Annual Report 2016 a.s.r. Archimedeslaan 10 P.O. Box 2072 3500 HB Utrecht www.asrnl.com 3 2016 Introduction Annual Report Strategic Report Contents Management report Financial report 1 5 Introduction 5 Financial Statements 2016 119 1.1 Notes to the reader 6 5.1 Introduction 121 1.2 a.s.r. at a glance 8 5.2 Consolidated financial statements 123 1.3 Message from the Chairman 11 5.3 Accounting policies 130 Business Report 1.4 Investor relations 13 5.4 Group structure and segment information 150 1.5 Highlights 2016 16 5.5 Notes to consolidated balance sheet 162 5.6 Notes to the consolidated income statement 191 5.7 Other notes 198 5.8 Risk management 211 2 5.9 Capital management 248 Strategic Report 19 5.10 Company financial statements 251 2.1 About a.s.r. 20 2.2 Key trends 23 2.3 Strategy 25 Governance Report 2.4 Value creation 33 6 2.5 Sustainability 38 Other information 259 2.6 Assurance report of the independent auditor 6.1 Report on the audit of the financial on the sustainability information 56 statements 2016 included in the Annual Report 260 6.2 Provisions of the Articles of Association regarding profit appropriation 266 3 Business Report 59 3.1 Themes in 2016 60 7 Financial Statements 2016 3.2 Business environment 64 Report of Stichting Continuïteit 3.3 Business segments 69 ASR Nederland 268 3.4 Group and segment financial performance 82 3.5 Risk management and Compliance 93 3.6 Executive Board In Control Statement 98 Appendices 269 Appendix A – Glossary 270 Appendix B – List of acronyms 276 Appendix C – Standar ds, convenants and 4 memberships 277 Governance Report 99 Appendix D – External recognition 280 4.1 Corporate governance 100 Appendix E – Additional insurance information 282 4.2 Supervisory Board report 109 Appendix F – Additional employee information 286 4.3 Remuneration report 113 Appendix G – Additional environmental information 291 Other a.s.r. 4.4 Employee representation 117 Appendix H – Additional information 294 Archimedeslaan 10 Appendix I – GRI Content Index 296 P.O. Box 2072 3500 HB Utrecht www.asrnl.com Introduction Strategic Report Business Report Governance Report Financial Statements 2016 Other 4 This page has intentionally been left blank. 5 Introduction Introduction 1 Introduction Strategic Report Strategic Report 1.1 1.4 Notes to the reader 6 Investor relations 13 Business Report Business Report 1.2 1.5 At a glance 8 Highlights 2016 16 Governance Report 1.3 Governance Report Message from the Chairman 11 Annual Financial Statements 2016 Financial Statements 2016 Financial Statements 2016 Other information Other Other Introduction | 1.1 Notes to the reader 6 Introduction 1.1 Notes to the reader Introduction The consolidated financial statements are presented in In this report ASR Nederland N.V. (hereinafter referred euro (€), this being the functional currency of a.s.r. and all to as ‘a.s.r.’ or ‘the Group’) gives an account of its 2016 its entities. All amounts quoted in the tables contained in financial performance, provides a transparent overview of these financial statements are in millions of euros, unless its strategy, businesses, risk management and governance otherwise indicated. Strategic Report (activities and objectives). a.s.r. also uses this report to describe the interrelationships between its strategy and As of 1 January 2016, Solvency II regulations came into governance and the social and economic context in which force. The Solvency II regime comprises requirements it operates. The Annual Report comprises the following for insurance companies. The new regime is meant to four chapters: harmonize the European insurance market, increase the • Strategic Report; protection of policyholders and improve risk awareness • Business Report; in both the governance and management of insurance • Governance Report; companies. Solvency II sets sophisticated solvency • Financial Statements. requirements and forms an integral part of the risk Completed by Other information and the Report of management of insurance companies. Business Report ‘Stichting Continuïteit’. The Solvency II figures presented in this report are based on the standard formula. In addition to the information This year, a.s.r. has taken another step towards integrated disclosed in this report a.s.r. also publishes a Solvency and reporting. In this Annual Report, a.s.r. discloses and explains Financial Condition Report (SFCR). its material financial and non-financial performance, its strategy and governance, relevant external developments a.s.r. has integrated the material sustainability issues into and the risks and opportunities a.s.r. faces. this report as from 2016. The sustainability information contained in this Annual Report has been prepared in The online version of the Annual Report contains links accordance with the Sustainability Reporting Standards, between the chapters of this report. You can find more CORE option, of the Global Reporting Initiative (GRI). Governance Report information on a.s.r. on its website asrnl.com. The GRI