserve, Natural perils fund ding business. The option premium is claims reserve, security reserve, rein- The operating profit from the natural capitalised when the agreement is surance reserve and administration perils fund, which is managed by the entered into and booked in the profit reserve. The minimum requirements Norwegian Natural Perils Pool, must and loss account when the option expi- for premium and claim reserves must be allocated to a separate natural perils res or is exercised. When booking the be satisfied for each line and for reserve. These allocations may only be result, account is taken of the market security reserves for each group of used to cover claims resulting from value and strike price. lines. natural perils. The option portfolio is valued as a The premium reserve is a reserve for portfolio, together with the share port- unearned premiums for own account Guarantee reserve folio, when establishing the market value. on current contracts in force on the A mandatory reserve for non-life and balance sheet date. Accrual is made credit insurance companies. The allo- Bond options pro rata and without deduction for cation is intended to contribute to The same accounting treatment as sha- expenses. policyholders receiving settlement in re options. The claims reserve is a reserve for accordance with the policies. 54 Sales expenses unsettled disability and death benefits Premium fund/pension regulation Sales expenses including commissions is made through an allocation to the fund in the insurance fund are expensed, except for external com- premium reserve in the insurance The premium fund contains prepaid missions on the marine lines. These fund. premiums “under the Taxes Act” from are capitalised in the accounts and policyholders on individual and expensed in line with the accrual of Transferring of premium reserves, etc. collective pension insurance. The the associated premium. Transferred premium reserves in the pension regulation fund consists of insurance fund on the transfer of poli- payments “under the Taxes Act” from Receivables/liabilities agents and cies between insurance companies are policyholders on collective pension policyholders booked to the profit and loss account insurance. The fund is to be applied in Receivables from policyholders contain at the date the risk is transferred. The payments of future bonuses to pen- both amounts outstanding which have year’s mandatory allocations to the sioners. fallen due and instalment premiums premium reserve are correspondingly Payments and withdrawals are not which have not yet fallen due. A loss reduced. In addition, the premium shown over the profit and loss account provision is calculated on amounts out- reserve transferred includes the but directly against the balance sheet. standing which have fallen due in policy’s part of the year’s realised and The premium fund is to have the same accordance with the age and historical unrealised profit. return as the premium reserve. The loss record. guaranteed yield is recorded as a finan- Premium receivables reduced by Technical reserves cial expense, while the remaining premiums for the period the company Technical reserves comprise the return is included in the allocation of has undertaken the risk are under the insurance fund, which includes the profits. Insurance Agreement Act reversed premium reserve, supplemental against premium income 8 weeks after insurance reserve, the premium Other reserves the due date. fund/pension regulation fund. In Up to and including 1994 other reser- addition allocations are to be made to ves contained that part of customers’ Receivables/liabilities insurance “Other reserves” and a statutory profits which were not allocated at companies security reserve. 31.12. With effect from 1995 custo- The balance sheet items contain mers’ profits are divided on the basis receivables and liabilities relating to Premium reserve in the insurance fund of an assessment between the premium reinsurance ceded and received, toget- The premium reserve represents the reserve and premium fund when her with direct business through bro- cash value of the company’s total closing the accounts. kers. Outgoing reinsurance includes insurance obligations in accordance both set-off and non set-off balances. with the individual insurance agree- Security reserve Receivables and liabilities include ments after deducting the cash value The security reserve consists of agreed, retained premium and claim of future premiums. The calculation statutory security allocations to cover deposits. principles are set out in the Insurance unexpected insurance risks. The calcu- Loss estimates are made on an Activities Act. The calculations are lations are made by an actuary in individual basis, when it seems likely made by an actuary. accordance with regulations published that the companies would experience by the Banking, Insurance and payment problems. Additional statutory allocations in Securities Commission. the insurance fund It is possible to increase the reserve Life insurance Among the measures taken by the by 50% above the minimum allocation. Premiums authorities in 1993 to strengthen the In special situations the Banking, Premiums are booked as income in the solvency of life insurance companies is Insurance and Securities Commission amount which falls due during the a requirement to make additional allo- may give permission that all or part of year. Accrual of premiums earned is cations to the insurance fund. The the reserve is used to cover a fall in the maximum additional statutory allocati- made through allocations to premium value of securities. In the accounts the Notes funds in the insurance reserve. on is set at the difference between the entire reserve is shown as a mandatory The result of reinsurance business is premium reserve calculated on the reserve. shown net under “Benefits and man- basis of 3.5% guaranteed yield and the datory allocations, life insurance”. actual guaranteed yield under the UNI Storebrand ASA Guaranteed yields which are credi- contracts. The company may be apply The main income of UNI Storebrand ted to the customer’s premium reserve previous years’ allocations if the return ASA is the return on capital invested in are deducted from financial income. is not sufficient to cover the yield gua- subsidiaries. In the company’s rantee. The additional statutory alloca- accounts group transfers received are Insurance benefits tions are a conditional reserve alloca- recorded in the same manner as Insurance benefits are the same as the ted to customers which is to be booked dividends received, i.e. as ordinary year’s gross insurance settlement to the profit and loss account as a man- operating income. amounts fallen due. The allocation for datory reserve allocation. 55 Notes UNI Storebrand ASA

Note 1: Group transfer from subsidiaries

NOM million 1995 1994

UNI Storebrand Skadeforsikring AS 740.0 140.0 UNI Storebrand Livsforsikring AS 400.0 350.0 UNI Storebrand SPAR AS 9.0 UNI Storebrand Fonds AS 0.2 0.2

Total 1,140.2 499.2

Note 2: Pension costs and pension liabilities

1995 1995 1995 1994 1994 1994 Net pension costs Insured Uninsured Total Insured Uninsured Total NOK million schemes schemes schemes schemes

Pension earnings for the year -10.2 -10.7 -20.8 -4.3 -1.5 -5.8 Interest costs -22.1 -6.8 -28.9 -8.2 -3.7 -11.9 Expected return on pension funds 28.4 28.4 10.5 10.5 Employment tax -2.1 -1.3 -3.5 0.9 -0.1 0.8

Net pension cost -6.0 -18.8 -24.8 -1.1 -5.3 -6.4

Shown below is a reconciliation of estimated pension liabilities and pension funds against the liability booked in the company’s balance sheet.

1995 1995 1995 1994 1994 1994 Net pension liability Insured Uninsured Total Insured Uninsured Total NOK million schemes schemes schemes schemes

Earned pension liability -140.6 -46.0 -186.6 -112.9 -57.5 -170.4 Estimated effect of future salary growth -14.9 -4.4 -19.3 -14.8 -4.2 -19.0

Estimated pension liability -155.5 -50.4 -205.9 -127.7 -61.7 -189.4 Pension funds at market value 202.6 202.6 140.5 140.5 Provided for employment tax -7.0 -7.0 2.1 -5.7 -3.6

Net estimated pension liability/funds 47.1 -57.4 -10.3 14.9 -67.3 -52.4

Estimate deviation at 01.01.95 * Pension funds 2.1 2.1 Pension liabilities -4.5 -1.0 -5.5

Net pension liability booked in balance sheet 44.7 -58.4 -13.7

* Estimate deviations are in accordance with the Norwegian Accounting Standard for Pension Liabilities booked against the “corridor” and not the profit and loss account (see Accounting principles).

The calculations cover 644 employees in total.

In 1995 payments of adjustment and rule supplements were replaced by a single premium to UNI Storebrand Livsforsikring AS. This related to a liability at 01.01.1995 of NOK 16.4 million.

See also note 27, which gives further comments on the pension scheme in UNI Storebrand and its accounting treatment.

56 Notes 57 0.0 269.0 413.2 -353.7 -328.5 619,070 735,000 883,000 1,165,000 1,605,622 1,081,500 -25.2 591.4 591.2 396.0 396.2 5.2 1995 1994 1995 1994 -22.1 798.2 -825.5 696,975 703,467 812,500 1,194,800 1,686,701 1,230,250 0.4 0% 571.4 571.2 0% 292.9 276.7 20% 20.0 20.0 20% 128.3 119.5 Risk weighting Book value Market value Risk weighting Book value Market value Control Committee*) Board *) Group required to have a Control Committee. covers all the Norwegian companies in the The Control Committee Total certificates Government bills/Central Bank Financial institutions Note 7: Certificates NOK million Duration Norwegian bonds 0.4 800 interest futures contracts were sold on the Norwegian government bond S463 in 1995. The company owns no interest futures contracts at 31.12.95. Norwegian Note 6: Financial instruments Total Government/Central Bank Note 5: Bonds NOK million - Application of loss carried forward Tax base for the year NOK million Result before tax +/- Change in temporary differences Norwegian Financial institutions Portfolio write-downs Note 4: Tax charge Consultancy fees to the auditor Consultancy fees to the Board of Representatives Note 3: Remuneration to officers to Note 3: Remuneration NOK +/- Permanent differences Group Chief Executive control functions Fees for audit and other Note 8: Real estate and operating assets

Real Machinery, Total NOK million estate vehicles, fittings

Acquisition cost at 1.1 14.5 103.4 117.9 Revalued in year Previously revalued Additions 1.1 52.2 53.3 Disposals at acquisition cost -8.4 -8.4 Aggregate depreciation and write-downs at 31.12 -0.2 -74.1 -74.3

Book value at 31.12 15.4 73.1 88.5

Ordinary depreciation for the year -0.1 -26.4 -26.5

The following linear depreciation rates have been used for operating assets: Machinery and fittings 4 years Vehicles 6 years Computer systems 3 years

Note 9: Investment/sale - real estate/operating assets (last 5 years)

NOK million 1995 1994 1993 1992 1991

Additions Real estate 1.1 0.6 Operating assets 52.2 30.8 22.3 19.6 297.6

Total 53.3 30.8 22.3 19.6 298.2

Disposals Real estate 258.5 Operating assets 4.1 1.8 2.5 110.4 2.4

Total 4.1 1.8 2.5 368.9 2.4

58 Notes 59 4,426.3 18.989.4 6.3 67.3 16.3 11.2 -8.9 -11.2 949.5 -802.5 115.0 -5.6 755.3 1,529.7 22.1 -3,464.0 803.4 1.45.9 -0.3 0.2 0.0 3,464.00.0 -803.4 0.0 0.0 14.950.172.3 -29.8 1,251.3 10.0 -825.5 -72.3 -72.3 25.2 58.4 147.0 105.7 109.4 755.3 1,551.8 -2,660.6 1.7 5.7 0.0 2,660.6 0.0 0.0 1995 1995 1994 1994 Net 44.7 40.1 92.2 445.7 -92.2 -92.2 Positive Negative Positive Negative change Company’s Total Per value Interest Book share capital (1,000) (NOK) % value to NOK 211 million. ase for balance sheet entries Accrued pension liabilities Difference balance Loss carried forward Other securities Operating assets Prepaid pensions *) for deduction against tax amounts is restated in order to be comparable with the loss carried forward. The unutilised credit The amount In April 1995 UNI Storebrand ASA sold 90% of the shares in Oslo Reinsurance Company ASA. This was carried out through a public secondary In April 1995 UNI Storebrand ASA sold 90% of the shares in Oslo Reinsurance Company ASA. Stock Exchange SMB List. The sale of the shares offering of 1,080,000 shares at a price of NOK 100 per share. The shares are listed on the Oslo does not affect the result in 1995. a book value of NOK assets with under shares held as fixed The company’s interest of 10% in Oslo Reinsurance Company ASA has been classified 12 million. Note 12: Sale of subsidiaries *0.2%. 74.9% is owned by UNI Storebrand Livsforsikring AS. The minority interest amounts to UNI Storebrand Forsikringsmegling ASTotal 3.5 35 100 100.0% 10.0 UNI Storebrand Skadeforsikring ASUNI Storebrand Livsforsikring ASUNI Storebrand SPAR ASUNI Storebrand Finans ASUNI Storebrand Fonds ASUNI Storebrand Nybygg ASA.S Værdalsbruket * 1,380.6 1,361.2 13,806 13,612 100 1.0 20.0 100 100.0% 5.0 50.0 100.0% 2,559.7 200 1 1,663.6 1.3 50 5 1,000 100 1,000 1,000 100.0% 100.0% 2 100.0% 100.0% 30.0 60.0 625 98.0 5.0 24.9% 0.0 Note 11: The parent company’s shares in subsidiaries Note 11: The parent company’s NOK million B Net temporary differences Limitation in deferred tax allowances Real estate Provisions Profit and loss account Unutilised credit *) Set-off Other Total temporary differences Temporary differences assets Shares held as fixed Note 10: Deferred tax allowances and deferred tax and deferred Deferred tax allowances Note 10: NOK million Note 13: Bond loan

