Policyholder Service Department Report

Transcription

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Table of contents
1
Letter from the Chairman
3
Board of Directors 5
Management Team 6
Group Companies and Main Business Areas 9
Financial environment and Group earnings
12
At Policyholders’ Service 15
Social Commitment 22
Corporate Values
27
Divina Pastora and Athletics 29
Team of Professionals
32
Technology 36
Branch Network 38
Policyholder Service Department Report 41
Consolidated Annual Accounts 57
Consolidated Audit Report 58
Consolidated Profit and Loss Statement 60
Consolidated Statement of Changes in Net Assets 65
Statement of Cash Flows for the Parent Company 68
Consolidated Report 70
Appendix 126
Consolidated Management Report 146
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Letter from the Chairman
3
As every year it is a pleasure to address our policyholders to notify them of the financial results and business
at the Divina Pastora Group for 2009 in this publication.
The financial crisis deepened throughout the year, affecting all business sectors. The insurance market was
no exception. However, beyond this and despite the difficult financial setting, I would like to once again stress
the Group’s financial strength on its 53rd anniversary in 2009, producing positive earnings for another year.
Our prudent investment policy means we are able to feel confident in the face of the national and international
crisis and maintain excellent solvency levels. Further, we offset the blows caused by the recession in the
Spanish economy, reduced consumer spending and the present unemployment rate with solid serious
management seen in net earnings after tax of 3,74 million euro, almost 80% higher than in 2008, leaving
the Company with net assets at 156,3 million euro.
These numbers show a good present and a hopeful future for the Divina Pastora Group, but above all a
guarantee for our policyholders with whom we fulfil our commitment year on year to show our underlying
values: quality, efficiency and speed in service.
We carried out a major push in 2009 to provide our different departments with greater human and technical
resources so as to further drive the growth phase the Group is experiencing, totalling a business volume
of 146,619 million euro - 11.7% above last year. It is precisely the solid management and loyalty of our
policyholders that allow us not only to face any difficult situation but also continue on our determined
strategy of product and marketing channel diversification that began some years ago.
Although this annual report contains a lot of information, projects, events and all types of details setting
out the Company’s trajectory, I would like to highlight here Divina Pastora’s social vocation of which we are
especially proud. A commitment that gave rise to the Mutualidad 53 years ago and which we must maintain
and strengthen today in all our decisions. Proof of this was seen in the merger with Mutualdis, Mutualidad
de previsión social pro personas con discapacidad, which began at the start of 2008 and was approved by
the Directorate General for Insurance in August 2009. This operation fulfils one of Divina Pastora’s main
principles — helping those less fortunate in society.
Lastly, I would especially like to thank the continued trust our policyholders place in Divina Pastora and
which helps us to continue moving forward. I would like to extend these thanks to the workers, collaborators,
management team and board of directors at the Group for their permanent commitment, dedication and
professionalism.
D. Armando Nieto Ranero
Chairman
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Board of Directors
5
Armando Nieto Ranero
Chairman
Ernesto Martínez Blasco
Secretary
Luis Munar Durán
Deputy Chair 1
Rosa Bosh Zuriaga
Deputy Chair 2
Luis de Bago Ruiz
Member
Cristina Martínez Tarazona
Member
José Luis Navas García
Member
Pedro Otón Hernández
Member
6
Management Team
Armando Nieto Ranero
Roberto Navarro Alfaro
Chairman
Head of IT and Telecommunications
• Born in Corunna in 1969. He is a graduate
in Theoretical Physics and IT, Economics and
Accounting and Finance and holds a Masters in the
Stock Market and Finance. He also holds the title
European Expert in Financial Investments (C.I.I.A.).
• He is a full member of the Institute of Spanish
Actuaries. He was an Associate Lecturer in the
Department of Mathematics for Economics at the
University of Valencia and worked on Research
and Development projects in the area
of Telecommunications, Chemical Engineering
and Nuclear Engineering.
• He regularly attends conferences and seminars
given at institutions such as the Financial Institute
of New York, the Actuaries Association of Catalonia,
INESE, Wolfram Research, etc. He has published
scientific articles and given conferences at the
University of Valencia, Sociedad Nuclear Española,
International Congress of Actuaries, etc.
• He joined Divina Pastora Seguros in 1997. Since then,
he has held management posts in Organisation,
Actuary and Financial Services, and IT.
Natividad García Guillén
Head of the Financial Department
•Born in Valencia 1977. She is a graduate in
Business Administration and Management.
She is an Auditor of the Official Record
of Accounts Auditing.
•She regularly attends seminars given by institutions
such as INESE, the Institute for International
Research, the University of Valencia, etc.
•She was the Audit Team Manager at Ernst & Young
for 5 years, and a Manager at the same company
for 3 years.
•She joined Divina Pastora Seguros in 2007
as Internal Control and Audit Director.
•Born in Valencia in 1951.
He is a graduate in Public Relations.
•He holds several diplomas certified by IBM in
programming languages, application analyses
and project management.
•He was the head of Development, Systems and
Communications at Oscar Mayer for 13 years.
•He joined Divina Pastora Seguros in 1985 and
has always been linked to management tasks
in the Department of IT.
Ramón Pérez Jiménez
Technical Director
•Born in Alcázar de San Juan (Ciudad Real) in
1969. He is a graduate in Economics, Actuary
and Financial Sciences, Technical Engineer in
IT. Masters in Financial and Tax Administration,
Masters in the Stock Market and Finance, European
Expert in Financial Investments (C.I.I.A.).
•He is a full member of the Institute of Spanish
Actuaries. He was an Associate Lecturer in the
Department of Mathematics for Economics at the
University of Valencia.
•He regularly attends conferences and seminars
given by institutions such as the Association of
Actuaries of Catalonia, INESE, the University of
Valencia, etc.
• He joined Divina Pastora Seguros in 1994 and has
held management posts in branch management,
internal auditing and insurance actuary.
Management Team
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Marta Navarro Garrote
Manuel Pinazo Blanco
Head of the Legal Department
Head of Marketing
• Born in 1974. She is a graduate in Law winning her
the extraordinary award on her degree programme.
• She holds a certificate in international legal English
from the University of Cambridge.
• Having worked for twelve years at the prestigious
Uría & Menéndez practice and a lecturer in Labour
Law on the MBA at the EDEM Foundation, she
regularly gives talks at seminars and has written
several articles for renowned magazines and
periodicals (Lexnova, Expansión, etc.).
• She joined Divina Pastora Seguros in January 2009
as Head of the Legal Department.
Luis Clavel Padró
Head of Human Resources
• Born in Valencia in 1969. He is an Industrial
Engineer and holds a Masters in Executive Business
Management.
• He is a regular speaker at international conferences
on telemarketing, as well as a collaborator at
different quality institutions.
• He was responsible for Customer Management
at the Aguas de Valencia Group for 10 years, having
led international implementation projects in the
commercial Latin American market.
• He joined Divina Pastora Seguros in 2006 as
Commercial Director, working before as an external
consultant in implementing the Call Centre.
Ernesto Martínez Blasco
Head of the Organisation Department
•Born in Barcelona in 1965. He is a graduate in Law,
holds a Masters in Community Law in Brussels and
a Masters in Executive Management from ESADE.
•He is Associate Lecturer in Community and
Constitutional Law at the University Jaume I of
Castellón.
•He regularly attends seminars and conferences on
Labour Law and Human Resources Management.
He was director of the CEOE Department and legal
consultant of the Astoria Foundation for 3 years.
•He joined Divina Pastora Seguros in 1994. His work
has been linked to the Personnel Department from
its beginnings.
•Born in Valencia in 1962. He is a graduate in
Economics and Actuary and Financial Sciences.
•He regularly attends seminars given by institutions
as the Spanish Quality Agency, the Association
of Actuaries of Catalonia, the University of Valencia,
INESE, etc.
•He was an Administration Manager at professional
offices for 8 years.
•He joined Divina Pastora Seguros in 1998, having
been a branch administration manager and head
of the Telephone Service Department.
Management Team
8
Luis Munar Durán
Jose Vicente Moreno Márquez
Head of General Services Department
Head of Department
Money-Laundering Prevention
•Born in Ceuta in 1964. He is a graduate in Law.
•He is a specialist in Civil Liability from the Antonio
Naya School of Legal Practice (Malaga), holds a
Masters in Security and Defence, the Certificate
in Terrorism Studies from St. Andrews University
(Scotland). He is a Graphologist as well as a qualified
pilot.
•He has belonged to the Association of Specialist
Lawyers in Civil Liability and the Association for
the Study of Community Law (ADECOM). He was
an insurance agent for Santa Lucía, Commercial
Inspector at FIATC and head of the external network
at Eagle Star Vida S.A.E. He has published articles
in newspapers such as Las Provincias, Diario Sur
(Malaga), Tribuna de Castilla y León, and the
Financial Newsletter at the Club de Inversión
Mobiliario in Valencia.
•He joined Divina Pastora Seguros in September
1996 as Regional Manager in Malaga,
having worked in the Commercial Department
and Legal Department.
Elena Durbá Alepuz
Head of Internal Control and Auditing
• Born in Valencia in 1979. She is a graduate in
economics from the University of Valencia.
• She holds a Masters in Accounting and Accounts
Auditing from the Centro de Estudios Financieros in
Valencia, 2004/2005.
• She gained a Masters in Management and
Accounts Management from the Centro de Estudios
Financieros in Valencia in 2008/2009.
• She worked at Gasso y Cía Auditores y Censores, S.L.
for a year as a junior auditor and at Ernst&Young for
2 years, becoming Team Leader.
• She joined Divina Pastora Seguros in September 2007
as a member of the Internal Control and Auditing
Department, later becoming the Department’s head.
•Born in Valencia in 1966. He is a graduate in Law
and holds a Masters in Town Planning Law from the
Centre for Financial Studies.
•He joined Divina Pastora Seguros in 1989 and has
held management posts in difference company
departments.
Ángela María Colomer Lorente
Head of Healthcare
• Born in Valencia in 1976. She is a graduate
in Actuary and Financial Sciences and holds
a Diploma in Business Studies and a Masters
in Financial Management.
• She is a full member of the Institute of Spanish
Actuaries.
• She regularly attends conferences and seminars at
institutions such as INESE, the University of Valencia,
ESIC, etc.
• She has held Actuarial and Commercial Services
positions at insurance companies and posts of
responsibility in administrative and accounting
departments at companies in the industrial sector,
as well as being Financial Director at a renewable
energy company.
• She joined Divina Pastora Seguros in 2008
as an insurance actuary.
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Group Companies
and Main Business Areas
BUSINESS ORGANISATION CHART
The merger of Mutualidad Divina Pastora and Mutualdis (a company focused on providing insurance services
for those with mental disabilities) was enacted via public deed in August 2009, after having been authorised
by the Directorate General for Insurance and Pension Funds.
2009 saw work done on the integration of Cisne Aseguradora, S.A., a company where 92.82% of stock was
purchased in July 2008. In turn, major work was performed in managing health products at the Company so
as to provide appropriate service for policyholders.
Divina Pastora
Seguros
Mutualidad
Fundación
Divina Pastora
Divina Pastora
Seguros Generales
SAU. (100%)
Cisne Aseguradora,
S. A. (92,82%)
Gesmutual
Inmobiliaria
(100%)
Viajes Divina Pastora,
S.A.U.
(100%)
As of 31st December 2009, the Group comprises the following companies:
Mutualidad General de Previsión del Hogar Divina Pastora Mutualidad de Previsión Social a Prima Fija
This is the Divina Pastora Group parent company centred on life, accident and health insurance which has
experienced major growth in recent years.
Company name: Mutualidad General de Previsión del Hogar Divina Pastora Mutualidad de Previsión Social a Prima Fija.
Foundation date: 15th March 1957.
Business: Private Life, Accident and Health Insurance.
Group Companies and Main Business Areas
10
Divina Pastora Seguros Generales, S.A. Unipersonal (formerly Alianza Médica)
A company 100% acquired in 2007.
Company name: Divina Pastora Seguros Generales, S.A.U.
Foundation date: 20th October 1945.
Acquisition date: 3rd May 2007.
Business: Health and Life Insurance.
The Directorate General for Insurance and Pension Funds authorised Divina Pastora Seguros Generales, S.A.U. to
operate in the areas of accidents, diverse pecuniary losses and legal defence on 4th December 2009.
The extended company purpose to incorporate these additional areas was enacted in public deed on 19th January
2010.
Cisne Aseguradora, S.A. Compañía de Seguros y Reaseguros
Divina Pastora Seguros acquired 92.82% of this company in July 2008, thus becoming its majority shareholder.
Company name: Cisne Aseguradora, S.A. Compañía de Seguros y Reaseguros.
Foundation date: 1st March 1891.
Acquisition date: 18th July 2008.
Business: Accident, Sickness, Life, Legal Services and Healthcare Insurance.
Ministerial Order dated 9th December 2009 authorised the total transfer of the Cisne Aseguradora S.A. Compañía
de Seguros y Reaseguros portfolio to Divina Pastora Seguros Generales, S.A.U.
Gesmutual Inmobiliaria, S.A. Unipersonal
This company was founded with the aim of focusing on the real estate business which was included before in
Divina Pastora Seguros.
The real estate market situation has not affected the Group significantly since it has always been prudent in this
business area. In this way, no new real estate developments have been started, leaving the land undeveloped in
expectation of sector improvements.
Company name: Gesmutual Inmobiliaria.
Foundation date: 11th January 2003.
Business: Property development.
Group Companies and Main Business Areas
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Viajes Divina Pastora, S.A. Unipersonal
This company was founded so as to offer an additional service for policyholders with the chance to book holidays
at a significant discount and a customised service at their travel agency.
Company name: Viajes Divina Pastora.
Foundation date: 7th October 2005.
Business: Travel agency.
Fundación Divina Pastora
The mission of this institution is to perform different types of charity work.
Company name: Fundación Divina Pastora.
Foundation date: 12th February 2004.
Business: Charity work.
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Financial environment
and Group earnings
2009 was marked by a complicated financial situation due to the crisis in Spain and, in general, most other
countries to a greater or lesser extent.
Several fundamental aspects to the financial environment need to be looked at to study the evolution of the
Divina Pastora Group and the wider insurance sector, crucially influencing:
• Low interest rates.
• High unemployment rates leading to reduced consumer spending in families.
• High levels of company failures due to complicated financial situations leading to high unemployment levels
and, therefore, reduced spending at both companies that fail and their workers. This has a chain effect
affecting suppliers.
• Financial scandals linked largely to financial institutions and uncertainty with regards to some countries
causing consumer lack of confidence in the sector and a change from a consumer mentality to a savings
mentality amongst those with resources.
The insurance sector experienced major uncertainty basically linked to investment levels at some insurance
companies where adjustments were made due to volatile stock markets; this had a greater effect on those
institutions whose investments were in equity or those which were unable to maintain investment maturity and
had to offload them, taking hits which, at times, were considerable.
In addition, the starting position where real estate investments were a major holding at many insurance
companies affected balance sheets through reduced values for these assets. At present there is practically
no market for these assets which must remain fixed on company balance sheets awaiting real estate sector
recovery allowing them to be sold and converted into treasury.
Within this scenario and according to provisional data at the Directorate General for Insurance and Pension
Funds for 2009, total business volume for the insurance sector in Spain grew 1.56% (the CPI in 2009 came in
at 0.8%). Within this performance, which was maintained with regards to 2008, there was a premium volume
increase in the life branch of 5.68% over last year, whilst the non-life sector saw a 2.33% decline. This differs
from sector performance in 2008 over 2007 since non-life premiums increased by 2.40% and 15.5% for the
life sector.
The explanation behind this different performance from one year to another is the fall in consumer spending
which directly affected non-life insurance and less available resources for saving in families, linked to the
uncertainty and distrust of the sector leading to lower growth in the life branch.
Within this framework, Divina Pastora Seguros, solely taking the Group parent company due to the changes
in the consolidation sphere not allowing a reasonable comparison between 2008 and 2009 with regards to
the consolidated accounts, generally saw a 6.4% reduction in business volume, breaking down into 5.7%
for the life branch and 0.7% for non-life, which in the case of Divina Pastora Seguros solely corresponds to
accidents. This last reduction is much below that seen in the accident branch for the sector which oscillated
around 4.8%.
With regards to the accident rate, whilst the life branch for the insurance sector in general saw a decline of
1.8%, Divina Pastora Seguros experienced a 3.7% increase due to the increased savings plan redemptions. In
turn, non-life accident rates at Divina Pastora Seguros fell 14.2%, over the 0.38% for the sector.
Financial environment and Group earnings
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With regards to Divina Pastora Group financial performance, the consolidated earnings after tax in 2009 rose to
3.74 million euro, whilst in 2008 earnings rose to 2.09 million, thus seeing a positive performance over the last
year.
In this sense, the main changes in 2009 over the previous year with regards to the consolidated accounts were as
follows:
• The consolidation sphere saw the incorporation into the Group of the subsidiary Cisne Aseguradora S.A.
Compañía de Seguros y Reaseguros with a 92.82% holding; this company was in a complicated financial
position at the end of 2009 due to negative earnings of 11.88 million euro for the period which, alongside the
negative earnings in 2008, led to net equity at the subsidiary showing a negative figure of 20.43 million.
• Divina Pastora financial statements incorporate the merger with Mutualidad de Previsión Social Pro Personas con
Discapacidad a Prima Fija (Mutualdis) in 2009, whose merger process finalised last August 2009.
All these arguments show the image of a solvent company with consolidated results over time and able to face
complicated market situations such as those experienced in the last two years.
The financial crisis of 2009 affected the Group, as it did the entire insurance sector, with regards to difficulty in
attaining higher production levels; however, investments were not affected by the market situation. Firstly, thanks
to the prudence in Divina Pastora Group investment policy, as well as the internal resources it has; this, as always,
meant investments were held to term without having to make them liquid in order to make payments.
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At Policyholders’ Service
Divina Pastora continued to show for another year
that policyholders are its basis and raison d’être.
Fulfilling the commitment to respond to them when
they most need it is the Mutualidad’s ultimate goal,
as well as finding them the best solution to their
needs. All this through higher service quality and
maximum cover at a competitive price.
Improving further policyholder service was one
of Divina Pastora Group’s major commitments
over the year. Resources were increased in every
department, both those with direct client contact and
those over the phone or the commercial network,
and in other areas, since good performance within
the Organisation leads to service excellence.
Quality and Continuous
Development
One of the clearest examples of this continuous
growth is the evident improvements in direct
permanent communication with policyholders. In this
sense, 2009 is characterised by the implementation
and development of management systems over
the previous year to truly attain the new service
challenges in the recently acquired branches for the
Group, all in accordance with the rigorous service
provided in the traditional business.
Specifically, the acquisition of the Health branch led to
the necessary creation of an internal service structure
and later management with the implementation
in IT systems of all data corresponding to Health
contracts from the integrated company so as to be
managed from a single application. As is logical,
the process required updated training for the units
responsible, as well as an adjustment in technical
and human resources.
The recording, assessment and possible payment
of all invoices that, due to health insurance, affect
health providers were transferred to this call centre
operating 24 hours a day 365 days a year at the
start of the year.
15
To do this, a specialised department was created to
record invoices by medical area, thus allowing for an
exhaustive study of the accident rate and rigorous
control of service and its appropriateness for current
policies. This department was supervised by two
people in permanent contact with the medical
department, resolving those issues requiring
qualified intervention. In total, the recording of
387,386 invoiced medical acts took place in 2009.
In turn, an area managing service incidents generated
by this type of contract was given resources, both
with regards to lack of service by certain medical
centres and to obtaining information on specialities
covered and service by geographic area.
Gradually, and as the months went by, the
Organisation standardised the integration of the
Health branch allowing a study of the sales possibility
of this type of product to commence. In any case,
the review and publication of the full medical service
in the province of Madrid was performed, then sent
out to all policyholders with this policy type.
The policyholder service centre took over the entire
ordinary management for Health contracts in the
first quarter of 2009, as well as the respective
authorisations. This meant a major effort in terms
of training and adapting IT systems, shown in the
70,893 authorisations and 87,988 calls dealt with.
With regards to the traditional business, understood
as the commercial business related to usual
products and known by Divina Pastora policyholders,
a rationalisation process for tasks aimed at adopting
an optimum structure to achieve service excellence
and process quality was begun.
For this, service by business area was
compartmentalised, creating highly qualified
specialists allowing effective and efficient management
for tasks and resources. Equally, a process of some
task decentralisation was started to take advantage
of the resources at the different administrative units,
giving offices more independence, as a good service
channel for the future.
16
The telemarketing unit created last year as a direct sales
channel, mainly for Bereavement products, was consolidated
in 2009. After the good results since beginning operations
in April 2008, this area was strengthened and extended
with technical and human resources in line with its growth
capacities. Fifteen individuals and two supervisors perform
cross-selling from 9am to 9pm, Monday to Friday. Production
at the unit continued to grow whilst contract expiry came in
at 8.6%, slightly above 2008, mainly due to the worsening
financial crisis.
Policyholder Service
This year maintained the downward line started in 2008
with regards to claims received due to disagreement with
the assigned benefit and opened files. 2006 saw 939 files,
reducing to 738 in 2007, 701 and 2008 and 690 in 2009.
Of these, 630 were from the Mutualidad, 57 from Cisne
Aseguradora and 3 from Divina Pastora Seguros Generales.
There was, therefore, an 8% reduction at the Mutualidad.
In turn, complaints ran to 244, spread as such: 36 from
the Mutualidad, with a notable decrease over the previous
year which closed with 66; 192 from Cisne, much lower
than those received in 2008, and 16 from Divina Pastora
Seguros Generales.
90% of claims are due to disagreement with decisions
taken on Temporary Incapacity benefits due to Accidents
(428) and Surgical Intervention (141), of which 131 and
28 were respectively admitted. This means that in the latter
instance the percentage of company-adopted decision
reviews remains below 20% (19.85%).
The information shows a continued decrease in reviews of
prior decisions due to the clear operational improvement
of the Benefits Department whose medical staff are
integrating their professional decisions thoroughly; they are
only nuanced at times as part of the special policyholder
protection and this never intends to correct professional
decisions made by the medical professional who has greater
knowledge and expertise.
The best protection
in personal insurance
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Personal Insurance
Divina Pastora continues to strengthen its specialisation
and competitiveness in “Personal Insurance”. As well as
the integration of new products and services from the
acquired companies over recent years, it continues to
work on its outstanding commitment to policyholders
to offer them the best solutions for their needs at the
best price on the market.
Year after year, the Group offers all types of products
and services in an ever more complete range tailored
to different types of public. Nonetheless, all these are
aimed at protecting what is most valuable – people –
and offering the best sector facilities and guarantees:
from Personal Multi-risk, a unique product on the market
with great flexibility in price and covering accidents due
to any activity – both professional and private; Life and
Invalidity, where policyholders are covered from the
first day without any exclusion period; the Savings/
Retirement Plan, with guaranteed income, security,
flexibility, transparency and advances in advantages
conditions; Family Bereavement Assistance, with the
possibility of choosing between an economical adjusted
amount or paying only till age 65; Health, offering a
complete medical service, or the Freelancer product
which guarantees financial benefits from the first day of
sickness and up to 18 months of cover.
All these Personal Insurance policies contain very
specific features that are especially attractive, as well
as the extraordinary price/cover ratio, making them
highly competitive products and services in the sector.
Proof of this is the increase, for example, of 14.7% in
the sales of Life insurance policies or the growth in
policyholders with Bereavement at 41.7% in its second
year of marketing.
This is similar to the Sports Insurance which in 2009
celebrated its second anniversary with figures showing
the wide acceptance it has amongst organisers of
amateur races. Specifically, the Sports Insurance came
about from the many sponsorship activities Divina
Pastora carries out in the athletics and road race world,
with 153,954 amateur runners benefitting from it at
113 events, triple the number in 2008, where it insured
33 races and 49,920 participants.
18
New Offices
Continuing in line with recent years, Divina Pastora extended
its presence in Spain in recent years and 2009 saw the
extension of direct and personal client service in two new
offices. Specifically, this year saw the opening of offices in
Lugo and Santiago de Compostela.
These two openings make Galicia one of the autonomous
communities with the highest Group presence through
its six offices: Corunna, Pontevedra, Lugo, Santiago de
Compostela, Tui and Vigo.
These new openings meant the Divina Pastora Group had 48
offices spread over 14 of the 17 autonomous communities
in Spain in 2009.
In addition to the openings of the two Galician offices, due
to the continuous growth of the Company and its resources
and the intention to improve policyholder service, the
Gijón office moved to a bigger location, whilst the offices in
Madrid and Bilbao were extended to house all incorporated
technical and human resources.
Personal Exclusive Service
Personal, up-close and exclusive service is a maxim
for the Divina Pastora Group. In fact, one of the things
setting it out from other sector companies is just this. This
feature, however, is not exclusive to Divina Pastora and its
policyholders through the customer service department,
the commercial network or the branch network; it is also a
feature, for example, of Viajes Divina Pastora.
This exclusive, preferential and tailored customer service
is the added value of the Group’s travel agency and what
marks it out in the sector. It does not just book trips but
advises on travel and tries all methods to find the solution
to requirements at the best price. In addition, Divina Pastora
Group policyholders benefit from the added value of
discounts.
2009 was the fourth year in business for Viajes Divina Pastora,
marked, as is to be expected, by the general financial situation;
nonetheless, it organised both holiday and corporate trips for
3,367 individuals, including both customers from the Divina
Pastora Group and external companies.
Offices network
in constant
increase
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19
Solidity
The rigorous internal control to avoid and resolve
possible risks of any type which the Company comes
up against and the professionalism of the staff spread
across different departments are the main business
strengths of Divina Pastora.
Its corporate values and the competitive environment
ensure the company seeks excellence in internal
operations. Logically with the aim that this continuous
perfecting leads to service quality for policyholders.
The Internal Control and Audit department at the
company, with its special independence in the year to
perform its duties with regards to other areas, is there so
that all excellence criteria, alongside the intrinsic values
at Divina Pastora such as honesty and transparency, are
fulfilled with greater normality.
Its responsibilities for internal control were extended in
2009, now covering all Divina Pastora Group companies.
In this sense, the internal audit section is responsible
for supervising transactions carried out at the Company
of the contract by administration staff ended as
through a process and regulations control; visits to
incidents, four serious, whilst 193 were classed as
different offices to review obligatory legal stipulations
errors, 71 serious and 128 slight.
are fulfilled onsite, as well as internal regulations; and
the research and production of incident reports so as
to clarify possible situations that go against the law or
In turn, the Internal Control Department received 69
departmental incidents, 31 ending as an incident, and
internal regulations.
the Department opened 23 audit cases over the year,
The Department, in addition to ensuring compliance
which normally leads to a more thorough analysis.
with the quality criteria a company such as Divina
Pastora should adhere to, promotes the efficiency and
effectiveness of all internal and external processes
carried out and sets the parameters allowing correct
performance thereof to be controlled. Its annual report,
generally due to the prior detection of an incident
Most cases were linked to manipulation or falsification
of medical reports provided to receive benefits, around
80% ending with the policyholder being dropped by
the Executive Committee.
sent to the Board of Directors for it to be sent by the latter
The Organisation has handwriting experts for document
to the Directorate General for Insurance and Pension
analysis who rigorously look at all these cases, as well
Funds, assesses the compliance and effectiveness of
as internal doctors in the Benefits area collaborating
said internal control procedures. In short, it is a clear
decisively in detection, analysis and supervision tasks
effective mechanism working on policyholder service
for reports.
quality, since one of the functions is to propose internal
changes based on possible incidents.
The collaboration of different hospitals and health
centres is also very important for the Company as they
In 2009, the “audit box” received 568 commercial
issue original medical reports to resolve cases. Several
incidents through the Call Centre area from personal or
instances of fraud by policyholders were detected
telephone contact with policyholders. Only 43 of all of
through these investigations, where the former received
them corresponding to the commercial network during
or tried to receive benefits not corresponding to them
the sales process or during administrative management
through report manipulation or falsification.
20
Internal release of all these detected incidents made all staff
members aware; in this way, agents can transmit this in the
personal policyholder service. Proof of this is the considerable
incident reduction in 2009 over the previous year.
In turn, the periodic operational reviews continued for
different departments and visits to Company offices so as
to review facilities, ensure compliance with legislation in
the area of occupational hazards, document management,
policyholder service, etc. This occurred in 2009 at the
offices in Elche, Salamanca, Leon, Ciudad Real, Sabadell,
Jaén, Almería, Huelva, Lugo, Tui and Santiago.
In the same way, part of 2009 was invested in reviewing
certain internal company departments, based on a review
plan. These were Human Resources, General Services, IT
and Telecommunications and Organisation.
Communication and Transparency
These two terms are intimately linked for the Divina Pastora
Group which maintains its permanent communication and
information transparency commitment with employees,
policyholders and the media.
Customer contact is continuous at different company
departments. In the personal area, such as agents in the
commercial network and the offices themselves, over the
phone as with the Call Centre, or through communication
sent from different company areas.
Divina Pastora understands that the entire structure
(employees, policyholders, collaborators, etc.) should know
every step it takes. This is why in 2009, due in part to the
new different business issues and the integration of new
products, the Group issued many types of communication
releases (information on policies, invitations to events via
e-mail, regulations, commercial letters, other letters with
information on institutional decisions, etc.).
In the second half of the year, Divina Pastora Seguros began
to contact policyholders and users over the internet through
banners on portals, the corporate website, thematic blogs
or e-mail. These tools help it to perform many commercial
activities, strengthen brand presence and introduce the
Company to other members of the public.
Some of this communication refers to promotions aimed
at policyholders and the general public, through which
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Divina Pastora took several couples on holiday around
the world. Nearly 4,000 Divina Pastora policyholders
entered for the prize on the campaigns “Free summer
holiday” and “Free winter break” where winners could
choose between attractive destinations such as the
French Alps, Amsterdam, Jamaica, Lapland, Punta Cana,
Paris, New York...
The two national campaigns should be highlighted
from the promotions launched by the company to
the general public in 2009, following the same sports
sponsorship and support line Divina Pastora has had
for some time, “We have good news” and “We still
have good news”, released through different advertising
supports such as TV adverts, internet and other print
media. The first campaign saw two people have the
chance to accompany the Spanish Athletics Squad to
the World Outdoor Championship in Berlin, whilst the
second saw a further two people do the same to the
World Indoor Championship held in Doha (Qatar);
others went to London to run the famous marathon in
the British capital.
The company started a proactive approach to general
communication some years ago and has relied on
the media to promote its business. It is in permanent
collaboration with journalists and the media when they
try to access specific information referring to any Group
activity. In the aim of helping them in their work, it
issues press releases on the business, the foundation,
sponsorship events, organised events, assembly
agreements, awards received, etc. This information
transparency in all Group areas has increased the
presence of Divina Pastora in the media.
As well as the frequent communication and press
releases, the company organised several meetings
with media professionals and press conferences to
introduce projects or sponsorship events in 2009. This
was true for the Divina Pastora Valencia 10K amateur
race, the Challenge 10K BCN Divina Pastora Seguros,
the delivery of the cheque for what was collected at the
Divina Pastora Valencia 10K for UNICEF, the opening in
Santiago de Compostela of the race Circuito Corre con
Nos in Lugo, the Oscar Pereiro Charity Race, and the
presentation of the Adapted Sport Programme.
