Annex 1

General information on the insurance market

Item / 2001 / 2002 / 20031
Number of insurance companies at end of period / 21 / 20 / 19
Number of non-life insurance companies at end of period / 15 / 14 / 13
Number of life insurance companies at end of period / 6 / 6 / 6
Gross premiums written, lats / 97,511,550 / 103,507,538 / 124,195,236
Share of gross premiums written by insurance companies with a foreign participating interest (>10%) in total gross premiums written, % / 68 / 67 / 64
Gross premiums written for direct life insurance, lats / 3,543,968 / 4,244,054 / 5,271,859
Share of gross premiums written for direct life insurance in total gross premiums written, % / 4 / 4 / 4
Gross premiums written for direct non-life insurance, lats / 89,355,744 / 95,079,696 / 114,101,391
Accepted reinsurance, lats / 4,611,838 / 4,183,788 / 4,821,986
Gross claims paid, lats
/ 37,692,931 / 41,646,691 / 43,863,244
Share of gross claims paid by insurance companies with a foreign participating interest in gross claims paid, % / 58 / 61 / 61
Gross claims paid for direct life insurance, lats / 1,928,807 / 1,736,970 / 3,313,821
Share of gross claims paid for direct life insurance in total gross claims paid, % / 5 / 4 / 8
Gross claims paid for direct non-life insurance, lats / 34,853,476 / 37,265,657 / 39,609,755
Accepted reinsurance, lats / 910,648 / 2,644,064 / 939,668
Gross premiums written per capita, lats / 41 / 44 / 53
Number of certified insurance brokers at end of period / 139 / 185 / 195
Number of insurance brokerage companies at end of period / 28 / 29 / 29
Gross premiums written by insurance brokerage companies, lats / 13,328,523 / 14,272,416 / 21,415,924
Share of gross premiums written by insurance brokerage companies in total gross premiums written by insurance brokerage companies, % / 14 / 14 / 16

1 Non-audited data.

2 Annex 2

Geographical breakdown of gross premiums written and gross claims paid for direct insurance 1

Country or group of countries / Gross premiums written / Gross claims paid
lats / % / lats / %
Latvia / 118,440,795 / 99.2 / 42,641,654 / 99.3
EU Member States / 578,376 / 0.5 / 254,791 / 0.6
Other EET countries 2 / 173,083 / 0.1 / 22,963 / 0.1
Switzerland / 275.4 / 0.0 / 0 / 0.0
USA / 877.9 / 0.0 / 0 / 0.0
Japan / 33 / 0.0 / 0 / 0.0
Other countries / 179,810 / 0.2 / 4168.21 / 0.0
Total / 119,373,250 / 100.0 / 42,923,576 / 100.0

1 Information is available since 01.01.2003.

2 Norway, Island and Liechtenstein.

Annex 3

Structure and geographical breakdown of investments made by insurance companies

Investment structure

2002 / 2003
Type of investment / 31.12.2002 / 31.03.2003 / 30.06.2003 / 30.09.2003 / 31.12.2003
lats / % / lats / % / lats / % / lats / % / lats / %
Land and buildings / 5,733,524 / 6.1 / 7,831,354 / 7.9 / 8,232,148 / 8.0 / 8,532,036 / 8.0 / 9,117,723 / 8.7
Shares and other variable-yield securities / 11,491,415 / 12.3 / 11,722,585 / 11.8 / 11,806,972 / 11.4 / 14,309,083 / 13.4 / 15,542,471 / 14.8
Debt securities and other fixed-income securities / 32,852,218 / 35.2 / 34,742,818 / 34.9 / 36,575,136 / 35.4 / 40,037,819 / 37.6 / 39,359,588 / 37.5
Investment shares in investment pools / 4,328,123 / 4.6 / 4,390,022 / 4.4 / 4,020,960 / 3.9 / 1,774,060 / 1.7 / 322,557 / 0.3
Mortgage loans and other loans / 2,894,030 / 3.1 / 2,592,574 / 2.6 / 1,985,650 / 1.9 / 1,678,639 / 1.6 / 1,963,715 / 1.9
Time deposits with credit institutions / 30,352,413 / 32.5 / 29,152,002 / 29.3 / 28,108,654 / 27.2 / 30,654,783 / 28.8 / 29,678,145 / 28.3
Other investments / 253,925 / 0.3 / 331,982 / 0.3 / 204,003 / 0.2 / 166,157 / 0.2 / 160,041 / 0.2
Claims on credit institutions / 5,391,659 / 5.8 / 8,873,398 / 8.9 / 12,336,787 / 11.9 / 9,448,704 / 8.9 / 8,685,817 / 8.3
Total investments / 93,297,308 / 100.0 / 99,636,735 / 100.0 / 103,270,310 / 100.0 / 106,601,281 / 100.0 / 104,830,057 / 100.0