NOK million Amount Currency Interest Maturity

UNI Storebrand ASA (raised in June 1993) 1,800.0 NOK 8.5% 2003

Note 14: Change in equity capital

NOK million 1995 1994

Equity at 1.1. 3,052.6 2,620.0 Share capital 1.1 1,882.1 1,756.6 New share capital 125.5 Write-down share capital 125.5

Share capital 31.12 1,882.1 1,882.1

Legal reserve 1.1 1,062.6 863.4 Issue 1994 172.3 Allocation of result 79.8 79.8 26.9 199.2

Legal reserve 31.12 1,142.4 1,062.6

Contingency reserve 1.1 107.9 0.0 Introduction of new standard for pensions -44.2 Allocation of profit 648.4 648.4 152.1 107.9

Contingency reserve 31.12 756.3 107.9

Dividend allocated -70.0 -90.0

Equity at 31.12. 3,780.8 3,052.6

Note 15: Loans and guarantees to officers and employees

NOK million

Loans and guarantees to employees: See note 63 Loans and guarantees to the President: NOK 3.1 mill Loans and guarantees to the Board and Board of Representatives: NOK 9.9 mill

Note 16: Liabilities on termination or change in managers’ employment contracts

There are no liabilities to the Chairman of the Board relating to special compensation on termination or a change in his appointment.

Åge Korsvold, President, has a salary compensation arrangement equivalent to 2 years’ salary (including 6 months’ notice period) from the date of termination. The amount is reduced by salary or other equivalent remuneration from duties carried out in another appointment during the period.

Pension is fixed at 70% of salary at date of retirement. Pension rights are built up on a straight line basis over 19 years, subject to voluntary retire- ment taking place at least 5 years after the date of appointment. If voluntary retirement takes place before 5 years, accrued rights are calculated on the basis of a normal earnings period of 30 years. The pension age is 67, with a right - and obligation if required by the Board - to retire with pensi- on from the age of 62.

60 Notes 61 Number Amount 276,418,702100,000,000 1,382,093,510 500,000,000 376,418,702 1,882,093,510 -62.0 6 month NIBOR/Bank rate + 1% Amount Terms 422 0.7 0.0 1,140.2 Settlement March/April 1996 owned*) at, 31.12.95 Number of shares Number of shares Remuneration Loan rate Interest Currency Terms Provided in the accounts 1) Insurance AS). Regress agreement with Oslo Reinsurance Company ASA (previously UNI Storebrand International 2) but considered to be immaterial. not specified Possible liability as result of operation of AS Duo which ceased on 7.6.1993. Liability is 3) Guarantee in connection with sale of Carl Kierulf & Co AS in 1993. 4) Unconditional guarantee in connection with the Filipstad project. 4) BA Arkitekter AS NOK NOK 2.5 million 0 The following guarantees have been issued by UNI Storebrand ASA: 1) Institute of London Underwriters (ILU)2) Rollins Hudig Hall (Skandinavia) Holding A/S3) Orkla Finans AS NOK Not contractually specified GBP Not contractually specified 0 0 NOK Not contractually specified 0 Note 19: Guarantees Total Preference shares On consideration of the question of the Preference shares may at the Annual General Meeting in 1998 or 1999 be approved for redemption. voting rights for their preference shares or their redemption of the preference shares, shareholders who own preference shares will not have 11.90 in 1999. ordinary shares. The redemption price will be NOK 11.60 per share in 1998, alternatively NOK UNI Storebrand ordinary UNI Storebrand preference The shares of UNI Storebrand ASA are divided into two classes, each of NOK 5 par value. The shares of UNI Storebrand ASA are divided NOK million Note 18: Share classes Other receivables within the group 41.8 Bank rate + 1% Balance sheet items: Long-term debt within the groupOther debt within the groupGroup transfers 980.2 6 month NIBOR 1.0 Bank rate + 1% Purchase and sale of services (net)Interest on internal debt 551.7 At cost, settled monthly *) in § 1-2 of the Companies Act. as specified the relevant person holds influence by spouses, children or companies where Includes shares owned rights at the general meeting in respect of more than 20% of the shares. defined as voting No shareholder has a material influence, Transactions between group companies NOK million Profit and loss account items: Shareholders Share options to senior employees Share options to senior Storebrand. On specified to purchase a total of 250,000 shares in UNI has a share option which gives the right Åge Korsvold, CEO & President, NOK 1.2 million. The option is and instead be paid an extra bonus totaling right to purchase shares in excess of 100,000 terms he may give up the 01.05 in the three succeeding to 50,000 shares. From 01.05.1995 and from 01.05.1994 he is given the right to purchase up structured so that from The option runs from 01.05.1994 to 30.06.1999. to purchase a further 50,000 shares each year. years he is given the right Control Committee Chief Executive Officer & President *)Chief Executive Officer Chairman of the BoardOther Board members 43,882 1.7 1,000,578 1,364 3.1 4.85-6.10% 1.0 0.2 1.8 0.2 4.85-6.95% 6.85% Note 17: Transactions with connected parties Transactions with Note 17: NOK million Notes UNI Storebrand Group

Note 20: Pro forma accounts 1994

Pro forma accounts for 1994 are exclusive of Oslo Reinsurance Company Group.

NOK million Accounts 1994 Pro forma 1994

Gross premiums written - life insurance 5,707.7 5,707.7 Net premiums earned - life insurance 8,715.2 6,812.1 Net financial income insurance 5,269.9 5,204.0 Other operating income 141.5 129.2

Total operating income 19,834.3 17,853.0

Gross benefits and statutory allocations - life insurance -7,533.7 -7,533.7 Net claims - non-life insurance -6,606.2 -5,017.3 Operating costs -3,428.4 -2,737.9 Miscellaneous other items -281.3 -281.7

Operating result 1,984.7 2,282.4

Result credited to policyholders - life insurance -1,462.8 -1,462.8

Group result 521.9 819.6

Allocations - non-life insurance -179.0 -215.0

Profit before tax 342.9 604.6

Taxes -80.7 -79.9 Minority interests -9.4 -15.3

Profit for the year 252.8 509.4

Note 21: Specification of the year’s gross premiums and insurance benefits - life insurance

Collective Group life Individual Individual Organisation- Total Total pension insurance endowment annuity and collective 1995 1994 NOK million insurance insurance pension insurance

Single premiums 680.4 0.2 44.2 724.8 556.7 Installment premiums 2,648.9 280.3 290.1 427.0 2.5 3,648.8 3,860.2 Life account/pension account 452.0 445.1 897.1 1,290.8

Total premiums written 3,329.3 280.3 742.3 916.3 2.5 5,270.7

Total 1994 3,293.0 303.0 738.4 1,370.6 2.7 5,707.7

Benefits -1,721.0 -211.6 -583.3 -833.4 -0.6 -3,349.9 -3,195.7 Terminated agreements/withdrawals on life accounts -35.4 -433.6 -12.2 -481.2 -490.9

Total insurance benefits -1,756.4 -211.6 -1,016.9 -845.6 -0.6 -3,831.1 -3,686.6

Statutory allocations -2,891.1 -48.8 182.6 -592.1 -4.7 -3,354.1 -3,361.6 Supplemental allocations (excl. allocation for 1995) 10.7 44.5 55.2 112.3 Transferred premium reserve 35.7 1.3 11.3 48.3 -597.8

Total benefits and allocations -4,601.1 -260.4 -788.5 -1,426.4 -5.3 -7,081.7

Total 1994 -4,569.2 -284.2 -762.2 -1,913.4 -4.7 -7,533.7

62 Notes 63 -2.4 51.4 26.5 37.0 41.4 -55.9 -74.9 -85.1 -45.3 311.2 541.7 290.8 214.8 686.9 -149.4 -246.4 -203.2 -678.4 -302.0 8,715.2 1,053.4 1,256.0 5,637.1 5,269.9 3,564.4 1,318.5 -1,876.0 -7,659.6 -6,606.2 -1,566.5 10,392.1 10,591.2 3.9 8.8 24.9 58.4 38.5 -79.7 -18.5 -74.8 182.9 489.9 318.6 243.9 578.3 374.3 181.9 321.5 -207.9 -158.0 -253.1 -236.9 752.9 6,817.3 6,954.7 2,926.6 1,129.0 1,239.7 8,302.0 8,286.6 7,170.2 -1,116.4 -5,774.1 -5,021.2 0.1 2.1 -2.4 -8.3-7.4 -5.2 -4.7 24.593.337.3 3.9 1.2 43.1 87.7 61.9 -29.5 33.4 -10.3-64.4-88.3 -192.9 -2.4 -205.2 688.5279.7 271.1 128.7 728.9 65.9 385.6243.7 257.7 -256.8 -25.1 -151.0 7.6 8.8 1.2 555.8 497.6 -2.4 -5.0 -0.1-5.7 -0.1 24.1 15.9 14.0 64.4 31.5 77.3 65.8 8,234.18,147.36,812.1 2,158.0 2,443.9 1,903.1 -50.8 -18.5 -18.2 -1,335.2-5,573.1-5,017.3 -540.8 -2,086.5 -1,588.9 126.3 197.9 361.6 392.7 -133.5 1,037.5 1,096.2 Non-life International Group 4.1 -8.1 752.9 36.9 49.3 38.8 -89.0 -45.3 -43.8 186.4 407.2 182.5 298.0 203.1 -151.0 -135.9 -246.4 -384.9 8,302.0 8,286.6 7,170.2 -1,116.4 -5,774.1 -5,021.2 1,161.5 4,751.7 4,549.3 2,921.1 1,275.4 -1,284.6 Life Non-life International Group 3.9 50.8 36.1 10.9 -56.6 -74.4 -28.9 380.4 309.9 180.7 847.0 244.2 158.8 363.6 321.0 228.0 -231.2 -153.0 -253.1 5,921.9 5,843.2 2,565.0 1,097.5 Gains/losses on sale/redemption of bonds Rental income Interest income loans Interest income certificates Gains/losses on sale/redemption of certificates Interest transferred premium fund Write-down/reversal of shares written down written down Write-down/reversal of certificates Total financial expenses income/expenses Total net financial Interest expenses Loan losses (see note 24) Other financial expenses Result, real estate Gains/losses on sales Other financial income Total financial income Interest income bonds Note 23: Net financial income insurance NOK million 1995 1994Write-downs 1995 1994 1995 1994 1995 1994 -28.4 -28.4 Claims for own account Reinsured portion Reinsurance ceded Premiums for own account Gross premiums written Note 22: Premiums and claims - Non-life insurance claims - Non-life Premiums and Note 22: NOK million 1995 1994 1995 1994 1995 1994 Interest income deposits Other interest income Gains/losses on the sale of shares/interests Operating costs Share dividends Foreign exchange gains/losses Write-down/reversal of bonds written down Gross premiums earned Gross claims Gains/losses on sale of real estate Note 24: Loan losses Life Non-life Group NOK million 1995 1994 1995 1994 1995 1994

Realised losses -2.3 -4.5 -2.4 -161.8 -4.7 -166.3 Reversed provisions on realised losses 2.3 3.3 2.4 164.0 4.7 167.3 Specific loss provisions on new doubtful loans 19.2 1.6 3.0 2.0 22.2 3.6 Changes in previous specific loss provisions -2.5 -21.1 -2.3 -4.5 -4.8 -25.6 Recovered on previous realised losses 0.1 0.1 Changes in unspecified loss provisions 164.0 70.0 0.4 2.4 164.4 72.4

Total loan losses 180.7 49.3 1.2 2.1 181.9 51.4

Note 25: Other operating income

Other operating income includes, among other items, NOK 71 million from A.S. Værdalsbruket, NOK 13 million from Aktuar Consult AS and NOK 49 million from UNI Storebrand SPAR AS.