Content Index outlines the indicators on which Scope of disclosures a.s.r. reports and shows where these indicators can be This report is intended for a.s.r.’s stakeholders. The found in the Annual Report. The table also includes financial information in this Annual Report is consolidated additional information that has not been included in the for a.s.r. and all its subsidiaries. The quantitative and Annual Report itself. For the GRI Standards Content Index qualitative information that is provided pertains to a.s.r. as please see page 296. a whole, except where it is stated that information applies to one specific entity, business line or division. Van Kampen Reporting process Groep (VKG), Dutch ID (Felisson and Boval), PoliService, Relevant topics for this report were selected based Financial Statements 2016 SuperGarant and Corins (total assets approximately on a materiality survey among internal and external € 213 million (0.37% of total assets)) are excluded from stakeholders using the GRI Standards indicators, in reporting on social and environmental aspects. which the materiality of items is ranked according to the importance that stakeholders attach to them. For more Presentation of information information, please see Appendix H. a.s.r.’s consolidated financial statements have been prepared in accordance with International Financial The information contained in the management report is Reporting Standards (IFRS) – including the International based on extensive reports from our business lines and the Accounting Standards (IAS) and Interpretations – as outcomes of qualitative and quantitative questionnaires adopted by the European Union (EU), and with the and reviews. All disclosures have been reviewed by the financial reporting requirements included in section 391, business lines and corporate departments. Publication Title 9, Book 2 of the Dutch Civil Code and the of the Annual Report is subject to the approval of the Dutch Code of Conduct for Insurers issued by the Dutch Executive Board and the Supervisory Board. Other Association of Insurers. Auditor’s scope and level of assurance Pursuant to the options offered by Section 362, Book 2 The consolidated financial statements have been audited of the Dutch Civil Code, a.s.r. has prepared its company by our external auditor, Ernst & Young Accountants LLP financial statements in accordance with the same principles (EY). The audit report of EY can be found on page 260. as those used for the consolidated financial statements. In addition to the Financial Statements, EY has reviewed Introduction | 1.1 Notes to the reader 7 Introduction the sustainability information in this Annual Report Introduction with a limited level of assurance. The objective is to provide a statement as to whether the information in this Annual Report is presented in accordance with the GRI Sustainability Reporting Standards, the Guidance Note on Sustainability Reporting of the Dutch Accounting Standards Board (Raad voor de Jaarverslaggeving) and a.s.r.’s internal reporting criteria. EY has conducted the assurance review in accordance Strategic Report with Dutch law including the Dutch Auditing Standards. Strategic Report This requires that EY complies with prevailing ethical requirements, which are available for consultation on nba.nl. EY’s assurance report can be found on page 56. For a download of this report or more information, please visit us at asrnl.com/investor-relations or asrnederland.nl/ investor-relations or contact us at [email protected]. Business Report Business Report Governance Report Governance Report Financial Statements 2016 Financial Statements 2016 Other Other Introduction | 1.2 At a glance 8 Introduction 1.2 At a glance a.s.r. is the Dutch insurance company for all types of insurance. Via the brands a.s.r., De Amersfoortse and Ditzo as well as niche brands such as Europeesche Verzekeringen and Ardanta, a.s.r. offers a wide range of financial products covering P&C (Property Strategic Report & Casualty), occupational disability and health insurance (non-life), individual life, group and individual pensions and funeral expenses insurance (life). It also offers asset management services, banking services and distribution services to intermediaries. History a.s.r.’s roots go back to 1720 with the foundation of ‘N.V. Maatschappij van Business Report since Assurantie, Discontering en Beleening der Stad Rotterdam anno 1720’, which – on 21 June 1720 – became the first listed insurance company in the Netherlands. The company in its present form was created in 2000 through the acquisition of ASR Verzekeringsgroep by Fortis. In October 2005, the 1720 brands AMEV, Stad Rotterdam and Woudsend Verzekeringen were replaced by Fortis ASR. In the same month, the name of the insurance group was changed to Fortis Verzekeringen Nederland. In 2008, a.s.r. was nationalized after the collapse of Fortis. In March 2009 the new name ASR Nederland was introduced. a.s.r. has been listed on Euronext Amsterdam since 10 June 2016.