22
Social Commitment
From its foundation, social commitment has guided Divina
Pastora business. This was the reason it was founded in 1957,
when the company aimed to provide financial protection to
those most in need. Half a century later, it maintains this
commitment to policyholders, trying to offer the best cover
at the best price, and to society, mainly through the projects
and support of the Divina Pastora Foundation for different
organisations or for charity purposes.
Divina Pastora understands that it must go beyond the
business of an insurance company. Social work is a duty that
maintains the essence of the Mutualidad alive and that is
presently performed by the Foundation with many activities
in the area of care and of foundational aims:
• Care and social inclusion, with special emphasis on family
problems, old age and childhood in situations of invalidity,
widowhood and orphanhood.
• The promotion and assistance of people at risk of exclusion
due to physical, social or cultural reasons, especially those
with physical or mental disabilities.
• The promotion of social action, including social work,
charity work, health and health protection.
• The promotion of the social economy, which is particularly
significant as the company’s legal status is a friendly
society, a model institution for the social economy.
• Performing training and education, teaching and/or cultural,
sports, environmental, art and culture protection activities,
promoting teaching, training and research.
With regards to supporting disability, in 2009 the Fundación
Divina Pastora renewed its agreement with the University
of Valencia to promote and support the physical activity of
almost 700 students with some type of disability through the
Adapted Sports Promotion and Development Programme.
This programme remains very active over the year not only
thanks to the university’s management but also as it helps
to finance the competition of top-level extraordinary disabled
sportsmen and women nationally and internationally which
week in week out recall the importance of initiatives like this
one with their successes. The swimmer David Levecq, cyclist
Maurice Eckhard, judoka Mónica Merenciano, and athletes
Jessica Castellano, Miguel Ángel Arroyo and David Bravo,
all students at the University of Valencia, are a group of real
Social Commitment
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top-flight winners and are the tip of the iceberg for the
Adapted Sports Programme.
In the disabled section, the charity event held on 8th
November at the Auditori de Torrent was particularly
emotional where famous names in fashion, music
and the media came together to create the Pasarela
Alma catwalk involving people with cerebral palsy; all
money collected went to projects at the Fundación
Aixec. Designers such as Francis Montesinos, Dolores
Cortés, Álex Vidal, Alejandro Saez, Tonuca, Siglo Cero,
Noelia Navarro, Jaime Piquer, Antonio Moreno, Matilda,
Hannibal Laguna, Javier Mompó, Miquel Suay and Javier
Larraínzar, alongside the journalist Andrés Aberasturi
and the singer Sole Giménez, supported this initiative
promoted by the Fundación Divina Pastora and the
Fundación Aixec, amongst other institutions.
Another up-and-coming project at the Foundation is the
“Sustainability” Photography Competition which held its
first edition in 2009 with the most visited exhibition at
the Botanical Garden in Valencia where the forty best
works from the competition (judged by a prestigious
jury) were on display. Proceeds from the sale of all
these works went to the NGO PayaSOSpital which
stimulates and enlivens the life of children in hospitals
with serious illnesses in the region of Valencia.
This initiative organised by the Falla Borrull-Dr. Peset
Cervera, which this year started with the launch of the
second edition, fulfils two aims: cultural promotion and
environmental awareness and care for children.
The following are highlights from the activities performed
by the Fundación Divina Pastora in 2009:
• Collaboration with the Christmas Basketball
Tournament which intends to support different
adapted sports and was a homage to the sportsmen
and women after their marvellous performance at
the Beijing Paralympic Games.
• Signing the agreement with the University of Valencia
to develop sports at the university and helping train
six top-level national and international disabled
sportsmen and women.
• Collaboration with the Fundación Aixec at the 1st
Adapted Golf Tournament.
• Collaboration with the University of Valencia and
the Valencian Adapted Sports Federation at the 9th
FORUM for Sport held from 26th to 28th December in
the Conference complex and part of the ORTPROTEC
fair where 320 university students were registered.
Social Commitment
24
• The Adapted Sports Amateur Race held in Tenerife
with great participation rates.
• Pasarela Alma, an event promoted alongside the
Fundación Aixec where people with cerebral palsy
participated with amateur and professional models
in a catwalk sponsored by major national fashion
houses.
• Support for APANDA (Association for Parents of
Children with Hearing Problems) with their project
in Cartagena to create the first interactive visual and
technology space dedicated to hearing: the Aula de
la Audición (Hearing Room).
• The photography exhibition “De narices en el
hospital” (“Noses at the Hospital”) commemorating
the first ten years of work of the NGO PayaSOSpital
with which the Fundación Divina Pastora shares
many initiatives to try to achieve a better life for
children going through a hard time. The photography
exhibition was opened at the Bancaja facilities in
Valencia and, after touring several cities, closed in
the Valencian town of Rafelbunyol.
• A collaboration agreement with the Club Escuela
de Fútbol in Benimàmet created to help children in
the area by offering sport as an alternative. This is a
group with a high risk of social exclusion. At present,
the school has 10 football teams from youth to
children with around 110 children benefitting from
the programme.
• The announcement of the 2nd “Sustainability”
photography competition alongside the Falla BorrullDr. Peset Cervera. This new launch will see the
competition extend to a national scale and have two
prizes. The Environment Department at Valencia
City Council is collaborating. The NGO PayaSOSpital
and the Fundación Aixec will benefit from the sales
of the best works.
• The Fundación Divina Pastora, alongside the
Politécnica University and Solución CO2zero, was
also present at the Climate Change Conferences
in Alicante, Gandía and Alcoy, offering the talk “El
Cómic y su aportación al Cambio Climático” (“The
Comic and its contribution to Climate Change”), as
well as exhibiting the touring work “El Planeta nos
habla” (“The Planet Talks to Us”). The ‘Planet talks to
us’ exhibition has successfully toured around several
Spanish cities where 19 comic artists talk about
Climate Change and launch an optimistic message in
the face of said situation, showing possible solutions
such as the use of renewable energies, forests in all
their splendour and rivers full of fish.
Social Commitment
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• The Foundation also took this exhibition to the Science
and Climate Change Week (SECICA), organised in the
town of Gandía.
• The creation of the first Friendly Society and Social
Economy Bulletin BEMES, in collaboration with CIRIECEspaña. This monthly electronic publication is distributed
to nearly 35,000 readers.
• 12th Research Conference in Social and Cooperative
Economy held in Murcia from 24th to 26th June under
the banner “The Crisis as an Opportunity for the Social
Economy”. Divina Pastora Technical Director Ramón
Pérez attended the Round Table, defending in his talk
the “Contributions of Friendly Societies to the Social
Economy in Times of Crisis”.
• Participation at the 4th International Rulescoop Congress,
held in September in Montevideo (Uruguay) with a
talk from the Chairman of Fundación Divina Pastora,
Armando Nieto, at the Round Table “Autonomy and Selfmanagement in the Social Economy and the Different
Forms of Associativism”.
Solidarity
The commitment to the values defended by the company
starts with Divina Pastora workers themselves and one of
these commitments is to the environment. Many years ago
the company started to remove neon signs from offices
around Spain to reduce energy use and to make staff aware
of the importance of becoming a paperless company. In
recent years the reduction in paper use and its useless
storage was significant at both branches and the head
office. These measures also lead to financial savings for the
Group.
Social Commitment
26
Solidarity is one of the most rooted values at Divina Pastora and amongst its staff who, every year, get the chance
to donate the amount of the Christmas Hamper the Mutualidad distributes to the most needy. This year’s collection
went to Apadema with whom the Fundación Divina Pastora has collaborated on several occasions through different
projects.
The interest in helping those who really need it is ever more extended at Divina Pastora amongst all employees. The
chairman Armando Nieto personally took part in several charity events where the Foundation collaborated. Amongst
these, and as a pianist, he performed at the National Auditorium of Madrid at the Extraordinary Concert for Apadema
held in March and at the Pasarela Alma playing a piece by Mozart in November at the Torrent Auditorium.
In addition, Divina Pastora donated furniture from its offices to the Fundación La Casa Grande throughout 2009,
another institution working with those with disabilities.
Divina Pastora and its employees are especially proud of all these humanitarian and solidarity projects that help to
ease, as far as possible, some social imbalances. The company sees this task as an obligation and, therefore, will
continue performing it year in year out with the same drive.
For all this work in the social arena the company recognises as an obligation, the Fundación Asindown wanted to
award the Fundación Divina Pastora with one of its Solidarity Awards 2009 for its work in contributing to the full
development of those with Down’s Syndrome. An award collected by the chairman at the fifth edition of the charity
event held on 26th June.
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Corporate Values
The journey taken by Divina Pastora throughout its
history and all that remains to do is set out in very clear
corporate values: honesty in complying with social laws
and regulations, as well as those at the company itself;
efficient and effective service for policyholders; the
permanent promotion of training for staff so as to provide
better quality and enrich employees’ professional activity;
innovation as a sign of technological development and
the continuous effort in work to improve productivity
and service; defending sustainable development and
environmental protection, as well as transparency in
communication with staff and policyholders.
Proof of this is the successful presentation of this
year’s Annual Progress Report where Divina Pastora
renews its membership of the Spanish Network for the
United Nations Global Compact, an Association whose
main aim is to attain voluntary commitment in social
responsibility at companies in the network through the
implementation of Ten Principles based on Universal
Conventions and Declarations of Human Rights,
Workers’ Rights, the Environment and Development,
and Fighting Corruption.
With the presentation of the documents in the Progress
Report, which assesses the commitment of the
member companies, Divina Pastora shows all these
principles reflected in the practice of its daily operations:
supporting and respecting the protection of fundamental
human rights; ensuring its companies do not infringe
human rights; supporting freedom of association and
effective recognition of the right to collective bargaining;
supporting the elimination of all types of forced labour or
that done through coercion; supporting the elimination
of child labour; supporting the abolition of discriminatory
practices at work; maintaining a preventive approach
favouring the environment; promoting initiatives for
greater environmental responsibility; favouring the
development and promotion of technology that respects
the environment and working against corruption in all its
forms, including extortion and bribery.
We work
in order to give
an effective and
efficient service
Corporate Values
28
Mutualdis
One of the best signs of Divina Pastora’s social
commitment became clear in August 2009 when the
Directorate General for Insurance approved the merger
with Mutualdis, Mutualidad de previsión social pro
personas con discapacidad, which commenced in early
2008.
This operation strengthens Divina Pastora Group’s
raison d’être as a Friendly Society created 53 years ago
and complies with one of its main principles: supporting
those less fortunate in society and, in this case, with a
clear risk of social exclusion.
Therefore, and after the merger, the 4,471 policyholders
at Mutualdis around Spain became the responsibility of
Divina Pastora Seguros.
Homage to the Founder
Divina Pastora’s strong trajectory is marked by its
origins. Alongside its expansion and growth, the social
commitment it was founded with is and always will
be visible in its business. The figure and spirit of the
founder, Father Salvador de Rafelbunyol, is the soul of
the company. For this reason the company wanted to
pay homage to him through the Foundation, alongside
Rafelbunyol Town Council, by placing a commemorative
sculpture in one of the town’s main squares bearing his
name in homage to one of its distinguished citizens.
The sculptor Vicente Ortí stated that he had based
himself on the “humanity, fraternity and generosity”
of the holy man to create the work, unveiled at an
emotional ceremony with many workers from the
Mutualidad there in homage to the founder.
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Divina Pastora and Athletics
The path taken by the company two years ago
Special mention goes to competitions such as the
continued in 2009 with its commitment to sport
“Challenge BCN 10K Divina Pastora”, a circuit covering
and, specifically, athletics, as a communication and
the top 8 ten-kilometre races held in Barcelona with the
sponsorship line. It was the start of a new ambitious
oldest race in Spain (Jean Bouinn), the biggest (Cursa
project which has been gradually consolidated week
El Corte Inglés), the most charismatic (Nike Bombers),
on week. A challenge attempting to build a brand
the most fun (San Silvestre Barcelona) and the most
that made Divina Pastora stand out and gave it a
traditional (Carrera de la Mercé) standing out.
public persona.
Alongside many others, Divina Pastora left its quality
The perfect motive was found in the values of
mark on recently created races since sponsorship has
athletics: hope, effort, a striving to excellence...
gone hand in hand with top quality organisations. This
Values that have a lot in common with the daily life
is the case, for example, of the 10K Divina Pastora
and corporate philosophy at Divina Pastora Group.
This is why it chose to support the Royal Athletics
Federation of Spain and the Spanish Team as the
main sponsor and official insurance company, and
amateur athletes, supporting several road races.
Whilst 2008 was a project consolidation year, 2009
was about expansion. Divina Pastora has become the
reference insurance company and one of the top private
companies for sports and athletics in Spain. Whist it
Valencia, a race which has only held two editions but
is already a reference amongst the 10K races in the
Valencia region.
For a further year, the City of Valencia Amateur Race
Circuit had support from Divina Pastora Seguros which
was key to consolidating it as the most important amateur
race circuit in Spain, with an average participation of
3,500 athletes at each of the ten races.
supported 12 amateur races in 2007, the next year it ran
A very similar project was started in Galicia in 2009,
to 88 and 2009 saw 160 races being supported.
also promoted by the company: the City of Lugo
30
Amateur Race Circuit (Corre con Nos) where Divina
Pastora is attempting to promote amateur athletics for
adults and children.
These are just some examples of the company’s busy
sponsorship activity in the year, covering the whole
of Spain but with notable increases in areas such as
Galicia, Levante, Catalonia and Madrid.
The insurer’s brand stamped on inflatable arches,
banners, departure structures, stopwatches, kilometre
points, marquees, stands, flags, arrival tapes and all
types of advertising material has become a constant
feature for the public and runners. The Divina Pastora
logo is already a classic presence at major road races,
from those with high turn-outs in big cities to those in
small towns.
Over 300,000 Runners
Thanks to these close links with road athletics, Divina
Pastora Seguros became consolidated in 2009 as a
specialist in the area of Sports Insurance, covering the
needs at these events. It insured 113 races over the
last year, corresponding to amateur races held around
Spain – more than triple the previous year. In total,
almost 154,000 runners benefitted from this insurance
at these sports events, although over 300,000 runners
took part in 160 sponsored road races.
After two years on the market the sports insurance
benefits from wide acceptance amongst organisers,
including the main national circuits. This growth
was due both to the product specialisation and the
awareness work performed by the company, whose
name in amateur athletics has become a reference
insurer in the sector.
In turn, unconditional support for grassroots sport
continued in 2009, especially with the sponsorship of
the Municipal Sports Schools of Valencia City Council
and the Children’s Circuit Corre con Nos of Lugo Town
Council.
Sports Merit Award
Thanks to this work, Divina Pastora Seguros was recognised by Valencia City Council as “the non-sports company to most support sports in the city in 2009”. This
award is part of the prestigious Premios al Mérito Deportivo (Sports Merit Awards) the council awards every
year to recognise the work of sportsmen and women,
teams, institutions and the media related to the world
of sport.
Logically, for Divina Pastora Seguros this award is a
stimulus to continue on the same vein and double its
efforts, contributing to develop playing sports in society
and, with this, the values and advantages physical activity has for people.
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Turin and Berlin - Two Elite Moments
The sponsorship of the Royal Athletics Federation of
Spain led to two high points in the 2009 season –
the European Indoor Championships held in March in
Turin and the biggest tournament of the year held in
summer in Berlin: the World Outdoor Championship.
These two competitions held the attention of Spanish
athletics fans, alongside the protagonism of Divina
Pastora Seguros as main sponsor of the Spanish
Team.
National athletes stood out in many competitions with
the Spanish team t-shirt wearing the Divina Pastora
brand on their chests. The moment of the year
was taken by Palencia-born Marta Domínguez who
became 3,000 m steeplechase world champion in
Berlin, taking the sting out of her fall at the Beijing
Olympic Games where she missed a medal by falling
at the second to last obstacle in the race.
In turn, Jesús Ángel García Bragado was the other great
hero in the German capital by winning a place on the
podium for the 50K racewalk and taking bronze.
At the first of the two big events, the European
Championships in Turin, Spain again took five medals
home, although none were gold this time around.
In any case, with or without medals, the effort and
discipline of the athletes are values that should be
seen in today’s society – especially amongst youth.
This is why Divina Pastora chose the Royal Athletics
Federation of Spain as its partner, at least until the
London Olympic Games in 2012.
32
The Divina Pastora Group once again left its
leading
commitment to its workers clear in 2009, especially
including the Chairman of the Board: 14 degrees,
in highly valued aspects by employees such as
three diplomas and six masters, most financial or
improved working conditions and work-life balance,
executive management.
extending resources or developing individual talent
and professional development.
the
different
company
departments
The training of managers is constant, as well as their
ability to advise in other areas that are not the exclusive
At the end of 2009, the Group had 372 workers
responsibility of the department they lead, in this way
spread across different categories: 46 in the executive
getting the chance to value different consolidated
manager group, section heads and graduates;
criteria before taking any major decision.
141 as business heads and officials, and 185 as
administrative assistants. Women outnumber men
in almost all categories at the company, totalling 280
Recruitment
to 92 men.
A highly significant point, especially in the complicated
Supported by different local HQs and offices, the
financial situation, that shows group solvency and
Human Resources Department put into operation
the period of expansion for the group is the 53 new
throughout 2009 different campaigns to attain rigor-
staff members in 2009, 37 women and 16 men.
ous recruitment and selection of commercial agents
Internal reports produced by the Human Resources
through infojobs.net, radio ads, or selection by areas.
Department show the value workers give to the
The large number of CVs received (12,163) through
continuous improvements put into place by the
the different channels and recruitment campaigns
company to help the working environment. This was
make it possible to match the professional profile
also seen in 2009 in the considerable increase in
requirements with continuous search and selection
commercial network loyalty with regards to previous
throughout the year.
years.
Specifically, the use of radio ads and the positioning
The following professional training levels are seen
on Google, carried out in December, led to a
on the management team, comprising ten managers
slight increase in applications in the Recruitment
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Department e-mail inbox. However, qualitative rather than quantitative
differences were seen, since it was a more commercial profile
specially linked to the insurance and financial sector.
New work methodologies are being performed and incorporated
into recruitment material aimed at refining further the search for
insurance agents so as to improve all channels and procedures to
achieve a larger number of agents matching the profile.
These measures include improvements in the present recruitment
process based on received CVs, both via infojobs or the website,
and other recruitment sources. Two new offers were designed with
the aim of recruiting Insurance Agents and Commercial Agents and,
in this way, attain a more defined and adapted profile to business
needs. In short, processes were sharpened for finding good profiles.
The company’s growth and the acquisition of new companies by the
group involved the incorporation of staff at several departments at
the Head Office: Legal, Technical, General Services and Commercial.
This led to six new members, two women and four men, whilst two
new posts were covered by internal promotion.
Training
Professional staff development is one of Divina Pastora Group’s
priorities. This is why it carries out many activities and makes
resources available to increase professionalism and competence
amongst employees, leading to better service for policyholders.
In this sense, the Training Area managed a total of 252 courses in
2009, followed by 679 workers at the company and meaning a
total of 16,946 hours. This translates to an average of 25 hours per
employee.
These numbers reflect an evident commitment to rigorous
specialised training, involving all departments and geographic areas,
from commercial agent courses to other vocational and professional
individual ones for employees at the Head Office and other internal
courses such as languages or sales techniques.
Training is
an indispensable
element to offer
the best service
to our insured
A Training Dossier was designed in 2009 aimed at incorporated
Exclusive Agents comprising two manuals: “The Insurance Sector:
Theory and Background”, developing different teaching units setting
out all the points in the Broker Law for training Broker Agents and
“Divina Pastora Seguros Products” which, in addition to setting out
all company products, includes other aspects supplementing agent
training such as “The Divina Pastora Seguros Group” and the appendix
“Rights and Obligations: Subscriber vs. Policyholder”.
In addition, the “Teacher Dossier” was created, aimed at Sales Heads and
including several supplementary guides for training and incorporating
34
new agents: “Teacher and Procedures Guide”, “Supplementary Material
for the Agent Product Manual” and the “Commercial and Administrative
Operations Guide”.
A distance training activity was chosen for administrative workers due to
the problems in performing training in office hours; this is a back-up to
the main concepts in the insurance sector and a review and strengthening
of company products. This initiative was split into two editions and was
highly valued by administrative workers.
Due to the introduction of new products in recent years, training was also
designed under the name “New Client Research” aimed at commercial
agents to cover the needs of new policyholders.
A new manual and examination assessing acquired knowledge was put
together for all company worker training in Preventing Money Laundering.
An activity carried out in the last quarter of 2009 and the first month of
2010.
In turn, the extensions and improvements made in the Policyholder Service
Department required specific training in two sectors of the Call Centre:
“Team Management” for supervisors who went on to manage teams in
this department and “Claims Management” for agents responsible for
taking policyholder calls.
Excellence Criteria
A highlight amongst the projects promoted by the Human Resources
Department was the interest in comparing Human Resources and
Organisation Culture practices at Divina Pastora with those at other leading
companies in different sectors. This led to the initiative to pursuing the
“Best Workplaces Spain 2009” certification for the first time – a prestigious
list produced each year by the Great Place to Work Institute Spain setting
out the 50 best companies to work at in Spain from the 250 who enter
the assessment process.
An exhaustive survey measuring employee satisfaction through five main
features (Credibility, Respect, Fair Treatment, Pride and Teamwork) was
the project’s main pillar since it was worth two-thirds of the total points
awarded by the Great Place to Work Institute. The remaining third is set
by an appraisal of the practices in the Human Resources Department and
the company’s Corporate Culture.
Divina Pastora took 61st place on the ranking, from 250 participating
companies. This result, although not winning the award Best Workplaces
reserved for the top 50, does show that the company is considered to
be an excellent place to work by its employees. In fact, 75% see it this
way, whilst 89% would recommend it as a good place to work according
to the survey.
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Further, Divina Pastora is valued higher than those
included in the top 50 in several aspects such as fair
treatment of employees, both in terms of salary and
promotion and favouritism, and in the company’s
commitment to work-life balance. They also see it as a
safe pleasant place to work, above those results obtained
by companies in the top positions on the table.
The rating is even more outstanding in the comparison
study of companies of the same size as Divina Pastora,
250 to 500 employees, or in the financial/insurance
sector, where it comes in fifth out of 20 participating
companies. Regards the above, we should add it is
also above others in terms of pride amongst workers
at the company, the company’s impartiality or equal
opportunities.
The results from all excellence criteria show not only
the company’s solidity creating confidence in the future
but also its desire to continue improving in the opinion
of its workers.
The company also took a top position in the financial
and insurance sector and stands out for the pride
employees feel in working there, directly influencing the
company’s satisfaction and commitment to continue
on the same path.
One our main interest
is the reconciliation
between professional
and familiar life
36
Technology
A large part of the technological development in 2009
authorisations issued to checking on invoiced medical
was dedicated to integrating the IT system of all new
interventions performed by health service suppliers
products from companies incorporated by Divina
and subsequent payment.
Pastora Group in recent years.
After the agreements reached with REDSA, the leading
Given their specific features, each required the
Spanish company in automation and process control
adaptation of the Company Databases, dialogues to
for the health sector, to use its SANIRED platform at
enter and show data, processes and controls to process
terminals installed at health centres and with health
benefits and manage collection; this led to exceptional
growth in the code contained in programmes controlling
product management.
professionals, new cards with standard magnetic
strips were issued to policyholders allowing medical
interventions to be validated and authorised at the
The major development effort was concentrated
time they occur, based on the services contracted
on the Health product management with the aim of
by each policyholder and fulfilling the commitments
maintaining total control over health benefits, from
to them. This progressive project practically allows a
Technology
2 0 0 9
Annual
Report
37
customer cancellation or a service limit to be known by
the network instantaneously, blocking authorisation for
the corresponding medical interventions.
With regards to mobile communications, PDA terminals
used by many staff members were replaced for those
with more advanced and simple versions allowing users
to have mobility for all contacts, their diary and e-mail
permanently synchronised, reducing service costs in
turn.
The year ended with technology renewal agreements
reached for the company data network, whereby the
telecommunications supplier ONO agrees to completely
replace the present company network for another one
with MPLS (Multi-Protocol Label Switching) technology;
this is increasingly popular due to the capacity to integrate
voice, video and data on a common platform with
quality of service (QoS) guarantees, in addition to the
performance improvements and availability obtained with
this technology.
The putting into place of this project provides advantages
including:
• Cost Savings. Applicable from the moment the first
agreement is signed so that they are not conditioned
to ending the operation and mean between 25%
and 40% savings if we take into account improved
services.
• Full Quality of Service (QoS) Support. Traffic priority in
real time, a key element when voice and video is to be
added to data networks.
• Improved Performance. Due to the nature of the
services, the number of jumps between points can be
reduced leading directly to improved response times
and application performance.
• Disaster Recovery. The services connect to data centres
and other key locations through redundant multiple
connections to other network sites. In addition,
remote sites can be easily and quickly reconnected to
backup locations if required. This flexibility for business
recovery is precisely one of the main reasons why
many companies are opting for this technology.
• Preparing for the Future. Most telecommunications
companies and operators have come to the conclusion
that this technology represents “the future”.
Our projects
to face new goals
with the best result
38
Branch Network
ALBACETE
Concepción,11, 3º izq.
ALCALÁ DE HENARES
Libreros, 11-1º, of.1
ALCIRA
Mayor Santa Catalina, 18 - bajo
ALCORCÓN
Rioja, 2, 4º (esquina Mayor, 56)
ALICANTE
Rambla Méndez Núñez, 28-32, 2ª B
ALMERÍA
Obispo Orbera, 26, entlo., of. 2
BADALONA
Pl. Alcalde Xifré,14,1º, 3ª
BARCELONA
Diputación,180, 2º A
BILBAO
Iparraguirre 50, 1, dptos. 4, 5 y 6
CÁDIZ
Ancha, 22, 2º
CARTAGENA
Pl. Castellini, 11, 1º, 1ª
CIUDAD REAL
Ramón y Cajal, 2, 1ª planta
CÓRDOBA
Avda. Ronda de los Tejares, 32, esc.1ª, 5ª pl., nº 157
ELCHE
Vicente Blasco Ibáñez, 58, bajo
(chaflán Mariano Luiña)
MADRID
Princesa, 2, 2º, of. 3
MÁLAGA
Avda. Manuel Agustín Heredia, 8
MURCIA
Primo de Rivera 10, local 6
OVIEDO
Melquíades Álvarez, 26, entlo.
PALMA DE MALLORCA
Caputxins, 4, A - 2º. Edif. Orisba
PONTEVEDRA
Nostramo Lourido, 1- bajo
PUERTO DEL ROSARIO
(FUERTEVENTURA) La Pesca, 35, bajo
SABADELL
Avda. Francesc Macià, 46-50, 3º, 3ª
SALAMANCA
Azafranal, 16
GANDÍA
Paseo de Germanías, 82, entlo. dcha.
SAN SEBASTIÁN DE LOS REYES
Plaza de la Constitución, 6, 1º, B
GETAFE
Concepción, 14, 1º-1
SANTA CRUZ DE TENERIFE
Pl. Candelaria,1 - 2ª pl., of. 276 - Edif. Olimpo
GIJÓN
Corrida, 4, entlo. dcha.
SANTANDER
Paseo Pereda, 32 ppal. dcha.
GIRONA
Avda. Sant Francesc, 21, 3º, B
SANTIAGO DE COMPOSTELA
Rúa Do Penedo, 4, bajo
GRANADA
San Antón, 72, 4º, 17. Of. Real Center
SEVILLA
Pl. Josefa Reina Puerto, 3, 2ª planta
GRANOLLERS
Avda. Sant Esteve, 37, 5º, 1ª
TORRENTE
Avda. País Valencià,134 - bajo
HUELVA
Cabezo de la Joya, 1
TUI
Compostela, 10-12
JAÉN
San Clemente, 3, 3º. Edif. Extremera
LA CORUÑA
Fernando González, 6, 1º
VALENCIA
Pl. Ayuntamiento, 26, entlo.
Primado Reig, 70, bajo dcha.
(esquina Botánico Cavanilles)
LAS PALMAS DE G.C.
Avda. José Mesa y López, 8, 2ª
VALLADOLID
Pl. Santa Ana, 7, 1º, A
LEGANÉS
Avda. Fuenlabrada, 61, 1, of. 3
VIGO
Policarpo Sanz, 3, entlo.
LEÓN
Burgo Nuevo, 24,1º
VILAFRANCA DEL PENEDÈS
Rambla de Sant Francesc, 11, entlo. 1ª
LUGO
Rúa Raíña, 18, 2º B
ZARAGOZA
Coso, 98 -100, 3º
2 0 0 9
Annual
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39
2 0 0 9
Annual
Report
Policyholder Service
Department Report
By virtue of what is set out in Order ECO/734/2004,
the Department of Customer Service must produce
an annual report on its performance from the
previous year. Said obligation was transferred to
article 33 in the Policyholder Service Regulations.
The performance area of the Policyholder Service
Department runs to the processing of complaints
and claims presented by policyholders within the
business area of all Divina Pastora group companies
that use as their own the Department of Customer
Service of the Mutualidad General de Previsión
del Hogar, Divina Pastora, accepting it, therefore,
as their own and, in turn, assuming its operational
regulations. In this sense, the department changed
its name from the Department of Customer Service
to the Department of Policyholder Service, taking on
the complaints and claims problem from both Divina
Pastora Seguros Generales and Cisne Aseguradora.
With the prior premises made, so as to be able
to follow the activity of the Friendly Society as
such, which has been done since the department
was created in 2004 with the approval of Order
ECO/734/2004, the treatment of the three
institutions will be individual throughout the report,
as far as possible.
41
In general, with regards to global activity, the
Department of Policyholder Service continues to
see decreasing claims numbers looked at and,
therefore, open files, begun in 2008. The 939 claim
files processed in 2006 were reduced to 738 in
2007, finalising in 701 in 2008 and ending at 690
in 2009, with 630 corresponding to the Mutualidad,
57 to Cisne Aseguradora and 3 to Divina Pastora
Seguros Generales. This is an 8% reduction with
regards to the Mutualidad, consolidating the
decrease in claims.
The incorporation of Cisne Aseguradora, with the
required changes having to be introduced, again
meant that, in relation to complaints, the figure
continues to increase, going from 51 to 141 last year,
75 in the last quarter due to Cisne Aseguradora, and
ending the year in question with 244 complaints,
spread in the following way: 36 from the Mutualidad,
with a notable decrease from last year which closed
with 66 complaints, 192 from Cisne Aseguradora, a
lower amount to the annualised amount received
in the first quarter with regards to Cisne complaints
and claims in 2008, and 16 from Divina Pastora
Seguros Generales.