Note 26: Operating expenses Life Non-life International Other Group NOK million 1995 1994 1995 1994 1995 1994 1995 1994 1995 1994

Salaries and personnel expenses *) -337.9 -345.9 -1,477.6 -1,505.7 -92.1 -502.7 -138.6 -2,318.2 -2,082.3 Other operating expenses -424.1 -433.2 -671.0 -437.3 -128.6 257.3 88.1 -837.8 -911.0 Depreciation of operating assets -19.6 -16.6 -44.6 -62.2 -5.8 -31.4 -15.0 -95.6 -99.6 Commissions on business received -20.0 -16.4 -554.7 -20.0 -571.1

Gross expenses -781.6 -795.7 -2,213.2 -2,021.6 -781.2 -276.8 -65.5 -3,271.6 -3,664.0

Commissions on business ceded 149.6 191.4 44.2 149.6 235.6

Expenses for own account -781.6 -795.7 -2,063.6 -1,830.2 -737.0 -276.8 -65.5 -3,122.0 -3,428.4

*) of which pension expenses -18.4 -18.4 -93.3 -63.1 -2.1 -25.2 -7.5 -136.9 -91.1

Note 27: Pension liabilities

Staff pensions are provided by a group pension scheme, primarily with UNI Storebrand Livsforsikring AS, in accordance with the rules on private occupational pension schemes. Pensions are payable at pension age which is 67 for executives and 65 for underwriters. The ordinary retirement age is 65, and a retirement pension corresponding to 70% of the pension basis at the time of retirement is paid. In cases where the period of service is less than 30 years at the time of retirement, a relative reduction is made. From the age of 67, the pensions from the company are coordinated with the State Social Security Fund benefits. The pension terms are part of a group agreement related to employment terms in UNI Storebrand ASA.

Pension costs and pension liabilities are treated for accounting purposes in accordance with the new accounting standard for pension costs from the Norwegian Accounting Standards Foundation (see Accounting principles). Both insured and uninsured schemes are treated as benefit plans. The following assumptions have been used in the calculation: Financial assumptions Return on pension funds 8.00% Discount rate 7.00% Annual salary growth 3.00% Expected adjustment of Social Security Fund’s base amount (G) 3.00% Annual pension adjustment 2.50% Average Employment Tax 13.50%

Actuarial assumptions - Standardised assumptions on mortality/disability and other demographic factors developed by the Norwegian Insurance Association. - Average departure frequency of 2-3% for the workforce as a whole. - Linear earning.

64 Notes 65 -5.9-0.8-5.0 10% 20% 20% -11.7 15.3 -1.1 14.2 36.1 -62.7 -26.6 -74.9 -20.8 -95.7 -20.2 -70.9 -91.1 299.1 -795.1 -496.0 178.9 178.9 -139.5 -49.0 -188.5 -251.7 -38.8 -290.5 -5.9 -0.8 -5.0 2,441.7 2,441.7 -1,927.0 -693.6-2,178.7 -2,620.6 -732.4 -2,911.1 -11.7 by 1995 1994 rate Life Owned Depreciation Depreciation Depreciation -63.0 -63.0 1995 1995 1995 1994 1994 1994 1995 1995 1995 1994 1994 1994 36.0 36.0 scheme scheme scheme scheme scheme scheme scheme scheme -84.3 -13.3 -97.6 -70.3 -38.9-34.9 -109.2 -62.3 -2.0 -74.6 -36.9 -136.9 420.6 -579.1 -158.5 372.3 -592.4 -220.1 195.2 195.2 -152.3 -33.7 -186.0 -279.7 -57.6 -337.3 2,772.2 2,772.2 -2,071.9 -458.5-2,351.6 -2,530.4 -516.1 -2,867.7 profit and loss account (see Accounting principles). Expected return pension funds Expected return pension Estimated pension liability Estimate deviation at 1.1.95 *: Pension funds Interest costs Fees for audit and other control functions for the group amounted to NOK 4,488,212, while consultancy fees paid to the auditor totalled NOK Fees for audit and other control functions for the group amounted to NOK 4,488,212, while 1,965,195. Note 29: Remuneration to auditor Total Försäkringsaktiebolaget UNI Storebrand SverigeUNI Storebrand SPAR AS Non-life US ASA Note 28: Depreciation of goodwill in subsidiaries NOK million Net pension liability booked in balance sheet * not the Norwegian Accounting Standard for Pension Liabilities booked against the “corridor” and Estimate deviations are in accordance with the to a was replaced by a single premium to UNI Storebrand Livsforsikring AS. This related In 1995 payments of the adjustment and rule supplement liability at 01.01.1995 of NOK 188.5 million. Pension liabilities Provided for employment tax Net estimated pension liability/funds Estimated effect of future salary growth NOK million Pension liability earned Estimated liability liabilities and pension funds against the liability booked in the Group balance sheet. Shown below is a reconciliation of estimated pension Net pension cost The year’s earnings Employment tax NOK million Net pension costsNet pension liability Insured Uninsured Total Insured Uninsured Total Insured Uninsured Total Insured Uninsured Total The calculations cover a total of 3,901 employees and 2,120 pensioners. employees and 2,120 cover a total of 3,901 The calculations in the table below. pension costs are shown Net accrued Pension funds at market value Aktuar Consult AS Note 30: Net financial items, other activities

Net financial items other activities include net financial income of NOK 35 million from UNI Storebrand Finans AS. In addition, the amount inclu- des net financial expenses in UNI Storebrand ASA, including interest costs on the bond loan of NOK 153 million and interest income of NOK 99 million.

Note 31: Result from associated companies Owned Our Result Result NOK million by interest % 1995 1994

Nordben Life and Pension Insurance Co. Ltd. Life 25% 3.5 3.0

Note 32: Technical result, non-life insurance Private Business Marine Reins. Pools- Other Total received incl.natural NOK million perils

Premiums written Gross premiums 4,702 2,000 1,103 10 350 137 8,302 Premiums ceded -60 -404 -432 -109 -75 -1,080

Premiums for own account 4,642 1,596 671 10 241 62 7,222

Gross business Premiums earned 4,556 2,064 1,124 10 394 139 8,287 Claims incurred -2,882 -1,429 -750 -113 -514 -86 -5,774 Management expenses -1,393 -483 -235 -15 -2 -47 -2,175

Technical result 281 152 139 -118 -122 6 338

Business ceded Premiums earned -67 -408 -454 -1 -109 -77 -1,116 Claims incurred -35 208 310 218 52 753 Management expenses -1 -4 -5 -1 -1 -3 -15 Commission income 3 67 65 15 150

Technical result -100 -137 -84 -2 108 -13 -228

Own account Technical result 181 15 55 -120 -14 -7 110

Claims incurred own account Incurred in year -3,214 -1,379 -475 12 -275 -37 -5,368 Incurred previous years 297 158 35 -125 -21 3 347

Total for accounting year -2,917 -1,221 -440 -113 -296 -34 -5,021

66 Notes 67 0.3 -0.2 -0.2 -0.2 -2.2 -0.2 -0.8 13.6 92.6 21.3 25.0 -80.5 -80.7 -78.3 -80.5 -80.7 342.9 711.6 459.2 269.0 521.9 -586.7 -145.0 -172.9 -179.0 -344.1 2.6 -2.2 38.2 28.2 2.7 -81.5 -14.7 -9.2 -6.1 -4.5 1995 1994 1995 1994 20.0 -15.3 -15.3 -15.3 -15.3 -25.2 587.8 798.2 1,436.5 1,183.8 1,451.2 -1,111.6 53.825.0 -32.5 -59.2-61.7 151.8 -83.3 -172.9 -215.0 36.0 Non-life International Group 2.6 -2.2 1995 1994 1995 1994 1995 1994 38.2 28.2 -81.5 -14.7 Tax charge Norway Abroad Total deferred tax Total tax payable Deferred tax Tax payable Norway Abroad Tax payable Deferred tax - net change Tax charge NOK million Profit before tax Note 36: Tax Total Guarantee scheme NOK million Security reserve Note 35: Allocations non-life insurance The profit of UNI Storebrand Livsforsikring AS, which is allocated between the policyholders’ fund, equity capital and tax, amounted to NOK 3,337 which is allocated between the policyholders’ fund, equity capital and tax, amounted to NOK The profit of UNI Storebrand Livsforsikring AS, to the policyholders, of which NOK 1,000 million has been conditionally allocated to policyholders, million. NOK 1,755 million has been allocated transfers and NOK 182 million has been retained in UNI Storebrand Livsforsikring AS. UNI NOK 400 million has been allocated to group result with NOK 588 million. Storebrand Life Group is included in the group Note 34: Result from UNI Storebrand Livsforsikring AS Note 34: Result from UNI Storebrand Natural perils reserve Total Eliminations UNI Storebrand Skadeforsikring Group UNI Storebrand Skadeforsikring Note 33: Group result by business areas Group result by Note 33: NOK million UNI Storebrand International Group UNI Storebrand International AS UNI Storebrand Finans Group UNI Storebrand Nybygg UNI Storebrand Livsforsikring Group UNI Storebrand Livsforsikring UNI Storebrand SPAR AS UNI Storebrand SPAR UNI Storebrand ASA Other companies Reinsurance reserve Administration reserve Note 37: Minority interests

Minority’s Share of result Share of result NOK million interest in % after tax 1995 after tax 1994

Biskop Gunnerus gate 3 Oslo ANS 30.0 -5.5 -15.3 Surety Reinsurance Company 47.5 5.9

Total - -5.5 -9.4

Note 38: Receivables from, and liabilities to, insurance companies

1995 1995 1994 1994 Total in Retained Total in Retained balance sheet on deposit balance sheet on deposit

Receivables from insurance companies 380.4 35.5 1,277.0 385.2 Liabilities to insurance companies 537.9 68.5 1,149.6 156.4