Geographical breakdown of investments

2002 / 2003
Placement / 31.12.2002 / 31.03.2003 / 30.06.2003 / 30.09.2003 / 31.12.2003
lats / % / lats / % / lats / % / lats / % / lats / %
Latvia / 89,622,994 / 96.1 / 96,060,751 / 96.4 / 99,201,425 / 96.1 / 100,555,566 / 94.3 / 98,509,824 / 94.0
Lithuania / 1,636,463 / 1.8 / 1,785,335 / 1.8 / 1,776,063 / 1.7 / 1,537,880 / 1.4 / 1,638,099 / 1.6
USA / 118,800 / 0.1 / 86,013 / 0.1 / 993,799 / 1.0 / 1,495,071 / 1.4 / 1,176,660 / 1.1
Finland / 154,942 / 0.2 / 64,970 / 0.1 / 69,320 / 0.1 / 407,015 / 0.4 / 801,843 / 0.8
Germany / 821,193 / 0.9 / 740,396 / 0.7 / 521,538 / 0.5 / 525,189 / 0.5 / 582,486 / 0.6
Denmark / 0 / 0.0 / 0 / 0.0 / 0 / 0.0 / 488,723 / 0.5 / 508,384 / 0.5
Poland / 59,400 / 0.1 / 58,700 / 0.1 / 66,392 / 0.1 / 483,109 / 0.5 / 469,075 / 0.4
Norway / 0 / 0.0 / 0 / 0.0 / 0 / 0.0 / 0 / 0.0 / 301,950 / 0.3
Switzerland / 92,859 / 0.1 / 94,283 / 0.1 / 87,841 / 0.1 / 92,081 / 0.1 / 166,085 / 0.2
Netherlands / 190,080 / 0.2 / 187,840 / 0.2 / 172,251 / 0.2 / 170,348 / 0.2 / 164,574 / 0.2
Great Britain / 131,355 / 0.1 / 131,228 / 0.1 / 65,200 / 0.1 / 220,206 / 0.2 / 152,470 / 0.1
Russia / 121,821 / 0.1 / 120,375 / 0.1 / 177,193 / 0.2 / 234,175 / 0.2 / 115,018 / 0.1
Italy / 0 / 0.0 / 0 / 0.0 / 0 / 0.0 / 107,914 / 0.1 / 112,627 / 0.1
Croatia / 79,300 / 0.1 / 81,640 / 0.1 / 98,264 / 0.1 / 97,360 / 0.1 / 90,531 / 0.1
Estonia / 134,725 / 0.1 / 93,364 / 0.1 / 27,971 / 0.0 / 21,514 / 0.0 / 24,757 / 0.0
Ukraine / 10,144 / 0.0 / 10,025 / 0.0 / 9,171 / 0.0 / 64,903 / 0.1 / 7,762 / 0.0
Czech / 2,970 / 0.0 / 2,935 / 0.0 / 2,935 / 0.0 / 99,332 / 0.1 / 7,025 / 0.0
Belgium / 489 / 0.0 / 513 / 0.0 / 532 / 0.0 / 527 / 0.0 / 550 / 0.0
Austria / 972 / 0.0 / 967 / 0.0 / 414 / 0.0 / 369 / 0.0 / 337 / 0.0
Slovakia / 118,800 / 0.1 / 117,400 / 0.1 / 0 / 0.0 / 0 / 0.0 / 0 / 0.0
Total investments / 93,297,307 / 100.0 / 99,636,735 / 100.0 / 103,270,310 / 100.0 / 106,601,281 / 100.0 / 104,830,057 / 100.0

Annex 4

Gross premiums written and gross claims paid by life insurance companies

Item / 2001 / 2002 / 20031
lats / % / lats / % / lats / %
Gross premiums written
/ 4,708,794 / 100 / 5,709,250 / 100 / 7,517,811 / 100
Life insurance / 3,543,736 / 75 / 4,244,054 / 74 / 5,271,859 / 70
Accident insurance / 196,952 / 4 / 215,633 / 4 / 157,508 / 2
Health insurance / 542,514 / 12 / 914,373 / 16 / 1,601,607 / 21
Accepted reinsurance / 425,592 / 9 / 335,190 / 6 / 486,837 / 6
Gross claims paid / 2,511,382 / 100 / 2,582,273 / 100 / 4,296,277 / 100
Life insurance / 1,928,807 / 77 / 1,736,970 / 67 / 3,313,821 / 77
incl. surrender value / 304,898 / 12 / 500,476 / 19 / 431,864 / 10
Accident insurance / 183,245 / 7 / 45,174 / 2 / 48,605 / 1
Health insurance / 326,795 / 13 / 664,790 / 26 / 925,987 / 22
Accepted reinsurance / 72,535 / 3 / 135,339 / 5 / 7,863 / 0

