Income Items

Reserves - Beginning of Period
Reserves are held to cover future liabilities. These are based on generally accepted actuarial standards and /or local legislation.

Premium
The premiums shown are the earned gross premiums.

Investment Income
This is the interest credited to the reserves and/or cash flow.

Excess Claim
The Peak Amount System places a limit on the amount of any individual death or disability claim that will be charged to the international account. The excess claim is any amount of claims that exceeds the applicable peak amount of EUR 250,000 (or any amount mutually agreed upon).

Outgo Items

Paid Claims
These are actual claims, benefits, and surrender values.

Expenses
Expenses comprise both local and international charges.

• Local charges
  Local charges cover the acquisition and administrative costs incurred by the network members.
• International charges
  They relate to the costs for managing the worldwide pooling programme. These charges vary according to the volume of the pool.

Commissions
When local companies use the services of a broker, commissions are paid.

Taxes
These are premium taxes and/or stamp duties payable.

Local Profit Sharing (LPS)
The local client is often eligible to participate in the profits of the local insurer. The local profit sharing can be paid out directly, or may be used to increase benefits. It can also be used as a premium reduction for the following year.

Non-rated part of the earned premium
This represents the part of the premium relating to the potential claims above the Peak Amounts.

Reserves - End of Period
See Reserves beginning of period.

Dividends

The Balance equals the sum of the Income items less the sum of the Outgo items.
If this balance is positive, it is returned to the multinational (in part or as a whole) as a dividend.