68 Notes 69 value value 77.1 98.4 68.3 8.9 Share Par value Number Interest Booked Market Life Others capital (NOK) value value booked booked Others Norsk HydroOrklaOrkla. B-sharesHafslund Nycomed, A-sharesSaga Petroleum, A-sharesSaga Petroleum, B-sharesKværnerAkerD.N.L.,Steen & Strøm InvestHelikopterserviceElkemNorske SkogindustrierNorske Skogindustrier. B-shares 502.7Dyno IndustrierArendals Fossekompani 1,510.9 4,581.5Scana IndustrierNorway Seafood 5 503.6 231.5Gresvig 15 20 4,652,455Braathens S.A.F.E. 987.2 4,060,000 3,991,865 15Kverneland 25 4.6 %Rieber & Søn 3.3 % 1.7 % 508.9 307,600Rieber & Søn, B-shares 527,956 25 121.7 79.5Eiendomsspar 328.7 980.3 541.9 780.5 3,593,533Glava 1,073.8 232.5 530.6Norsk Jern Holding 343.1 20 8.5 % 971.7Telenor Venture 5 157.3 13 447.4RGI (Antilles) N.V. 790.4 900.0 12 2,300,065 131.7 23.5 371,163 297.5 20 24.9 1,434,831Merkantildata 61.5 1,138.3 20 1,953,900 25Dagbladet 80.3 14.5 % 508.4 985.6 31.2 159.4 495,146 3.3 %Veidekke 24.3 3,330,900 181.2 10 9.7 % 842,300Glamox 315.0 741.2 26.2 2.1 % 20Bøhler-gruppen % 6.9 140.7 20 230.0 76.2 13.4 % 96.3 221,000Raufoss 49.2 20.9 324.3 72.3 249.4 97.9 1,686,500 32.2 225.8Selmer 612,300 151.9 35.4 1 8.9 % 398.3Union, A-shares 162.6 2.6 280.6 3.4 % 5 65.1 236.7 279.4 2.4 %Union, B-shares 91.9 2,124,766 31.0 76.2 127.3 18.6 125.4 5Gyldendal Norsk Forlag 398.3 89.6 1,391,304 10.1 % 30 35.6 86.2Norges Handels og Sjøfartstidende 213.9 110.5 195.5 13.4 445.0 64.8 200.0Adresseavisen 123.1 230,700 86.8 9.1 % 68.0 5 185,725 30 10 35.5 Elkjøp Norge 90.5 30.3 1,000 11.1 53.2 100.0 3.6 % 7.5 50 76.2 114.2 471,600 69.6 4.1 593,411 478,641 1,000 46.9 96.0 10,000 79.5 58.4 11.2 300,000 7.6 % 3.2 % 5.3 % 44.1 - 61.2 5.0 % 0 14,063 75.3 11.2 6.7 49.6 100 3.4 % 39.2 46.7 53.2 24.1 14.1 % 30.0 6.8 530,000 11.5 35.1 5 60.7 24.1 57.0 45.3 96,574 83.1 60.1 42.2 30.0 0.8 % 46.2 48.0 20 - 10.1 % 550,000 39.6 23.5 10 4.7 10 1 11.2 29.5 30.0 45.6 150.0 7.0 32.9 43.1 30.2 125,154 6.2 % 100 3.0 237.5 6,000,000 30.0 59,094 200,000 10 35.1 10.4 % 4.0 26.9 6.3 31.8 3.6 45.1 20 10 - 30.0 9.9 % 58,489 5.1 % 3.5 % 23.9 126,475 10 50 38.0 - 39.1 12.7 % - 175,500 22.5 12.0 56,020 14.7 22.9 65.1 5.4 % 25.2 - 154,057 37.6 51,476 22.8 2.3 % 10.7 % 20 14.8 29.4 13.4 29.0 24.6 25.3 5.0 3.2 % 10 17.6 15.5 17.6 23.9 85,000 15.9 2.3 43.0 22.5 12.0 62,400 22.9 21.2 61.6 4.5 % 14.3 22.7 - 20.7 1.0 % 10.1 10.3 - - - 17.6 15.5 56.6 10.3 - 3.3 15.9 17.9 10.0 - - 14.3 - 10.3 9.4 - - 0.9 Romsdals Fellesbank shares Industry and other 69.7 100 63,439 9.1 % 8.7 20.0 8.7 - NorgeskredittSparebanken NOR. certificatesBolig- og NæringsbankenProtector Forsikring 2,390.9 100 487.7 396,050 1,133.6 228.9 50 1.7 % 100 55.6 320,000 100 1,218,350 10.7 % 3.3 % 64.5 111,000 169.1 42.1 4.8 % 268.0 53.6 15.6 47.7 2.0 158.6 16.3 40.0 10.5 2.1 - 15.6 NOK million Note 39: Shares UNI Storebrand Group Shares UNI Storebrand Note 39: Norwegian Bank and insurance shares Norwegian Bank and Share Par value Number Interest Booked Market Life Others capital (NOK) value value booked booked NOK million value value

Shipping shares Smedvig 80.4 3 1,400,100 5.2 % 128.4 179.6 120.5 7.9 Transocean Drilling 263.3 5 1,055,000 2.0 % 108.0 116.8 96.7 11.3 Bergesen d.y, A-shares 99.6 3 626,950 2.4 % 92.1 80.3 88.4 3.7 Bergesen d.y, B-shares 42.5 3 738,793 103.1 93.1 94.8 8.3 Wilh, Wilhelmsen 49.7 5 116,900 4.4 % 16.8 15.0 15.5 1.3 Wilh, Wilhelmsen, B-shares 22.7 5 522,922 65.9 65.4 60.9 4.9 Leif Høegh & Co 60.0 2 449,900 1.5 % 43.0 41.8 39.0 4.0 Storli 148.7 10 347,204 3.9 % 19.8 33.2 18.8 1.0 Storli, B-shares 69.8 10 504,500 39.2 47.7 32.9 6.3 Farstad Shipping 113.3 3 1,500,000 3.3 % 22.5 22.4 20.2 2.3 Nordic American Shipping 21.7 5 453,810 10.5 % 21.8 18.2 18.9 2.9 Color Line 96.5 2 1,000,000 2.1 % 20.3 18.8 18.3 2.0 Others 17.7 19.5 17.6 -

Units in mutual equity funds UNI Storebrand Finans 50 520,947 75.3 117.0 75.3 - UNI Storebrand Pluss 50 194,417 44.3 79.8 44.3 - UNI Storebrand 1982 10,000 1,702 43.3 75.5 43.3 - UNI Storebrand Effisient Indeks 10,000 2,100 21.0 30.6 21.0 - UNI Storebrand Aksje Utland 10,000 1,980 20.0 19.0 20.0 - Others 30.0 38.2 30.0 -

Share options Others -4.9 -5.3 -4.9 -

Total Norwegian shares, units and share options 6,327.0 7,864.2 5,750.0 577.0

Foreign shares Switzerland Nestlé 8,411 53.6 58.9 43.5 10.1 Ciba-Geigy 6,910 36.9 38.5 29.8 7.0 CS Holding 52,290 30.0 33.9 24.5 5.5 BBC Brown Boveri 4,180 28.2 30.7 22.9 5.3 Sandoz 6,800 27.8 39.4 23.2 4.6

Germany VEBA 167,300 41.2 44.9 33.5 7.7 Bayer 20,900 33.2 34.9 27.0 6.2 Deutsche Bank 104,500 32.9 31.3 26.4 6.5 Siemens 8,890 28.4 30.8 23.1 5.3 Kolbenschmidt 27,700 26.4 25.0 21.4 5.0 Adidas 70,000 21.6 23.4 17.5 4.1

Spain Iberdrola 557,500 26.8 32.3 22.0 4.8 Telefonica de España 314,000 26.3 27.5 21.3 5.0

Finland KCI Kone Cranes International, A-shares 65,944 21.7 21.5 21.7 - KCI Kone Cranes International, B-shares 51,022 16.8 16.6 16.8 - Partek 120,000 10.3 8.5 10.3 -

France Usinor-Sacilor 393,000 38.9 32.9 31.3 7.6 Societe Generale 47,000 33.2 36.7 26.7 6.5 Generale des Eaux 51,163 31.4 32.3 25.4 6.0 Peugeot 31,000 26.8 25.9 21.4 5.4 Danone 25,000 25.0 26.1 20.3 4.7 LVMH 20,900 23.9 27.5 19.3 4.6 Elf Aquitaine 30,000 12.7 14.0 10.3 2.4 Paribas 35,000 12.4 12.1 9.9 2.5

70 Notes 71 value value 50,000 21.5 22.150,000 17.2 4.3 16.2 18.6 13.2 3.0 121,000149,540 26.2 30.6 17.8 19.4 19.3 6.9 10.1 7.7 Share Par value Number Interest Booked Market Life Others capital (NOK) value value booked booked Coca Cola 27,000 10.6 12.7 8.3 2.3 Ellos PostorderL.M. EricssonVolvo Amphenol Corp.MCI Communications Corp.Procter & GambleBristol Myers Squibb Co.Varity Corp.Delta Air Lines Inc.Living Centers of AmericaTime Warner Inc.Mobil Corp.Disney American ExpressCase Equipment Corp. 170,280Pacific Arbitrage Co. Ltd.Schering-Plough 145,400Apple ComputersTexas InstrumentsFord Motor Co.Duke Power 16.0Beta Viet Nam Fund Ltd. 18.3 165,000 16.2 18.0 145,000 16.0 40,000 45,000 13.1 21.2 90,000 - 5.2 40,000 27.2 21.3 75,000 20.8 65,000 20.8 22.2 19.3 21.7 17.2 105,000 255,000 25,000 70,000 23.6 19.6 1.9 18.8 19.9 20.1 20.8 18.7 17.0 16.7 2.5 50,000 17.6 50,000 14.8 14.4 13.9 30,000 - 15.6 150,000 4.1 16.2 15.0 19.6 2.4 60,000 30.3 16.7 16.6 17.7 18.3 13.1 - 40,000 13.8 3.4 13.6 10.5 13.9 3.9 11.1 11.0 16.2 10.8 17.3 10.1 3.9 11.1 - 9.8 4.2 8.3 - 13.8 11.0 11.0 13.6 11.1 11.0 12.0 - 11.1 - - - 8.3 - 2.7 SE-BankenUSA Norex America Inc.Philip MorrisDean Witter Discover and Co.Royal Caribbean CruisesDuPont 80,000 609,500 50,600 149,300 60,000 25.9 33.6 2.1 24.1 23.7 48.1 26.9 2.7 20.7 22.7 33.6 34.3 3.2 24.1 - - 22.9 - 2.1 4.0 Astra UnileverSweden 34,500 27.4 30.7 22.2 5.2 KNP BTAkzo NobelPhilips ElectricsING-Group 118,500 240,000 45,000 79,914 31.2 44.5 33.2 27.1 27.8 39.0 32.9 33.8 25.7 35.9 26.8 5.5 8.6 22.5 6.4 5.3 Credito ItalianoNetherlands 2,500,000 17.6 18.6 14.3 3.3 Allied Irish BankItaly Telecom ItaliaGenerali Ass. 750,000 2,780,000 133,000 24.1 25.9 26.7 20.6 19.5 27.6 4.6 20.6 21.7 16.6 5.0 4.0 British TelecomHanson TrustBeta Global Emerging MarketGrand MetropolitanGlaxo WellcomeHSBC HoldingsGeneral Electric Co,P & 0 DFDMarks & SpencerFidelity Japanese ValuesTomkinsRoyal InsuranceRank OrganisationRolls-Royce 2,901,946 1,145,000 2,096,816 932,279 39.7 475,206 1,000,000 39.2 418,702 44.9 2,750,000 40.3 39.0 39.7 753,600 33.8 600,000 39.6 35.0 32.4 42.3 5.9 36.3 33.1 750,000 630,000 30.3 1,175,000 42.6 34.8 33.6 31.6 8.6 41.3 30.4 20.5 1,500,000 31.9 6.7 7.4 28.8 26.2 33.2 27.2 28.2 26.9 28.0 22.1 6.2 6.2 28.2 5.9 24.6 28.0 8.2 28.8 24.7 32.4 25.8 5.8 27.8 22.8 6.1 21.8 22.9 5.4 5.1 20.0 5.3 4.7 NOK million Great Britain Share Par value Number Interest Booked Market Life Others capital (NOK) value value booked booked NOK million value value

Foreign shares 345.8 362.0 294.2 51.6

Interests in units ISA Asian Growth Fund 451,046 225.2 227.7 225.1 - Scudder - Growth and Income Fund 539,446 62.4 68.9 62.4 - Nova Latin Pacific Investment Co, 966,000 37.3 20.9 29.9 7.4

Share options Others 38.8 55.1 34.4 4.5

Total foreign shares, units and share options 2,621.0 2,754.8 2,238.5 382.5

Total shares held as current assets 8,948.0 10,619.0 7,988.5 959.5

Shares held as fixed assets Norway 16.8 30.0 2.0 14.8 Denmark 5.2 5.2 - 5.2 USA 0.7 0.7 - 0.7

Total shares held as fixed assets 22.7 35.9 2.0 20.7

Note 40: Share options 1995 1995 1994 1994 NOK million Option Market Option Market Option type premium value premium value

Call options issued -6.0 -6.4 Call options purchased 39.9 56.2 13.4 11.1

Share options are included in the note on shares (note 39).