1 Non-audited data.

Annex 5

Largest claims incurred by life insurance companies, broken down by class of insurance1

(lats)
Item / 2002 / 1st quarter / 2 quarters / 3 quarters / 2003
2003 / 2003 / 2003
Accident insurance / 11,482 / 8,000 / 929 / 1,000 / 5,520
Health insurance / 2,930 / 767 / 1,598 / 1,598 / 1,690
Life insurance / 66,021 / 30,134 / 266,810 / 533,580 / 533,580
Total / 80,433 / 38,901 / 269,337 / 536,178 / 540,790

1 Information is available since 31.12.2002.

Annex 6

Performance indicators for life insurance companies

Item / 2001 / 2002 / 20031
Earned net premiums2, lats / 4,204,498 / 5,048,457 / 6,675,113
Reinsurers' share in gross premiums written, % / 13.6 / 11.5 / 4.6
Net claims incurred3, lats / 2,295,779 / 2,425,909 / 4,763,281
Reinsurers' share in gross claims paid, % / 4.5 / 11.5 / 11.9
Available assets, lats / 11,661,836 / 12,731,970 / 11,244,068
Solvency ratio4, % / 2,031.0 / 1,727.4 / 1,267.4
Net technical provisions, lats / 9,833,113 / 11,899,661 / 14,414,718
Legitimate investments covering technical provisions5, % / 100.0 / 112.1 / 100.0
Return on investments6, % / 6.7 / 12.4 / 7.3

1 Non-audited data.

2 Earned premiums = written premiums – change in unearned technical provisions.

3 Incurred claims = claims paid + change in technical provisions for outstanding claims.

4 Solvency ratio = available assets/solvency margin.

Solvency margin is calculated in accordance with the Regulations on the Calculation of a Solvency Margin for Life Insurance Joint Stock Companies and Mutual Co-operative Life Insurance Societies approved by the Commission on 14 December 2001 and characterises the quantitative amount of risks covered by insurance contracts.

5 Legitimate investments covering technical provisions – investments complying with the restrictions set out in Articles 42 and 43 of the Law on Insurance Companies and Their Supervision.

6 Return on investments = net investments income/average amount of investments in period.


Annex 7

Cover for the technical provisions of life insurance companies and geographical breakdown of the cover

Investment structure of the cover

2002 / 2003
Type of investment / 31.12.2002 / 31.03.2003 / 30.06.2003 / 30.09.2003 / 31.12.2003
lats / %1 / lats / %1 / lats / %1 / lats / %1 / lats / %1
Land and buildings / 399,537 / 3 / 220,081 / 2 / 273,244 / 2 / 286,821 / 2 / 423,379 / 3
Investment certificates of investment funds admitted to trading by stock exchanges / 259,183 / 2 / 263,763 / 2 / 193,069 / 1 / 219,887 / 2 / 218,213 / 2
Equity securities admitted to the official list of stock exchanges except those mentioned in the previous item / 8,577 / 0 / 0 / 0 / 29,023 / 0 / 0 / 0 / 12,657 / 0
Debt securities issued by the State and local governments / 6,499,840 / 55 / 7,159,140 / 55 / 7,012,031 / 52 / 7,390,507 / 53 / 7,378,494 / 51
Debt securities admitted to the official list of stock exchanges / 171,190 / 1 / 262,160 / 2 / 179,191 / 1 / 336,603 / 2 / 337,854 / 2
Mortgage bonds / 947,841 / 8 / 1,190,078 / 9 / 1,062,682 / 8 / 1,114,740 / 8 / 889,358 / 6
Mortgage loans / 10,981 / 0 / 0 / 0 / 0 / 0 / 0 / 0 / 8,077 / 0
Time deposits with credit institutions / 4,538,197 / 38 / 3,520,834 / 27 / 3,897,136 / 29 / 4,056,454 / 29 / 4,689,560 / 33
Claims on credit institutions / 171,922 / 1 / 124,535 / 1 / 926,003 / 7 / 567,047 / 4 / 445,210 / 3
Debts of policy holder debtors from direct insurance operations2 / - / - / 55,252 / 0 / 22,403 / 0 / 11,916 / 0
Securities not publicly traded 3 / 330,483 / 3 / 288,006 / 2 / - / - / -
Total investments / 13,337,751 / 112 / 13,028,597 / 100 / 13,627,631 / 101 / 13,994,462 / 100 / 14,414,718 / 100
Net technical provisions / 11,899,661 / 100 / 13,028,598 / 100 / 13,452,618 / 100 / 13,994,462 / 100 / 14,414,718 / 100