42
A. MUTUALIDAD GENERAL DE PREVISIÓN DEL HOGAR, DIVINA PASTORA
1. YEARLY STATISTICS
On a statistical level, and separating the claims from the Mutualidad, we should indicate that in 2009 the Department
of Policyholder Service resolved 630 files on claims of very different types. From these files, the department stated
154 were reviews of prior company decisions, standing at 24.44%. This percentage is a slight increase in prior
decision revisions of 2.72% (21.72 to 24.44%), the adopted decision review indices therefore remaining at similar
figures to previous years, except 2007 with over 36% reviews of decisions taken. It should be stated that, as in
previous years, said percentage is not uniform across different benefits and the resulting statistic should be analysed
further when the later individual analysis is performed for each.
The benefits subject to claim are once again almost entirely Temporary Incapacity due to Accidents and Surgical
Intervention. In the analysed period, 428 were Temporary Incapacity files and 141 Surgical Intervention. This means
that 90% of claims are disagreements with decisions taken on both benefits. The circumstance already seen in
prior years has remained with most of the Company’s operational volume and decisions leading to a relation with
policyholders being these two benefits, the most common and with the lowest amounts and cover.
The following table shows the number of benefits subject to claim, as well as those dealt with by the Department
of Policyholder Service in favour of the policyholders and the percentage of total claims per benefit. It should be
stated that there is a difference of three claims, as some claims are considered in two sections, such as a single
claim for both temporary incapacity and claimed severe disability, or two deaths, one due to illness and the other
to an accident, where the AVAF was claimed jointly.
Benefit/reason
Total
Confirmed
Admitted
Percentage
Temporary Incapacity
428
304
124
28.97 %
Surgical Intervention
141
113
28
19.85 %
17
17
0
0%
I. Absolute illness
5
5
0
0%
Statutory leave
7
6
1
14.28 %
Death due to Accident
6
6
0
0%
Payment reimbursement
6
5
1
16.66 %
Redemption P.A. and P.J.
1
1
0
0%
Partial Incapacity
5
5
0
0%
I. Absolute accident
3
3
0
0%
Birth
2
2
0
0%
Wedding
2
2
0
0%
Death assistance
4
3
1
25 %
AVAF
4
3
1
25 %
Death P.J.
1
1
0
0%
Severe Disability accident
1
1
0
0%
Old Age Benefit
1
1
0
0%
634
478
156
26.18 %
Total Incapacity
TOTAL
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Annual
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43
A further year, the activity of the Department of Policyholder Service reached a wide selection of benefits at the
Company, as even issues such as Old Age Benefit gave rise to claims. This year saw claims once more for Death
due to an Accident or Sever Disability due to Accident (which did give rise to claims in 2007). However, none of
the benefits, except in the case of Total Incapacity due to Accident with seventeen claims, ran over ten.
2. AFFECTED QUANTITIES
With regards to affected quantities, no specific amount was requested in the claim, except in 19 files; instead, the
request was for review of the amount or the right to receive the corresponding benefit. This is a reflection of the
sentiment embodied by claimants in their letters, where they state the amount is insufficient and ask for the original
file to be looked at again, without recurring to other reasons nor justifying the defence of the judgement or they
do not agree with the benefit denial judgement; however, their intent does not go beyond a recognition of their
financial rights without assessing the amount itself.
Once again, and in line with the previous year, rarely has the company’s judgement review exceeded an average
assessment of the severity of less serious in temporary incapacity benefit resolutions, except for fractures involving
surgical intervention where there is a clearly established rating of serious, in the lower amount.
With regards to the remaining affected amounts, since there was no revision of the company’s decision with the
exception of those referring to temporary incapacity and surgical interventions with affected amounts, there was
only one AVAF file review with approval of the €31,500 insured.
The total sum for reviews of decisions previously taken by the Department of Policyholder Service ran to €89,149.07
including the stated €31,500 for recognised AVAF.
3. CLAIM REASONS
For the claims processed, the file was closed without resolution on eighteen occasions for different reasons:
1) File shelved, 16 occasions.
a- No claim verification, 11 occasions.
b- Unforeseen resolution (the claim was dealt with), 3 occasions.
c- Not clarified claim, 2 occasions.
2) Not admitted and terminated due to the presentation of settlement proceedings, one occasion.
3) Terminated due to claiming policyholder death, one occasion.
In turn, there are eighteen not admitted files for claims, without an extraordinary file being opened. The reasons are
those limited by law and reflected in the departmental regulations: either due to two years having passed between
the notification of the decision taken by the company and the claim application, or due to the repetition of former,
already resolved, files. These circumstances automatically exclude the claim after the appropriate file and transfer
thereof to claimants.
The criteria of not closing files without the appropriate resolution was maintained, except where it is clearly impossible
to carry on. In this instance, it is closed early, more for the policyholder’s protection so as to leave the claim route
pending before the Department of Policyholder Service, thus not violating their rights and being excessively formal
in complying with legal requirements for minimum claim content.
44
4. STATISTICS
A percentage list of the main reasons behind claims with regards to the different benefits.
The first statistics table shows disagreement with the amount awarded alongside other reasons for claims due to a
refusal. We believe it is useful to continue the criteria begun in previous years’ reports of starting to take into account
the level of dissatisfaction amongst clients due to a benefit award that fails to match their expectations.
Claim distribution chart according to file resolution with regards to benefit award or not.
Prior resolution
Benefit
Total
Approved
Percentage of app.
Refused
Temporary Incapacity
428
122
306
28.50 %
141
47
94
33.33 %
Total Incapacity
17
0
17
0%
I. Absolute illness
5
1
4
20 %
6
0
6
0%
Redemption P.A. and P.J.
1
1
0
100 %
Partial Incapacity
5
0
5
0%
I. Absolute accident
3
0
3
0%
Birth handicap
2
2
0
100%
Wedding
2
0
2
0%
Death assistance
4
0
4
0%
AVAF
4
0
4
0%
Death P.J.
1
1
0
100 %
Severe Disability accident
1
0
1
0%
Old Age Benefit
TOTAL
1
1
0
100 %
621
175
446
28.18 %
Disagreement with the amount awarded continues to be the main cause of claims received. The percentages from
the previous years remain practically stable with regards to temporary incapacity and surgical intervention; therefore,
we can state that the publication of the benefits scale in application of article 22 has had NO effect on reducing
disagreement claims on the amount awarded.
However, claims have different reasons. Whilst approval can be the cause for claim due to it not meeting expectations,
the most common cause (in 71.82% of the cases according to the table above) is due to a refusal.
The following table shows a total analysis of claim reasons for benefits where resolutions taken have been approved
by the Department of Policyholder Service, without the agreements taken being reviewed. They are Company
agreements which, due to their nature, have a single refusal reason or, in some cases, the benefit has been
awarded but the policyholder does not agree with the amount.
This table has minor significance due to the scant number of claims fulfilling these characteristics but completes the
activity overview of the Department of Policyholder Service.
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General refusal reasons table.
Benefit
Statutory leave
Death assistance and AVAF
Redemption
I. Absolute illness
Nº
Claim Source
4
Undeclared illness
1
Total incapacity award
1
Arrears
2
Article 103, prior illness registration
2
Suspension of rights
1
Disputed amount
1
Article 34, start prior to 24 monthly payments.
1
Not stating relevant data for risk assessment.
2
Article 33, no accreditation of total incapacity.
1
Disputed amount.
Wedding
2
Non-fulfilment of deficiency period
Birth handicap
2
Disputed amount
Death P.J.
1
Disputed amount
Severe Disability acc.
1
Refusal article 7.a)
Old Age Benefit
1
Disputed amount
There were two cases in the previous files where the decision taken by the Company was reviewed:
a) In reference to a statutorily taken cancellation since the illness the policyholder was removed for was undeclared
multiple sclerosis, the diagnosis of which was clearly given after joining the company; therefore, no fraud existed
in this case. It would be different with regards the non-concession of permanent incapacity if the illness had
begun prior to taking out a policy.
b) In a file for death due to illness, refused as per article 103, the illness starting before contracting the products;
the benefit refusal could not be ratified as the documentation provided did not show the illness leading to death
starting before the policy was taken out; there was a shock due to bilateral pneumonia without said illness being
present previously.
After the general table for most benefits by type, the remaining benefits are analysed, the volume of which
represents over 90% of claims received.
Firstly, Total and Permanent Incapacity for the Declared Profession due to Accident requires analysis in a separate
table since, although Company criteria have not been reviewed in any instance, it is the third benefit by volume. In
this way, an analysis of the different refusal reasons will be clearer. In addition, as there are files with more than one
refusal reason, the table is extended and more complex, with specific analysis being clearer.
46
The Total Professional Incapacity benefit is, by far, the most common amongst permanent incapacities, much higher
even than the less frequent partial incapacity. There was a major decline in claims numbers, running to 17 claims
from the 28 last year.
No Company judgement was reviewed this year in any cases for this benefit, all decisions taken by the Company
on this benefit being taken as correct and in line with the law, without a reason to reconsider any resolution.
Table of claim reasons for Total Permanent Incapacity for the Declared Profession due to Accident.
Claim reason
Nº
Out of risk cover
% of files
14
82.47 %
Prior illness, article 68.b)
4
23.53 %
Origin not considered an accident, article 8.
5
29.41 %
Due to illness
1
5.88 %
Non-notified accident
1
5.88 %
In view of the table above, it is advisable to highlight refusal due to the permanent incapacity being out of the
insured risk cover year. Over 80% of claims for total incapacities have this reason for refusal, being the sole benefit
refusal reason in 50% of cases. The truth is that the incapacities clearly fell in this lack of cover due to a long time
period having passed. The conclusion is that there was not a significant increase in the refusal reason, despite the
regulatory change made in 2007, specifying the consideration of the insured risk cover.
The remaining reasons are essentially conditioned by the existence of prior independent circumstances to the
accident that determine the policyholder’s situation, either as illness or prior illness, all linked to the special
consideration of accident set out in article 8, a faithful reflection of article 100 in the Insurance Contract Law.
Nonetheless, this contrasts head on with the classification of “work accident” given by Social Security and causes
confusions amongst policyholders in many instances as they can not distinguish the difference between the concept
of accident in the two spheres.
Table of review reasons for Partial Permanent Incapacity due to Accident.
Claim reason
Nº
% of files
Non-permanent incapacity
3
60 %
Out of risk cover
1
20 %
No facial deformation proven
1
20 %
The number of claims for partial incapacity fell to five this year, with just one refusal decision being applied due to
non-accreditation, except in one case of insured risk cover expiry. Partial incapacities are determined by situations
where the policyholder proves the existence of permanent consequences that are included on the partial incapacity
scale, but which IN THEIR CASE do not cause limitation above 33% in performing professional tasks, thereby not
comprising a status of permanent incapacity. This is a concept which, at times, policyholders find hard to accept,
especially if the attached scale in the Benefits Regulations is analysed and they consider their consequence is
included in it and liable to partial permanent incapacity.
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47
Table of claim reasons for Absolute Incapacity due to Accident.
This benefit was subject to claim on three occasions due to files all with two refusal reasons. Therefore, there are
six refusal reasons for the initial benefit.
Claim reason
Nº
% of files
No absolute permanent incapacity due to accident article 59
2
66 %
Out of risk cover
1
33 %
Prior illness, article 60.b)
1
33 %
No causal link of the consequences to the accident
1
33 %
1
33 %
This is a question of incapacities that must involve its scope leading to the impossibility of performing any profession
or trade. At times, it is difficult for the policyholder to accredit their situation, despite the existence of ailments which
undoubtedly worsen their quality of life but which need to be accredited so that the Company may provide financial
importance to their claims. However, it was clearly seen that the assessment of absolute incapacity due to accident
had not been justified.
Table of claim reasons for Death due to Accident.
Claim reason
No accident
Nº
% of files
Article 8.d), loss of consciousness.
1
16.66 %
Article 8.i), high risk activity.
1
16.66 %
Article 8.b), prior illness
1
16.66 %
Article 8.h), under the influence of alcohol.
1
16.66 %
Refusal article 40, not the beneficiary.
1
16.66 %
1
16.66 %
This benefit was subject to six claims with a refusal reason for each. Said refusal reasons were mainly based on the
different exclusions for accident in article 8, on one occasion each of them. In turn, the article 7.a) exclusion was
applied: breaking the law or regulations on one occasion, specifically for loss of vehicle control and drifting to the
opposite land, and for inappropriate speed.
This year claims were received again for benefits refusals for Accidental Death, something that did not occur last
year, going from three files in 2007, none in 2008 and a new presentation in 2009. Although we can not state that
the volume thereof allows more statistical conclusions to be set, both at general process level for the Department
of Policyholder Service and in existing claims, it should simply be pointed out, no more.
Benefits tables with Company judgement review by the Department of Policyholder Service on some
occasions.
In interpreting the following tables, the criteria followed for their production should be taken into account:
1. The number of claim reasons exceeds that of files since there are files with more than one refusal reason.
2. The first percentage is calculated on the total number of files, NOT reasons, since the useful information is
knowing the number of claims EACH refusal reason has given risen to.
3. The second percentage refers to the number of claims admitted in relation to EACH refusal reason, since the
useful information is knowing the percentage where IT HAS NOT BEEN POSSIBLE to maintain the judgement
adopted in principle by the Company.
48
It should be highlighted that, despite being subject to previous analysis, the information on approved benefits
whose claim is based on disagreement with the awarded amount is again included in order to complete the table
of claim reasons for each benefit.
Temporary Incapacity due to Accident
This is the most common benefit and with the largest type of benefit refusal reasons. The table for all occurring
refusal reasons was developed in order to allow comparison with previous years.
With the effect of 122 cases analysed in a prior table, where the origin to the claim was an approved benefits file, it
is worthwhile centring efforts on a table analysing in detail the effect of refusal reasons, the possibility of maintaining
them after a new detailed analysis of the files and the causes that have not allowed said refusals to be sustained.
The first point we should refer to this year is the maintenance of the prior decision review percentage by the
Department of Policyholder Service; this backs up the large improvement in resolving processed benefits files,
remaining at 28.90% of prior decision reviews.
The following table shows all refusal reasons used which were subject to claims (there may be more than one
in the resolution for each file), the total amount of claims said reasons have given rise to, the percentage of total
temporary incapacity claims, admitted cases and admittance percentage for the claim for each refusal reason.
Claim reason
428
Nº
% of files
Admitted
Disputed amount
122
Article 8.a), non-accident origin.
115
26.87 %
19
16,52 %
Incapacity not justified
111
25.93 %
34
30,63 %
Prior illness
25
5.84 %
3
12 %
Article 25, insufficient accreditation.
39
9.11 %
14
38,46 %
3
0.70 %
0
0%
14
3.27 %
0
0%
Suspension of rights
Article 8.j), strain.
Article 8.d), loss of consciousness.
28.50 %
% of reason
36
29.50 %
2
0.47 %
1
50 %
Article 8.i), high risk activity.
14
3.27 %
3
21.43 %
Article 7.a), no protection measures
16
3.74 %
12
75 %
Article 7.a)
12
2.80 %
2
16.66 %
Article 9, no documentation.
7
1.63 %
4
57.14 %
Article 8.h), alcohol or drugs.
1
0.23 %
1
100 %
Article 8.e), mental illnesses
1
0.23 %
0
0%
Injury not in declared accident
3
0.70 %
0
0%
Non-provision of relevant information
2
0.47 %
2
100 %
The reason for this type of analysis, without any figure being able to total one hundred per cent, is that the aim is
to see the frequency of each refusal reason in claims made, as well as its use in Company refusals, calibrating if it
has been possible to maintain the judgement or necessary to change it.
Looking at the table, the first significant fact is that 348 files were in disagreement with the amount awarded or as
refusal reasons the fact of not accrediting incapacity or the existence of an accident not being accredited. Out of
said files, the Company decision was changed 89 times.
There was a slight reduction in all review reasons, although the percentages of Company judgement reviews
adopted by the Department of Policyholder Service remain the same. Once again, criteria such as rest, operational
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49
incapacity and diverse categories and limitations of doctors producing the reports need to be highlighted as making
incapacity assessment particularly difficult, as well as the description of traumatic, after trauma, or certifications of
falls and contusions, highly dubious and difficult to treat, all justifying a more conservative approach by the Company
in the above instances. None of the more frequent reasons for requesting review surpasses 31% of cases.
With the most significant variations with regards company decision reviews, it should be highlighted that in the two
most frequent reasons there was a near 30% increase in reviews of files on approved benefits, where disagreement
was with the amount awarded, as well as significant decrease with regards accidents, with a wide downturn in prior
decision review from 23.26% last year to 16.52% this year, a tangible improvement in processing benefit refusals
for accident.
Reviews of refused files due to lack of documentary accreditation as per article 25 of the Benefits Regulations
remain significant, at nearly 40%, as well as the non-use of professionally-approved protection measures at 75%
of the prior decision review. The high-risk activity consideration, however, saw better processing this year with only
three reviewed cases out of the 14 processed.
With regards to a lack of documentation, the process at the Department of Policyholder Service continues to ask
again for additional documentation with the dispatch of the corresponding acknowledgement of receipt, using
the same to provide policyholders with the chance to provide a specific document for correct accreditation of the
corresponding benefit. The response to this requirement has led, in many cases, to the possibility of awarding the
corresponding benefit, to which the policyholder certainly had a right, with correct accreditation thereof.
The consideration of applying article 8.i) on high-risk activities or the use of necessary protection measures is worth
a separate mention. In the first instance great care must be taken in refusal for this reason; greater correction has
been applied with the refusal criteria as it is a highly restrictive consideration as to what should be considered a
high-risk activity, as well as considering the catalogue thereof which the article itself leaves open.
With regards to non-application of necessary protection measures, this is about cases of welders with metal splinters
in their eyes but who were using their protection screens; or where employment is not accredited it is certainly
logical that people in this activity suffer some accident of these characteristics without the frequency thereof being
such that the existence of habitual carelessness in this sense can be presumed. We understand that the application
of this refusal decision must be reduced as it has had to be reconsidered by the Department of Policyholder Service
too often in recent years.
We understand that the function of the Department of Policyholder Service has been integrated into Company
operation, in coordination with the medical team responsible for benefit treatment, true craftsmen and women
of everyday resolution work on Company insurance cover, and with a good performance of everyday work and
resolution of company files, with the independence and professionalism the almost expert level of their work
demands.
Three temporary incapacity files were left out of the table, albeit referenced in the freelance product, although they
are part of the 428 temporary incapacity files. In reality, the application criteria are similar as, although the benefit
has its differences, the non-consideration reasons are similar to those for temporary incapacity. The company’s
decision was not reviewed in any of these three files and they were refused for the following reasons in each:
1. The presence of a prior illness conditioning the occurrence and evolution of the resulting incapacity.
2. Non-compliance of the 180-day deficiency period, prior to the start of the incapacity due to illness and lack of
documentation with regards to accreditation of the start of the illness.
3. Non-accreditation in compliance with the accident status, nor providing the specifically requested
documentation.
50
As it is a new product, this first processing year for the Department of Policyholder Service was considered as a
whole for temporary incapacity figures. However, in subsequent years it will be analysed separately due to the
increased problems said product is foreseen as possibly generating.
Finally, we show the reasons in a table referring to surgical intervention files in a similar way, with the same criteria
followed to product a comparative table.
The table details the article for the different refusal reasons each of the articles gives rise to, since the reasons in
both article 10 and article 15 are very different and differentiated processing is required.
By looking at the table we can see that the number of revisions of initially adopted decisions remained at practically
the same level as the previous year. In total there were 28 revisions of the decision taken out of 141 surgical
intervention files, i.e., 19.85%. This means file review stands below 20%, highlighting the exceptional nature of the
figure double this from 2008.
Claim reason
428
Nº
% of files
Admitted
% of reason
Disputed amount
47
33.33 %
11
23,40 %
Article 13 (not general anaesthetic)
39
27.66 %
6
15.38 %
Start prior illness
Article 10
Article 15
22
15.60 %
6
27.27 %
Non-intervention due to illness
9
6.38 %
1
11.11 %
Treatment
4
2.84 %
2
50 %
No accredited intervention
2
1.42 %
0
0%
Exploratory examination
4
2.84 %
1
25 %
Repeat intervention
6
4,26 %
1
16.66 %
No deficiency period
1
0,70 %
0
0%
Benefit not transmissible mortis causa
1
0,70 %
0
0%
Article 14
Plastic surgery
4
2.84 %
2
50 %
Article 12
Accident origin
7
4.96 %
0
0%
The slight increase in review percentages was due to the new assessment of the applied scale chapter, a more
appropriate application for the practised intervention, as well as the reconsideration of the start of the ailment
operated on. This is because the Benefits Regulations set out “clinical manifestations”, an item that at times, even
when the logical evolution of the illness, in application of medical decisions, means the start of the illness is prior
to contracting the product, many times said start did not correspond to the clinical manifestations, after taking out
the product.
With regards to the previous year, refusal for not providing relevant information disappeared, as was recommended
in the report thereof, as well as the suspension of rights and being the second operation after a previous intervention,
which means an appropriate evolution in the correct application of the condition in the Benefits Regulations.
Statistics Conclusions
The information shows a continued decrease in reviews of prior decisions due to the clear operational improvement
of the Benefits Department whose medical staff are integrating their professional decisions thoroughly; they are
only nuanced at times as part of the special policyholder protection and the application of the decision in favour
thereof which is the job of the Department of Policyholder Service. This never intends to correct professional
decisions made by the medical professional who has greater knowledge and expertise.
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Complaints
With regards to complaints, it should be highlighted that thirty-sex letters addressed to the Mutualidad have been
dealt with regarding very different issues and with no specially significant circumstance.
As stated in previous years, it is difficult to establish a common type or subject for complaints made. Therefore, the
only conclusion is that it is a mechanism used by policyholders to state their dissatisfaction in their relationship with
the Company in the face of which the Department of Policyholder Service has attempted to provide the appropriate
explications. In these cases, we can not talk of admission or not thereof, since no declaration is required for it, but
merely they were stating their dissatisfaction with the Company’s service.
For example, there were complaints due to delay in file resolution, the dealings with agents, even against a specific
agent, to not attending an agreed appointment or to being in one of the city centre offices and “it being difficult
to park”. In summary, very varied circumstances with which it is only necessary to pay special attention to those
on incorrect information received when contracting a product. Nonetheless, they were isolated cases and so no
typology thereof needs to be established.
5. STATISTICS DATA ON CLAIMS RECEIVED BY THE DIRECTORATE GENERAL FOR
INSURANCE AND PENSION FUNDS.
As part of the Department of Policyholder Service activity, and after five and a half years with Order ECO/734/2004 in
force, it is worth reflecting, albeit with simple absolute information, on the claims received by said body for the year.
In this sense, in the year analysed, there was entry in 2009 with numbers provided by the Claims Service: 45 files
referring the Mutualidad to the Directorate General for Insurance and Pension Funds, a similar level to 2006 with
44 and a slight improvement on the previous year with 51.
The subjects of said files are varied and it is not worth making a statistical analysis as this would provide little with
such a small number of very different claims.
The regulatory changes due to recommendations provided by the Directorate General for Insurance and Pension
Funds for both the appraisal of article 22 in the Benefits Regulations and the application of the year of insured risk
cover, changes establishing criteria such as the time consideration for permanent incapacities or the assessment
of temporary incapacities more clearly, have not influenced any of the claims sent, either in number or method.
Therefore, it is confirmed that they have added little to regulations that are already sufficiently clear and thorough.
It should only be highlighted that the reports received insist on the consideration to risk cover year, dating its
consideration from the moment of the accident since they understood that the incapacity exists from that moment
and not interrupted by a high work period from the accident to administrative consideration. Nonetheless, nonautomatic application of the incapacity is being advised in response to the requirement of said reports with regards
to the need to apply the permanent incapacity occurrence criteria in compliance with the clarification introduced in
the Benefits Regulations and which means a necessary stabilisation of the consequences.
6. GENERAL CRITERIA INCLUDED IN THE RESOLUTIONS
Following on from criteria already seen in previous years, the resolution decisions follow three main principles
present in all Department of Policyholder Service activity.
1. Policyholder benefit principle. In response to different legal principles present in our Regulations, a defence
principle has been established for the supposedly weakest party in honour of the consumer defence criteria
required by regulatory legislation from customer service departments governed by Order ECO/734. Where there
52
has been a doubt as to the justification or existence of refusal reasons contained in the resolution taken by the
Company subject to claim, a review of the decision has been advised.
2. Burden of proof principle. This principle obliges the parties to prove what they are trying to state. Policyholder
defence does not necessarily mean, in the opinion of this Department, automatic approval of corresponding
benefits but that sufficient documentation must be supplied justifying intentions, as well as allowing financial
implications thereof inherent in awarding a benefit and, with this, the appropriate financial compensation.
3. Legal certainty principle. A double-sided activity criterion has been maintained for this, both to identically resolve
like situations and to try to maintain decision independence allowing a true and objective assessment of the
Company’s decision to be performed.
7. SUGGESTIONS OR RECOMMENDATIONS
The coordinated work and full collaboration with the Organisation Department - which receives most claims continued, as it has direct contact with policyholders, and meets their expectations by fulfilling the insured
outcomes.
With regards to Company work and operation recommendations, a legal requirement for the report content, specific
work is recommended on the thoroughness when applying the different benefit refusal reasons, an always conflictive
point with policyholders, based on the ever more precise application of the certain and real reason as to why
policyholders’ applications are not admitted, as a refusal that could be taken by policyholders as arbitrary, or inadequate
processing of data arriving at the Company, is a cause of conflict and loss of reputation for the Company.
This point is made with regards to the basis for the refusal reason, which must be based on a correctly analysed and
coherent event assessment. It should not be possible for policyholders to have a sensation of arbitrariness, although
this is more in line with exceptional rather than common circumstances, since customers are already unhappy that
their demands are not being met.
B. DIVINA PASTORA SEGUROS GENERALES, S.A.
The Department of Policyholder Service work with regards to work taken on as the Customer Service Department
from the company Divina Pastora Seguros Generales was limited in 2009 to processing three claims files and
sixteen written complaints.
All files, except one claim and two complaints, were put forward due to an increase in the set premium, based on
the sufficiency criteria for the premium made.
The other complaints put forward are due to a lack of service provided with regards to delivering cheques and
authorisations, something we should see as isolated complaints on the service offered.
The pending claim, bereavement insurance claiming the amount of the tombstone, was dealt with appropriately at
the time, seeing the existence of the policyholder’s right.
In the face of the small amount of complaints, it is not necessary to perform statistical analysis or draft directives
or recommendations and merely urge the continuation of work carried out. There is no further incident thereto at
Department of Policyholder Service level.
C. CISNE ASEGURADORA, S.A.
The Mutualidad’s acquisition of the company led to the integration of the former’s Department of Policyholder
Service into this one in October 2008, the operational regulations thereof being assumed.
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This incorporation was carried out in accordance with the legal authorisation allowing companies in the same group
to share customer service departments, as well as the optional figure of customer ombudsman.
Upon incorporation, the unification of complaints and claims was carried out in the same record book as for the
rest of Divina Pastora group companies.
The present year saw normal operation of the Department of Policyholder Service with regards to complaints and
claims put forward for Cisne Aseguradora business.
1. YEARLY STATISTICS
In the year, 57 claims were processed, thirteen being accepted and clear instructions given to Company administrative
bodies to resolve them and pay the corresponding amounts.
Twelve claims were filed for different reasons; five as they were dealt with prior to claim resolution and five more
either for not having clarified the claim subject or for not ratifying the content thereof - a formal compliance
requirement.
The volume of complaints was higher, standing at 192, with the appropriate explanations being provided. In no
instance did said complaints give rise to later acts or rectifications by the Company.
2. Affected Quantities
Neither the claims not the complaints deal with specific amounts, except in five claims for a specific amount albeit as
disparate as the €29.56 for a refund of payments or the €4,500 for a surgical intervention performed with regards a
refund policy. The other amounts were €1,200 for refund for a surgical intervention and €315 and €153 for invoice
refund. The higher amount and that for €315 were accepted as the policyholders were within their rights.
The remaining claims and, of course, complaints have no set amount, above all because the latter, due to their
nature, address the behaviour of the Company rather than claiming any financial compensation, there being no
amount attached..
3. CLAIM AND COMPLAINT REASONS
Claims reasons in the year are varied, although there are issues that can be dealt with uniformly.
With regards to complaint reasons, they are highly diverse but useful for seeing how policyholders feel about service
from the Company. Of the complaints received, 50 were about confusion relating to a letter sent by the Company
in the month of October providing the obligatory two months’ notice on the new premium amounts for 2010.
In replying to said complaints, the Department of Policyholder Service based its replies on the need to adjust the
premium, in accordance with the appropriate actuarial calculations, to the cover provided, as set out in insurance
legislation. The Organisation Department was aware of a letter dealing with the issue, a circumstance which
conveniently stopped the number of complaints received, although each year has led to a flow of complaints despite
the detailed explanation offered by the different company channels where, in spite of everything, the premiums put
forward by the company were even below those offered by other insurance companies in the market.
The remaining complaints were about the different changes such as the home assistance service, complaints simply
occurring, upon analysis, due to people’s habits and routines, especially those in upper age ranges, who find it hard
to accept new methods without assessing whether they do their job or not or even mean a major improvement.
54
However, given the complaints sent, mostly referring to the service provided in Madrid, we can see that on
numerous occasions the complaint referred to the problem in phoning for an appointment via the specific number
Madrid Hospitals made available to the company, a number which likely overloaded due to the number of calls, a
circumstance which, although not the company’s direct responsibility, trying to improve the service and its image
must be taken into account. Nonetheless, the Department of Policyholder Service is aware that the numbers
of hospitals generally suffer frequent saturations of this type and that an enormous increase in resources is an
unacceptable solution; however, special attention must be made to improve it.
Complaints about the telephone service extended to obtaining authorisations due to the increase in medical
tests and practices that have made request thereof a necessity; however, the complaints were due initially to the
increased management control at the company when policyholders perceived that they could request medical tests
and healthcare as they liked, without any company control. It would be normal to expect that over time people
accept the company’s policy, seeing it as a necessary control requirement and not as a bureaucratic requirement
due to bad operation.
Finally, there was the delay in producing and sending the medical chart with the changes and termination of professionals,
especially as a consequence to the termination of the agreement with Clínica Universal, a centre where Madrid
policyholders identified the company’s healthcare service, knowing the professionals there and even with the problems
of transferring patient files not provided by the professionals with the subsequent anxiety amongst policyholders who
suddenly found the doctor treating them had disappeared without being able to go to the health centre.
4. SUGGESTIONS OR RECOMMENDATIONS
After a full year dealing with company complaints, the perception thereof in the Department of Policyholder Service
show a series of points:
1) The necessary premium increase, especially for long-term elderly clients, gave rise to a high percentage of
claims - a circumstance accepted by the company since the premium change was necessary for a second year
running.
2) The Madrid service number for appointments provided by Madrid Hospitals was insufficient for direct fluid
policyholder service. A study of the unanswered calls would be a good idea to try to improve the service offered.
However, as it is a service provided by a third party, the solution is not directly for the company, therefore it
should be analysed in a wider context with regards to the agreement with Madrid Hospitals.
3) The production and delivery of the medical chart for the Community of Madrid should improve the regard for
the service and good company operation. However, the information on it provided through the Call Centre as
well as on the website should be true, reliable and never contradictory.