72 Notes 73 0.7 2.8 2.8 0.3 25.625.6 25.5 25.5 28.4 28.3 114.7 143.1 113.7 in % value value 2.7% 0.7 2.0% 5.0% 1.4%1.9% 0.2 0.1 Interest Booked Market 15.0%10.0% 2.1 0.7 2.6 0.2 20.0% 50.4% 50.0% 113.7 -25.2 -25.2 3,793.3 3,804.3 209.2 207.1 4,002.5 4,011.4 26,467.3 27,248.2 4,390.7 4,496.7 404.5 404.7 31,262.5 32,149.6 Risk- Life Non-life Others Group weighting Booked Market Booked Market Booked Market Booked Market Duration Norwegian bondsDuration foreign bonds 3.8 5.3 2.6 5.0 MiscellaneousTotal 100% 32.8 31.7 8.5 7.1 41.3 38.8 Portfolio write-down Foreign Government/Central BankFinancial institutions 0% 7,094.7 20% 7,570.2 1,275.3 418.9 1,350.5 386.6 8,370.0 8,920.7 418.9 386.6 Government/Central BankPublic sector excluding Government/Central Bank 20% 0 % 10,479.4 10,742.8 1,722.9 1,767.0 292.9 276.7 12,495.3 12,786.5 NOK millionHeld as current assets Norwegian Financial institutionsMiscellaneous 20% 4,391.1 value 4,443.6 100% 1,078.6 vaue 257.1 1,064.0 value 269.0 128.9 value 96.2 120.1 5,598.6 101.0 value 5,627.7 value 7.9 value 7.9 value 361.1 377.9 Note 42: Bonds Total held as fixed assets Total held as fixed Total interests in partnerships UNI Storebrand ASA ANS Høgset Total UNI Storebrand ASA ANS Grønnegt. 83 seksjon 2 Total UNI Storebrand Skadeforsikring AS Total UNI Storebrand Livsforsikring AS UNI Storebrand Skadeforsikring AS ANS Skolebygg Californian Partnership Limited KS West Bonanza Fixed assets UNI Storebrand Livsforsikring AS ANS Eiendomspart Høvik Kontorsenter I ANS Søndregate 10 KS Eiendomspart Eiksveien 110 Total UNI Storebrand Skadeforsikring AS Total UNI Storebrand Skadeforsikring Total held as current assets KS Atlas Trader KS AS Parkering & co Total UNI Storebrand Livsforsikring AS Total UNI Storebrand Livsforsikring AS UNI Storebrand Skadeforsikring Apax UK V-B Limited Note 41: Interests in partnerships Note 41: NOK million Current assets AS UNI Storebrand Livsforsikring Bond options

Option type Par USD Expiry

Call options purchased 100 mill. 27,02,96 Put options sold 150 mill. 27,02,96

Fixed bonds (to be held to maturity) Par Booked Acquisition Market Unrealised Unrealised NOK million value value cost value gain loss

Life Norwegian Government/Central Bank 4,931.6 5,462.1 5,480.6 5,814.7 352.6 Public sector excluding Government/Central Bank 869.1 871.0 871.7 917.5 46.8 0.3 Financial institutions 4,068.0 3,906.2 3,902.0 4,059.4 153.2

Total life 9,868.7 10,239.3 10,254.3 10,791.6 552.6 0.3

Non-life Norwegian Government/Central Bank 79.9 81.8 81.8 82.1 0.3 Public sector excluding Government/Central Bank 172.5 170.8 170.9 175.0 5.3 1.1 Financial institutions 845.0 820.4 820.4 841.2 20.9 0.1

Total non-life 1,097.4 1,073.0 1,073.1 1,098.3 26.5 1.2

Total Group 10,966.1 11,312.3 11,327.4 11,889.9 579.1 1.5

During 1995 bonds totalling NOK 8,689 million have been reclassified from current assets to fixed assets (hold to maturity) in UNI Storebrand Livsforsikring AS. The amount for UNI Storebrand Skadeforsikring AS is NOK 951 million. All reclassification has taken place on the lowest of the lowest value principle at the date of transfer.

Remaining term*

NOK million Life Non-life Group

Within 1 year 606.3 4.0 610.3 From 1 to 5 years 4,304.7 513.1 4,817.8 From 6 to 10 years 4,914.5 527.3 5,441.8 Over 10 years 413.8 28.6 442.4

Total 10,239.3 1,073.0 11,312.3

* To redeem adjusted for expected return.

74 Notes 75 20.03.96 20.03.96 267.5 3,404.4 Contract value -50 12 months 4,7001,0001,150 7.7 1.3 3 months 6,800 6.1 6 months 12 months 15.1 800.0 280.0 Number 31.12.95 Expiry Purchase/sale Market value Period paid received value (fixed) (floating) 915 -38.7 Amount Interest Interest Under Expiry See further note 7 where UNI Storebrand ASA is described. See further note 7 where UNI Storebrand ASA Sale Sale Net sale Buy NOK million Sale C) Future rate agreements (FRAs) pay or receive a fixed interest rate for a standard period in the future. This is a standardised agreement to Total sold NOK million Total purchased At 31.12.1995 the following contracts were entered into: At 31.12.1995 the following contracts Interest futures contracts are on the Norwegian government bond issues and Euro interest rates. These are standardised contracts listed on the rele- government bond issues and Euro interest rates. These are standardised contracts listed on Interest futures contracts are on the Norwegian and million. Interest futures are treated in the accounts as trading instruments with daily valuation vant countries’ exchanges with a par value of 1 accounting. UNI Storebrand Livsforsikring AS has entered into interest swap agreements where the company pays a fixed interest rate and receives a floating interest where the company pays a fixed AS has entered into interest swap agreements UNI Storebrand Livsforsikring bonds. have been valued on the balance sheet date and are included in the market value of rate based on NIBOR (3 and 6 month). The contracts credit recognised banks. The risk that the counterparty will be unable to cover its obligations (the The counterparties under the agreements are risk) is therefore considered immaterial. B) Interest futures an underlying interest-bearing instrument at a fixed price in the future. A standardised contract to buy or sell UNI Storebrand Livsforsikring ASUNI Storebrand Livsforsikring Total 100 8.10% 5.36% -17.9 28.12.98 UNI Storebrand Livsforsikring ASUNI Storebrand Livsforsikring ASUNI Storebrand Livsforsikring ASUNI Storebrand Livsforsikring 415 200 7.65% 200 7.66% 5.50% 7.65% 5.36% -10.7 5.36% -5.1 18.06.97 -5.0 18.06.97 18.06.97 Own company Note 43: Financial instruments Note 43: swaps A) Interest to exchange interest terms. two parties for a specific period An agreement between NOK million D) Foreign exchange and forward contracts Agreements to purchase or sell currency in the future at an agreed price. Life Non-life Currency Nominal Premium/ Currency Nominal Premium amount value discount value amount value discount value 31.12.95 31.12.95

Sold: CHF 25.0 137.1 0.1 2.0 11.0 0.0 DEM 778.5 3,425.9 3.6 87.0 383.2 1.2 DKK 957.0 1,089.5 0.1 79.0 89.8 0.0 ESP 760.0 39.7 -0.2 FIM 173.0 251.3 3.7 FRF 594.0 765.3 -11.3 110.5 141.7 -1.8 GBP 160.7 1,575.9 -6.5 17.0 167.2 -1.1 ITL 119,206.8 479.4 -2.2 28,700.0 115.5 -0.6 NLG 68.0 267.8 0.8 15.0 58.8 -0.0 NOK 235.4 235.4 1,348.2 1,348.2 SEK 2,842.0 2,711.2 -136.9 646.0 616.3 -24.9 USD 535.0 3,383.5 4.0 53.0 335.6 2.5

Total - 14,361.9 -144.8 - 3,267.3 -24.6

Bought: ATS 4.0 2.5 AUD 2.5 11.8 -0.1 BEF 25.0 5.4 CAD 5.5 25.6 0.1 HKD 20.0 16.4 -0.1 IEP 1.0 10.1 0.0 JPY 50.0 3.0 -0.1 MYR 2.0 5.0 -0.0 NOK 13,698.2 13,698.2 1,887.6 1,887.6 USD 77.0 487.9 -2.6 200.0 1,264.2 -4.1

Total 14,186.1 -2.6 3,231.7 -4.2

The table includes current and fixed assets. The nominal contract values in NOK are converted on the basis of bid or offered exchange rates at 31.12.1995.

Note 44: Pledged assets

NOK million 1995 1994

Shares and bonds deposited as security for reinsurance taken over. 55.2 421.7

Note 45: Certificates Life Non-life UNI Storebrand ASA Group Risk Booked Market Booked Market Booked Market Booked Market NOK million weighting value value value value value value value value

Norwegian Government/Central Bank 0% 7,077.9 7,081.2 2,771.3 2,772.0 571.4 571.2 10,420.6 10,424.4 Public sector excluding Government/Central Bank 20% 624.8 625.3 315.0 315.1 939.8 940.4 Financial institutions 20% 4,979.6 4,985.5 2,220.6 2,223.0 20.0 20.0 7,220.2 7,228.5 Others 100% 300.0 300.1 324.9 325.3 625.0 625.4

Foreign Government/Central Banks 0% 2,327.4 2,448.8 508.3 533.4 2,835.7 2,982.2

Total 15,309.7 15,440.9 6,140.1 6,168.8 591.4 591.2 22,041.3 22,200.9

76 Notes 77 4.5 8.1 73.7 16.2 66.7 32.3 99.0 47.2 97.4 50.3 14.6 -59.7 -77.3 -51.5 289.3 379.2 170.4 -135.4 1,999.7 1,870.9 15,470.1 15,275.0 17,145.9 6.5 4.0 27.1 91.0 39.0 15.2 42.3 10.1 63.9 88.2 50.7 160.6 191.1 243.5 -13.0 -11.0 -11.5 760.0 646.6 -101.9 9,864.5 9,840.5 10,487.1 88.1 68.2 211.7 131.9 379.2 640.4 439.6 123.6 309.5 2,566.1 11,882.2 15,088.7 Life Non-life Life Non-life 46.9 243.5 196.6 1995 1994 1995 1994 1995 1994 1995 1994 60.5 97.5 97.5 37.0 303.9 258.4 7,642.3 1,674.8 9,621.0 4.2 455.8 872.7 1.5 362.6 134.1 -0.7 -3.2 -20.6 -63.7 1,829.4 379.2357.9170.4 2.2 103.5 2.2 461.4 2.2 5.3 14.6 98.3 -3.3 -0.6 -2.9 599.4 361.2 120.0 79.8 -77.9 243.5 239.6 160.6 319.4 Life Non-life 90.2 149.0 -39.1 -13.6 -48.3 4,724.2 -134.7 15,088.7 10,097.0 1,829.4 1,767.5 15,088.7 14,914.9 16,682.4 Life Non-life International Group Commercial loans Housing loans loans Commercial Housing loans 60.0 53.9 111.9 -9.7 -8.6 9,395.2 9,621.0 -10.4 -24.0 599.4 566.8 9,600.9 9,621.0 10,167.7 Specific loss provisions Other loans Specific loss provisions Total - Of which, under legal enforcement Commercial loans Housing loans Note 49: Loans subject to special provisions NOK million Between 60-80% of valuation - Of which, guaranteed Above 80% of valuation Total Within 60% of valuation Note 48: Loans with security in real estate by valuation limits Note 48: Loans with security in NOK million Others Total Private individuals NOK million 1995 1994 1995 1994 1995 1994 1995 1994 Note 47: Loans by type of debtor Total other loans Total loans Unspecified loss provisions Total loans with mortgage security Total loans with mortgage Loans with mortgage security Unspecified loss provisions Note 46: Loans Note 46: NOK million 1995 1994 1995 1994 1995 1994 1995 1994 * In December 1995 NOK 4.3 billion of industry loans were sold to Postbanken. Financial institutionsTrade and industry * Public sector 28.3 Note 50: Interests in associated companies

1995 1995 1994 1994 NOK million Booked Equity Booked Equity Company value value value value

Nordben Life and Pension Insurance Co. Ltd. 16.9 22.1 16.9 18.8

The shares are entered at equity value in the group accounts.