1 Cover for technical provisions as a percentage.

2 Allowed to be used as cover for technical provisions from 15 April 2003.

3 Not allowed to be used as cover for technical provisions from 15 April 2003.

Geographical breakdown of the cover

2002 / 2003
Placement / 31.12.2002 / 31.03.2003 / 30.06.2003 / 30.09.2003 / 31.12.2003
lats / % / lats / % / lats / % / lats / % / lats / %
Latvia / 13,224,247 / 99.1 / 12,826,335 / 98.4 / 14,435,315 / 98.9 / 13,841,926 / 98.9 / 14,105,486 / 97.9
Lithuania / 113,504 / 0.9 / 116,249 / 0.9 / 120,441 / 0.8 / 115,566 / 0.8 / 273,481 / 1.9
USA / 0 / 0.0 / 86,013 / 0.7 / 37,745 / 0.3 / 36,970 / 0.3 / 35,751 / 0.2
Total investments / 13,337,751 / 100.0 / 13,028,597 / 100.0 / 14,593,501 / 100.0 / 13,994,462 / 100.0 / 14,414,718 / 100.0

Annex 8

Investment structure of life insurance companies and their geographical breakdown

Investment structure

2002 / 2003
Type of investment / 31.12.2002 / 31.03.2003 / 30.06.2003 / 30.09.2003 / 31.12.2003
lats / % / lats / % / lats / % / lats / % / lats / %
Land and buildings / 399,537 / 1.4 / 443,007 / 1.5 / 481,970 / 1.6 / 700,892 / 2.3 / 764,061 / 2.5
Shares and other variable-yield securities / 3,933,299 / 13.7 / 4,000,300 / 13.2 / 4,042,639 / 13.7 / 4,602,532 / 15.1 / 6,245,013 / 20.4
Debt securities and other fixed-income securities / 15,745,344 / 54.8 / 16,658,422 / 55.1 / 15,764,731 / 53.6 / 16,360,539 / 53.5 / 16,265,981 / 53.2
Investment shares in investment pools / 1,399,020 / 4.9 / 1,419,088 / 4.7 / 1,439,909 / 4.9 / 1,454,984 / 4.8 / 0 / 0.0
Mortgage loans and other loans / 303,237 / 1.1 / 666,128 / 2.2 / 61,377 / 0.2 / 62,802 / 0.2 / 64,748 / 0.2
Time deposits with credit institutions / 6,558,480 / 22.8 / 6,539,122 / 21.6 / 6,466,640 / 22.0 / 6,507,113 / 21.3 / 6,362,878 / 20.8
Other investments / 41,373 / 0.1 / 30,561 / 0.1 / 29,561 / 0.1 / 29,188 / 0.1 / 29,188 / 0.1
Claims on credit institutions / 373,002 / 1.3 / 473,727 / 1.6 / 1,117,864 / 3.8 / 855,312 / 2.8 / 834,956 / 2.7
Total investments / 28,753,292 / 100.0 / 30,230,355 / 100.0 / 29,404,691 / 100.0 / 30,573,362 / 100.0 / 30,566,825 / 100.0

Geographical breakdown of investments

2002 / 2003
Placement / 31.12.2002 / 31.03.2003 / 30.06.2003 / 30.09.2003 / 31.12.2003
lats / % / lats / % / lats / % / lats / % / lats / %
Latvia / 28,215,229 / 98.1 / 29,599,803 / 97.9 / 28,832,572 / 98.1 / 29,530,878 / 96.6 / 29,250,427 / 95.7
Denmark / 0 / 0.0 / 0 / 0.0 / 0 / 0.0 / 488,723 / 1.6 / 508,384 / 1.7
Germany / 313,632 / 1.1 / 322,465 / 1.1 / 337,741 / 1.1 / 332,187 / 1.1 / 374,696 / 1.2
Lithuania / 148,239 / 0.5 / 151,344 / 0.5 / 120,442 / 0.4 / 115,566 / 0.4 / 323,584 / 1.1
Finland / 66,622 / 0.2 / 63,559 / 0.2 / 66,703 / 0.2 / 67,901 / 0.2 / 70,946 / 0.2
USA / 0 / 0.0 / 86,013 / 0.3 / 37,745 / 0.1 / 36,970 / 0.1 / 35,751 / 0.1
Estonia / 8,597 / 0.0 / 6,204 / 0.0 / 9,074 / 0.0 / 768 / 0.0 / 2,700 / 0.0
Austria / 972 / 0.0 / 967 / 0.0 / 414 / 0.0 / 369 / 0.0 / 337 / 0.0
Total investments / 28,753,291 / 100.0 / 30,230,355 / 100.0 / 29,404,691 / 100.0 / 30,573,362 / 100.0 / 30,566,825 / 100.0

Annex 9