4) A problem has been detected with regards the knowledge on current and applicable policies for each policyholder
due to the successive changes in the conditions thereof which has not been notified to and accepted by the
policyholders, it being applicable only for new policyholders or those who have accepted the new conditions with
more restrictions. Therefore the revision and incorporation of the physical archive into the company database is
recommended so as to better handle existing documentation and, from this, standardise the contractual situation
for each company portfolio.
The evolution of complaints and claims should be monitored in coming years since, till now, there has been no
historical record of the performance of the company portfolio.
Signed: José Vicente Moreno
Head of the Department of Policyholder Service
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Consolidated
Annual Accounts
57
Consolidated Audit Report 58
Consolidated Profit and Loss Statement 60
Consolidated Statement of Changes in Net Assets 65
Statement of Cash Flows for the Parent Company 68
Consolidated Report 70
Appendix 126
Consolidated Management Report 146
Consolidated Audit Report
58
CONSOLIDATED ANNUAL ACCOUNTS AUDIT REPORT
To the Policyholders at
MUTUALIDAD GENERAL DE PREVISION DEL HOGAR, DIVINA PASTORA.
MUTUALIDAD DE PREVISIÓN SOCIAL A PRIMA FIJA.
1. We have audited the consolidated annual accounts of Mutualidad General de Previsión del Hogar, Divina Pastora,
Mutualidad de Previsión Social a Prima Fija (Parent Company) and subsidiary companies (Divina Pastora Group)
which comprise the consolidated balance sheet as of 31st December 2009, the consolidated profit and loss
account, the consolidated net asset changes report, the consolidated cash flows report and the consolidated
report for the year finishing on said date, whose formulation is the responsibility of the Directors of the parent
company. Our responsibility is to express an opinion on said consolidated annual accounts as a whole, based
on the work performed in accordance with generally accepted audit regulations which require the examination,
via selective tests, of the justifying evidence of the consolidated annual accounts and the assessment of their
presentation, the accounting principles applied and the estimates made. Our work did not include the auditing
of the 2009 annual accounts for the company Cisne Aseguradora, Compañía de Seguros, S.A. where the
Mutualidad General de Previsión del Hogar, Divina Pastora, Mutualidad de Previsión Social a Prima Fija holds
a 92.8% share (see financial figures in note 8 of the report). Said annual accounts for Cisne Aseguradora,
Compañía de Seguros, S.A. have been audited by other auditors (Boris Loring) and our opinion stated in this
report on the consolidated annual accounts of Mutualidad General de Previsión del Hogar, Divina Pastora,
Mutualidad de Previsión Social a Prima Fija is solely based, with regards to the share in Cisne Aseguradora,
Compañía de Seguros, S.A., on the report from said auditors.
2. As stated in note 2 in the attached report, in accordance with what is set out in Transitory Rule Four in Royal
Decree 1317/2008 whereby the new Accounting Plan for Insurance Companies (PCEA) is approved, the
Directors of the Mutualidad opted, when formulating the 2008 consolidated annual accounts, to take 31st
December 2008 as the transition date to said Plan, thereby the consolidated profit and loss account for said
period was put together as per the valuation regulations set out in the previous Accounting Plan for Insurance
Companies approved by Royal Decree 2014/1997, although presented in accordance with the model set out
by the new PCES with the necessary changes as per the consolidated nature of the annual accounts. Therefore,
the attached 2009 consolidated profit and loss account is the first to be prepared following the new accounting
regulations set out in said Royal Decree 1317/2008. For this reason, in accordance with what is set out in note
3, the attached 2009 consolidated annual accounts do not include comparative figures with those from the
previous year. Note 2 ‘Aspects due to the transition to new accounting regulations’ in the attached consolidated
report, presents the consolidated balance sheet, the consolidated profit and loss account, the consolidated
net asset changes report and the consolidated cash flow reports included in the approved 2008 consolidated
annual accounts, alongside an explanation of the main differences between the accounting criteria set out in
Royal Decree 2014/1997 and the new PCEA. Our opinion exclusively refers to the 2009 consolidated annual
accounts. Other auditors issued their Audit Report on 19th May 2009 for the 2008 consolidated annual accounts
of the Mutualidad General de Previsión del Hogar, Divina Pastora, Mutualidad de Previsión Social a Prima Fija
formulated in accordance with the generally accepted accounting principles and regulations in force in Spanish
legislation at the time, where they gave a favourable opinon.
Consolidated Audit Report
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59
3. As stated in note 1 and note 4.d in the attached report, the General Assemblies of the Mutualidad General de
Previsión del Hogar, Divina Pastora, Mutualidad de Previsión Social a Prima Fija and Mutualidad de Previsión
Social Pro Personas con Discapacidad a Prima Fija (Mutualdis) approved the merger of both companies in 2008
with an effective date of 1st January 2008. However, both companies proceeded to formulate and approve their
annual accounts for 2008 separately due to the lack of obligatory authorisation from the Directorate General for
Insurance, obtained in June 2009. Since, in accordance with what is set out in the paragraph above, the attached
consolidated annual accounts do not include comparative figures with the previous year, the Directors present
in these annual accounts all balances and transactions corresponding to the period of twelve months ending on
31st December 2009 for the merged friendly society.
4. In our opinion based on our audit and on the report from the other auditors (Bores Loring Auditores), the
attached 2009 consolidated annual accounts express, in all significant aspects, the true and fair image of
the consolidated assets and financial situation of Mutualidad General de Previsión del Hogar, Divina Pastora,
Mutualidad de Previsión Social a Prima Fija and subsidiary companies as of 31st December 2009, and the
results of its operations, the consolidated net asset changes and the consolidated cash flows for the year
finishing on said date and contain the necessary and sufficient information for appropriate interpretation and
comprehension, in accordance with the applicable generally accepted accounting principles and regulations
which in Spanish legislation.
5. The attached consolidated management report for 2009 contains the explanations the Directors deem appropriate
on the situation of the Parent Company, the development of its businesses and other points, and is not an
integral part of the consolidated annual accounts. We have verified that the accounting information contained in
said management report is in line with that in the consolidated annual accounts for 2009. Our work as auditors
is limited to verifying the management report with the scope mentioned in this paragraph and does not include
a revision of information other than that obtained from the account ledgers at the Mutualidad General de
Previsión del Hogar, Divina Pastora, Mutualidad de Previsión Social a Prima Fija and subsidiary companies.
PricewaterhouseCoopers Auditores, S.L.
PEDRO DÍAZ-LEANTE SANZ
Partner – Account Auditor
13th May 2010
Consolidated Profit and Loss Statement
60
BALANCE SHEET- 2009
Year ending 31st December (Euro)
ASSETS
Notes
2009
A.1) CASH AND OTHER EQUIVALENT LIQUID ASSETS
12,027,571.20
A.2) FINANCIAL ASSETS MAINTAINED FOR NEGOTIATION
A.3) OTHER FINANCIAL ASSETS AT FAIR VALUE WITH CHANGES
POSTED IN PROFIT AND LOSS
--7.4.1.
24,207,489.17
III.Hybrid instruments
A.4) FINANCIAL ASSETS AVAILABLE FOR SALE
I. Asset instruments
II. Representative debt values
A.5) LOANS AND ITEMS PAYABLE
24,207,489.17
7.4.1.
798,325,052.64
47,726,996.19
750,598,056.45
7.4.1.
643,477,890.87
I. Representative debt values
III.Deposits in credit institutions
40,506,152.91
V. Loans for direct insurance operations
54,533,977.69
1. Insurance policyholders
539,553,546.54
7.4.1.7.
54.533.977,69
IX. Other loans
8,884,213.73
1. Loans with Public Administrations
7.4.1.7.
1.318.876,11
2. Other loans
7.4.1.7.
7.565.337,62
A.6) INVESTMENTS HELD UNTIL EXPIRY
---
A.7) HEDGING DERIVATIVES
---
A.8) REINSURANCE SHARE IN TECHNICAL PROVISIONS
---
A.9) TANGIBLE FIXED ASSETS AND REAL ESTATE INVESTMENTS
73,337,070.20
I. Tangible fixed assets
7.1.
12,281,464.66
II. Real estate investments
7.2.
61,055,605.54
7.3.
2,029,583.77
A.10) INTANGIBLE FIXED ASSETS
III. Other intangible assets
V. Goodwill for fully consolidated companies
A.11) SHARE IN GROUP AND ASSOCIATE COMPANIES
1,934,433.31
7.4.1.6.
III.Shares in group companies
A.12) TAX ASSETS
95,150.46
II. Deferred tax assets
1,140,901.31
1,140,901.31
7.6.
25,033,079.48
25,033,079.48
A.13) OTHER ASSETS
19,774,143.50
III.Accruals
19,531,459.84
IV.Other assets
A.14) ASSETS HELD FOR SALE
TOTAL ASSETS
242,683.66
162,600.00
1,599,515,382.14
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61
NET LIABILITIES AND ASSETS
Notes
2009
A) LIABILITIES
---
A.1) FINANCIAL LIABILITIES HELD FOR NEGOTIATION
A.2) OTHER FINANCIAL LIABILITIES AT FAIR VALUE
WITH CHANGES POSTED IN PROFIT AND LOSS
A.3) DEBITS AND ITEMS PAYABLE
--7.4.2.
436,606,816.42
460,605.05
III. Debts for insurance operations
36,493.70
1. Policyholder debts
2. Broker debts
105,667.12
3. Conditioned debts
318,444.23
IV. Debts for reinsurance operations
VII.Debts with credit institutions
IX. Other debts
1. Debts with Public Administrations
3. Other remaining debts
A.5) TECHNICAL PROVISIONS
I. Unearned premiums provision
III. Life insurance provision
1. Unearned premiums provision
3. Mathematical provision
V. Provision for profit share
VI. Other technical provisions
II. Provision for pensions and similar obligations
IV. Other non-technical provisions
A.7) TAX LIABILITIES
15,798,145.83
901,006,373.94
5,936,927.72
895,069,446.22
19,511,157.40
--595,141.86
10,295,418.46
34,133.30
983,682.48
9,277,602.68
9
18,510,100.74
18,510,100.74
II. Deferred tax liabilities
40,890,843.42
A.8) OTHER LIABILITIES
--936,910,819.03
I. Provisions for tax and other contingencies
382,148,194.37
A.6) NON-TECHNICAL PROVISIONS
388,346,178.19
6,197,983.82
IV. Provisions for services
141,398.78
47,658,634.40
40,890,843.42
I. Accounting asymmetry liabilities
---
A.9) LIABILITIES LINKED TO ASSETS HELD FOR SALE
1,443,213,998.07
TOTAL LIABILITIES
B) NET ASSETS
B.1) EQUITY
1. Stated capital or Mutual Fund
143,937,703.21
20,601,012.10
20,601,012.10
7,625,691.35
III. Reserves
3. Other reserves
8. Reserves in fully consolidated companies
8
I. Capital or Mutual Fund
15,819,981.33
(8,194,289.98)
111,966,660.40
V. Results from previous years
1. Remaining surplus
118,447,365.99
2. Negative results from previous years
(6,480,705.59)
VII.Earnings for the consolidated period
Earnings for the period, minority partners
B.2) ADJUSTMENTS FOR CHANGE IN VALUE
4,597,273.48
(852,934.12)
11,340,159.92
I. Financial assets available for sale
42,008,292.48
IV. Accounting asymmetry correction
(30,668,132.56)
B.3) SUBSIDIES, DONATIONS AND BEQUESTS RECEIVED
B.4) EXTERNAL PARTNERS
TOTAL NET ASSETS
TOTAL NET LIABILITIES AND ASSETS
Valencia, 31st March 2010
--1,023,520.94
156,301,384.07
1,599,515,382.14
62
CONSOLIDATED PROFIT AND LOSS ACCOUNT - 2009
I. NON-LIFE INSURANCE TECHNICAL ACCOUNT
2009
I.1. NET REINSURANCE PREMIUMS ATTRIBUTED TO THE PERIOD
59,648,527.98
59,460,082.71
a)Premiums paid
a.1) Direct insurance
a.3) Provision variation for premiums pending payment
59,459,484.97
597.74
(294,324.36)
b)Ceded reinsurance premiums
c) Provision variation for unearned premiums
and current risks (+ or -)
c.1) Direct insurance
482,769.63
482,769.63
I.2. INCOME FROM TANGIBLE FIXED ASSETS AND INVESTMENTS
5,028,082.65
4,908,462.04
b)Income from financial investments
c) Value corrections due to depreciation in tangible fixed
assets and investments
c.2) Financial investments
52,244.20
52,244.20
67,376.41
d)Profits in realising tangible fixed assets and investments
I.3. OTHER TECHNICAL INCOME
244,444.70
I.4. NET REINSURANCE ACCIDENT RATE FOR THE PERIOD
53,508,610.11
52,657,699.41
a)Benefits and expenses paid
b)Provision variation for benefits (+ or -)
b.1) Direct insurance
52,657,699.41
(1,661,759.98)
(1,661,759.98)
c) Expenses chargeable to benefits
2,512,670.68
I.5. VARIATION IN OTHER NET REINSURANCE TECHNICAL
PROVISIONS (+ or -)
(293,741.35)
I.6. SHARE IN BONUSES AND REBATES
---
I.7. NET OPERATING EXPENSES
5,380,979.77
a) Acquisition costs
2,706,505.63
b) Administration costs
2,674,474.14
I.8. OTHER TECHNICAL EXPENSES (+ or -)
a) Depreciation variation for insolvencies (+ o -)
d) Others
352,907.30
(543,322.17)
896,229.47
I.9. TANGIBLE FIXED ASSET AND INVESTMENT EXPENSES
1,242,499.08
1,242,391.24
a)Investment management expenses
a.1) Tangible fixed asset and real estate investment expenses
a.2) Investment and financial accounts expenses
1,242,330.65
60.59
107.84
b)Value corrections for tangible fixed assets and investments
b.1) Tangible fixed asset and real estate investment amortisation
I.10. SUBTOTAL (Non-life Insurance Technical Account Result)
107.84
4,142,317.72
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63
I. LIFE INSURANCE TECHNICAL ACCOUNT
2009
86,971,330.66
87,155,801.56
a)Premiums paid
a.3) Provision variation for premiums pending payment (+ or -)
87,133,313.76
22,487.80
(184,470.90)
c) Provision variation for unearned premiums and current risks (+ or -)
(184,470.90)
66,249,326.11
66,076,649.77
d.2) Financial investments
172,676.34
172,676.34
---
83,897,137.33
83,897,137.33
86,425,554.12
(139,352.46)
(139,352.46)
2,667,769.25
I.5. VARIATION IN OTHER NET REINSURANCE TECHNICAL PROVISIONS (+ or -)
471,339.31
471,339.31
a)Life insurance provisions
471,339.31
1,870,932.35
1,870,932.35
a)Services and expenses for share in bonuses and rebates
12,891,552.82
a)Acquisition costs
9,184,994.40
b)Administration costs
3,706,558.42
1,389,128.51
1,389,128.51
c) Others
12,804,576.99
12,801,358.24
12,801,358.24
I.10. SUBTOTAL (Life Insurance Technical Account Result)
3,218.75
3,218.75
37,367,572.68
64
III. NON-TECHNICAL ACCOUNT
2009
III.1. INCOME FROM TANGIBLE FIXED ASSETS AND INVESTMENTS
1,232,655.11
a)Income from real estate investments
377,224.70
571,356.41
c) Value correction applications for depreciation
284,074.00
III.2. TANGIBLE FIXED ASSET AND INVESTMENT EXPENSES
a.2) Tangible investment expenses
2,810,725.88
2,143,928.21
666,797.67
b) Value corrections for tangible fixed assets and investments
b.3) Financial investment depreciation
25,851,619.29
22,297,422.04
12,587.06
22,284,834.98
743,471.37
c) Losses from tangible fixed assets and real estate investments
c.1) Tangible fixed asset and real estate investment
743,439.94
31.43
III.3. OTHER INCOME
5,467,627.82
5,467,627.82
b)Other income
III.4. OTHER EXPENSES
19,312,566.34
19,312,566.34
b)Other expenses
III.5. SUBTOTAL (Non-technical account result)
(38,463,902.70)
III.6. EARNINGS BEFORE TAX
3,045,987.69
III.7. CORPORATION TAX
(698,351.67)
III.8. EARNINGS FROM CONTINUING OPERATIONS (III.6+III.7)
3,744,339.36
III.9. EARNINGS FROM TERMINATED OPERATIONS
NET OF TAX (+ or -)
III.10.EARNINGS FOR THE PERIOD (III.8+III.9)
--3,744,339.36
Consolidated Statement of Changes in Net Assets
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65
CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
A) STATEMENT OF RECOGNISED INCOME AND EXPENSES
Notes from
the Report
2009
I. EARNINGS FOR THE PERIOD
3,744,339.36
II. OTHER RECOGNISED INCOME AND EXPENSES
3,777,795.39
II.1 Financial assets available for sale
Profits and losses by value
Amounts transferred to profit and loss account
Other reclassifications
2.h)
9,161,468.22
(1,011,941.60)
II.2 Cash flow hedges
Amounts transferred at initial values for hedge items
---
II.3 Net investment hedge in overseas businesses
---
II.4 Exchange and conversion differences
---
II.5 Accounting asymmetry correction
2.h)
(2,776,769.53)
II.6 Assets held for sale
---
II.7 Actuarial profit/(losses) for long-term staff payments
---
II.8 Other recognised income and expenses
2.h)
3,998.73
II.9 Corporation tax
6.6)
(1,598,960.43)
III. TOTAL RECOGNISED INCOME AND EXPENSES
7,522,134.75
66
TOTAL STATEMENT OF CHANGES IN NET ASSETS
B) TOTAL STATEMENT OF CHANGES IN NET ASSETS
Stated capital
or mutual
fund
Reserves
20,000,000.00
131,538,851.51
601,012.10
5,293,472.46
20,601,012.10
136,832,323.97
---
(4,398,472.60)
20,601,012.10
132,433,851.37
I. Total recognised income and expenses
---
---
II. Operations with members and policyholders
---
---
A. BALANCE, END OF 2008
B. BALANCE, END 2008 MUTUALDIS
C. BALANCE END 2008 CONSOLIDATED
I. Adjustments from criteria changes
D.ADJUSTED BALANCE, START OF 2009
(6,360,794.03)
III.Other changes in net assets
2.Transfer between net asset items
---
2,089,084.70
3.Other variations
---
(8,449,878.73)
20,601,012.10
126,073,057.34
---
---
II. Other conversion adjustments
---
---
20,601,012.10
126,073,057.34
B. BALANCE, END OF 2009 WITHOUT CONVERSION
C. BALANCE, END OF 2009
Valencia, 310 March 2010
2 0 0 9
Annual
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67
Earnings from
prior years
Adjustment
for change
n value
Earnings
for the period
External
shareholders
TOTAL
---
2,089,084.70
3,660,472.10
---
157,288,408.31
---
(4,434,120.49)
---
---
1,460,364.07
---
(2,345,035.79)
3,660,472.10
---
158,748,772.38
(2,046,585.10)
---
4,047,574.67
---
(6,445,057.70)
(2,046,585.10)
(2,345,035.79)
7,708,046.77
---
156,351,289.35
---
3,744,339.36
---
---
3,744,339.36
---
---
---
1,023,520.94
1,023,520.94
(4,434,120.49)
2,345,035.79
(145,682.24)
---
(8,595,560.97)
(4,434,120.49)
2,345,035.79
---
---
---
---
(145,682.24)
---
(8,595,560.97)
(6,480,705.59)
3,744,339.36
7,562,364.53
1,023,520.94
152,523,588.68
---
---
3,777,795.39
---
3,777,795.39
---
---
---
---
(6,480,705.59)
3,744,339.36
11,340,159.92
1,023,520.94
156,301,384.07
Statement of Cash flows for the parent company
68
STATEMENT OF CASH FLOWS
2009
A) OPERATIONAL ACTIVITIES CASH FLOWS
A.1) Insurance Activity
1- Direct insurance premium receipts
119,897,030.76
2- Direct insurance benefit payments
112,982,807.60
3- Other operational payments
9- Total insurance activity cash receipts (I)
119,897,030.76
10- Total insurance activity cash payments (II)
115,290,344.57
2,307,536.97
A.2)Other operational activities
3- Receipts from other activities
1,870,668.85
4- Payments from other activities
21,993,412.53
5- Total cash receipts from other operational activities (III)
6- Total cash payments from other operational activities (IV)
21,993,412.53
A.3)Total net cash flows for operational activities (I-II+III-IV)
(15,516,057.49)
1,870,668.85
B)INVESTMENT ACTIVITY CASH FLOWS
B.1) Investment activity receipts
4- Financial instruments
6- Interest receipts
9- Other receipts from investment activity
10- Total cash receipts for investment activities (VI)
146,194,841.29
2,354,206.23
4,000,000.00
152,549,047.52
B.2)Investment activity payments
1- Tangible fixed assets
7- Other payments from investment activity
8- Total cash payments for investment activities (VII)
B.3)Total cash flows for investment activities (VI-VII)
20,073.87
105,786,802.23
292,244.25
106,099,120.35
46,449,927.17
C)FINANCING ACTIVITY CASH FLOWS
C.1) Financing activity receipts
5- Other receipts
421,631.14
6- Total cash receipts (VIII)
421,631.14
C.2)Financing activity payments
5- Other payments
27,150,407.92
6- Total cash payments (IX)
27,153,115.47
C.3)Total cash flows for financing activities (VIII-IX)
Effect of exchange rate variations (X)
Total increase/decrease for cash and equivalent (A.3+B.3+C.3+-X)
Cash and equivalent at the start of the period
Cash and equivalent at the end of the period
Cash and equivalent at the end of the period components
1- Cash and banks
2- Other financial assets
Total cash and equivalent at the end of the period
(26,731,484.33)
(184,547.13)
4,017,838.22
15,127,353.36
11,109,515.14
YEAR 2009
11,109,515.14
--11,109,515.14
2 0 0 9
Annual
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69
Consolidated Report
70
1. GENERAL INFORMATION ON THE PARENT COMPANY AND BUSINESS
The Group has presented consolidated annual accounts since 2002. The companies comprising the Consolidated
Group are: Mutualidad General de Previsión del Hogar, Divina Pastora, Mutualidad de Previsión Social a Prima Fija
(hereinafter the Parent Company or Mutualidad), as Parent Company, Gesmutual Inmobiliaria, S.A.U., Valenciana de
Sistemas Integrales, S.L., Viajes Divina Pastora, S.A.U., Divina Pastora Seguros Generales, S.A.U., Cisne Aseguradora,
S.A. and Cisne Outsourcing, S.L. as Subsidiary Companies (hereinafter Subsidiary Companies).
The Mutualidad General de Previsión del Hogar Divina Pastora, Mutualidad de Previsión Social a prima fija, known
previously as Montepío de Previsión Social Divina Pastora and which initially by the name Montepío de Previsión
Social del Servicio Doméstico Divina Pastora was approved by the Directorate General of Insurance on 15th March
1957 and entered into the Official Register of Charitable Funds and Friendly Societies under number 2,38, is a nonprofit Private Social Welfare Company governed by its own Articles of Association and the Consolidated Text of Law
30/1995 dated November 8th on the Regulation and Supervision of Private Insurance (Royal Legislative Decree
6/2004 dated October 29th) and applicable Regulations.
The Mutualidad, Parent Company, has full legal status in accordance with what is set out in the Consolidated Text
of Law 30/1995 dated November 8th on Regulation and Supervision of Private Insurance (Royal Legislative Decree
6/2004 dated October 29th) and the applicable Regulations, therefore having the legal capacity to acquire, possess,
encumber and dispose of all types of assets, as well as perform any type of acts and contracts related to the aims
for which it is founded, with no further limitations than those set out in the aforementioned legal precepts.
It may also promote the procedures it deems appropriate and exercise its corresponding rights and actions before
ordinary and special jurisdictions and State Administration across all levels.
The purpose of the Parent Company comprises social welfare and the help and assistance of its members and
assets, providing Social Benefits and human, social and family promotion, granting social loans and mortgages,
organising social, cultural and financial services for its members, in accordance with the Stipulations in its Articles of
Association and with the specific particular regulations to be set for awarding each and every one of the benefits,
as well as administering the necessary financial resources to comply with the aforementioned purposes and
recognised benefit methods by law and Branches of Government.
The legal domicile for the Parent Company is located in Valencia, Calle de Colón 74, although this may be relocated
upon agreement by the Board of Directors due to location convenience for the head offices, in which case the
Directorate General for Insurance and Pension Funds at the Ministry of Economy would be notified for all relevant
purposes.
The main areas covered by the Parent Company are Life and Accidents, using 48 offices located across the country
for distribution.
The Merger agreement between Divina Pastora (Parent Company) and the Mutualidad de Previsión Social Pro
Personas con Discapacidad a Prima Fija (Mutualdis) was enacted by public deed on 3rd August 2009.
The effective date of the merger from which the operations of the absorbed Mutalidad are considered performed by
Divina Pastora (Parent Company) for accounting purposes is 1st January 2008. However, in 2008 both companies
formulated and approved their annual account separately without taking into account the merger accounts since
the merger was subject to authorisation from the Directorate General for Insurance and Pension Funds; said
authorisation was granted via ministerial order on 24th June 2009.
Consolidated Report
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Annual
Report
71
2. SUBSIDIARY AND ASSOCIATE COMPANIES
The companies forming part of the consolidation sphere with the Parent Company are the subsidiary companies
Gesmutual Inmobiliaria, S.A. (Single Shareholder Company), Valenciana de Sistemas Integrales, S.L., Viajes
Divina Pastora, S.A. (Single Shareholder Company), Divina Pastora Seguros Generales, S.A. (Single Shareholder
Company), Cisne Aseguradora, S.A., Cisne Outsourcing, S.L. and Previgalia Corporación, S.A. The financial year
for said companies closes on 31st December every year and the annual accounts for 2009 have been used for
integration into the consolidated account.
The subsidiary companies comprising said scope are so considering the Parent Company holds the majority of voting
rights in all cases in application of Law 30/1995 on Regulation and Supervision of Private Insurance, Royal Decree
1317/2008 whereby the Accounting Plan for Insurance Companies and Regulations for formulating accounts of
Insurance Company groups is approved. Furthermore, what is set out in the Code of Commerce, Limited Companies
Law and other specific dispositions, especially in the Accounting Plan for Insurance Companies approved by Royal
Decree 1317/2008 and Royal Decree 1815/1991 dated December 20th whereby the regulations for formulating
consolidated annual accounts has been applied.
With regards to the group companies Cisne Aseguradora and its subsidiary Cisne Outsourcing, on 17th December
2008, the Directorate General for Insurance and Pension Funds named a provisional administrator for said company,
whereby on 31st December 2008 the Parent Company did not comply with the requisites set out in article 42 in
the Code of Commerce by not having control of said company. For this reason, it was not integrated in the scope
of consolidation as of 31st December 2008.
However, on 7th July 2009 the provisional substitution measure for Cisne Aseguradora management bodies by the
Directorate General for Insurance and Pension Funds ceased, with the Shareholders Meeting on 10th August 2010
naming a new management body. For this reason, on 31st December 2009 the circumstances set out in article 42
of the Code of Commerce arose and therefore the company Cisne Aseguradora and its 100% subsidiary Cisne
Outsourcing had to be integrated by the global integration method.
The Parent Company holds 73% of the shares in the Company Previgalia Corporación, S.A., headquartered in
Madrid, Gran Vía 12. Its purpose is social welfare benefits and help for policyholders (mentally disabled individuals),
following the articles of association approved on foundation. The Company is not listed on the stock market.
On the formulation date for these consolidated annual accounts the company is in administration, equity standing
at zero. In addition, there are no transactions with said company and, for this reason, it has not been integrated into
the consolidated annual accounts as its effect is completely immaterial.
The most relevant information for the subsidiary companies is as follows:
GESMUTUAL INMOBILIARIA, S.A.U.
Head Office:
Calle Colón nº 74 (Valencia)
The business purpose of the company is the activity of real estate development companies in
the terms and with the scope set out in Order dated 28th December 1995 from the Ministry of
Business:
the Treasury on the Regulations for adaptation of the General Accounting Plan for real estate
companies.
Capital stock held: 100%
Consolidated Report
72
The details for Equity at this Company as of 31st December 2009 and other useful information, as per the
abbreviated, unaudited annual accounts, are as follows:
Euro
Equity:
Capital
1,675,000.00
Reserves
64,894.40
2009 Result
(577,808.76)
Total Equity
1,162,085.64
Extraordinary earnings
12,236.72
Parent company investment value
1,162,085.64
Total Assets 31 December 2009
14,403,154.97
st
On 18th June 2009 through a decision of the Single Shareholder the capital stock of Gesmutual Inmobiliaria was
agreed to be reduced to compensate losses, going from 6,500,000.00 euro to 1,675,000.00 euro. Said reduction
was performed via proportional reduction of the nominal value of the shares.
Since 2005 the company Gesmutual Inmobiliaria has held 40% of stock in Valenciana de Sistemas Integrales,
S.L. headquartered in Calle Filipinas 39, Valencia, and whose business purpose is sales and operating all types of
estates, real estate, lots, construction, development and renovation of all types of property, as well as brokerage in
any of the activities set out above. Via sales deed formalised before a notary on 28th March 2008, it acquired the
remaining shares up to 100% of Company shares, comprising 2,000 shares at 3,775 euro each.
The financial statements for said company have been consolidated with its parent company Gesmutual Inmobiliaria,
S.A.U. to be incorporated into the group formed by the Parent Company Mutualidad General de Previsión del Hogar
Divina Pastora, Mutualidad de Previsión Social a Prima Fija.
The details for Equity at this Company as of 31st December 2009 and other useful information, as per the abbreviated
annual accounts on 31st December 2009, are as follows:
Euro
Equity:
Capital
Reserves
2009 Result
6,000,000.00
(14,205,979.97)
(1,064,992.03)
Total Equity
(9,270,972.00)
Total Net Assets
(9,270,972.00)
Total Assets 31st December 2009
Total Income 2009
--27,410,700.65
7,383.00
Consolidated Report
2 0 0 9
Annual
Report
73
VIAJES DIVINA PASTORA, S.A.U.
Head Office:
The company’s business purpose is the sale of tickets or reservation of places on all types of
transport methods, as well as the reservation of rooms and services with tourist companies
and, specifically, at tourist accommodation establishments, organising and selling package tours
and day trips and, specifically, at tourist accommodation establishments; organising and selling
package holidays and short trips.
Business:
annual accounts, are as follows:
Euro
Equity:
Capital
363,500.00
Results from previous years
(68,332.92)
2009 Result
(53,050.07)
Total Equity
242,117.01
Extraordinary earnings
3.81
Parent company net investment value
242,117.01
504,138.56
st
DIVINA PASTORA SEGUROS GENERALES, S.A. (Sociedad Unipersonal)
Head Office:
Its business comprises insurance operations in the areas of healthcare, sickness and death,
covering the risks specified in the policy for each insurance branch. The Company is not listed
on the stock market.
Business:
A company acquired 100% by the Parent Company on 3rd May 2007, founded as a Limited Company on 20th
October 1945.