Note 51: Real estate and operating assets Real Machinery, Total estate vehicles, NOK million fittings

Acquisition cost at 1.1 4,986.3 512.6 5,498.9 Revaluations in year Revaluations in previous year 1,458.6 1,458.6 Additions 558.9 129.9 688.8 Disposals at acquisition cost -170.6 -54.2 -224.8 Aggregate depreciation and write-downs at 31.12 -1,317.9 -364.3 -1,682.2

Book value at 31.12 5,515.2 223.9 5,739.3

Ordinary depreciation for the year 16.6 95.6 112.2

The following linear depreciation periods have been used for operating assets: Machinery and fittings 4 years Vehicles 6 years Computer systems 3 years

Note 52: Investment/sale - real estate/operating assets (last 5 years)

NOK million 1995 1994 1993 1992 1991

Additions Real estate 558.9 240.0 299.5 373.3 213.6 Operating assets 129.9 89.9 116.0 197.4 391.8 Leased operating assets 54.2

Total 688.8 329.9 415.5 570.7 659.6

Disposals Real estate 177.3 403.8 262.6 294.4 42.0 Operating assets 32.0 9.1 23.3 115.7 69.9 Leased operating assets 17.6 65.0 33.7 148.2

Total 209.3 430.5 350.9 443.8 260.1

78 Notes 79 82.2 Hotel 9,291 100.0% value building level 141.2 Office 10,929 84.8% Booked Type of Sq.metres Occupancy 3,301.15,515.2 322,369 97.6% Life Non-life US ASA Others Group 25.625.5 2.8 2.8 28.4 28.3 -178.2 -26.2 -204.4 2,311.9 201.2 0.0 0.0 2,513.1 2,255.12,254.9 360.5 360.5 2,615.6 2,615.4 7,988.59,566.8 959.5 1,052.2 10,619.0 8,948.0 15,309.715,440.9 6,140.1 6,168.826,467.3 591.427,248.2 591.2 4,390.7 4,496.7 396.0 22,041.2 396.2 22,200.9 8.5 8.5 31,262.5 32,149.6 52,046.254,358.1 11,853.6 12,054.8 987.4 987.4 8.5 8.5 64,895.7 67,408.8 1. 26, Oslo Ruseløkkveien 2. VII's gate 10 ANS, Oslo Haakon 3. Gunnerus gate 3 Oslo ANS, Oslo Biskop 4. Maudsgate 1-3 ANS,Oslo Dronning 5. 1-3, Oslo Wergelandsveien 6. 14, Oslo Ruseløkkveien 7.Bryggen, Bergen Nye 8. plass 5, Oslo St. Olavs 9. 1-3, Oslo Rådhusgt. 314.7 353.0 Hotel 298.4 613.5 Office 26,801 Office Office 29,000 284.7 99.7% 20,873 55,823 249.0 98.8% Office 93.2% 236.7 99.0% Office 21,362 168.8 Hotel 100.0% 19,127 Office 25,637 94.9% 15,520 97.9% 98.8% Unrealised gains current assets Total current assets Book value Market value Market value Market value Miscellaneous Book value Market value Market value Foreign exchange and forward contracts Book value Market value Bonds Book value Certificates Book value Interests held as current assets Book value Book value Note 54: Market value securities NOK million Total 15. Hell Hotell, Stjørdal Total 15 largest Shares held as current assets Market value Note 53: 15 largest commercial properties 15 largest commercial Note 53: NOK million 10. Oslo Sameiet Kjelleren - Parkering, 11. Lille Grensen 7, Oslo12. Søebergkvartalet, Sandefjord13. Olav Kyrresgt. 22, Bergen14. Sandakerveien 64, Oslo 140.0 Garage 102.8 44,085 129.8 101.9 100.0% Office Office 84.4 Office 16,430 Office 7,056 97.2% 9,140 100.0% 11,295 96.6% 88.1% Note 55: Deferred tax allowances and deferred tax NOK million 1995 1994 Net Timing differences Positive Negative Positive Negative change

Shares held as current assets 34.1 8.3 96.1 -53.7 Other securities 2.7 29.4 4.0 86.1 -55.4 Real estate 229.9 354.2 262.4 383.2 3.5 Operating assets 17.5 145.1 16.1 139.5 4.2 Provisions 73.6 221.8 57.5 142.1 63.6 Prepaid pension 372.2 299.2 18.6 -91.6 Accrued pension liabilities 592.6 792.6 -200.0 Profit and loss account 42.0 25.0 52.6 25.9 9.7 Miscellaneous 66.3 181.8 158.2 788.6 -514.9

Total timing differences 804.2 1,584.0 858.3 2,472.7 -834.6

Loss carried forward 2,399.7 3,229.5 -829.8 Credit carried forward 756.9 756.8 0.1

Set-off -649.9 -649.9 -699.4 -699.4

Net timing differences 154.3 4,090.7 158.9 5,759.6 -1,664.3

Limitation in deferred tax allowances -3,936.4 -5,600.7 1,664.3

Base for balance sheet entries 154.3 154.3 158.9 158.9 0.0

Deferred tax/tax allowances in balance sheet 43.2 43.2 44.5 44.5

Note 56: Loss carried forward

NOK million Amount

UNI Storebrand Kredittforsikring AS 0.4 UNI Storebrand Forsikringsmegling AS 1.5 UNI Storebrand Nybygg AS 4.7 UNI Storebrand Finans AS 841.3 UNI Storebrand ASA 1,551.8

Total 2,399.7

Note 57: Intangible assets in subsidiaries

NOK million Owned Intangible assets Company by 31.12.95 31.12.94

Försäkringsaktiebolaget UNI Storebrand Sverige (Goodwill) US Skade 8.7 14.6 Aktuar Consult AS (Goodwill) US Liv 0.8 1.6 UNI Storebrand SPAR AS (Goodwill) US ASA 2.5 7.5 UNI Storebrand Filipstad AS (Property rights) US Nybygg AS 48.0 48.9

Total 60.0 72.6

80 Notes 81 129.7 637.9 624.2 871.2 638.6 3,393.3 1,734.9 3,187.7 8,238.2 1,031.2 11,136.2 17,656.2 56,901.8 69,358.9 69,997.5 69.0 556.6 621.6 687.7 1995 1994 3,051.0 7,905.5 1,474.9 13,678.6 591.8 4,026.6 8,797.2 61,724.9 74,548.7 75,140.5 perils received incl. natural 97.2 32.5 554.6624.2 703.7 83.3 167.5 3,001.07,779.41,513.1 392.3 3,356.8 221.8 13,569.5 4,086.7 Non-life International Group 1995 1994 1995 1994 1995 1994 69.0 556.6 621.6 687.7 3,051.0 7,905.5 1,474.9 13,678.6 Private Business Marine Reins. Pools- Other Total **** 3,186 2,411 757 573 521 2 202 140 303 13 35 173 53 46 6,372 1 13 1,453 69 535 * 2,116 535 217 2,868 Security reserve * Supplemental allocation Claims reserve Reinsurance reserve Premium and pension adjustment fund Premium and pension Total reserve. element claims * of which, inflation Administration reserve Natural perils fund Premium reserve NOK million BISC minimum requirement Security reserveReinsurance reserveBISC minimum requirement Administration reserve* schemes. BISC minimum requirement does not apply to foreign companies/branch offices and pool 779 2 521 306 140 13 187 53 35 51 1 13 1,475 69 557 BISC minimum requirement BISC minimum requirement BISC minimum requirement Claims reserve 3,820 2,618 934 247 174 113 7,906 NOK million Premium reserve, unearned premiumsPremium reserve, excess over unearned premiums 2,145 542 217 1 120 26 3,051 Note 59: Claims reserves - Non-life insurance Note 59: Claims reserves - Non-life Technical reserves for own account Security reserve Total Other funds Policyholders’ funds Premium reserve Note 58: Reserves for insurance liabilities - Life insurance liabilities Reserves for insurance Note 58: NOK million Note 60: Subordinated loan capital

NOK million Own Amount Currency Interest Maturity Borrowed from/Date company NOK in%

J.P. Morgan (Syndicated to 16 banks. 11.05.1995) Liv 758.6 USD 6.65% 2005 Carl Kierulf & Co AS, SPN Fonds/Oslo Securities (15.01.1992) Liv 561.0 NOK 11.15% 2002

Total 1,319.6

Note 61: Minority’s interest in equity capital Minority’s Share of Share of interests equity equity NOK million % capital capital Company 1995 1994

Biskop Gunnerus gate 3 Oslo ANS 30.0 103.6 Kovan Förvaltning AB 20.0 1.2 0.7 Surety Reinsurance Company 47.5 12.9

Total 1.2 117.2

Note 62: Change in equity capital

NOK million 1995 1994

Equity 1.1. 2,458.9 2,428.4 Result for the year 1,415.7 252.8 Gain on conversion of foreign subsidiaries 10.0 -46.8 Dividends allocated -70.0 -90.0 Introduction of new pension standard -404.6 New equity (net) 297.7 Other changes in equity -8.3 21.4

Equity at 31.12. 3,806.3 2,458.9

Note 63: Loans and guarantees to employees

Loans and guarantees to employees amount to NOK 1,669.8 million.

82 Notes 83 1995 1996 1997 6.75% 7.50% 8.00% 77 -8 -59 61 7 -87 -125 -143 Life Non-life US Finans AS US ASA Group 2,257 1,569 49 3,749 3,530 1,1283,305 1,569 49 3,624 1,319 4,661 14.1% 30.3% 45.4% 71.1% 15.8% UNI while the sale price was reinvested in securities with a risk Storebrand Livsforsikring AS to Postbanken. The loans were weighted 100%, weighting of mainly 0%. Group companies are involved in the following disputes: for alleged breach of price discrimination rules in A claim from Metropolitan Mining Company Inc. against LEFAC AS and Tomra Systems AS the million. USA. Estimated amount USD 10 accounts. The companies have not received any new writs in 1995 which affect the loss provisions in the Note 65: Disputes Year Required capital ratio % Capital ratio % Banking, Insurance and Securities Commission’s regulations: Schedule for increasing capital ratio under the Unspecified loss provisions grossUnspecified loss provisions capitalGross subordinated loan Revaluation reserve Intangible assets Other deductions Net primary capital *)in December 1995 as a result of the sale of NOK 4.3 billion of commercial loans from The risk-weighted balance sheet was reduced 19 3 1,319 22 1,319 Eligible subordinated loan capital Eligible subordinated loan Reduction in eligible subordinated loan capitalReduction in eligible subordinated -191 Core capital loss provisionsReduction in unspecified loss provisions Eligible unspecified -13 -2 -15 Risk-weighted calculation base *Risk-weighted calculation 23,437 5,177 109 5,097 29,511 Note 64: Capital adequacy Note 64: Note 66: Key figures UNI Storebrand Skadeforsikring

1995 1994 1993 1992 1991 Market Booked Market Booked Market Booked Market Booked Market Booked

Change in gross premiums written 0.8% 3.9% 15.2% -0.9% -2.3% Percentage of premiums written for own account 87.0% 83.9% 79.2% 88.5% 89.4% Claims ratio gross 69.7% 68.4% 67.4% 78.8% 77.1% Claims ratio for own account 70.0% 73.7% 77.4% 77.1% 77.3% Costs ratio for own account 28.5% 26.3% 27.9% 31.2% 31.4% Combined ratio for own account 98.6% 99.9% 105.2% 108.2% 108.7% Finance return 7.6% 6.2% 3.2% 4.3% 11.4% 9.9% 6.7% 5.8% 4.4% 6.3% Profit ratio 20.2% 16.5% 7.7% 10.4% 22.4% 18.6% 6.3% 4.4% -0.1% 4.4% Return on equity 29.1% 24.7% 11.3% 15.8% 32.7% 27.9% 10.8% 7.2% -0.3% 7.9% Solvency margin 72.0% 67.5% 68.7% 67.9% 72.4% 68.5% 66.2% 66.2% 49.3% 55.6% Solvency sensitivity 210.7% 224.6% 227.0% 229.7% 217.2% 229.3% 210.5% 210.6% 270.8% 239.9% Liquidity ratio 84.7% 86.2% 88.6% 88.6% 87.5% 88.8% 117.4% 117.4% 131.6% 130.9% Capital ratio 30.3% 25.9% 18.8% 18.3% 16.0% Percentage of premiums written for own account Premiums written for own account/Gross premiums written Claims ratio gross Gross claims incurred/Gross premiums earned Claims ratio for own account Claims incurred for own account/Premiums earned for own account Costs ratio for own account Total operating costs (excl. US Factoring)/Premiums written for own account Combined ratio for own account Claims ratio for own account + Costs ratio for own account Finance return Net financial income/Average assets Profit ratio Operating result/Premiums earned for own account Return on equity Operating result/Average equity Solvency margin Solvency capital/Premiums written for own account Solvency sensitivity (Claims reserves + Premium reserves)/Solvency capital Liquidity ratio Premium + claims reserves/Liquid assets Capital ratio Applicable regulations of Banking, Insurance and Securities Commission and Ministry of Finance (BISC rules) Solvency capital Total equity + Total other reserves + Subordinated loan capital + Security reserve + Administration reserve + Reinsurance reserve + Statutory natural perils reserve + Surplus/under values, assets + Off-balance sheet pension obligations Average equity (Solvency capital - Subordinated loan capital) last 2 years/2 Liquid assets Cash/bank + Bonds + Short-term equity investments + Certificates Market term The market column takes account of unrealised gains and off-balance sheet pension liabilities.

