Insurance companies: annual accounts

 

SUMMARY OF:

Directive 91/674/EEC on the annual accounts and consolidated accounts of insurance undertakings

WHAT IS THE AIM OF THE DIRECTIVE?

It aims to ensure that the balance sheets of all EU insurance companies have the same layout and the same item headings in order to ensure comparability.

KEY POINTS

The directive applies to all insurance companies or firms except small mutual associations not carrying out insurance business.

It complemented the Fourth Council Directive (Directive 78/660/EEC) on annual accounts of companies with limited liability which has since been repealed and replaced by Directive 2013/34/EU (annual and consolidated financial statements and related reports of certain types of undertakings).

Even if national accounting standards may differ across EU countries, the directive prescribes certain basic information in the interests of greater comparability of consolidated accounts. To this end, the content of the various balance sheet items is determined precisely.

To provide a proper understanding of the financial situation of an insurance companies, the current value of investments, as well as their value based upon the principle of the purchase price or production cost, must be disclosed; disclosure of the current value of investments is also required.

For life assurance provisions use may be made of actuarial methods which may be laid down in national law and with due regard for the actuarial principles recognised.

Lastly, for the calculation of the provision for claims outstanding, any implicit discounting or deduction is prohibited. On the other hand, in the interests of prudence and transparency, precise conditions for recourse to explicit discounting or deduction are defined.

To adapt accounting disclosures to insurance business models, certain requirements are set out relating to the content of the notes on the accounts, e.g. gross premiums broken down by category of activity (accident and health, motor, fire, etc.) and by geographical market.

It must be possible to obtain a copy of accounts and annual reports upon request at a price not exceeding their administrative cost.

FROM WHEN DOES THE DIRECTIVE APPLY?

It has applied since 23 December 1991 and had to become law in the EU countries by 1 January 1994.

MAIN DOCUMENT

Council Directive 91/674/EEC of 19 December 1991 on the annual accounts and consolidated accounts of insurance undertakings (OJ L 374, 31.12.1991, pp.7-31)

Successive amendments to Directive 91/674/EEC have been incorporated into the original document. This consolidated version is of documentary value only.

RELATED DOCUMENTS

Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC (OJ L 182, 29.6.2013, pp. 19-76)

See consolidated version.

Directive 2006/46/EC of the European Parliament and of the Council of 14 June 2006 amending Council Directives 78/660/EEC on the annual accounts of certain types of companies, 83/349/EEC on consolidated accounts, 86/635/EEC on the annual accounts and consolidated accounts of banks and other financial institutions and 91/674/EEC on the annual accounts and consolidated accounts of insurance undertakings (OJ L 224, 16.8.2006, pp. 1-7)

Directive 2006/43/EC of the European Parliament and of the Council of 17 May 2006 on statutory audits of annual accounts and consolidated accounts, amending Council Directives 78/660/EEC and 83/349/EEC and repealing Council Directive 84/253/EEC (OJ L 157, 9.6.2006, pp. 87-107)

See consolidated version.

Directive 2003/51/EC of the European Parliament and of the Council of 18 June 2003 amending Directives 78/660/EEC, 83/349/EEC, 86/635/EEC and 91/674/EEC on the annual and consolidated accounts of certain types of companies, banks and other financial institutions and insurance undertakings (OJ L 178, 17.7.2003, pp. 16-22)

Commission Recommendation of 30 May 2001 on the recognition, measurement and disclosure of environmental issues in the annual accounts and annual reports of companies (OJ L 156, 13.6.2001, pp. 33-42)

last update 24.09.2018