The details for Equity at this Company as of 31st December 2009 and other useful information, as per the Group
company annual accounts, audited by PricewaterhouseCoopers, are as follows:
Euro
Equity:
Capital
3,008,000.00
Reserves
1,106,046.28
2009 Result
Total Equity
77,872.41
4,191,918.69
Parent company net investment value
5,750,218.69
6,464,674.71
Total Income 2009
2,641,138.42
st
Consolidated Report
74
CISNE ASEGURADORA, S.A. COMPAÑÍA DE SEGUROS Y REASEGUROS
As of July 2008, the Parent Company had acquired 92.82% of Cisne Aseguradora, S.A., Compañía de Seguros y
Reaseguros.
The registered office: was transferred in 2009 to Calle Colón no. 74, Valencia, being entered in the Companies
Register of Valencia, Volume 9043, book 6327, folio 1, Section 8, Sheet V-134.195, with
C.I.F. (Tax ID) no. A 28263242.
Business:
The business of the company is private insurance operations, being authorised to operate
in area no.1 accidents, area 2 illness and healthcare, area 17 legal defence and area 19
bereavement in article 6 of the Royal Legislative Decree 6/2004 dated October 29th whereby
the Consolidated Text of the Law on Regulation and Supervision of Private Insurance is
approved. The Company is not listed on the stock market.
Capital stock held: 92.82%
The details for Equity at this Company as of 31st December 2009 and other useful information, as per the Group
company annual accounts, audited by Bores Loring, S.L., are as follows:
Euro
Equity:
Capital
Reserves
Negative results from previous years
21,860,013.18
425,684.15
(30,835,090.24)
2009 Result
(11,879,305.28)
Total Equity
(20,428,698.19)
---
The accounting adjustments performed in 2008 at the company Cisne Aseguradora, S.A. due to the inspection report
issued by the Directorate General for Insurance and Pension Funds (DGSFP) on 25th November 2008 revealed an
asset imbalance at the company which, at the end of the year, was in the legal process of being liquidated as set
out in article 260 in the TRLSA. The annual accounts formulated by the provisional administrator designated by the
DGSFP showed the equity deficit and, therefore, the order of the day at the General Meeting called to examine and
approve the accounts and audit company management also included the provisional administrator’s report on the
asset and financial situation at the company and the adoption of measures leading to the reestablishment of asset
balance or, where applicable, the agreement to dissolve and liquidate the company.
Bearing in mind the above, upon the proposal of the provisional administrator, the General Meeting on 29th July
2009 agreed to the total transfer of the company’s insurance portfolio, upon administrative authorisation of the
operation and the latter being verified, the dissolution and liquidation of the company in compliance with what
is set out in article 27.1.b) in the Law on Private Insurance Regulation and Supervision (“LOSSP”). The portfolio
transfer was authorised by Order EHA/3705/2009 dated December 29th from the Honourable Vice-president
2 of the Government and Minister of the Economy and the Inland Revenue (BOE 25th January 2010) and was
formalised in public deed dated 29th January 2010, entered in the Companies Register of Valencia on 3rd March. In
compliance with the regulatory norms and the Ministerial Order dated 29th December 2009, in the public deed of
transfer it was stated that with the latter the suspension condition of company dissolution and liquidation had been
fulfilled and, consequently, the procedures to carry it out would be started.
The annual account of the subsidiary company were formulated, by what is set out above, under the company in
liquidation principle, the application of this principle meaning a positive effect on company earnings of 392,400.18
euro, by valuing the intangible assets, the tangible assets and the real estate investments at liquidation value.
Consolidated Report
2 0 0 9
Annual
Report
75
On 24th March 2010, the Board of Directors at the subsidiary company ratified the decision to present insolvency
proceedings. (See Note 12 in this report.)
CISNE OUTSOURCING, S.L.
Cisne Aseguradora owns 100% of Cisne Outsourcing, S.L.
It was founded on: 12th December 2005 before Notary Public of the Association of Madrid, Mr. José Luis MartínezGil Vich, under number 4,070 in his notarial records. The company owns 100% of the capital
stock. The registered office is located at no. 13 Calle Eduardo Dato, Madrid. It is entered in the
Companies Register of Madrid, Volume 22.123, Book 0, Section 8, Folio 70, Sheet M-394679
with C.I.F. (Tax ID) no. B84540525.
Business: Service provision
annual accounts of the Group company, unaudited and provided by the single director of said company, are as
follows:
Euro
Equity:
Capital
Reserves
2009 Result
Negative Net Equity
3,300.00
(4,597,335.87)
(497,042.75)
(5,091,097.62)
Total Assets 31st December 2009
Total Income 2009
--230,682.15
2,259,145.54
The company basically provided services to its parent company Cisne Aseguradora, S.A.
Insolvency proceedings were presented on 18th June 2009 at the subsidiary Cisne Outsourcing, it being in
administration when these consolidated annual accounts were formulated.
3. ASPECTS ARISING FROM THE MOVE TO NEW ACCOUNTING REGULATIONS
In accordance with what is set out in Royal Decree 1317/2008 dated July 24th whereby the Accounting Plan for
Insurance Companies (PCEA) was approved, all companies covering by section II in the consolidated text of the
Law on Regulation and Supervision of Private Insurance, approved by Royal Legislative Decree 6/2004 dated
October 29th, as well as the branches of insurance and reinsurance companies registered in third-party states, nonmembers of the European Economic Community, established in Spain must apply said Plan from the end of the
year 31st December 2008.
At the close of the previous period, as in compliance with what is set out in provisional regulations 1 and 4 in the
Plan, the Parent Company selected the transition date as 31st December 2008, whereby the attached consolidated
annual accounts for the 2009 period are the first where the recording and valuation criteria set out by the new
accounting standard are applied; therefore, based on the interpretation stated by the Directorate General for
Insurance and Pension Funds (detailed in Note 4), the Parent Company has opted to not present comparative
information from 2008 at the close of 2009 in any of the documents forming part of the consolidated annual
accounts as the consolidated profit and loss accounts for 2008 and 2009 are not comparable.
Consolidated Report
76
The main differences between the accounting criteria used in the consolidated profit and loss account in 2009 and
those used in the previous year are set out below:
• The variations in the fair value of financial assets at fair value with changes on the profit and loss statement,
which were previously accounted by acquisition price, are recorded in the profit and loss account for 2009.
• The implicit and explicit interest on fixed income financial assets have been recorded on the profit and loss
account for 2009, using the effective interest rate method - allocation criteria that differ from that used by the
company up to the transition date.
4. PRESENTATION BASES FOR THE CONSOLIDATED ANNUAL ACCOUNTS
a) True and fair view
The attached consolidated annual accounts have been prepared based on the accounting records of the Parent
Company and Subsidiary Companies which are included in the consolidation (see Note 2 in this consolidated
report) the annual accounts for which have been formulated by the Parent Company Directors in accordance
with the Accounting Plan for Insurance Companies, approved in RD 1317/2008, as well as by the General
Accounting Plan approved by Royal Decree 1514/2007, to show a true and fair view of assets, the financial
situation, Group results, as well as the flows incorporated in the cash flow report.
The attached individual consolidated annual accounts for the Mutualidad General de Previsión del Hogar, Divina
Pastora, Mutualidad de previsión social a prima fija and Subsidiary Companies corresponding to 2009 are
pending approval by the Policyholders Assembly. However, the Directors expect them to be approved without,
where applicable, any significant changes.
b) Accounting principles and consolidation regulations
All Subsidiary Companies have been consolidated by the global integration method, given the business they
carry out and the significant effect on their consolidated annual accounts.
The Parent Company, based on the slight relevance of the group company Previgalia Corporación, S.A. and
since this company has insignificant interest with regards the fair view set out in the consolidated accounts, has
not integrated it, being presented by its acquisition costs (see section 7.4.1.6. in this consolidated report).
The attached consolidated annual accounts do not include the fiscal effect which, where applicable, may
occur as a consequence of the incorporation of consolidated company reserves into Parent Company assets,
considering said reserves will be used as a source of self-financing at each consolidated company.
In preparing the consolidated annual accounts, the Parent Company has followed the obligatory accounting
principles set out in the Accounting Plan for Insurance Companies, approved by Royal Decree 1317/2008
dated July 24th.
There is no obligatory applicable accounting principle which, having a significant effect on the consolidated
annual accounts, has not been applied.
c) Critical aspects to the assessment and margin of error
In preparing the consolidated annual account, judgements and estimates have been used based on future
hypothesis and uncertainties which basically refer to the following concepts:
1. Losses for depreciation of certain assets (see Note 6.d) 3.).
2. The fair value of certain unlisted assets (see Note 6.d)).
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3. The hypotheses used to assign part of the unrealised profits from financial investment portfolios assigned as
“available for sale” and as “at fair value with changes in results” as the higher amount of the life insurance
provisions (see Note 6).
4. The useful life of tangible and intangible assets. (See Notes 6 a) and 6 b).)
5. The amount for assets and liabilities from insurance contracts (see Notes 6 c) and 6 i)).
The estimates and hypotheses used are reviewed periodically and are based on the historical experience and
other factors considered fairer at all times. If, as a consequence of these reviews, an estimate change occurs in
a certain period, its effect will be applied in that period and, where applicable, subsequent periods.
d) Information comparison
The consolidated financial statements for 2009 comprising the consolidated balance sheet, the consolidated
profit and loss account, the consolidated net asset changes statement, the consolidated cash flow statement
and the consolidated report notes are not presented in comparison with said consolidated statements from
the previous year.
As set out in Note 3, the Parent Company Directors opted to take the transition date for the new accounting
plan as 31st December 2008, whereby the consolidated profit and loss account for said period was formulated
as per the criteria set out in the previous accounting plan (R.D. 2014/1997). Consequently, the attached
consolidated profit and loss account for 2009 is the first prepared as per the new accounting standards set
out in said Royal Decree 1317/2008. For this reason, in accordance with the response dated 13th February
2009 from the Institute of Accounting and Account Auditing to the enquiry made by the Institute of Sworn
Accounts Auditors of Spain which contained the considerations made by the Directorate General of Insurance
and Pension Funds with regards to the effects of applying the New Accounting Plan for Insurance Companies
with the audit reports for 2008 and subsequent, the attached consolidated annual accounts for 2009 do not
include comparative figures with those from the previous year.
The General Extraordinary Policyholders Assembly for the Mutualidad General de Previsión del Hogar Divina
Pastora took place on 26th September 2008. Said Meeting approved the merger between Divina Pastora
(Acquiring Company) and Mutualdis (Acquired Company), taking as a reference thereof the balance sheets as
of 31st May 2008.
Said merger project included as effective date thereof the 1st January 2008.
The merger project as well as the authorisation application for said merger was sent to the Directorate General
for Insurance and Pension Funds (DGSFP) on 29th October 2008. However, the DGSFP did not authorise said
operation until 24th June 2009 via ministerial order sent to the Company on 26th June 2009.
In this way in 2008 the company, based on the applicable regulations on said date, did not record it on the
books awaiting the appropriate authorisation and later entry in the Companies Register.
In this sense, in accordance with the statement from the Directorate General for Insurance and Pension Funds
made in 2009 with regards to the date for accounting purposes of the merger, the company recorded the
merger in the books in 2009 with retroactive effects; therefore, as set out later, the opening balances of the net
asset changes statement have been adjusted as a result of the recording of the merger, taking it as a change in
accounting criteria with regards to those applied in the previous year by both companies.
For information purposes, the report, balance sheet, profit and loss account, the net asset changes statement
and the cash flow statement from the Parent Company and included in the annual accounts for the previous
year have been included as Appendix I. In addition, the Mutualdis balance sheet and profit and loss account
for the annual period ending 31st December 2008 are included as Appendix II. Finally, the balance sheet and
aggregate profit and loss account for the consolidated Divina Pastora statement at 31st December 2008 and
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for Mutualdis at the same date are included as Appendix III, corresponding to the accounting criteria change
applied with regards to the merger of both companies set out above.
e) Elements included in different items
There are no asset elements recorded in two or more items on the consolidated balance sheet.
f) Changes in accounting criteria, estimates and accounting errors correction
In addition to the accounting criteria change set out in the information comparison note regarding the merger of
Mutualdis and Mutualidad General de Previsión del Hogar Divina Pastora, the reassessment of the accounting
classification of certain financial instruments containing implicit derivatives has been performed which in the
first application of the new Accounting Plan for Insurance Companies RD 1317/2008 were initially classified
as “Financial assets available for sale” instead of the category “Financial assets with changes in Profit and Loss”.
This classification change has meant a reclassification of “Adjustments for value change” to “First application
reserves” for the amount of 4,047,574.68 euro (net of tax), the valuation for 2009 being recorded on the profit
and loss account.
In turn, the valuation of certain financial assets from the extinct Mutualdis has been re-estimated, a correction
being recorded for an amount of 2,046,586.10 euro (net of tax) which decreases the equity on the closed
Mutualdis balance sheet for 2008 and is included on the asset changes statement as it is due to the first
application of the new PCEA.
Given the absence of comparative information with regards to 2008 in accordance with what is set out in Note
3.d) no conversion is performed on the reference financial statements.
g) Income and expenses allocation criteria
The technical income and expenses are obtained directly from accounting, according to the branches operated
by the Parent Company and the Subsidiary Companies Divina Pastora Seguros Generales, S.A.U. Compañía de
Seguros and Cisne Aseguradora, S.A. Compañía de Seguros y Reaseguros.
The allocation criteria between life and non-life branches applied by the Parent Company and the aforementioned
Subsidiary Companies for the effect of investments in one or another activity, in application of the allocation
thereof for financial income and expenses, have been performed based on the technical provisions to be
covered, the remaining investments being aimed at remunerating Group assets.
Income and expenses related to the business at Gesmutual Inmobiliaria, Valenciana de Sistemas Integrales,
Cisne Outsourcing and the business of Viajes Divina Pastora are shown in the non-technical account, since their
business is not related to that of an Insurance Company.
5. RESULT DISTRIBUTION
The proposed result distribution for the Parent Company for 2009, which the Parent Company Board of Directors
will assess for approval at the Policyholders Meeting, is as follows:
Euro
Distribution balance:
Earnings for the year after tax
4,757,766.37
Distribution
Remaining surplus
4,757,766.37
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6. VALUATION REGULATIONS
In compliance with the Regulations on formulating group accounts subject to consolidation for Insurance Companies
(Royal Decree 1317/2008 dated July 24th) for Subsidiary Companies, the Parent Company has maintained the
accounting rules set out in specific legislation for this Parent Company which are subject to the Accounting Regulations
in the General Accounting Plan (Royal Decree 1514/2007 dated November 16th) performing homogenisation,
where applicable.
The most significant accounting criteria and valuation regulations applied by the Parent Company in formulating the
consolidated annual accounts are as follows:
a) Intangible fixed assets
Basically these include IT applications.
They are valued at their acquisition price. Amortisation is performed linearly over a maximum period of 4
years.
The consolidation goodwill corresponds to the amount paid above the Underlying Book Value at the time of
acquisition of the Subsidiary Company Divina Pastora Seguros Generales, S.A.U.
b) Tangible fixed assets and real estate investments
The assets included in the real estate investments and tangible fixed assets sections on the attached consolidated
balance sheet are valued at acquisition price which includes, as well as the seller price, the non-recoverable
indirect taxes from the Inland Revenue and all additional expenses up to operation, including financial costs as
long as these are paid before said operation and have been issued by the supplier or correspond to loans or
another type of other financing, directly and specifically aimed at financing the acquisition.
The extension and improvement costs for assets are incorporated into the assets at best asset value exclusively
when they mean an increases in capacity or surface area, performance or extension of useful life, in no way
repairs and conservation work being considered as improvements in any way. The net book value of the asset
after the incorporation of the improvement is above market value.
Amortisation of these assets is systematically calculated by the linear method based on the estimated useful
life, taking into consideration the effective depreciation due to operation, use and enjoyment.
The years of estimated useful life for elements comprising the tangible fixed assets are as follows:
Years of useful life
Buildings
50
Transport elements
8.3
Furniture and facilities
8.3-10
Equipment for information processing
5
Other tangible fixed assets
10
At year-end the corresponding value corrections for tangible asset and building investments have been performed,
making the appropriate provisions for depreciation as long as the market value is below the acquisition value or
production cost, deducting amortisation.
Market value is understood, in the case of tangible asset investments, the appraisal value set by an authorised
appraisal company, in accordance with the current valuation regulations for the purposes of technical provision
cover.
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As part of its business, as is set out in the articles of association (see Note 1 in this consolidated report), the
Parent Company is dedicated to real estate development including the result of its business in the following
sections of the consolidated balance sheet and consolidated Profit and Loss account:
• Real estate investments (see Note 7.2. in this consolidated report).
Including the amount for sites, works in progress and property pending sale related to real estate development
business and best valued between the acquisition/production cost and market value.
The acquisition cost is set as follows:
1. Sites: based on the acquisition cost thereof.
2. Current developments: including the cost for the sites, work certifications and other direct costs which are
listed below for ‘Property pending sale’, up to the reference date.
3. Property pending sale: including all direct costs related to the business, the details of which are as
follows:
- Acquisition of land and sites
- Work certifications
- Quantity surveyor and architect fees
- Personnel salaries in the real estate department for building phases.
- Support services
- Any cost considered greater book value for the property (licences, permits, technical fees, projects, etc.).
• Real estate expenses (see Note 7.2. in this consolidated report).
As an integral part of the aforementioned section, all those costs related to the real estate development
business, as well as the variation in sites, are included.
• Real estate investment income (see Note 7.2. in this consolidated report).
Mainly including all income from sales related to the real estate development business, as well as the variation
in work in progress and property pending sale.
• Financial investment income.
The interest on loans provided by the Parent Company in relation with the real estate business is included.
c) Advance fees and other activated acquisition costs
The Parent Company has activated the recurring acquisition fees and costs for the amount pending amortisation.
The activated costs have future financial influence as they are linked to the future generation of business
volume.
The activated acquisition fees and costs are amortised in the accrual period for premiums with a linear criteria.
If the policies are cancelled or totally or partially free from premium payment, before the fees and costs are
completely amortised they are amortised in advance at cancellation or liberation even when the latter is partial,
this circumstance is taken into account.
d) Financial assets
Those assets corresponding to cash, an asset instrument from another company or mean a contractual right to
receive cash or another financial asset, or any exchange of financial instruments in favourable conditions are
classified as financial assets.
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d.1. Classification and valuation
For the purposes of valuation, financial assets are classified in one of the following categories:
1. Loans and items payable
2. Other financial assets at fair value with changes to the profit and loss account
3. Investments in group, multi-group and associate company assets
4. Financial assets available for sale
1. Loans and items payable
The loans for commercial and non-commercial operations are recorded in this category, including financial
assets whose collections are a set or ascertainable amount, that are not negotiated in an active market and
for which all the payment made by the Company is expected to be recovered except, where applicable, for
reasons chargeable to debtor solvency.
Initially, they are identified on the balance sheet at fair value which, except where there is contrary evidence,
is the transaction price equating to the fair value of the consideration provided plus directly attributable
transaction costs.
After initial recording, these financial assets are valued at their amortised costs, recording the interest
paid based on the effective interest rate, understood as the discount rate equalling the book value of the
instrument with all estimated cash flows until expiry.
For those items classified in this section with expiry below one year and which have no contractual interest
rate, they are initially and subsequently valued at par value, when the effect of not updating cash flows is
insignificant.
Loans for direct insurance operations
Loans with brokers and policyholders are valued at par value, providing, where applicable, the appropriate
reduction provisions applicable in accordance with financial criteria and insurance business practices, in
general, when there are latent insolvency situations or for those whose age gives rise to reasonable doubt
as to recovery.
Provision for premiums pending payment corresponds to premiums pending payment at year-end which,
foreseeably and in accordance with Parent Company and subsidiary insurance company experience, are not
expected to be paid. This is calculated separately for each branch or risk, based on the age of the premiums
pending payment:
- Premiums equal or above six months not claimed in court are given a provision for the whole amount.
- Premiums equal or above three months and below six months, not claimed in court, are provided for by
applying a coefficient of 50%.
- Premiums below three months, not claimed in court, are given a provisions of 25% of the premium rate
pending payment.
- For premiums claimed in court, provisions are made based on the circumstances in each case.
The provision calculate in this way is reduced by the amount for fees allocated to results and in that for
the provision for unexpired premiums constituted on said premiums, which in the case of instalments, the
provision for unexpired premiums to deduct is that corresponding to unpaid premium instalments.
2. Other financial assets at fair value with changes to the profit and loss account
Hybrid financial instruments are included in this category when it is not possible to perform the valuation of
the implicit derivative separately or the fair value can not be set reliably, whether at the time of acquisition
or on a later date.
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3. Investments in group, multi-group and associate company assets
Share in group companies
Investments in capital in group, multi-group and associate companies are included in this category.
They are initially valued by cost, which is equal to the fair value of the consideration provided plus the
transaction costs. The amount for preferential subscription rights and similar that have been acquired is part
of the initial valuation.
After initial recognition, they are valued at cost less, where applicable, the accumulated amount of value
corrections for depreciation. However, where there is an investment prior to registering as a group, multigroup or associate company, the investment cost is considered at book value before having that standing.
The value adjustments prior accounting directly in the net assets are maintained therein until they are
cancelled.
If there is objective proof that the book value of an investment is not recoverable, the appropriate value
corrections are made for the difference between the book value and the recoverable amount, this being
understood as the higher amount between the fair value less the sales value and the actual value of cash
flows derived from the investment calculated through estimating the participation in cash flows expected to
be generated by the subsidiary company both from its ordinary activities and its disposal or removal due to
sale. Save better evidence of the recoverable amount, the depreciation estimate for these investments takes
into account the net assets of the subsidiary company corrected for existing tacit gains on the valuation date.
The value correction and, where applicable, its reversal is recorded in the profit and loss account for the year
it occurs. The depreciation reversion will have the investment book value as a limit which would be recorded
on the reversion date if the value depreciation reversion had not been recorded.
The payment made by the Parent Company for the foundation of the company DIVINA PASTORA SEGUROS
DE AMÉRICA, S.A. is included in this section for an amount of 1,140,901.31 euro, the latter not being
consolidated as it is the foundation process.
The 73% share in the group company Previgalia Corporación, S.A. is also included, not integrated into the
consolidated accounts due to its scant relative importance for them.
4. Financial assets available for sale
Those assets not classified in any of the other categories are included in this category.
Initially, they are valued at fair value which is the transaction price, understood as the fair value of the
consideration provided plus directly attributable transaction costs.
Later valuation is performed by fair value, without deducting the possible transaction costs occurring in
disposal. The changes to the fair value are directly recorded in net assets, until the asset is removed from the
balance sheet or depreciates, when the recognised amount is posted in the profit and loss account.
The interest amount, calculated according to the effective interest rate method, and the paid dividends are
recorded in the profit and loss account.
At year-end, value corrections are performed if the asset has depreciated due to the following
circumstances:
- For acquired debt instruments, if there has been a reduction or delay in estimated future cash flows, which
may be due to debtor insolvency.
- For investments in asset instruments, if there is evidence of a lack of recoverability in the asset book value.
In all instances, it is assumed that the asset has depreciated due to an 18-month fall and forty per-cent of
its price without value recovery having occurred.
The value correction for value depreciation for these assets is the difference between the cost or amortised
cost less, where applicable, any value correction for prior recognised depreciation in the profit and loss
account and the fair value at the time the valuation is performed.
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The accumulated losses in net assets due to reduction in fair value, as long as there is objective evidence of
asset value depreciation, are identified in the profit and loss account.
For those assets where the fair value has increased later, the value correction recognised in previous years
reverts with an addition to the profit and loss account for the year. However, where the fair value increases
for an asset instrument, the value correction recognised in previous years does not revert with an addition to
the profit and loss account and the increase in fair value is recorded directly against net assets.
d.2. Interest and dividends received for financial assets
The interest and dividends for financial assets paid after acquisition have been identified as income in the profit
and loss account. The interest is identified using the effective interest rate method and the dividends when the
right to receive it is stated.
To these effects, the initial valuation of financial assets independently records, in line with expiry, the amount of
explicit accrued interest receivable as well as the dividends agreed at acquisition. Explicit interest is understood
for these purposes as that obtained from applying the contractual interest rate for the financial instrument.
In turn, when the distributed dividends are unequivocally from earnings generated before the acquisition date
as amounts above the profits made by the subsidiary company since acquisition have been distributed, they
are not identified as income and they reduce the investment book value.
d.3. Depreciation of financial assets
The Parent Company assesses at close if the financial assets or group of financial assets have depreciated.
Financial assets accounted at amortised cost (items payable)
The necessary value corrections are performed, as long as there is objective evidence that the value of a
financial asset or group of financial assets accounted at amortised cost has depreciated as a result of one or
more events having occurred after initial identification and causing a reduction or delay in estimated future cash
flows.
The loss for value depreciation of these financial assets is the difference between book value and the actual
value of future cash flows expected to be created, deducted at the effective interest rate calculated at the time
of their initial recognition. The effective interest rate on the close date for financial statements in accordance
with contractual terms is used for financial assets at variable interest.
The calculation for losses for depreciation of a group of financial assets uses models based on formulae or
statistical methods.
The value corrections for depreciation, as well as reversion when the amount of said losses is reduced due
to causes related to a later event, are identified as an expense or income respectively in the profit and loss
account. The depreciation reversion is performed with the asset book value as a limit which would be recorded
on the reversion date if the value depreciation reversion had not been recorded.
Financial assets available for sale
Value corrections are performed for financial assets available for sale if there is objective evidence that the value
has depreciated as a result of a reduction or delay in estimated future cash flows for acquired debt instruments
or the lack of recoverability of the asset book value for investments in asset instruments. The value correction
is the difference between the cost or amortised cost less, where applicable, any value correction for previously
recognised in the profit and loss account and the fair value at the time the valuation is performed. For asset
instruments valued at cost as the fair value can not be determined, the value correction is set in the same way
as for group, multi-group and associate company asset investments.
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If there is objective depreciation evidence, the Parent Company recognises in the profit and loss account
the accumulated losses previously identified in net assets for fair value depreciation. The losses for value
depreciation identified on the profit and loss account for asset instruments do not revert through the profit and
loss account.
The fair value of a financial instrument on a given date is understood as the amount at which it can be purchased
or sold between an interested and duly informed buyer and seller in mutual conditions of independence.
The fair values of listed investments are based on current purchase prices. If the market for a financial asset is
not active (and for unlisted securities), the Parent Company establishes the fair value using valuation techniques
based on the updated flows, taking the appropriate market rates curve as a reference (debt or swap, based
on the asset type) adjusted by the corresponding reference risk premiums contrasted, where applicable, with
counterparty valuations. The new Accounting Plan for Insurance Companies modified the applicable system for
different financial instruments with regards to the system planned in valuation standard 5 in the 1997 PCEA,
establishing a recognition and valuation system after the initial recognition which will depend on the category
or portfolio where they are allocated. This means, amongst other things, the disappearance of the concept of
representative listing and the level premiums based on the quality of the issuer or the issue terms to estimate
the market value of fixed rate securities based on the updated future flows.
As an alternative, Note 2 in point 6 of the Conceptual Framework for accounting introduces the price concept in
an active market and, failing that, the need to recur to the application of valuation models and techniques.
An active market is a market where the following conditions simultaneously occur:
- The exchanged goods or services are homogeneous.
- Buyers or sellers for a specific good or service can be found at practically any time.
- The prices are known are easily accessible for the public. Further, these prices must reflect real, present market
transactions occurring regularly.
Regarding the above, the regulation refers to the need for a market to be transparent and solid. Therefore,
the prices known and easily accessible for the public offered by financial information providers reflecting real
present market transaction occurring regularly will be considered as active market prices.
If there were no price on an active market, it would need to be estimated with a valuation model or technique
that is consistent with the methodology accepted and used on the market for setting prices, maximising the use
of observable data on the market. For instruments representing debt, the discount methodology of certain or
probabilised flows can be used in accordance with a discount, credit risk and liquidity rate adjusted to market
conditions.
e) Financial liabilities
Those instruments issued, committed or assumed which mean for the Parent Company a direct or indirect
obligation as per the financial reality to pay in cash or with another financial asset or exchange financial assets
or liabilities with third parties in unfavourable conditions are recorded as financial liabilities.
Classification and valuation
Financial liabilities are classified in their entirety in the “Debts and items payable” category.
They correspond to debts for commercial and non-commercial transactions.
They are initially valued at fair value which, except where there is contrary evidence, is the transaction price
equating to the fair value of the consideration received. The directly attributable transaction costs are part of the
initial valuation.
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After the initial recognition at fair value, they are valued at amortised cost. Interest paid is entered into the
accounts in the profit and loss account, applying the effective interest rate method.
However, debits for commercial transactions with due date not above one year and which have no contractual
interest rate, both at initial valuation and later valuation, are valued at par value when the effect of not updating
cash flows is insignificant.
f) Cash and other equivalent assets
This section includes the cash in current accounts and temporary asset acquisition complying with all the
following requisites:
• They are convertible to cash.
• At the time of acquisition, the maturity was not above 3 months.
• They are not subject to any significant value change.
• They are part of the normal treasury management policy at the Parent Company.
g) Other asset - accruals
The interest paid and not mature for financial investments is mainly recorded in this section when they are not
part of the reimbursement value.
In addition, the fees and recurring acquisition expenses are classified which are to be charged to the year
or following years in accordance with the policy cover period which are activated with the limits set out in
the technical note in the ‘Accruals’ section for the asset on the consolidated balance sheet, being charged to
earnings in accordance with the policy cover they are associated with.
There are no advanced fees or other recurrent acquisition expenses.
h) Current and deferred taxes
The expense for corporation tax for the year is calculate via the sum of the current tax, resulting from the
application of the corresponding tax rate to the taxable base for the year less bonuses and deductions, and
the variations for said period in the assets and liabilities for recorded deferred taxes. It is identified in the
consolidated profit and loss account, except where it corresponds to transactions directly recorded in the net
assets.
The deferred taxes are recorded for the temporary differences on the date of the consolidated balance sheet
between the tax base for the assets and liabilities and accounting values. The amount attributed to an asset
element is taken as the tax base for tax purposes.
The tax effect for temporary differences is included in the corresponding sections ‘Assets by deferred tax’ and
‘Liabilities by deferred tax’ on the consolidated balance sheet.
The Parent Company recognises assets by deferred tax for all deductible temporary differences, unused tax
credits and negative tax bases pending payment, as far as it is probable that the Parent Company will have
future tax gains allowing the application of these assets.
At year close, the Parent Company assesses the recognised assets by deferred tax and those not recognised
previously. Based on said assessment, the Parent Company removes a previously recognised asset if it is
unlikely to be recovered or records any previously unrecognised asset by deferred tax, as long as it is likely the
Parent Company will have future tax gains allowing its application.
Assets and liabilities by deferred tax are valued at expected tax rates at reversion, as per current approved
regulations.
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i) Technical provisions
• Provision for unearned premiums
This comprises the part of the premium aimed at complying with unexpired future obligations at current yearend.
The provision for unearned premiums is calculated for every insurance mode, taking as a base the premium
rates and issued surcharges, paid in the year, net of cancellations, returns, bonuses and taking a uniform
distribution for the accident rate. The Parent Company uses the ‘policy to policy’ procedure to calculate
the provision for those modes generating it (Accidents, Death Assistance and Voluntary Death Assistance
Extension (AVAF)).