1995 1994 1993 1992 1991 NOK million Market Booked Market Booked Market Booked Market Booked Market Booked Gross premiums written 8,302 8,302 8,234 8,234 7,928 7,928 6,879 6,879 6,942 6,942 Premiums written for own acount 7,222 7,222 6,912 6,912 6,283 6,283 6,089 6,089 6,208 6,208 Gross premiums earned 8,287 8,287 8,147 8,147 7,959 7,959 6,872 6,872 7,048 7,048 Premiums earned for own account 7,170 7,170 6,812 6,812 6,266 6,266 6,092 6,092 6,364 6,364 Gross claims incurred 5,774 5,774 5,573 5,573 5,362 5,362 5,414 5,414 5,438 5,438 Claims incurred for own account 5,021 5,021 5,017 5,017 4,848 4,848 4,696 4,696 4,917 4,917 Total operating costs 2,064 2,064 1,830 1,830 1,765 1,765 1,897 1,897 2,010 1,951 Net financial income 1,362 1,096 543 729 1,730 1,491 882 770 544 775 Other income 2218 18 20 20 2 2 10 10 Operating result I 1,449 1,184 526 712 1,402 1,164 382 270 -9 281 Total equity 1,773 1,773 1,570 1,570 1,396 1,396 1,441 1,441 1,500 1,500 Total other reserves 383 383 336 336 361 361 297 297 227 227 Subordinated loan capital General loan loss reserve 31 31 Security/reinsurance/ administration reserve 2,101 2,101 2,165 2,165 2,098 2,098 1,865 1,865 1,147 1,147 Statutory natural perils fund 622 622 624 624 451 451 427 427 548 548 Surplus/under values, assets 321 0 55 0 241 0 2 0 -110 0 Off-balance sheet pension obligations 00 0 0 0 0 0 0 -284 0 Solvency capital 5,199 4,878 4,749 4,694 4,547 4,306 4,032 4,030 3,059 3,453 Average equity 4,974 4,786 4,648 4,500 4,289 4,168 3,546 3,741 3,331 3,580 Premium reserves 3,051 3,051 3,001 3,001 2,877 2,877 2,654 2,654 2,661 2,661 Claims reserves 7,906 7,906 7,779 7,779 6,997 6,997 5,833 5,833 5,623 5,623 Cash 1,220 1,220 1,685 1,685 1,106 1,106 891 891 454 454 Bonds 4,497 4,391 2,886 2,944 5,150 5,096 3,986 4,036 3,830 3,863 Short-term equity investments 1,055 962 899 859 1,298 1,186 879 910 1,343 1,344 Certificates 6,169 6,140 6,697 6,676 3,735 3,732 1,475 1395 667 667 Liquid assets 12,940 12,713 12,167 12,165 11,289 11,120 7,231 7,232 6,294 6,328 Total assets 18,352 18,031 17,306 17,251 16,535 16,294 13,741 13,739 12,691 12,800 Average assets 17,829 17,641 16,921 16,772 15,138 15,016 13,216 13,269 12,404 12,397 84 Notes 85 68 74 43 -78 113 550 556 191 529 261 712 265 8,234 6,912 8,147 1,117 3,266 3,001 9,944 2,165 7,779 -1,322 -5,573 -2,007 -1,335 70 70 42 221 109 531 833 753 150 621 299 263 3,272 3,051 7,906 8,302 7,222 8,287 1,184 -1,080 -5,774 -2,211 -1,116 10,120 83 83 24 37 53 28 -92 -89 -92 -14 158 158 388 296 368 279 173 173 -3 -3 87 2,214 60 74 100 100 211 124 135 101 275 167 318 217 -108 -430 -112 -108 -3 89 45 44 58 73 31 24 94 42 79 11 87 -30 983 572 411 289 353 142 360 144 -211 -210 -201 75 39 36 69 22 27 36 98 30 36 15 13 12 -16 513 510 126 312 343 164 350 -179 -242 -181 1,023 -6 -5 95 73 72 37 46 56 42 22 -20 275 180 692 142 912 489 924 319 -423 -670 -244 - -437 1,884 1,192 75 80 66 36 48 30 31 27 24 82 -16 277 202 772 137 833 564 846 308 -269 -677 -233 -290 1,966 1,194 69 82 38 63 77 -23 733 121 612 326 155 162 347 147 105 117 -527 -499 -536 2,821 2,495 2,139 1,612 2,176 -1,492 69 74 34 81 89 78 662 104 559 341 161 157 294 233 139 305 -463 -531 -468 2,955 2,614 2,088 1,625 2,154 -1,486 -4 -4 28 73 73 47 -33 110 210 109 286 230 213 -743 3,080 1,324 1,324 3,108 2,798 2,794 2,674 -1,948 -3 -3 29 62 63 47 97 435 120 105 660 213 438 -863 2,887 1,407 1,407 2,916 2,979 2,976 2,897 -1,809 2 4 91 47 71 73 43 64 25 42 54 89 79 -13 -65 -65 687 683 -491 1,018 1,065 1,644 1,579 1,645 -1,164 4 3 51 66 70 43 58 36 49 43 86 -58 -66 -34 999 127 750 747 132 -547 1,050 1,784 1,726 1,722 -1,129 Claims reserve ratio f.o.a. Key figures Claims ratio gross Gross unearned premiums Operating result 1 Technical reserves Technical result Return, solvency capital Reinsurance claims Reinsurance commission Gross management expenses Gross result by sector Gross premiums written Premiums written f.o.a. Technical resultsNOK million Private excl. motor 1995 Motor 1994 1995 1994 Industry 1995 1994 Marine 1995 1994 Inward reins. 1995 Natural perils 1994 1995 1994 Total 1995 1994 Note 67: UNI Storebrand Skadeforsikring results by sector Skadeforsikring UNI Storebrand Note 67: sector at 31.12.95 Results by Reinsurance ceded Gross premiums earned * Financial income by sector Reinsurance ceded Reinsured portion Gross claims unpaid Reinsured portion Unpaid claims f.o.a. The breakdown by lines is based on the classification of non-life insurance lines by the Banking, Insurance and Securities Commission, see further of non-life insurance lines by the Banking, Insurance and The breakdown by lines is based on the classification reinsurance is not as separate lines and that inward note 32. The difference from note 32 is mainly that motor and natural perils are specified lines. added to the same main line as the direct business. Other pools are divided between the relevant * between 5.5% p.a. on technical reserves in 1995 and 5.8% p.a. for 1994, less amount in working capital. Financial income is divided Claims ratio f.o.a. Premium reserves f.o.a. Gross losses incurred Return difference, finance Unearned premiums f.o.a. Cashflow analysis

UNI Storebrand UNI Storebrand UNI Storebrand ASA UNI Storebrand Skadeforsikring Livsforsikring 1995 1994 Group NOK million 1995 1994 1995 1994 1995 1994

Cashflow from operations: Movements in premium reserves -1,163.6 -1,905.7 -1,163.6 -1,905.7 Premiums paid, direct insurance/premium reserve 7,916.7 7,917.3 5,413.2 5,692.1 13,329.9 13,827.5 Claims/insurance benefits paid -5,440.6 -4,552.9 -3,994.2 -4,421.3 -9,434.8 -9,130.0 Payments on reinsurance received 112.0 132.7 3.7 -1.4 115.7 -804.1 Payments on reinsurance ceded -349.9 -600.9 -349.9 -620.9 Interest/commissions received 15.8 26.7 57.0 69.9 Other operating income received - 272.6 500.5 1,281.5 62.6 311.3 Interest/commissions paid - -1.8 -1.2 -29.1 Operating expenses paid -2,049.2 -2,081.1 -838.8 -745.8 -124.6 -2.9 -3,089.1 -3,095.5 Purchase/sale operating assets -23.0 -27.0 -24.4 -23.0 -49.3 -29.6 -97.9 -85.0

A Cashflow from operations 181.8 1,085.6 -604.1 -1,405.1 326.6 1,249.0 -571.2 -1,461.6

Cashflow from investments Financial income received 996.7 890.8 6,468.0 5,013.1 104.4 65.7 7,509.2 6,172.8 Financial expenses paid -35.6 -35.1 -153.0 -135.9 -242.2 -263.0 -367.7 -369.4

Purchase/sale of investment assets: - real estate 70.3 4.6 -419.5 179.8 -349.2 182.1 - shares 165.3 414.8 -1,825.5 3,021.4 -102.0 -298.0 -1,762.2 3,371.8 - bonds -2,499.8 1,891.8 -7,115.9 3,340.1 137.3 -438.3 -9,478.4 5,708.3 - loans 144.8 202.9 6,634.8 2,107.2 -50.0 -101.4 6,729.6 2,353.4 - certificates 537.3 -2,943.4 -5,410.8 -7,061.7 111.3 -377.4 -4,762.2 -10,475.7 - other changes in financial assets 225.3 -191.8 - - 78.6 -111.4 -174.1 -353.1

B Cashflow from investments -395.7 234.6 -1,822.0 6,464.0 37.4 -1,523.8 -2,654.9 6,590.2

Cashflow from financing, etc. Financing: - equity capital paid in - 165.1 - - - 297.8 - 297.8 - subordinated loan capital paid in - - 214.2 -37.9 214.2 -37.9 - long-term debt raised/instalments -40.5 -0.6 -135.1 -137.5 -240.2 -405.0 -222.8

Others: - dividends paid -140.0 -895.0 -350.0 -400.5 -90.0 -160.2 -90.0 -160.2 - tax paid -71.3 -10.8 -14.2 -164.3 -87.1 -140.0

C Cashflow from financing, etc. -251.8 -741.3 -285.1 -740.2 -330.2 137.6 -367.8 -263.1

Net change in liquidity (A+B+C) -465.7 578.9 -2,711.2 4,318.7 33.8 -137.2 -3,594.0 4,865.5 + Liquid assets at 01.01. 1,685.2 1,106.4 5,971.6 1,652.9 148.7 285.9 8,318.1 3,452.6

= Liquid assets 31.12 1,219.5 1,685.2 3,260.4 5,971.6 182.5 148.7 4,724.1 8,318.1

86 Significant Differences Between Norwegian and United States Generally Accepted Accounting Principles

The accounting principles under accounting principles (N GAAP) and accounting principles (US GAAP). which the group financial statements differ in certain significant respects A summary of the significant have been prepared conform with from United States generally accepted differences is presented below. Norwegian generally accepted

Reconciliation of group net income to US GAAP

NOK millions 1995 1994

Group result - N GAAP 1,451.2 521.9 Technical allocations non-life/income taxes/minority interests -35.5 -269.1

Result for the year - as reported in Group Profit and Loss Account - N GAAP 1,415,7 252.8

Effect of estimated US GAAP adjustments: Contract acquisition costs 161.9 29.5 Claim adjustment expenses -22.3 -6.1 Liabilities for unpaid claims 39.3 94.8 Real estate -125.8 27.0 Pension costs -26.1 -28.3 Investment securities and derivatives -176.7 155.4 Life insurance policyholders' participation in other US GAAP adjustments 116.6 -8.5 Income taxes: Full deferred asset recognition -332.6 -45.6 Income tax effects of other US GAAP adjustments 9.3 -74.7 Discontinued operations - loss on disposal -103.7