• Current risk provisions
The provision for current risks will complement the provision for unearned premiums as its amount is not
sufficient to reflect the value of all risks and expenses to cover which correspond to the unelapsed cover
period on the date of year-end.
On 31st December 2009, the allocation thereof was not considered necessary as there was no risk cover
insufficiency.
• Life insurance provisions
They represent the value of the Parent Company obligations net of the policyholder obligations for life
insurance at year-close.
Life insurance provisions correspond for insurance where the cover period is equal or less than one year, to
the unearned premium provision and to the mathematical provision for other insurance.
The mathematical provision represents the difference between the actual actuarial value of Parent Company
future obligations and those of the policyholder or, where applicable, the insured party. The calculation is
performed policy-by-policy, applying the prospective method, based on future obligations contained in each
contract and the mortality and invalidity tables, as well as the technical interest rates set out according to
regulations.
The mathematical provision calculation basis was the inventory rate paid in the year. The pure premium
increased by administration costs in the Technical Bases for the corresponding insurance category has been
taken as inventory rate.
The mathematical provisions have been calculated using the PER-2000 tables which contain the most prudent
consideration for groups from the Mutualidad. With regards to the groups of disabled from Mutualdis, a
correction of the biometric hypothesis has been estimated in line with the characteristics of the policyholders
on the basis of the best available information on the market for this death risk.
The Parent Company, with the exceptions set out below, has calculated its mathematical provisions on 31st
December 2009 at the technical interest rate of 2.60%, set out in Resolution dated 2nd January 2009 from
the Directorate General for Insurance and Pension Funds.
The Parent Company has assigned to the Retirement Plan 2, Retirement Plan 2000, Retirement Plan 2003
and Retirement Plan 2006 portfolio (Savings Plan) appropriate investments in accordance with what is set out
in article 33.2.a) in the ROSSP and Order EHA/339/2007 dated February 16th, whereby the technical interest
rate used in the mathematical provisions calculation on 31st December 2009 is the implicit rate resulting from
the comparison between the actual value of assigned investment, calculated on its IRR for purchase corrected
for credit rating, and the planned benefits and expenses payments. However, for the Retirement Plan 2,
Retirement Plan 2000 and Retirement Plan 2003 portfolios, due to them being products with profit-share, the
higher limit of that used to calculate the premium has been taken for the technical interest rate to use in the
calculation, as per art. 33.3 in the ROSSP.
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• Provisions for services
These represent the best estimate for total pending obligations amounts for the Group derived from the
accidents occurred before year-close, which is equal to the difference between the total estimated or set cost,
including external and internal management and administration expenses for the files and all amounts already
paid for said accidents.
In order to set the amount, accidents have been classified by years of occurrence and insurance branches,
each accident being valued individually.
These provisions are split into pending liquidation or payment, pending declaration and internal expenses for
accident liquidation.
The provision calculation for accidents pending declaration has been performed taking into account the
information and experience from previous years at the Group. The calculation is made by multiplying the
average number of accidents pending declaration by the average cost thereof for the last year and estimated
in accordance with what is set out in the Rules on the Regulation and Supervision of Private Insurance.
The provision for internal expenses for accident liquidation aims to provide the sufficient amount to cover
necessary internal Group expenses for total accident process finalisation which must be included in the
provision for services.
• Profit-share provision
This includes the amount for benefits paid to policyholders or beneficiaries, whilst they have not been assigned
individually to each of them.
• Other provisions
This corresponds to provision for deaths. It represents, in contracts lasting over one year, the amount at the
close of annual accounts for all future Group commitments (payment of compensation and management
expenses), net of all future policyholder commitments (premium payment). It is calculated contract-by-contract
with the biometric (mortality) and financial (interest rate) hypotheses current at the time of calculation.
There are two sub-portfolios in the calculation:
Contracts with a start date before 1st January 2008
Due to the characteristics of the policies in this portfolio, the provision is calculated for those contract where
the policyholder is 65 (or older) as of or before 1/1/2009. The premium is taken as that current on renewal
as of 1/1/2009 in these contracts and both this and the amount of the benefit are maintained constant
throughout the future contract life, since the policies do not include an automatic premium or cover update
mechanism for these contracts.
The premium amount aimed at internal and external expenses is set as per the technical bases governing
these contracts as of October 1999.
Contracts with a start date after or as of 1st January 2008
Due to the characteristics of the policies in this portfolio, the provision is calculated for all contracts and in
accordance with what is set out in the technical bases for November 2007.
Consolidated Report
88
j) Provisions and contingent liabilities
The provisions for environmental restoration, restructuring costs, debts for assumed payments arising from
agreements taken on with insurance companies and litigation are recognised when the Parent Company has
a current legal or implicit obligation as a result of past events, a resource use is likely to be necessary to
settle the obligation and the amount can be reliably estimated. Provision for future operational losses are not
recognised.
Provisions are valued at present payment value expected to be required to settle the obligation using an
interest rate that reflects the present market valuations of the time value of money and the specific risks of the
obligation. The adjustments to a provision due to updating are recognised as a financial cost as they are paid.
Provisions with an expiry below or equal to one year with an insignificant financial effect are not discounted.
When part of the payment necessary to settle the provision is expected to be repaid by a third party, the
repayment is recognised as an independent asset, as long as receipt thereof is practically assured.
In turn, contingent liabilities are considered as such when they are possible obligations arising from past events,
whose materialisation is conditioned to one or more future events occurring outside the Parent Company’s
control, not being subject to accounting record.
In 2009 a provision has been recorded for contingent liabilities due to the transfer operation of the insurance
portfolio from the group company CISNE ASEGURADORA, COMPAÑÍA DE SEGUROS Y REASEGUROS, S.A to
the single shareholder group company DIVINA PASTORA SEGUROS GENERALES, S.A.U., as set out in the Later
Events note, where the latter takes on the technical liabilities of the former.
k) Liabilities for long-term payments to staff
Provisions for pensions and similar obligations (retirement bonuses and supplements)
Retirement bonus
The Collective Insurance Agreement sets out a financial compensation for retirement at sixty-five years, so that if
retirement is requested by the employee in the month they are sixty-five, the company must pay an instalment
once, whose maximum will run to thirty-five years of service at the company retiring the employee.
The actuarial values for obligations the Group has with its personnel in application of the agreement have been
performed by the internal Technical Department at the Parent Company.
The Technical Bases used for calculations, as per the Actuarial Report, are as follows:
Actuary tables:
- In order to value the survival risk, the mortality tables have been used which are taken as adapted to the
time of valuation and legally recommended for survival insurance, GRM95 and GRF95, for men and women,
respectively.
- In order to value the invalidity risk across each of its levels, the base in the study performed by Merino,
Ponciello and Soler on Spanish experience is used, contrasted with the company’s experience in this area.
- In order to value the risk of an employee retiring, the base in the Appendix of the ‘Ministerial Order 3433/2006
dated November 2nd on special technical conditions applicable to insurance and pension plan contracts
implementing certain commitments for pensions linked to retirement’ is used.
Interest rate: The TSIR has been used derived from the listing of ‘strips’ of Spanish Public Debt as of 31/12/2009,
adjusted by 5% (in accordance with Order EHA/339/2007 governing Financial Immunisation).
Forecast salary inflation: the arithmetic average for the annual CPI variation over the last full 5 years (20052009) has been used.
Consolidated Report
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89
Pension plan
The Parent Company promoted the creation of the ‘Previsión del Hogar, Plan de Pensiones’ (‘Home Welfare,
Pension Plan’) Pension Plan with the aim of providing retirement, incapacity, widowhood and orphanhood
benefits for those workers with over 2 years of service who wish to join the plan.
The pension plan is a mixed employment system since it contains two sub-plans, one for defined benefit and
one for defined contribution.
In accordance with the Control Committee for the plan dated 26th December 2007, it was decided to transform
the defined benefit sub-plan to a pure defined contribution one as of 1st January 2008.
The plan management company is Aseguradora Valenciana, S.A. de Seguros y Reaseguros.
Life Insurance
As required by the collective Agreement for Insurance Companies, a provision has been made for employee
life insurance. The following hypotheses have been used:
Actuary tables: The mortality tables taken as adapted to the valuation time and legally recommended for
survival insurance, Gk95, for men and women respectively have been updated.
As invalidity tables, the study performed by Merino, Pociello and Soler on Spanish experience has been used
and contrasted with the Company’s experience in this area.
Technical interest rate: Valuation is performed at a constant technical interest rate of 2.60%.
l) Income and expenses
Income and expenses are recorded based on their payment period, social transactions being recorded taking
into account the correlation between generated income and the corresponding expenses.
Premiums
Premiums are entered into the accounts by applying the accrual criteria, including the premiums paid and
ceded in the year and the variations to the corresponding technical provisions for unearned premiums.
Accident rate
The technical expenses for accidents, which are accounted as per the accrual criteria, show payments for
benefits derived from insurance contracts and the expenses covered chargeable to their liquidation; in turn, the
variations to the corresponding technical provisions for benefits are included.
Expenses Reclassification by purpose
As of 31st December 2009, reclassification for expenses by purpose was performed as per the following
criteria:
In compliance with what is set out in the General Accounting Plan for Insurance Companies, the Parent
Company has reclassified in the Profit and Loss account certain expenses originally accounted by their nature
by the purposes for which they have been applied.
The most important sections for expense reclassification are as follows:
- Fees, holdings and other portfolio expenses
- Personnel expenses
- External services
- Taxes
- Provisions for amortisations
Consolidated Report
90
The purposes for which it is necessary to locate accounted expenses by type are:
- Acquisition costs
- Administration costs
- Expenses chargeable to benefits
- Expenses chargeable to investments
- Other technical expenses
- Other non-technical expenses.
The most important criteria used by the Parent Company for reclassification, which it reviews every year, were
as follows:
• Fees, holdings and other portfolio expenses have been considered as acquisition expenses as they have arisen
due to policy subscription or renewal.
• Personnel expenses have been spread based on a study of the estimated assignment of the staff in the
different areas of the Group to each of the specified purposes.
• Distribution criteria derived mainly from the use of resources by Group personnel and their correspondence to
reclassified personnel expenses have been established for the remaining expenses considered by type.
The criteria used were uniformly applied in the previous year.
m) Business combinations
Business combinations are recorded by acquisition method. The cost for the purchasing company of a business
combination is the fair value of the delivered assets, the issued asset instruments and the liabilities incurred
or assumed on the exchange date, as well as any other additional consideration, plus the expenses directly
attributable to the combination.
Goodwill represents the excess business combination cost for the acquired identifiable asset value less that of
the assumed liabilities, applying the criteria relating to intangible assets for valuation.
n) Transactions between related parties
In general, transactions between the Parent Company and a group company are account at the initial moment
by their fair value. Where applicable, if the agreed price differs from the fair value, the difference is recorded
in line with the financial reality of the transaction. The later valuation is performed as per what is set out in the
corresponding regulations.
ñ) Transactions in foreign currencies
1. Functional and presentation currency
The Company consolidated annual accounts are presented in euro, which is the Parent Company’s presentation
and functional currency.
2. Transactions and balances
Transactions in foreign currency are initially converted to the functional currency using the current exchange
rates on the transaction date. Profits and losses in foreign currency resulting from the settlement of these
transactions and the conversion to exchange rates at close for monetary assets and liabilities denominated in
foreign currency are identified in the profit and loss account, except where they differ in net assets such as
qualified cash flow coverages and qualified net investment coverages.
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91
Conversion differences on non-monetary items, such as asset instruments held at fair value with changes on
the profit and loss account are presented as part of the profit or loss in fair value. Conversion differences on
non-monetary items, such as asset instruments classified as financial assets available for sale are included in
net assets.
Non-monetary items in foreign currency valued in terms of historic cost are converted by using the exchange
rates on the date this fair value is set.
o) Assets (alienable element groups) held for sale and interrupted activities
The assets (or alienable element groups) are classified as held for sale when it is believed that their book value
will be recovered through a sales operation instead of through continued use. This condition is only seen as met
when the sale is highly probable and available for immediate sale in its present condition and will foreseeably
be completed in the period of one year from classification date. These assets are presented with a value at
the lesser amount between their book value and fair value reduced by the necessary costs for transfer and not
subject to amortisation.
Consolidated Report
92
7. INFORMATION ON CERATIN ITEMS IN THE CONSOLIDATED BALANCE SHEET AND
THE CONSOLIDATED PROFIT AND LOSS ACCOUNT
7.1. INTANGIBLE ASSETS
The composition of this section and the movement during 2009 for the different accounts comprising it is as
follows:
COST
Balance
on 31.12.08
Addition
by Merger
Land and natural assets
3,878,458.54
756,000.00
Buildings and other constructions
7,036,052.26
768,045.78
Transport elements
1,064,813.98
---
Furniture and Facilities
5,165,060.10
107,841.45
Information process equipment
3,090,283.87
30,644.01
5,473.78
---
Assets in progress
2,456.73
---
132,119.36
---
20,374,718.62
1,662,531.24
(1,846,768.27)
(39,045.78)
(221,894.59)
---
Furniture and Facilities
(4,753,370.10)
(55,710.24)
Information process equipment
(2,588,319.42)
(26,746.57)
(1,643.50)
---
Total Accumulated Amortisation
(9,411,995.88)
(121,502.59)
NET TOTAL
10,962,722.74
Advances tangible fixed assets
TOTAL COST
ACCUMULATED AMORTISATION
Buildings and constructions
Transport elements
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93
Addition by
Cisne Integration
Additions /
Transfers
Withdrawals /
Transfers
Adjustments for
liquidation value
Balance on
31.12.09
---
---
---
---
4,634,458.54
---
---
---
---
7,804,098.04
18,669.34
---
---
(18,669.34)
1,064,813.98
947,026.91
54,275.80
(803,654.27)
(70,552.02)
5,399,997.97
377,020.10
221,859.87
(237,892.76)
(1,529.68)
3,480,385.41
---
24,424.03
---
---
29,897.81
---
---
---
---
2,456.73
---
---
(132,119.36)
---
---
1,342,716.35
300,559.70
(1,173,666.39)
(90,751.04)
22,416,108.48
---
(148,455.94)
---
---
(2,034,269.99)
---
(125,784.27)
---
---
(347,678.86)
(225,675.89)
(196,126.68)
272,656.49
36,765.24
(4,921,461.18)
(163,646.83)
(239,567.53)
189,254.85
---
(2,829,025.50)
---
(564.79)
---
---
(2,208.29)
(389,322.72)
(710,499,21)
461,911.34
36,765.24
(10,134,643.82)
12,281,464.66
Euro
The adjusted amounts on Cisne Aseguradora assets are included in the column “Adjustment for liquidation value”
since they have been adjusted to the liquidation value as stated in the individual report for this subsidiary.
The transport elements include the right to use an aeroplane.
On 31st December 2009, there were tangible fixed assets which, being in use, were totally amortised at a cost value
of 1,561,550.47 euro.
Consolidated Report
94
The land and buildings the Parent Company uses for its own activities are as follows:
PROPERTIES
Concepción, 11 (Albacete)
Cost value
Accumulated
Amortisation
313,728.32
51,608.38
Concepción, 7 garage, 2-34 (Albacete)
20,218.04
2,405.89
Rambla Méndez Núñez, 28 (Alicante)
281,599.13
57,306.54
Rambla Méndez Núñez, 28 (Alicante)
22,526.61
5,128.69
Diputación, 180 (Barcelona)
121,708.16
38,537.11
Diputación, 180 (Barcelona)
133,354.05
20,750.78
Pl. Alcalde Xifre, 14-15 (Badalona)
118,388.68
24,657.31
99,972.98
19,545.61
201,424.39
38,814.47
Av. Francesc Masiá, garage space (Sabadell)
13,943.48
2,744.12
Av. Francesc Masiá, garage space (Sabadell)
13,943.48
2,744.12
Ancha, 22 (Cadiz)
256,233.92
39,759.00
Ronda Tejares, 32 (Cordoba)
188,440.76
56,154.99
Garage, 14-R. Tejares, 34 (Cordoba)
22,069.17
3,836.33
San Francisco, 21 (Gerona)
19,402.86
10,279.81
San Antón, s/n (Granada)
273,715.39
51,446.75
San Antón, s/n (Granada)
11,747.58
2,508.99
301,283.52
57,294.07
Compostela, 10-12 (Tuy)
52,889.07
8,576.75
Juan Florez, 8 garage 20-2 (Corunna)
18,030.36
2,903.05
Juan Florez, 8 garage 21-2 (Corunna)
313,728.32
20,218.04
Av. Mesa y López, 8 (Las Palmas) 281,599.13
22,526.61
121,708.16
133,354.05
Burgo Nuevo, 24 (León)
118,388.68
99,972.98
201,424.39
Princesa, 2 (Madrid)
13,943.48
13,943.48
256,233.92
Princesa, 2 (Madrid)
188,440.76
22,069.17
Mayor, 56 (Alcorcón)
19,402.86
273,715.39
11,747.58
Colón-Pl. Nuncio (Alcorcón)
301,283.52
52,889.07
18,030.36
Princesa, 2-Premises 1-B (Madrid) 18,030.36
267,903.18
228,777.79
Princesa, 2 Car park. 45 (Madrid) 394,078.67
18,030.36
2,903.05
267,903.18
41,569.59
228,777.79
56,004.89
394,078.67
70,012.66
61,330.65
18,414.56
221,695.72
50,901.30
50,143.62
12,359.40
160,783.47
30,012.82
24,040.49
4,487.54
Princesa, 2-Premises 7 Pl 9º
208,843.15
39,209.12
Ramón y Cajal, 2 (Ciudad Real)
270,333.57
33,746.72
Alameda Colón, 9 (Malaga)
100,435.99
27,688.90
Alameda Colón, 9 (Malaga)
7,085.65
2,247.44
385,135.93
62,363.44
15,025.30
2,556.60
Av. S. Esteve (Granollers)
Av. Francesc Masiá (Sabadell)
Fernando González, 6 (Corunna)
Padre Atanasio, oficine A (Majorca)
Padre Atanasio, garage space 2,29 (Majorca)
Euro
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95
PROPERTIES
Cost value
Accumulated
Amortisation
15,025.30
2,556.60
15,025.30
2,556.60
15,025.30
2,556.60
Manresa, 1 (Murcia)
105,012.00
25,443.24
Av. General primo de Rivera, 10 (Murcia)
735,700.00
13,923.78
Corrida, 4 (Gijón)
132,079.81
27,701.76
Melquiades Álvarez, 26 (Oviedo)
913,185.67
155,545.95
Policarpo Sanz, 3 (Vigo)
241,467.50
32,174.85
Paseo de Pereda, 32 (Santander)
477,707.44
81,354.82
415,164.85
90,137.71
26,560.18
5,867.12
390,117.01
67,254.86
12,101.94
2,089.73
Colón, 74 Offices (Valencia)
784,767.07
210,947.38
Colón, 74-64 garage places.
200,973.92
53,774.26
Pl. Ayuntamiento, 26 (Valencia)
528,953.37
114,792.18
85,630.21
16,741.25
Racó de Ademuz, 4 (Industrial Building)
172,490.48
20,146.84
Pº Germanías, 82 (Gandía)
128,768.70
20,281.09
Pl. Santa Ana, 7 (Valladolid)
273,375.20
44,261.21
Coso 98 (Saragossa)
311,055.34
44,636.34
Coso 98, garage 2,20 (Saragossa)
18,030.36
2,587.54
Coso 98, garage 2,10 (Saragossa)
18,030.36
2,587.55
1,524,045.78
42,869.94
12,438,556.58
2,034,269.99
PL. Josefa Reina, 3 (Seville)
Rioja, 25 (Seville)
Pl. Candelaria, 1 de. Olympo (Tenerife)
Ed. Olympo Garage 352 (Tenerife)
Pl. Ayuntamiento, 26-2º (Valencia)
Villanueva 27 (Madrid)
TOTAL
Euro
The building Villanueva 27 comes from the merger with Mutualdis. Said property was revalued in 2008 and the
initial cost value was 191,342.68 euro.
The Parent Company has no lease contract with third parties for these properties.
The Parent Company has insurance policies with third parties to cover possible risks affecting tangible fixed assets
and tangible investments. The policy cover is considered sufficient.
The effect of the update on the provision for amortisation in 2009 was 13,276.44 euro and on the amortisation of
the next year will be for a similar amount.
At the end of 2009, land and constructions with a market value of 5,282,341.00 euro were subject to the technical
provisions coverage.
Consolidated Report
96
7.2. REAL ESTATE INVESTMENTS
The composition of this section and the movement during 2009 for the different accounts comprising it is as follows:
Balance
on 31.12.08
COST
Land and natural assets
Addition by merger
44,868,902.28
4,768,386.00
---
---
Other tangible investments (finished social works)
17,877,158.10
3,068,589.08
Tangible investments in progress (social works in progress)
6,836,394.56
---
110,046.33
---
69,692,501.27
7,836,975.08
---
(370,699.79)
---
(370,699.79)
(11,785,697.37)
---
Real estate investment advances
Total Cost
Real estate investment value depreciation
NET TOTAL
57,906,803.90
Real estate investment Expenses/Income
The item list for real estate investment expenses and income in the non-technical account, all related to the real estate
business, is as follows:
EXPENSES (Euro)
INCOME (Euro)
Site acquisition
---
Sales
478,940.00
Site variation
---
Work in progress variation
197,531.60
Work in progress performance
Fees for independent professional services
Personnel expenses
Taxes
Other costs
TOTAL
327,768.51
65,328.81
Property pending sale variation
Lease income
(457,723.07)
158,476.17
246,243.24
---
18,065.05
---
9,392.06
---
666,797.67
TOTAL
377,224.70
Parent Company lots aimed at own use pending construction as well as different properties from the merger with Mutualdis
leased to third parties are included in real estate investments.
Lastly, housing pending sales from the real estate business is included in finished work.
The company has insurance on said property with sufficient coverage. The properties are not subject to technical provisions
coverage.
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97
Addition for real estate investment value depreciation correspond to the homogenisation adjustment in the
consolidation for subsidiary company land, having been valued in accordance with Order Eco/805/2003 dated
March 27th on property valuation regulations and certain data for certain financial purposes.
Additions for
Cisne integration
Deductions
Additions
Withdrawals
for liquidation
value
Transfers
Balance
on 31.12.09
71,427.68
---
---
---
478,304.34
50,187,020.30
419,575.50
---
(110,015.33)
---
(56,615.27)
252,944.90
---
2,215.61
(457,723.07)
(9,325,477.63)
---
11,164,762.09
---
199,990.25
---
9,435,523.96
---
16,471,908.77
---
---
---
(110,046.33)
---
---
491,003.18
202,205.86
(567,738.40)
---
421,689.07
78,076,636.06
(65,842.65)
(120,713.69)
10,714.74
---
63,131.97
(483,409.42)
(65,842.65)
(120,713.69)
10,714.74
---
63,131.97
(483,409.42)
---
(4,751,923.73)
---
---
---
(16,537,621.10)
61,055,605.54
Euro
7.3. INTANGIBLE FIXED ASSETS
On 31st December 2009, the balance for the attached consolidated balance sheet section, as well as its progress
in 2009, presents the following details:
COST
IT applications
Balance
on 31.12.08
551,871.35
Additions
---
Transfers
Balance
on 31.12.09
---
551,672.34
(49,600.85)
1,934,433.31
Goodwill in fully consolidated companies
1,984,034.16
TOTAL COST
2,535,905.51
---
(49,600.85)
2,486,105.65
IT applications
(410,878.20)
(45,842.69)
---
(456,521.88)
(410,878.20)
(45,842.69)
---
(456,521.88)
NET TOTAL
2,125,027.31
2,029,583.77
Euro
On 31st December 2009, there were completely amortised, but in use, IT applications running to 363,537.91 euro.
Consolidated Report
98
7.4. FINANCIAL INSTRUMENTS
7.4.1. Financial assets
The composition of financial assets on 31st December 2009 is as follows:
FINANCIAL ASSETS
Cash and other equivalent
liquid assets
Other financial assets at
fair value with changes
posted in the Profit and
Loss account
Hybrid financial
nstruments
ASSET INSTRUMENTS:
---
---
Financial investments in equity
---
---
Shares in investment funds
---
---
Shares in venture capital funds
---
---
Provisions
---
---
---
---
Fixed income securities
---
---
Other representative debt values
---
---
HYBRID INSTRUMENTS
---
24,207,489.17
DEPOSITS IN CREDIT INSTITUTIONS
---
---
LOANS FOR DIRECT INSURANCE OPERATIONS
---
---
Insurance policyholders:
---
---
Pending receipts
---
---
Provision for premiums pending payment
---
---
Brokers:
---
---
OTHER LOANS
---
---
Loans with Public Administrations
---
---
Other loans
---
---
TREASURY
12,027,571.20
---
TOTAL
12,027,571.20
24,207,489.17
REPRESENTATIVE DEBT VALUES
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Financial assets available for sale
Loans and items
payable
Value fair
TOTAL
Cost
47,139,064.98
587,931.21
---
47,726,996.19
---
---
---
---
47,139,064.98
---
---
47,139,064.98
---
750,000.00
---
750,000.00
---
(162,068.79)
---
(162,068.79)
750,598,056.45
---
539,553,546.54
1,290,151,602.99
750,598,056.45
---
---
750,598,056.45
---
---
539,553,546.54
539,553,546.54
---
---
---
24,207,489.17
---
---
40,506,152.91
40,506,152.91
---
---
54,533,977.69
54,533,977.69
---
---
54,533,977.69
54,533,977.69
---
---
54,837,910.01
54,837,910.01
---
---
(303,932.32)
(303,932.32)
---
---
---
---
---
---
8,884,213.73
8,884,213.73
---
---
1,318,876.11
1,318,876.11
---
---
7,565,337.62
7,565,337.62
---
---
---
12,027,571.20
797,737,121.43
587,931.21
643,477,890.87
1,478,038,003.88
Euro
Consolidated Report
100
7.4.1.1. Classification by maturity
The maturity details for financial assets are as follows:
MATURITY
YEAR
Cash and other
equivalent liquid
assets
Hybrid
financial
instruments
Representative
debt values Available for sale
Deposits
in group
institutions
Loans and
items payable Representative
debt values
TOTAL
2010
12,027,571.20
2,883,300.00
26,979,601.03
25,506,152.91
---
67,396,625.14
2011
---
1,500,000.00
1,168,200.52
---
---
2,668,200.52
2012
---
---
13,041,808.80
---
---
13,041,808.80
2013
---
---
77,336,875.34
---
---
77,336,875.34
2014
---
---
312,286,928.49
---
---
312,286,928.49
Other years
---
19,824,189.17
319,784,642.27
15,000,000.00
539,553,546.54
894,162,377.98
12,027,571.20
24,207,489.17
750,598,056.45
40,506,152.91
539,553,546.54 1,366,892,816.27
TOTAL
Euro
7.4.1.2. Assets ceded as guarantee
The Parent Company has securities pledged for a par value of 60,626 thousand euro as a guarantee for the two
loan policies it has with financial institutions at year-end; therefore no technical provisions have been made for
coverage purposes.
7.4.1.3. Information related to the profit and loss account and net assets
The following chart shows information related to the profit and loss account and net assets for financial instruments
for the Parent Company:
Net assets
(net profit and losses by valuation)
Financial income and expenses by
application of the effective interest rate
(4,925,753.21)
753,960.93
Asset instruments
3,859,281.97
4,797,461.75
Debt instruments
5,245,297.75
53,767,388.65
TOTAL
4,178,826.52
59,318,811.33
ITEM
Hybrid instruments
Euro
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Annual
Report
101
7.4.1.4. Coverage and fair value operations
Financial instruments designated as cover instruments comply with the current registration and valuation
regulations.
Financial exchanges
On 31st December 2009, the Parent Company had 6 current financial exchange transactions on fixed against fixedtype interest rates, corresponding to 4 SWAPS and 2 SPVS transactions. Said transactions were contracted with
the purpose of adapting payment flows thereof to existing payment obligations by contracting insurance products.
Below is a breakdown of contractual values for said transactions, the insured interest rates for payment flows
thereof alongside their maturity dates on 31st December 2009:
PRODUCT
Cost (Euro)
Fair value
(Euro)
Profitability
Maturity date
Swap I
12,739,802.54
2,770,165.31
4.13%
01/11/2045
Swap II
106,793,591.16
48,352,515.85
3.95%
01/01/2046
Swap III
16,306,924.79
876,116.68
4.57%
01/12/2046
Swap IV
38,336,655.88
12,345,574.05
4.98%
01/09/2047
SPV I
79,463,122.64
36,352,302.49
3.93%
01/07/2050
SPV II
62,791,998.61
24,357,734.83
4.29%
01/10/2046
The amounts to pay (updated by the internal transaction profitability rate) as a consequence of said financial
exchange contracts run to 313,779 thousand euro, as of 31st December 2009, which are recorded in the balance
sheet in the section ‘Loans and items payable - Representative debt values’.
The difference between the reimbursement value and the actual value of assets is recorded in the same section
and runs to 124,150 thousand euro. These expenses are accrued as per financial criteria.
In addition, the amounts to pay for these contracts run to 379,274 thousand euro as of 31st December 2009
(obtained in function of the internal profitability rate for the financial exchange transaction) which the Parent
Company, in accordance with the contracts, must liquidate with the other party on maturity.
The income and expenses paid in the year corresponding to financial exchange transactions have been recorded in
the technical life account in the corresponding financial investment income and expenses sections respectively.
The fair value has been calculated by updating collection and payment flows to the zero coupon curve on close
date. On 31st December 2009, the credit risk of these transactions runs between AAA and A.
Consolidated Report
102
7.4.1.5. Financial instrument risk
Management of credit and market risks is performed by the Finance Department and is supervised by the Internal
Control Department.
The Parent Company has a very conservative investment policy impeding it taking on high risks in terms of credit
risks, setting the minimum rating for financial investment within the investment band and without, in any case,
entering the speculation band.
In addition, at the minimum monthly frequency meetings held by the Investment Committee, the average portfolio
rating is revised, as well as information provided on if there has been any significant downward variation in the
credit rating of any portfolio securities.
There are no significant investments in currency whereby the Parent Company is not at all exposed to currency
exchange risk. In turn, in order to cover the interest rate risk at all times, the policy of adjusting the liabilities terms
and interest rates continues with those corresponding to investments and materialisation in low risk securities.
With the aim of ensuring necessary liquidity for business development, the Group has a treasury shown on the
attached consolidated Balance Sheet. In turn, the Financial Department periodically carries out financial projections
on collections and payments to be made in the future so as to develop prudent asset and liability management,
foreseeing over time cash requirements.
The following charts show the significant information from the last year relating to the exposition level to interest
rate risk for financial assets and liabilities:
Asset amount exposed to interest rate risk in:
PORTFOLIO
Hybrid instruments
Fair value
(fixed interest rate)
Not exposed to risk
Total
---
24,207,489.17
24,207,489.17
Available for sale
750,598,056.45
47,726,996.19
798,325,052.64
TOTAL
750,598,056.45
77,813,204.21
822,532,541.81
Euro
The credit rating for issuers of fixed income bonds are set out below for 2009:
Issuer credit rating
Book value
Portfolio available for sale
Hybrid instruments
AAA
667,719,043.23
---
AA
13,908,132.69
---
AA-
22,511,260.81
10,000,016.66
A+
25,825,700.34
14,207,472.51
A
3,051,207.07
---
A-
1,674,111.75
---
BBB+
1,846,644.64
---
BBB
1,897,944.60
---
12,164,011.32
---
750,598,056.45
24,207,489.17
No credit rating
TOTAL
Euro
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Annual
Report
103
7.4.1.6. Investments in group and associate company assets
The composition of this section and the movement during 2009 for the different accounts comprising it is as follows:
Additions for
merger with
Mutualdis /
Additions
Withdrawals for
integration in
consolidated
COST
Balance
on 31.12.08
Shares in group companies
45,406,948.89
1,039,500.00
(44,130,946.58)
2,315,502.31
Cisne Aseguradora, Compañía
de Seguros y Reaseguros
44,130,946.58
---
(44,130,946.58)
---
1,140,901.31
---
---
1,140,901.31
135,101.00
1,039,500.00
---
1,174,601.00
(23,440,757.95)
(21,864,789.63)
44,130,946.58
(1,174,601.00)
21,966,190.94
(20,825,289.63)
---
1,140,901.31
Divina Pastora Seguros
de América
Previgalia Corporación, S.A.
Value depreciation
NET VALUE
Balance
on 31.12.09
Euro
Information on group companies not integrated in the consolidated accounts is as follows:
DIVINA PASTORA SEGUROS DE AMÉRICA, S.A.
The company ‘DIVINA PASTORA SEGUROS DE AMÉRICA, S.A.’ is currently being constituted which will be 100%
owned by the Company which has already provided 1,140,901.31 euro for its foundation.
PREVIGALIA CORPORACIÓN, S.A.
The company’s business is shareholder in portfolio. In this sense, it holds 100% of two subsidiary companies:
• Previgalia Correduría, which was sold on 17th July 2009 for 1 euro.
• Previgalia Gestión, a company in liquidation at year-close and with no business.
Given the immaterial nature of the effect integrating the financial statements of this subsidiary on 31st December
2009 would have, the company has not included it in the consolidation scope and is presented at cost.
The group company financial information, as set out in the unaudited annual accounts, is as follows:
Euro
Equity:
Capital
1,502,024.00
Reserves
933.56
2009 Result
(1,059,416.43)
(443,494.19)
Total Equity
46.94
---
46.94
st
Total Income 2009
---
Consolidated Report
104
7.4.1.7. Loans and items payable
a) Loans for direct insurance operations
The details for premiums pending payments and their corresponding provisions are as follows:
Receipts for premiums pending collection
Euro
1,690,564.67
Credits for receipts pending issue
(instalment premiums whose receipt has not been issued)
53,147,345.34
Correction for depreciation of premiums pending collection
(303,932.32)
TOTAL
54,533,977.69
b) Loans with Public Administrations
The accounts and respective balances included in the sections referring to the consolidated balance sheet are
shown below:
Inland Revenue receivable for VAT
Inland Revenue receivable for Corporation Tax
TOTAL
Euro
1,301,497.96
17,378.15
1,318,876.11
c) Other loans
The accounts and respective balances included in the sections referring to the consolidated balance sheet are
shown below:
Euro
Different receivables
479,560.39
Receivables payable
129,683.32
Loan debts
Remuneration advances
4,929,762.38
12,876.43
Staff loans
189,230.79
Loan value depreciation for commercial transactions
(87,249.56)
Advance guarantees
843,204.95
Other loans
1,068,268.92
TOTAL
7,565,337.62
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Annual
Report
105
7.4.1.8. Cash and other equivalent liquid assets
The composition of this balance sheet section on 31st December 2009 is as follows:
Euro
Current accounts in Credit Institutions
Cash
12,026,297.26
1,273.94
TOTAL
12,027,571.20
7.4.2. Financial liabilities
The composition of financial liabilities on 31st December 2009 is as follows:
Debts and items payable
FINANCIAL LIABILITIES
Debts for insurance operations:
460,605.05
• Policyholder debts
36,493.70
• Broker debts
105,667.12
• Conditioned debts
318,444.23
Debts for reinsurance operations
141,398.78
Debts with credit institutions
47,658,634.40
Other debts:
388,346,178.19
• Debts with Public Administrations
• Other debts
6,197,983.82
382,148,194.37
TOTAL
436,606,816.42
Euro
The maturity details for the main items of financial assets are as follows:
YEAR
Euro
2010
31,276,497.09
2011
27,180,929.23
2012
25,427,933.30
2013
37,392,899.96
2014
21,583,224.67
Resto
239,286,710.12
TOTAL
382,148,194.37
The debt amount with credit institutions corresponds to two loan policies with financial institutions which have
annual renewals.
Consolidated Report
106
8. NET ASSETS - EQUITY
a) Mutual Fund
In accordance with articles 64 and 65 in the Parent Company articles of association, the Mutual Fund is totally
paid out charged to surpluses from previous years.
The Mutualidad financial resources will comprise:
1. The collection of policyholder fees.
2. The collection of allocations which, where applicable, the General Meeting sets.
3. The profitability of Mutualidad assets.
4. Donations and subsidies.
Any other income set or collected for the Mutualidad.
When, at financial year-end, the earnings account shows fundamental deviations which may affect the financial
stability of the Mutualidad and the causes are due to circumstantial catastrophe, the General Meeting, upon
economic, financial and actuarial advice deemed pertinent, will set an extraordinary allocation or contribution
from policyholders to the Mutualidad, specifying the amount and effectiveness terms.
When, at financial year-end, the earnings account shows surpluses, these may be used to improve benefits, give
rise to the corresponding asset allocation or be transferred to the net asset accounts of the Mutualidad, all in the
method and amount set by the General meeting, upon proposal of the Board of Directors.
The General Meeting may also, upon Board of Director proposal, use all or part of the freely disposable
surpluses of the Social Benefits deemed appropriate for policyholders.
b) Reappraisal reserve Royal Decree-Law 7/1996, dated June 7th
In accordance with Royal Decree-Law 7/1996 dated June 7th on urgent tax measures and financial activity
development and liberalisation, the Parent Company updated its asset elements for the tangible fixed assets
and real estate investments corresponding to the year ending 31st December 1996. The amount of the update
ran to 2,906,126.84 euro, an amount net of the 3% tax on capital gains, which was charged to said account
with payment to the crediting Inland Revenue for an amount of 89,880.21 euro.
The reappraisal reserve, as well as update transactions, were checked and approved by the State Inland Revenue
Inspection dated 23rd March 2001.
Said reserve, since the period of 10 years has passed since the balance sheet date where the update transactions
are shown, can be used for free disposal reserves, its balance able to be distributed.
c) Merger with Mutualdis
The General Extraordinary Policyholders Assembly for the Mutualidad General de Previsión del Hogar Divina
Pastora took place on 26th September 2008. Said Meeting approved the merger between Divina Pastora
(Acquiring Company) and Mutualdis (Acquired Company), taking as a reference thereof the balance sheets as
of 31st May 2008.
Said merger project included as effective date thereof the 1st January 2008.
The merger project as well as the authorisation application for said merger was sent to the Directorate General
for Insurance and Pension Funds (DGSFP) on 29th October 2008. However, the DGSFP did not authorise said
operation until 24th June 2009 via ministerial order sent to the Company on 26th June 2009.
Mutualdis valued its assets at market value in 2008, therefore generating an increase in reserves of
4,696,960.41 euro.
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Annual
Report
107
9. FISCAL SITUATION
The Parent Company has still not presented its corporation tax return for 2009, although the calculation has
taken into consideration the different applicable legislative dispositions.
The Parent Company has all taxes corresponding to 2006 to 2009 open for inspection and 2005 for Corporation
Tax.
The fiscal loans and debts as of 31st December 2009 are recorded respectively in the sections Loans and items
payable and Debts and items payable of the assets and liabilities on the attached consolidated balance sheet.
Settlement between the Group accounting earnings and the aggregate taxable base for corporation tax in 2009
is as follows:
BOOK AND TAX EARNINGS SETTLEMENT
Tax paid
Book earnings for the year before corporation tax
3,045,987.69
Long-term differences
(446,087.29)
Individual increases
Increases for fully integrated companies
Individual reductions
Tax
payable/
(refundable)
1,262,829.11
987,070.38
(2,695,986.78)
Book earnings adjusted by 25%
2,599,900.30
Book earnings adjusted by 30%
87,855.43
Adjusted book earnings Total
2,687,755.73
Share on adjusted book earnings (25%)
649,975.07
Share on adjusted book earnings (30%)
26,356.64
Share on Total book earnings
676,331.71
Timing differences
Originating in the year
Increases
Reductions
28,968,190.26
28,968,190.26
---
Originating in previous years
Increases
Reductions
Negative taxable bases
(638,007.07)
74,678.01
(712,685.08)
(4,434,120.99)
Share on negative taxable bases (25%)
Taxable base (fiscal result)
Share on fiscal earnings (25%)
Share on fiscal earnings (30%)
TOTAL
(1,108,530.25)
26,583,818.03
(458,555.18)
6,578,616.26
26,356.64
80,805.86
(432,198.55)
6,659,422.12
Deduction for double taxation
(71,647.77)
(71,647.77)
Pension Plan Deduction
(15,320.32)
(15,320.32)
Training expenses
(4,861.55)
(4,861.55)
Deduction for contributions to foundations
(174,323.49)
(174,323.49)
Total tax due minus tax credits 2009
(698,351.67)
Taxes withheld and payments on account
TOTAL
6,393,208.99
(1,826,781.13)
4,566,487.86
Euro
Consolidated Report
108
The details for the main timing differences are as follows:
Originating
in the year
Group company risks and expenses provision
Originating in
previous years
5,020,800.18
---
Provision premiums pending payment (2009)
218,323.20
---
Provision premiums pending payment (2008)
---
(645,456.27)
Deferral for reinvestment
---
74,678.01
164,955.79
---
---
(67,228.81)
3,211,435.63
---
(11,026,371.16)
---
CISNE ASEGURADORA depreciation provision adjustment
20,785,500.00
---
CISNE ASEGURADORA Insolvency Provision
10,593,546.42
---
TOTAL
28,968,190.06
(638,007.07)
Accident life insurance provision (allocation)
Accident life insurance provision (application)
Valenciana de Sistemas Insolvencies Provision Depreciation
CISNE share depreciation
Euro
The amount for income covered by reinvestment deferral is as follows:
YEAR
Euro
1997
87,582.18
1998
104,154.90
1999
81,625.77
2000
508,043.59
2001
224,020.61
TOTALS
1,005,427.05
Said income comes from the disposal of different elements for the following amounts:
YEAR
Euro
1997
369,350.60
1998
249,420.02
1999
387,652.81
2000
847,427.07
2001
444,748.96
TOTALS
2,298,599.46
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Annual
Report
109
The asset elements where reinvestment of part of the income obtained has occurred were:
Euro
YEAR
Asset elements
1999
Sabadell Building
201,424.40
Zaragoza Building
311,055.34
2001
Garage Concepción
Castellana Madrid Building
20,218.05
1,183,993.85
Rincón de Ademuz Warehouse
172,490.47
Furniture and equipment
244,844.00
2002
125,713.00
2003
38,860.35
TOTALS
2,298,599.46
The integration methods on the taxable base for earnings covered by the reinvestment deferral system are:
• From the year following the termination of the period to perform reinvestment for seventh parts, for the part
corresponding to land from prior investments and furniture and equipment.
• For the part corresponding to the building value of prior investments, based on the amortisation thereof.
The amounts already integrated into the taxable bases for the Parent Company were:
YEAR
Euro
1999
516.68
2000
2,066.73
2001
2,125.83
2002
19,261.16
2003
22,681.42
2004
44,454.72
2005
74,678.01
2006
74,678.01
2007
74,678.01
2008
74,678.01
2009
74,678.01
TOTALES
464,496.59
The income pending integration in the taxable base runs to 540,930.43 euro.
In turn, the Parent Company has not applied in the year the fiscal benefit awarded for the reinvestment of
extraordinary earnings set out in the Consolidated Text of the Companies Law in article 42.
Consolidated Report
110
Lastly, it should be stated that, as set out in current legislation, the taxes can not be considered definitively settled
until the returns presented have been inspected by the tax authorities or the legal period of four years has passed.
At year-close, the company has the last five years returns pending tax inspection for Corporation Tax and the last
four years returns for the other applicable taxes. Company directors believe that the settlements of said taxes have
been appropriately carried out; therefore, even if discrepancies were found in the current regulatory interpretation
for tax treatment awarded to the transactions, the possible resulting liabilities, if applicable, would not significantly
affect the attached annual accounts.
10. NON-TECHNICAL PROVISIONS
The movement of these provisions in 2009 is as follows:
Provision for
tax and other
contingencies
Balance on 31.12.2008
Provision
for pensions
and similar
obligations
Other provisions
TOTAL
---
738,376.58
151,384.17
889,760.75
34,133.30
57,333.17
6,668,259.37
6,759,725.84
Allowances
---
926,349.31
2,609,343.31
3,535,692.62
Applications
---
(738,376.58)
(151,384.17)
(889,760.75)
34,133.30
983,682.48
9,277,602.68
10,295,418.46
Additions for Cisne integration
in consolidated
Balance on 31.12.09
Euro
a) Provisions for pensions and similar obligations
In accordance with the current collective agreement for the insurance sector, from the date an employee is
65 years old and requests retirement in the month (s)he reaches the age, the insurance company must pay a
monthly payslip for every five years of service, once, with a maximum of ten instalments.
During 2009, and as occurred last year, an actuarial study was performed that allowed the liabilities paid for said
item to be quantified, the provision constituted at year-end being 761,393.32 euro, equivalent to 100% of the
liabilities paid as of 31st December 2009.
On the other hand, in 2009 the Company has provisioned an amount of 164,955.99 euro for life-accident
insurance, in compliance with article 57 in the Collective Agreement for insurance companies.
b) Other provisions
This section also includes the liabilities for commitments acquired by the group and pending liquidation as of
31st December 2009.
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Annual
Report
111
11. ENVIRONMENTAL INFORMATION
Given the business of the Group, it has no environmental liabilities, expenses, assets or provisions and contingencies
that could be considered significant with regards to assets, the financial situation and the results thereof. For this
reason, specific breakdowns are not included in the present report for the consolidated annual accounts with
regards to environmental information.
The Parent Company performed investments related to environmental protection is previous years. Said investment
is included in the Financial Assets Available for Sale - Asset Instruments section in the consolidated balance sheet
at a fair value of 430,653.89 euro.
12. EVENTS AFTER CLOSE
As stated in Note 10 in this consolidated report, on 4th January 2010 notification of the Ministerial Order dated 29th
December 2009 whereby the Ministry of the Economy and Inland Revenue authorised the total transfer of the
insurance portfolio from the company Cisne Aseguradora Compañía de Seguros y Reaseguros, S.A. to the company
Divina Pastora Seguros Generales, S.A.U. was received.
Said portfolio transfer was enacted by public deed on 29th January 2010 between the parties, the effective transfer
date being 1st February 2010. Entry into the Companies Register of the transfer deed took place on 9th February
2010.
In addition, with an effective date of 1st February 2010 the staff of Cisne Aseguradora was transferred to Divina
Pastora Seguros Generales.
The Cisne Aseguradora, S.A. Board of Directors ratified the presentation of the administration of said company on
24th March 2010.
13. OPERATIONS WITH RELATED PARTIES
The Parent Company balances and transactions with group companies not integrated in the consolidated accounts
for 2009 are those detailed below:
Balances payable
Euro
Divina Pastora Seguros de América
1,683.71
TOTAL
1,683.71
There were no transactions or balances pending charge or payment with Previgalia Corporación, S.A. in the year.
Consolidated Report
112
14. OTHER INFORMATION
Employee information
Average employee number
The average number of employees in 2009 at the Parent Company broken down into category and gender is as
follows:
Men
Executive managers
Women
2009
6
2
8
11
4
15
7
6
13
12
11
23
3
5
8
Supervisors 1
21
48
69
Supervisors 2
4
39
43
Trade supervisor
2
---
2
Administrative staff
9
84
93
Auxiliary consultant
21
78
99
TOTAL
96
277
373
Executive managers 1
Section managers
Department managers
Graduates
Number of employees at year-close
Men
Executive managers
Women
2009
6
2
8
11
4
15
7
6
13
12
11
23
3
5
8
Supervisors 1
20
48
68
Supervisors 2
4
39
43
Trade supervisor
2
---
2
Administrative staff
8
81
89
Auxiliary consultant
19
77
96
TOTAL
92
273
365
Executive managers 1
Section managers
Department managers
Graduates
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2 0 0 9
Annual
Report
113
Information on Board of Directors members
The details of the payments received by the directors are as follows:
Food and other allowances
Euro
11,783.84
Salaries and wages
794,650.69
TOTAL
806,434.53
In addition, in 2009 the Parent Company made contributions to director pension plans for a total amount in the
year of 25,739.47 euro.
On 31st December 2009, there were balances pending payment by the directors for a total amount of 5,641.91
euro, corresponding to mortgages for real estate business.
The Directors have notified that they do not hold a direct share in the capital stock of Companies with the same,
analogous or complementary type of activity to that comprising the corporate purpose of the Parent Company outside
the group, as well as not holding positions of Directors in other companies with the same, analogous or complementary
type of business to that comprising the corporate purpose of the Parent Company outside the group.
Executive Management Payments
The salary payments for Executive Management at the company (general and division managers) in 2009 ran to
1,785,175.38 euro. In turn, contributions to pension plans were made of 79,558.06 euro.
Audit fees
The fees corresponding to the audit of the annual accounts for 2009 ran to 81,000 euro, plus VAT.
The Group has paid 7,500 euro plus VAT for other services provided by the accounts auditor or other companies
comprising its international network.
15. INCOME AND EXPENSES
Parent Company personnel expenses
Wages, payroll and similar
Euro
10,807,768.92
Social Security
2,169,590.47
Other social expenses
2,178,677.35
TOTAL
15,156,036.74
“Other Social Costs” includes the allocation made for the amount of 739,022.75 euro as “Contribution to the
supplementary pensions system”. In addition, 144,805.83 euro are included for the life-accident insurance provision
so as to cover the benefits included in the Collective Agreement and 397,512.55 euro for the external Pension
Plan contribution.
Consolidated Report
114
16. SEGMENTED INFORMATION
Premiums and surcharges distribution net of cancellations
The premiums and surcharges net of cancellation for the Parent Company are distributed as follows:
BY PRODUCT LINE
%
Basic benefits
40.60
Personal Multi-risk
8.76
Savings/retirement plan
40.91
AVAF (Voluntary extension for death assistance)
7.69
Freelance
0.74
Mutualdis Annuities
1.30
100.00
All Parent Company business is in Spain.
17. TECHNICAL INFORMATION
17.1. Information on risks covered by redemptions
As per the Internal Inspection Instruction 9/2004 from the Directorate General for Insurance on the application
of article 36.2 in Rules on the Regulation and Supervision of Private Insurance, those products are presented
below whose mathematical provision is calculated in accordance with art. 3.2 in the Rules on the Regulation and
Supervision of Private Insurance, when the Parent Company is potentially exposed to market risk by the redemption
value not being referenced to the market value of the assigned assets.
PRODUCT
Savings Plan
Redemption value
38,097,465.24
Assigned assets market value
64,192,415.85
It can be seen that at year-close there is no risk in the case of redemption, since the market value is above the
redemption value.
Consolidated Report
2 0 0 9
Annual
Report
115
17.2. Life insurance information
Composition of the life business by direct insurance premium volume
The direct insurance premiums issued for life insurance corresponding to 2009 from the Parent Company have
the following details:
Individual contract premiums
Euro
Periodic premiums
86,734,232.49
Single premiums
237,098.17
86,971,330.66
No profit-share contract premiums
35,860,065.27
Profit-share contract premiums
51,111,265.39
86,971,330.66
Technical conditions for the main life insurance categories
The main life insurance categories for 2009 have the following specifications:
PROFIT-SHARE
MODE
Interest
rate
used
Cover type
Tables
used
With or
without
share
Distributed
amount in
euro
Distribution
method
Type of
contract
Old age subsidy
2.6%4%
Survival
PER 2000
WITHOUT
---
---
Periodic
premium
AVAF (1)
2.5%
Death
PER 2000
WITHOUT
---
---
Single
premium
Retirement Plan 1
5.3%
Retirement
PER 2000
WITH
---
Individual
Periodic
premium
Retirement Plan 2
4%
Retirement
PER 2000
WITH
---
Individual
Periodic
premium
Retirement Plan 2000
3%
Retirement
PER 2000
WITH
---
Individual
Periodic
premium/
single
premium
2.5%
Retirement
PER 2000
WITH
---
Individual
Periodic
premium/
single
premium
4%
Retirement
PER 2000
WITHOUT
---
Individual
Periodic
premium/
single
premium
(1) AVAF: Voluntary extension for death assistance.
Financial duration for investments assigned to the mathematical policy provisions coverage
The company has not had to allocate supplementary mathematical provisions as it obtained a real yield in the
year for different portfolios, excluding those managed via regulated flow union in the article 33.2 in the Rules on
Regulation and Supervision of Private Insurance, above the average technical interest rate for the different portfolios
the life products are classified in.
Consolidated Report
116
The information corresponding to the asset book value, the real yield and financial duration and the percentage
of assets excluded from the calculation for said financial duration, as well as the amount of the mathematical
provision, the average technical interest and the financial duration, for each of the portfolios where life insurance is
classified is shown in the following table:
Assets
Liabilities
Mathematical
provision
average
interest
Mathematical
provision
financial
duration
189,083,614.32
3.50%
19.01
5.64
541,001,425.77
4.97%
13.13
12.41
164,984,406.13
2.60%
31.70
Real yield
on assigned
assets
Financial
duration for
assigned
assets
---
17.79
Provisional regulation 2
5.10%
Article 33.1
4.35%
PORTFOLIO
Article 33.2
Mathematical
provision
(Euro)
17.3. Technical income and expenses by branches
The details for technical income and expenses for 2009 for non-life insurance are as follows:
Individual contract premiums
Euro
Direct insurance and accepted reinsurance allocated premiums:
Premiums net of cancellations
Unearned premium provision variation
Provision variation for premiums pending
TOTAL acquired premiums, net of reinsurance
59,459,484.97
597.74
482,769.63
59,942,852.34
Direct insurance and accepted reinsurance accident rate:
Paid benefits and expenses and loss rate expenses
52,657,699.41
Technical provision variation for benefits
(1,661,759.98)
TOTAL loss rate, net of reinsurance
50,995,939.43
Direct insurance and accepted reinsurance acquisition expenses.
2,706,505.63
Direct insurance and accepted reinsurance administration expenses.
2,674,474.14
Other direct insurance and accepted reinsurance technical expenses.
352,907.30
All operating expenses other technical costs.
5,733,877.07
Consolidated Report
2 0 0 9
Annual
Report
117
17.4. Technical earnings for non-life insurance by year of occurrence
The details for the technical result by year of occurrence for the non-life branch are as follows:
Accidents
Healthcare
35,307,670.64
22,939,885.33
299,919.72
177,794.10
9,954.19
---
1. Premiums net of cancellations
---
181,338.22
2. +/- provision variations for unearned premiums
---
---
35,617,544.55
22,933,140.32
20,738,924.43
18,593,701.19
7,767,638.91
3,817,275.22
1. Benefits and Expenses Paid for accidents in the year
---
---
2. Technical provisions for benefits for accidents in the year.
---
---
28,506,563.34
22,410,976.41
ACQUISITION EXPENSES (Direct)
1,426,414.93
1,527,616.77
VI. ADMINISTRATION EXPENSES (Direct)
1,364,200.15
1,935,337.28
489,362.78
106,975.97
---
(212,287.58)
IX. TECHNICAL FINANCIAL INCOME NET OF EXPENSES
OF THE SAME TYPE
3,627,669.79
83,571.58
TECHNICAL RESULT
7,458,673.14
(2,748,706.06)
I.
ACQUIRED PREMIUMS (Direct)
1. Premiums net of cancellations
2. +/- provision variations for unearned premiums
3. +/- provision variation for premiums pending
II.
REINSURANCE PREMIUMS (Ceded)
A. TOTAL ACQUIRED PREMIUMS NET OF REINSURANCE (I-II)
III. LOSS RATE (Direct)
1. Benefits and Expenses Paid for accidents in the year,
including chargeable loss rate expenses.
2. Technical provisions for benefits for accidents in the year.
IV. REINSURANCE LOSS RATE (Ceded)
B. TOTAL LOSS RATE NET OF REINSURANCE
V.
VII. OTHER TECHNICAL EXPENSES (Direct)
VIII. ACQUISITION, ADMINISTRATON AND OTHER TECHNICAL
EXPENSES (Ceded)
Euro
Consolidated Report
118
17.5. Accounting asymmetry corrective assets and liabilities information
So as to minimise the accounting asymmetry due to the application of different valuation methods for certain assets
and liabilities, recognised profits or losses on the profit and loss account or in equity from certain financial assets
valued as fair value and subject to certain insurance transactions, they have been identified symmetrically on the
profit and loss account or in net assets with a balancing entry in the valuation of technical provisions or in a liability
account.
The details for insurance transactions are as follows:
Euro
Life insurance transactions that use financial immunisation techniques
9,032,278.58
Life insurance transactions that recognise a share in profits
31,858,564.84
TOTAL
40,890,843.42
18. GUARANTEES WITH THIRD PARTIES
List of guarantees:
COMPANY
ITEM
Euro
Valencia Town Council
Land Value Increase Liquidation.
1,126.96
Court of first instance nº 10 Valencia
Vicente Gallego suit notation
9,015.18
A.E.A.T.
Chamber of Commerce Fee
11,219.70
Almansa Town Council
Property guarantee
15,310.76
Juana Sánchez
Guarantee for premises leased in Salamanca
12,000.00
Investments and leases Dura Family
Guarantee for premises leased in Elche.
14,400.00
Repsol
Credit facilities
1,800.00
AENA
Assets and services payment
5,000.00
Consolidated Report
2 0 0 9
Annual
Report
119
19. CONSOLIDATED COVER STATUS FOR TECHNICAL PROVISIONS
The investments subject to technical provisions cover have been valued in accordance with articles in Section 2
(Technical Provisions Cover) in the Rules for the Regulation and Supervision of Private Insurance (Royal Decree
297/2004 dated February 20th) modified by Royal Decree 239/2007 dated February 16th.
The consolidated report for technical provisions cover is set out below:
Technical provisions to cover life insurance on 31st December 2009
PROVISIONS TO COVER
Euro
Insurance with a cover period equal or below one year
PROVISION FOR UNEARNED PREMIUMS AT YEAR-END
(-) Provision for unearned premiums on premiums pending payment
(-) Fees pending charge to earnings
(-) Provision for premiums accrued and not issued net of fees.
PROVISION FOR CURRENT RISKS AT YEAR-END
5,936,927.72
34,014.14
--5,715,765.80
---
Remaining life insurance
MATHEMATICAL PROVISION AT YEAR-EN
(-) Mathematical provision on premiums payable at year-end issued in the same period.
239,707.14
(-) Advances on life insurance policies
---
(-) Interest pending reimbursement for advances on life insurance policy.
---
(-) Fees technically pending amortisation
---
(-) Provision for premiums accrued and not issued net of fees.
16,458,463.97
PROFIT-SHARE AND RETURNS PROVISION
BENEFITS PROVISION
Provision for benefits pending liquidation or payment
4,538,510.69
Provision for benefit pending declaration
657,119.97
Provision for internal accident liquidation expenses
186,601.36
PROVISION FOR DEVIATIONS IN CAPITALISATION TRANSACTIONS BY LOT
TOTAL PROVISIONS TO COVER LIFE INSURANCE
--883,940,654.91
Consolidated Report
120
Assets subject to life insurance technical provision cover on 31st December 2009
CODE
TYPE
011
Marketable fixed income securities and rights negotiated in R national
markets (representative)
012
Marketable fixed income securities and rights negotiated in overseas
markets
243
Deposits in credit institutions
301
Set or predetermined cash flow exchanges
Euro
615,880,432.03
67,901,490.41
47,187,367.11
160,280,042.86
TOTAL AFFECTED ASSETS
891,249,332.41
TOTAL PROVISIONS TO COVER LIFE INSURANCE
883,940,654.91
DIFFERENCE
7,308,677.50
Technical provisions to cover non-life insurance on 31st December 2009
PROVISIONS TO COVER
Euro
PROVISION FOR UNEARNED PREMIUMS
15,798,145.83
-) Provision for unearned premiums on premiums pending payment
(-) Fees pending charge to earnings
(-) Provision for premiums accrued and not issued net of fees
87,959.66
--11,823,829.35
PROVISION FOR CURRENT RISKS
---
PROVISION FOR SHARE IN PROFITS AND REBATES
---
BENEFITS PROVISION
Provision for benefits pending liquidation or payment
8,648,334.62
Provision for benefit pending declaration
4,907,880.34
Provision for accident liquidation expenses
STABILISATION PROVISION
572,710.42
---
PROVISION FOR DEATH COVER
399,782.26
OTHER TECHNICAL PROVISIONS
195,359.60
TOTAL PROVISIONS TO COVER NON-LIFE INSURANCE
18,610,424.06
Consolidated Report
2 0 0 9
Annual
Report
121
Assets subject to non-life insurance technical provision cover on 31st December 2009
CODE
TYPE
Euro
011
Marketable fixed income securities and rights negotiated in representative
national markets.
053
Shares and holdings in mutual investment funds
031
Other fixed income securities
2,900,000.00
101
Real estate
6,053,021.00
201
Cash on hand, bank notes or coins
1,064,190.00
10,523,322.28
740,441.56
TOTAL AFFECTED ASSETS
21,280,974.84
TOTAL PROVISIONS TO COVER NON-LIFE INSURANCE
18,610,424.06
DIFFERENCE
2,670,550.78
LIFE
NON-LIFE
TOTAL
P.T. to cover
883,940,654.91
18,610,424.06
902,551,078.97
Assets subject to cover
891,249,332.41
21,280,974.84
912,530,307.25
7,308,677.50
2,670,550.78
9,979,228.28
DIFFERENCE
Euro
Consolidated Report
122
20. SOLVENCY MARGIN STATUS
The criteria for determining and rating items chargeable for the purposes of determining uncommitted assets are
those in the new Rules on the Regulation and Supervision of Private Insurance (Royal Decree 297/2004 dated
February 20th), modified by Royal Decree 239/2007 dated February 16th.