Net income for the year - US GAAP basis 1,059.3 292.6

Consisting of: Loss from discontinued operations -358.1 Income from continuing operations 1,059.3 650.7

Reconciliation of shareholders' equity to US GAAP

NOK millions 1995 1994

Equity capital - as reported in Group Balance Sheet - N GAAP 3,806.3 2,458.9

Effect of estimated US GAAP adjustments Contract acquisition costs 2,130.1 1,968.2 Claim adjustment expenses -283.4 -261.1 Liabilities for unpaid claims 2,045.0 2,005.7 Real estate -1,462.2 -1,336.4

Pension costs 234.8 260.9 US GAAP Investment securities and derivatives -448.7 -272.0 Life insurance policyholders' participation in other US GAAP income statement adjustments -28.3 -144.9 Effect of recognizing market value for available for sale securities 3,174.0 1,433.1 Life insurance policyholders' participation in market value adjustment for available for sale securities -2,125.6 -1,051.7 Income taxes: Full deferred asset recognition 1,102.2 1,434.8 Income tax effects of other US GAAP adjustments -906.0 -728.5 Dividends 70.0 90.0

Shareholders' equity - US GAAP Basis 7,308.2 5,857.0

87 Contract Acquisition Costs reserves) include certain minimum estate is carried at historical cost and, Under N GAAP all costs and expenses amounts required by regulation and for buildings used in the business and incurred in connection with the the anticipated effects of inflation on income-producing investment origination of new insurance contracts future payment amounts are properties, depreciation is recorded are charged to expense as incurred. considered to be part of a special over the expected useful lives of the Under US GAAP those costs which vary statutory reserve. US GAAP prescribes buildings not in excess of fifty years. with and are primarily related to the no minimums for such liabilities and Interest expense incurred during the acquisition and renewal of insurance requires that liabilities for unpaid development of a real estate project is contracts, for example commissions, claims include inflationary effects. capitalized as part of its cost. are capitalized and charged to Statutory reserves not supported by Impairment provisions are evaluated expenses in proportion to related actual incurred claims are not on an individual property basis. revenue recognized. recognized.

Pension costs Claim Adjustment Expenses Real estate While N GAAP and US GAAP provide Under N GAAP all expenses associated Under N GAAP real estate held both for similar measurements of pension with processing and settling claims for investment and for use in the costs, US GAAP spreads certain under insurance contracts are charged business is periodically revalued to transition effects of adopting its to expense as incurred. Under current value and is not depreciated in standard over the remaining service US GAAP costs expected to be the life insurance company while period of employees covered measured incurred in connection with the buildings are depreciated over from January 1, 1989, while N GAAP settlement of unpaid claims are 100 years in the non-life companies. provide for the full absorption of the accrued when the related liabilities for Interest expense incurred during the transition liability in shareholders’ unpaid claims are accrued. development of a real estate project is equity effective January 1, 1994. expensed as incurred. Also, any impairments in value deemed Liabilities for Unpaid Claims permanent are evaluated on a total Investment Security and Under N GAAP liabilities for unpaid portfolio basis. Under US GAAP real Derivatives non-life claims (claims reserve or Under N GAAP cost of investment allocations to non-life technical securities is defined as original cost and transactions are recorded as of the

88 settlement date. Investment securities – Available for sale securities are which by government regulation must except those classified as held to quoted equity instruments and all allocate at least 65% of profits before maturity beginning in 1995, and other debt securities and are carried the allocation to policyholders. US related derivative instruments are at fair market value with the GAAP considers the 65% minimum generally carried in the financial difference between such value and policyholder participation as statements at the lower of cost or amortized cost carried as a separate applicable to all elements of pre-tax market with any required adjustments component of shareholder’s equity. profits and therefore provides for a made in the income statement Impairments in value deemed other similar 65% participation in all of the (profit and loss account). than temporary are written down US GAAP differences which are of Under US GAAP cost is defined as through earnings. timing nature and which affect the amortized cost for debt instruments measurement of such profits in the life which requires that premiums and Under US GAAP derivative financial insurance entity on a US GAAP basis. discounts arising at time of purchase instruments are generally marked to Norwegian government regulation be amortized over the lives of the market through the income statement also requires a participation by related securities through the income unless they are effectively hedging or terminating policyholders in statement and transaction are altering the characteristics of a unrecognized unrealized investment recorded as of the trade date. The financial instrument on the balance gains through a formula that attributes accounting for investment securities sheet. 75% of such gains to policyholders as a depends on their classification and two group. No recognition of this potential classifications are relevant to the group liability is reflected under N GAAP. financial statements: Life Insurance Policyholders’ Under US GAAP 75% of the – Held to maturity securities are debt Participation adjustment to shareholders’ equity securities which will not be sold Pre-tax operating results of the life arising as a result of marking available before their maturity dates and are insurance entity are shared with for sale securities to market value is carried at amortized cost reduced by policyholders on the basis of a formula allocated to policyholder liabilities in any impairments in value deemed to recognition of this regulatory be other than temporary. provision. US GAAP

89 Income Taxes Discontinued operations Dividends to shareholders N GAAP limits the recognition of The effects of the company’s disposal Under N GAAP dividends to deferred tax assets regardless of the of its international business in 1994 is shareholders are recorded in the year prospects for recoverability. US GAAP measured in the same way for N GAAP to which they are deemed to relate. requires the recognition of all deferred and US GAAP, adjusted for the effects Under US GAAP dividends are not tax amounts subject to a recoverability of the other differences described recorded until formally declared by test for deferred tax assets. above, but under US GAAP the result the board of directors. An additional US GAAP difference of that business along with the gain or arises to reflect the income tax effects loss from final disposition should be of the other US GAAP differences. separated from income from continuing operations.

90 Companies in UNI Storebrand at 31.12.1995

NOK million Interest in % Currency Share capital

UNI Storebrand ASA NOK 1,882.1

UNI Storebrand Skadeforsikring AS 100 NOK 1,380.6 Europeiske Reiseforsikring AS 100 NOK 7.9 UNI Storebrand Kredittforsikring AS 100 NOK 25.0 UNI Storebrand Kredittförsäkring AB 100 SEK 0.1 Försäkringsaktiebolaget UNI Storebrand Sverige 100 SEK 95.0 Kovan Förvaltning Aktiebolag 100 SEK 0.1 AS Risk Management 100 NOK 0,.1

UNI Storebrand Livsforsikring AS 100 NOK 1,361.2 Aktuar Consult AS 100 NOK 2.5 AS Værdalsbruket 74.9 NOK 4.8 Trones Bruk AS 100 NOK 2.0 UNI Storebrand Eiendomsdrift AS 100 NOK 0.2 Nordben Life and Pension Insurance Co.Ltd 25 GBP 6.0

UNI Storebrand Finans AS 100 NOK 20.0

UNI Storebrand SPAR AS 100 NOK 1.2

UNI Storebrand Fonds AS 100 NOK 5.0

UNI Storebrand Nybygg AS 100 NOK 50.0 UNI Storebrand Filipstad AS 100 NOK 1.0

UNI Storebrand Forsikringsmegling AS 100 NOK 3.5 Securitas Assuransemegler AS 100 NOK 0.5 Companies in UNI Storebrand

91 Addresses

Head office UNI Storebrand Aktuar Consult A/S UNI Storebrand ASA Mid Norway Division Tullinsgt. 6 Ruseløkkveien 26 Kongensgt. 16 P.O.Box 6878 St. Olavspl. P.O.Box 1380 Vika N-7001 Trondheim N-0130 Oslo N-0114 Oslo Telephone: +73 58 35 00 Telephone: +22 31 20 00 Telephone: +22 31 50 50 Telefax: +73 58 35 40 Telefax: +22 31 13 37 Telefax: +22 31 57 90 UNI Storebrand Other Activities Non-life Insurance Northern Norway Division UNI Storebrand SPAR AS UNI Storebrand Skadeforsikring AS Vestregt. 27–31 Stranden 3A Ruseløkkveien 26 P.O.Box 115 P.O.Box 1764 Vika P.O.Box 1380 Vika N-9001 Tromsø N-0122 Oslo N-0114 Oslo Telephone: +77 64 36 00 Telephone: +22 01 48 00 Telephone: +22 31 50 50 Telefax: +77 64 36 66 Telefax: +22 01 48 75 Telefax: +22 31 59 20 Europeiske Reiseforsikring A/S UNI Storebrand Finans AS UNI Storebrand Haakon VII's gt. 10 Parkveien 61 Oslo og Akershus Division P.O.Box 1380 Vika P.O.Box 1380 Vika Ruseløkkveien 14 N-0114 Oslo N-0114 Oslo P.O.Box 1380 Vika Telephone: +22 31 50 50 Telephone: +22 31 50 50 N-0114 Oslo Telefax: +22 31 20 99 Telefax: +22 31 23 89 Telephone: +22 31 50 50 Storebrand Bank AS Telefax: +22 31 28 02 UNI Storebrand Kredittforsikring AS Parkveien 61 Haakon VII's gt. 5 P.O.Box 1380 Vika UNI Storebrand P.O.Box 1380 Vika N-0114 Oslo East Division N-0114 Oslo Telephone: +22 12 49 00 Østre Torg Telephone: +22 31 50 50 Telefax: +22 12 49 10 N-2300 Hamar Telefax: +22 31 23 80 – 22 31 23 72 Telephone: +62 51 64 00 UNI Storebrand Nybygg AS Telefax: +62 51 64 80 Försäkringsaktiebolaget Ruseløkkveien 26 UNI Storebrand Sverige P.O.Box 1380 Vika UNI Storebrand Engelbrektsplan 2 N-0114 Oslo Southern Norway Division P.O.Box 5502 Telephone: +22 31 50 50 Langsæveien 4 S-114 85 Stockholm Telefax: +22 31 18 11 Harebakken Telephone: +46 8 67 90 100 P.O.Box 1500 Myrene Telefax: +46 8 61 11 506 UNI Storebrand N-4801 Arendal Investment Management Telephone: +37 01 71 00 Stranden 3B Telefax: +37 01 71 11 Life Insurance P.O.Box 1380 Vika UNI Storebrand Livsforsikring AS N-0114 Oslo UNI Storebrand Ruseløkkveien 26 Telephone: +22 31 15 00 Western Norway Division P.O.Box 1380 Vika Telefax: +22 31 25 00 Olav Kyrresgt. 22 N-0114 Oslo P.O.Box 1243 Telephone: +22 31 50 50 N-5001 Bergen Telefax: +22 31 59 20 Telephone: +55 54 77 00 Telefax: +55 54 77 54

92 UNI Storebrand is Norway’s leading profit based supplier of financial welfare services. We provide insurance, money management and protection from health and environmental hazards to more than a million customers.

UNI Storebrand shall be accessible to customers, perform ma- ximum standard claim settlements and simplify customers’ financial arrangements. High skills will ensure competitive- ness in products and prices.

UNI Storebrand provides individual and group based services in an interplay with public programs.

UNI Storebrand takes co-responsibility for improving the en- vironment, increasing welfare and promoting quality of life.

UNI Storebrand will create value for customers and sharehol- ders through operating in markets that provide the best long term return. Design: Mohr Design Photo: Johs. Böe. Scanfoto. Prepress: Esset Grafisk AS. Print: Aktietrykkeriet AS Paper: 115g Galerieart silk, swanmarked environmentally-friendly Cover paper: 240g Tacoblanc Natur, swanmarked environmentally-friendly Annua N Storebrand 1995 UNI

UNI Storebrand ASA P.O.Box 1380 Vika N-0114 Oslo Norway Report UNI STOREBRAND ¥ Table of Contents al R e p ort ¥ Overview ¥ Summary 1995 ¥ Key figures ¥ Report of the Board of Directors ¥ Income Statement ¥ Balance Sheet ¥ Cash Flow Analysis ¥ Notes Annual Report 1995 ¥ Shareholders Policy

1995 1995