The consolidated solvency margin report for 2009 is set out below:
CONSOLIDATED SOLVENCY MARGIN REPORT
Year 2009
Recorded amount
Unaccounted amount
Mutual Fund
20,601,012.10
---
Reserves
15,819,981.33
---
118,447,365.99
---
4,597,273.48
---
11,274,504.69
5,445,084.43
---
---
170,740,137.59
5,445,084.43
Intangible elements (to deduct)
---
---
Profit and loss debit balance
---
---
Reserves in fully consolidated companies
8,194,289.98
---
6,480,705.59
---
852,934.12
---
15,527,929.69
---
155,212,207.90
5,445,084.43
50% liability allocation receivable from policyholders
---
---
Subordinate financing
---
---
Indeterminate duration financing
---
---
155,212,207.90
5,445,084.43
Minimum solvency margin
---
---
Solvency margin result
---
---
Remaining surplus
Profit and loss credit balance
Adjustments for change in value
Capital gains
Total positive items
Earnings for the period, Minority partners
Total negative items
Difference
Solvency margin
Consolidated Report
2 0 0 9
Annual
Report
123
CONSOLIDATED SOLVENCY MARGIN REPORT
Accounted amount
Life
Non-life
20,601,012.10
16,686,819.80
3,914,192.30
15,819,981.33
12,814,184.87
3,005,796.46
118,447,365.99
95,942,366.45
22,504,999.54
4,597,273.48
3,723,791.52
873,481.96
5,829,420.26
4,110,528.66
1,718,891.60
---
---
---
165,295,053.16
133,277,691.30
32,017,361.86
---
---
---
---
---
---
8,194,289.98
6,637,374.88
1,556,915.10
6,480,705.59
5,249,371.53
1,231,334.06
852,934.12
690,876.63
162,057.49
15,527,929.69
12,577,623.04
2,950,306.65
149,767,123.47
120,700,068.26
29,067,055.21
---
---
---
---
---
---
---
---
---
149,767,123.47
120,700,068.26
29,067,055.21
52,548,595.25
41,942,830.77
10,605,764.48
97,218,528.22
78,757,237.49
18,461,290.73
Euro
Consolidated Report
124
GUARANTEE FUND
The guarantee fund is as follows:
ITEM
A. 1/3 minimum solvency margin amount
B. Minimum guarantee fund amount
C. Guarantee fund (higher amount between A and B)
Euro
17,516,198.42
3,200,000.00
17,516,198.42
Guarantee Fund establishment:
Paid-up capital stock
20,601,012.10
Other asset reserves
119,592,351.75
Profit and loss credit balance
4,597,273.48
Adjustments for change in value
5,829,420.26
Minority partners
(852,934.12)
TOTAL
149,767,123.47
Surplus
132,250,925.05
The directors of Mutualidad General de Previsión del Hogar Divina Pastora, Mutualidad de Previsión Social a Prima
Fija, have formulated the consolidated annual accounts for 2009 comprising:
• The consolidated balance sheet on pages 1 to 2
• The profit and loss account on pages 3 to 5
• The changes in the consolidated net assets report on pages 6 to 7
• The consolidated cash flow report on page 8
• The consolidated report on pages 9 to 91
In Valencia, 31st March 2010.
2 0 0 9
Annual
Report
125
Appendix I. Consolidated Balance Sheets as of December 31st 2008
126
CONSOLIDATED BALANCE SHEET-2008
ASSETS
Notes
2008
17,773,282.66
---
A.3) OTHER FINANCIAL ASSETS AT FAIR VALUE WITH CHANGES POSTED IN PROFIT AND LOSS
10,520,400.00
6.4.1.
10,520,400.00
I. Representative debt value
II. Loans
807,716,520.79
6.4.1.
67,292,804.21
740,423,716.58
627,360,598.95
6.4.1.
525,559,090.24
488,260.03
16,456.23
1. Policy advances
471,803.80
2. Loans to group and associated institutions
36,500,000.00
55,729,177.09
6.4.1.7.
55,729,177.09
6.4.1.7.
3,496,594.45
2. Other loans
6.4.1.7.
5,587,477.14
9,084,071.59
IX.Other loans
---
---
--68,869,526.64
6.1.
10,962,722.74
6.2.
57,906,803.90
2,075,426.46
A.10)INTANGIBLE FIXED ASSETS
III.Other intangible assets
A.11)SHARE IN GROUP AND ASSOCIATE COMPANIES
I. Shares in associated companies
III.Shares in group companies
A.12)TAX ASSETS
I. Current tax assets
140,993.15
1,934,433.31
6.4.1.6.
21,966,190.94
39,789.63
21,926,401.31
6.6.
10,002,725.11
--10,002,725.11
A.13)OTHER ASSETS
21,201,612.13
III.Accruals
21,169,782.65
IV.Other assets
A.14)ASSETS HELD FOR SALE
TOTAL ASSETS
31,829.48
--1,587,486,283.68
Appendix I. Consolidated Balance Sheets as of December 31st 2008
2 0 0 9
Annual
Report
127
CONSOLIDATED BALANCE SHEET-2008
A)LIABILITIES
A.1)FINANCIAL LIABILITIES HELD FOR NEGOTIATION
A.2)OTHER FINANCIAL LIABILITIES AT FAIR VALUE WITH CHANGES
A.3)DEBITS AND ITEMS PAYABLE
2. Broker debts
VII. Debts with credit institutions
IX. Other debts
2. Other debts with group and associate companies
A.4)HEDGING DERIVATIVES
A.5)TECHNICAL PROVISIONS
Notes
2008
---
--6.4.2.
479,972,916.71
116,248.72
8,156.02
80,155.00
27,937.70
930.93
65,421,984.64
414,433,752.42
1,100,043.77
736,887.36
412,596,821.29
---
14
901,545,234.89
16,306,577.08
868,791,071.65
5,752,456.82
863,038,614.83
15,813,884.79
608,239,61
25,461.76
A.6)NON-TECHNICAL PROVISIONS
6.7.
889,760.75
738,376.58
A.7)TAX LIABILITIES
6.6.
9,675,889.15
9,675,889.15
151,384.17
A.8)OTHER LIABILITIES
TOTAL LIABILITIES
B)NET ASSETS
B.1)EQUITY
III. Reserves
3. Other reserves
V. Earnings from previous years
VII. Earnings for the consolidated period
B.2)ADJUSTMENTS FOR CHANGE IN VALUE
38,114,073.87
38,114,073.87
--1,430,197,875.37
6.5.
153,627,936.21
20,000,000.00
20,000,000.00
10,648,477.60
6,980.580.31
3,667,897.29
120,890,373.91
120,890,373.91
2,089,084.70
3,660,472.10
32,100,345.27
(28,585,555.41)
V. Other adjustments
B.3)SUBSIDIES, DONATIONS AND BEQUESTS RECEIVED
TOTAL NET ASSETS
145,682.24
--157,288,408.31
1,587,486,283.68
Appendix I. Consolidated Profit and Loss Accounts as of December 31st 2008
128
2008
36,942,757.87
36,995,694.61
a)Premiums paid
b) Ceded reinsurance premiums
36,858,089.89
137,604.72
(5,722.50)
(47,214.24)
c) Value corrections due to depreciation in tangible
fixed assets and investments
1,420,573.34
1,410,072.92
10,500.42
10,500.42
82,074.43
I.4. NET REINSURANCE LOSS RATE FOR THE PERIOD
33,986,030.03
28,439,056.05
28,439,056.05
4,218,018.70
4,218,018.70
1,328,955.28
I.5. VARIATION IN OTHER NET REINSURANCE TECHNICAL PROVISIONS (+ or -)
3,393.89
---
3,059,920.47
1,921,099.98
1,138,820.49
358,965.33
d)Others
358,965.33
36,597.01
a) Investment management expenses
129,139.00
1,712.30
34,884.71
I.10. SUBTOTAL (Non-life Insurance Technical Account Result)
92,541.99
83.28
92,458.71
914,744.69
2 0 0 9
Annual
Report
129
2008
a)Premiums paid
a.1)Direct insurance
92,460,232.80
92,625,234.23
92,397,460.24
227,773.99
c)Provision variation for unearned premiums and current risks (+ or -)
c.1)Direct insurance
(165,001.43)
(165,001.43)
79,861,222.26
68,323,701.89
c)Value corrections due to depreciation in tangible
fixed assets and investments
c.2)Financial investments
8,184,785.31
8,184,785.31
3,352,735.06
d.2)Financial investments
3,352,735.06
63,010.30
I.4. NET REINSURANCE LOSS RATE FOR THE PERIOD
79,694,302.38
79,694,302.38
(2,148,767.92)
b.1)Direct insurance
79,846,091.52
(2,148,767.92)
2,300,557.06
c)Expenses chargeable to benefits
I.5. VARIATION IN OTHER NET REINSURANCE
TECHNICAL PROVISIONS (+ or -)
10,488,370.99
10,488,370.99
10,488,370.99
1,826,720.45
2,049,951.16
b)Provision variation for share in bonuses and rebates
(223,230.71)
12,570,948.71
a)Acquisition costs
9,554,383.01
3,016,565.70
1,240,685.69
1,240,685.69
c)Others
a.2)Investment and financial accounts expenses
17,814,667.56
17,814,667.56
b.1)Tangible fixed asset and real estate investment amortisation
b.3)Financial investment depreciation
27,276,641.65
8,231,574.09
2,485.59
8,229,088.50
c)Losses from tangible fixed assets and investments
c.2)Financial investments
I.10.SUBTOTAL (Life Insurance Technical Account Result)
1,230,400.00
1,230,400.00
39,135,006.36
130
2008
6,105,956.69
2,927,843.63
1,545,573.12
1,632,539.94
1,632,539.94
41,425,516.01
7,474,485.25
1,048,612.22
6,425,873.03
33,951,030.76
9,720.04
b.2) Real estate investment depreciation
11,487,975.89
22,453,334.83
III.3. OTHER INCOME
912,820.28
912,820.28
b) Other income
1,801,389.11
1,801,389.11
b)Other expenses
(36,208,128.15)
3,841,622.90
1,752,538.20
2,089,084.70
III.9. EARNINGS FROM TERMINATED OPERATIONS NET OF TAX (+ or -)
--2,089,084.70
2 0 0 9
Annual
Report
131
Appendix I. Consolidated statement of changes in net assets
as of December 31st 2008
132
CONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS
Year ending 31st December 2008 (Euro)
A) STATEMENT OF RECOGNISED INCOME AND EXPENSES
Notes from the
Report
I. EARNINGS FOR THE PERIOD
18,724,901.11
II. OTHER RECOGNISED INCOME AND EXPENSES
II.1 Financial assets available for sale
2008
---
2.h)
---
II.2 Cash flow hedges
Amounts transferred at initial values for hedged items
---
II.3 Net investment hedge in overseas businesses
---
II.4 Exchange and conversion differences
---
II.5 Accounting asymmetry correction
2.h)
---
II.6 Assets held for sale
---
II.7 Actuarial profit / (losses) for long-term staff payments
---
II.8 Other recognised income and expenses
2.h)
---
II.9 Corporation tax
6.6)
---
III. TOTAL RECOGNISED INCOME AND EXPENSES
18,724,901.11
Appendix I. Consolidated statement of changes in net assets
2 0 0 9
Annual
Report
133
Year ending 31st December 2008 (Euro)
B) TOTAL STATEMENT OF
CHANGES IN NET ASSETS
Stated capital
or mutual
fund
Reserves
A. ADJUSTED BALANCE,
START OF 2008 WITHOUT
CONVERSION
20,000,000.00
I. Total recognised income
and expenses
II. Operations with members and policyholders
Earnings for the
period
Adjustment
for change in
value
TOTAL
131,538,851.51
2,089,084.70
3,660,472.10
157,288,408.31
---
---
18,724,901.11
(630,785.85)
18,094,115.26
---
---
---
---
---
5,379,424.31
(2,089,084.70)
---
---
---
2,089,084.70
(2,089,084.70)
---
---
3. Other variations
---
3,290,339.61
---
---
3,290,339.61
B. BALANCE, END
OF 2008 WITHOUT
CONVERSION
20,000,000.00
136,918,275.82
18,724,901.11
3,029,686.25
178,672,863.18
---
299,521.90
---
---
299,521.90
---
---
---
---
---
20,000,000.00
137,217,797.72
18,724,901.11
3,029,686.25
178,972,385.08
III.Other changes in net assets
2. Transfer between net asset items
II. Other conversion adjustments
C. BALANCE,
END OF 2008
Appendix I. Statement of Cash flows for the parent company
134
2008
A) OPERATIONAL ACTIVITIES CASH FLOWS
A.1) Insurance Activity
1- Direct insurance premium receipts
126,891,474.25
2- Direct insurance claims
108,850,226.41
3- Other operational payments
21,572,239.94
9- Total insurance activity cash receipts (I)
126,891,474.25
10- Total insurance activity cash payments (II)
130,422,466.35
A.2) Other operational activities
3- Receipts from other activities
5,503,026.09
4- Payments for other activities
1,955,057.05
5- Total cash receipts from other operational activities (III)
5,503,026.09
6- Total cash payments for other operational activities (IV)
1,955,057.05
A.3) Total net cash flows for operational activities (I-II+III-IV)
16,976.94
B) INVESTMENT ACTIVITY CASH FLOWS
B.1) Investment activity receipts
6- Interest receipts
10- Total cash receipts for investment activities (VI)
111,304,155.69
41,535,081.84
152,839,237.53
B.2) Investment activity payments
1- Tangible fixed assets
5- Share in group companies
8- Total cash payments for investment activities (VII)
B.3) Total cash flows for investment activities (VI-VII)
350,628.16
103,063,248.29
69,240,021.33
172,653,897.78
(19,814,660.25)
C) FINANCING ACTIVITY CASH FLOWS
C.1) Financing activity receipts
5- Other receipts
30,382,477.44
6- Total cash receipts (VIII)
30,382,477.44
C.2) Financing activity payments
5- Other payments
24,100,810.09
6- Total cash payments (IX)
24,100,810.09
C.3) Total cash flows for financing activities (VIII-IX)
Effect of exchange rate variations (X)
Total increase/decrease for cash and equivalent (A.3+B.3+C.3+-X)
6,281,667.35
70,315.29
(13,586,331.25)
Cash and equivalent at the start of the period
24,713,684.61
Cash and equivalent at the end of the period
11,127,353.36
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Appendix II. Consolidated Balance Sheets as of December 31st 2008. Mutualdis
136
CONSOLIDATED BALANCE SHEET- 2008
ASSETS
Notes
2008
1,301,840.63
---
---
---
III. Hybrid instruments
18,485,500.73
306,132.75
18,179,367.98
4,050,476.68
---
II. Loans
---
1. Policy advances
III. Deposits in credit institutions
IX. Other loans
2. Other loans
--144,695.38
144,695.38
3,905,781.30
174,982.72
3,730,798.58
---
---
---
9,007,303.94
9,007,303.94
---
---
---
---
---
III. Shares in group companies
---
A.12)TAX ASSETS
---
---
A.13)OTHER ASSETS
469,901.26
III.Accruals
469,901.26
IV.Other assets
TOTAL ASSETS
----33,315,023.24
Appendix II. Consolidated Balance Sheets as of December 31st 2008. Mutualdis
2 0 0 9
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137
Notes
2008
A) LIABILITIES
A.1)FINANCIAL LIABILITIES HELD FOR NEGOTIATION
---
A.2)OTHER FINANCIAL LIABILITIES AT FAIR VALUE WITH
CHANGES POSTED IN PROFIT AND LOSS
---
A.3)DEBITS AND ITEMS PAYABLE
2. Broker debts
IX. Other debts
A.4)HEDGING DERIVATIVES
A.5)TECHNICAL PROVISIONS
243,848.04
---
--243,848.04
243,848.04
--31,610,810.13
---
---
10,074,928.07
21,535,882.06
---
A.6)NON-TECHNICAL PROVISIONS
---
---
---
A.7)TAX LIABILITIES
A.8)OTHER LIABILITIES
---
---
A.9)LIABILITIES LINKED TO ASSETS HELD FOR SALE
TOTAL LIABILITIES
--31,854,658.17
B)NET ASSETS
B.1)EQUITY
III. Reserves
3. Other reserves
601,012.10
601,012.10
5,293,472.46
5,293,472.46
---
VII.Earnings for the period
B.2) 1,460,364.07
ADJUSTMENTS FOR CHANGE IN VALUE
B.3)SUBSIDIES, DONATIONS AND BEQUESTS RECEIVED
TOTAL NET ASSETS
(4,434,120.49)
---
--1,460,364.07
33,315,022.24
Appendix II. Consolidated Profit and Loss Accounts
as of December 31st 2008. Mutualdis
138
PROFIT AND LOSS ACCOUNT - 2008
2008
1,891,807.37
1,891,807.37
a)Premiums paid
1,891,807.37
---
1,544,173.85
a) Income from tangible investments
300,885.83
1,195,082.11
c) Value corrections due to depreciation in tangible fixed
assets and investments
14,035.31
14,035.31
34,170.60
34,170.60
3,462,654.24
4,564,223.64
4,564,223.64
(1,171,346.59)
(1,171,346.59)
69,777.19
PROVISIONS (+ or -)
(273,881.39)
(273,881.39)
(273,881.39)
b)Provision variation for share in bonuses and rebates
---
633,344.40
a)Acquisition costs
337,020.82
296,323.58
3,295,772.31
b)Asset depreciation variation
3,235,957.16
c) Others
59,815.15
679,406.67
679,406.67
679,406.67
---
c) Losses from tangible fixed assets and investments
---
I.10.SUBTOTAL (Life Insurance Technical Account Result)
(4,361,315.01)
Appendix II. Consolidated Profit and Loss Accounts
as of December 31st 2008. Mutualdis
2 0 0 9
Annual
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139
PROFIT AND LOSS ACCOUNT - 2008
2008
---
---
---
---
---
---
---
III.3. OTHER INCOME
21,181.37
21,181.37
b)Other income
(93,986.85)
(93,986.85)
b)Other expenses
(72,805.48)
(4,434,120.49)
NET OF TAX (+ or -)
(4,434,120.49)
---
(4,434,120.49)
Appendix III. Consolidated Merged Balance Sheets as of December 31st 2008
140
ASSETS
2008
19,075,123.29
---
10,520,400.00
10,520,400.00
826,202,021.52
67,598,936.96
758,603,084.56
631,411,075.63
525,559,090.24
II. Loans
1. Policy advances
488,260.03
16,456.23
471,803.80
36,500,000.00
55,873,872.47
55,873,872.47
12,989,852.89
IX.Other loans
3,671,577.17
2. Other loans
9,318,275.72
---
---
---
77,876,830.58
19,970,026.68
57,906,803.90
III. Shares in group companies
A.12)TAX ASSETS
I. Current tax assets
2,075,426.46
140,993.15
1,934,433.31
21,966,190.94
39,789.63
21,926,401.31
10,002,725.11
--10,002,725.11
A.13)OTHER ASSETS
21,671,513.39
III.Accruals
21,639,683.91
IV.Other assets
TOTAL ASSETS
31,829.48
--1,620,801,306.92
Consolidated Merged Balance Sheets as of December 31st 2008
2 0 0 9
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Report
141
2008
A) LIABILITIES
---
A.1) FINANCIAL LIABILITIES HELD FOR NEGOTIATION
A.2) OTHER FINANCIAL LIABILITIES AT FAIR VALUE
WITH CHANGES POSTED IN PROFIT AND LOSS
---
A.3) DEBITS AND ITEMS PAYABLE
480,216,764.75
116,248.72
2. Broker debts
8,156.02
80,155.00
27,937.70
IX. Other debts
2. Other debts with group and associate companies
A.5) TECHNICAL PROVISIONS
930.93
65,421,984.64
414,677,600.46
1,100,043.77
736,887.36
412,840,669.33
--933,156,045.02
16,306,577.08
878,865,999.72
5,752,456.82
873,113,542.90
37,349,766.85
608,239.61
25,461.76
889,760.75
A.6) NON-TECHNICAL PROVISIONS
738,376.58
151,384.17
9,675,889.15
38,114,073.87
38,114,073.87
A.8) OTHER LIABILITIES
9,675,889.15
A.7) TAX LIABILITIES
---
TOTAL LIABILITIES
1,462,052,533.54
B) NET ASSETS
3. Other reserves
VII.Result for the consolidated period
B.2) ADJUSTMENTS FOR CHANGE IN VALUE
V. Other adjustments
15,941,950.06
12,274,052.77
3,667,897.29
120,890,373.91
20,601,012.10
III. Reserves
20,601,012.10
155,088,300.28
B.1) EQUITY
B.3) SUBSIDIES, DONATIONS AND BEQUESTS RECEIVED
TOTAL NET ASSETS
120,890,373.91
(2,345,035.79)
3,660,472.10
32,100,345.27
(28,585,555.41)
145,682.24
--158,748,772.38
1,620,801,305.92
Appendix III. Consolidated Merged Profit and Loss Accounts
142
2008
36,942,757.87
36,995,694.61
a) Premiums paid
b) Ceded reinsurance premiums
36,858,089.89
137,604.72
(5,722.50)
(47,214.24)
(47,214.24)
1,420,573.34
1,410,072.92
b) Income from financial investments
c) Value corrections due to depreciation in tangible fixed assets
and investments
10,500.42
10,500.42
82,074.43
28,439,056.05
b) Provision variation for benefits (+ or -)
28,439,056.05
a) Benefits and expenses paid
33,986,030.03
4,218,018.70
4,218,018.70
1,328,955.28
PROVISIONS (+ or -)
3,393.89
---
3,059,920.47
1,921,099.98
1,138,820.49
358,965.33
358,965.33
d) Others
129,139.00
36,597.01
1,712.30
34,884.71
I.10.SUBTOTAL (Non-life Insurance Technical Account Result)
92,541.99
83.28
92,458.71
914,744.69
2 0 0 9
Annual
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143
2008
94,352,040.17
94,517,041.60
a) Premiums paid
94,289,267.61
227,773.99
(165,001.43)
(165,001.43)
81,405,396.11
a) Income from tangible investments
300,885.83
69,518,784.00
c) Value corrections due to depreciation in tangible fixed assets
and investments
8,198,820.62
8,198,820.62
3,386,905.66
d) Profits in realising tangible fixed assets and investments
3,386,905.66
63,010.30
a) Benefits and expenses paid
84,258,526.02
84,258,526.02
(3,320,114.51)
b) Provision variation for benefits (+ or -)
83,308,745.76
(3,320,114.51)
2,370,334.25
PROVISIONS (+ or -)
10,214,489.60
10,214,489.60
a) Life insurance provisions
10,214,489.60
1,826,720.45
a) Services and expenses for share in bonuses and rebates
2,049,951.16
b) Provision variation for share in bonuses and rebates
(223,230.71)
13,204,293.11
9,891,403.83
3,312,889.28
4,536,458.00
b) Asset depreciation variation
3,235,957.16
c) Others
1,300,500.84
27,956,048.32
18,494,074.23
8,231,574.09
18,494,074.23
2,485.59
8,229,088.50
c) Losses from tangible fixed assets and investments
I.10. SUBTOTAL (Life Insurance Technical Account Result)
1,230,400.00
1,230,400.00
34,773,691.35
144
2008
6,105,956.69
a) Income from real estate investments
2,927,843.63
1,545,573.12
d) Profits in realising tangible fixed assets and investments
1,632,539.94
1,632,539.94
41,425,516.01
7,474,485.25
1,048,612.22
6,425,873.03
33,951,030.76
9,720.04
b.2) Real estate investment depreciation
11,487,975.89
22,453,334.83
III.3. OTHER INCOME
934,001.65
934,001.65
b) Other income
1,707,402.26
1,707,402.26
b) Other expenses
(36,092,959.93)
(477,329.37)
1,752,538.20
NET OF TAX (+ or -)
(2,229,867.57)
--(2,229,867.57)
2 0 0 9
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145
Consolidated Management Report
146
PARENT COMPANY INFORMATION
Commercial Activity
Over 2009, the production obtained, compared with the previous year, was as follows:
Product
Personal Multi-risk
Amount
2008
Amount
2009
Collection
2008
Average
Monthly
Premium
2008
Collection
2009
Average
Monthly
Premium
2009
20,311
16,677
€ 4,276,670
€ 3,522,580
€ 21.04
€ 21.12
475
47
€ 2,001,524
€ 230,209
4,213.73
€ 4,898.06
Regular Contribution
Savings Plan
7,395
4.005
€ 3,476,403
€ 1,980,330
€ 47.00
€ 49.44
Life Insurance
Single Contribution
Savings Plan
6,479
7,097
-
-
-
-
Freelance
-
529
-
€ 237,840
-
€ 37.46
Amateur Races
-
134
-
€ 160,666
-
-
With regards to 2008 there is a generalised decrease in production except for life insurance, which improved.
In general, the decrease is due to the financial crisis in Spain, specifically with regards to unemployment which
drastically affected the real possibility of selling voluntary insurance policies. In turn, the sustained low interest
rates linked with the impossibility of many families managing to save also led to a major fall in savings plan sales.
It should also be highlighted that those families who maintain a comfortable financial level prefer to place their
savings with banks since the interest rates they offer are highly attractive thanks to the overarching need of the
financial system to recover liquidity levels.
Life insurance saw a major upturn which is expected to continue in the coming year. This upswing can be explained
by several reasons. On the one hand, the higher remuneration for sellers with regards to previous years and, on the
other, improved product benefits since, in contrast to the product sold since 1994, a policy for bereavement without
greater cover, now includes cover for severe disability or total incapacity due to accidents.
This is the first full year the work incapacity product for freelancers has been marketed; it has not seen a great initial
uptake mainly due to the difficulties sales have experienced as commented above.
Linked to the sports sponsorship of the athletics federation, marketing of the sports policy for amateur races began,
taking advantage of the sports race circuit that Divina Pastora also sponsors. The policy has been a success and,
although not generating major volume, has been sufficiently profitable.
2 0 0 9
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147
Operating Management
The following benefits were resolved over the year:
Benefit
Approved
Refused
Total
16,754
3,433
20,187
25,508
5,761
31,269
63
16
79
459
247
706
30
21
51
Severe Disability due to Illness
Permanent Incapacity for any work due to Illness
Absolute Incapacity due to Accident
2
4
6
Total Incapacity for any profession due to Accident
12
24
36
Total Incapacity for the declared profession due to Accident
39
53
92
Partial Permanent Incapacity due to Accident
21
65
86
Birth
8,951
83
9,034
Wedding
3,430
39
3,469
Old Age Benefit
6,122
4
6,126
410
28
438
157
8
165
12,842
8
12,850
Assistance due to Death
Death PJ
Redemption RP
Expiry RP
AVAF
2,632
136
2,632
27
163
Other services
3
3
Death AF
1
1
96
96
Partial redemption RP
Temporary Incapacity due to Accident IA
Temporary Incapacity due to Illness IA
TOTAL
216
22
238
52
44
96
77,936
9,887
87,823
Benefits experienced a major decrease with regards to last year, around 6%, on the one hand explained by the
reduced census and, on the other, by the adjustment to a normal rate of retirement plan redemption applications. It
should be pointed out that in the previous year, redemptions saw an abnormal increase due to the general distrust
of financial institutions.
Financial Management
The investment policy from previous years was maintained, keeping the fixed income products from high creditrated issuers, swaps on fixed rates to ring-fence savings products and structured products with capital guarantee as
main investment lines.
The excellent year in financial terms meant new adjustments were made to guarantee greater solvency, specifically
in the life annuities that Divina Pastora inherited from the merger with Mutualdis: life expectancy amongst the
disabled group increased, adapted to levels being seen today.
148
Highlights
The merger with Mutualdis, a friendly society specialised in insurance policies for the disabled, concluded in August
2009. This transaction should not be framed exactly as a business transaction but rather an operation where Divina
Pastora has fulfilled its social principles by taking charge of the cover for Mutualdis policyholders. Without this
transaction Mutualdis, due to its small size, could see future difficulties which would have meant a deterioration in
the financial situation of a certain sector of the population - those with disabilities.
Continuing with what occurred in 2008, in 2009 Divina Pastora was obliged to provision the remaining value of the
Cisne operation investment given the deterioration situation the company experienced due to the management of
the previous administrators. Such is the case that in order to maintain a commitment to the company’s policyholders,
Divina Pastora was obliged to agree the portfolio transfer with its subsidiary, Divina Pastora Seguros Generales, as
the only viable solution to sustaining the policyholders portfolio.
INFORMATION ON SUBSIDIARY COMPANIES
DIVINA PASTORA SEGUROS GENERALES, S.A.U.
Commercial Activity
Over 2009, the production obtained, compared with the previous year, was as follows:
2009
Amount
Healthcare
Death
2008
64
79
5,258
3,966
Benefits management
The following benefits were resolved over the year
Benefit
Death Assistance
Healthcare
Illness
Approved
Refused
Total
34
---
34
21,813
---
21,813
8
---
8
Operating management
In 2009, the company applied for authorisation from the Directorate General for Insurance and Pension Funds
to operate in the accident, diverse financial losses and legal defence areas. The Ministerial Order authorising the
company to operate in said areas was approved on 4th December 2009.
In addition, as of 29th December 2009, the Ministerial Order whereby the Ministry of the Economy authorised the
total transfer of the policyholders portfolio of Cisne Aseguradora, S.A. to Divina Pastora Seguros Generales, S.A.U.
was signed. Said portfolio transfer occurred on 1st February 2010.
2 0 0 9
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149
Earnings for the period
Earnings after tax at the company in 2009 were 71,353.89 euro. In 2009 the company continued to market the
new bereavement product designed in 2008 and began the necessary processes to launch the health insurance
policy in 2010 in Santander and the Basque Country.
CISNE ASEGURADORA, S.A.
A. Business evolution and company situation
A.1. General company information and business.
Note 1 in the annual accounts report for 2009 provides information on the company, its constitution, origins and
registered office, as well as the areas where it operates; the main area is healthcare, whose premium volume in
2009 ran to 97% of total premium volume collected in the year.
In 2009 the Directorate General for Insurance and Pension Funds (DGSF) revoked the company’s authorisation
to operate in the areas of Fires and asset damage and Other damage to assets, given the inactivity thereof.
The taking control of the company through acquisition of a direct representative share of 92.82% of the capital
stock by Mutualidad Divina Pastora (hereinafter the ‘Mutualidad’ or ‘Divina Pastora’) and subsequent to this
the replacement of the previous management led to a deep renovation of the company, the adoption of
restructuring measures through recapitalisation and efficient financial management, and the implementation of
a new business model based on the introduction of internal control procedures, which had been non-existent
until that point, based on the efficiency of different processes (basically, premiums and benefits) and the
improvement of recording, review and payment procedures for healthcare benefits. In addition, the company’s
business was centred on those areas where it is a specialist, cancelling upon expiry all additional policies as there
were no appropriate controls thereof and it not being company business, such as accident policies related to
bullfighters, federations, and tourism and leisure.
However, the critical situation of the company at the end of the first quarter 2008 was an insuperable obstacle
and frustrated all attempts made to restructure the finances and recover business. The many business model
deficiencies could have been solved if there had not been an endless amount of irregular actions and, mostly,
presumably illegal acts by the previous managers who also had control of the capital, frequently used for
interests opposed to the company’s own. As stated by the DGSFP in its Inspection Report dated 2nd July 2007
and the Resolution dated 24th November, all this undermined the company which, on 30th June 2008, had no
capital, assets or liquidity that could be classified as such, with the aggravating factor of all this being masked by
false accounting to present a non-existent viability.
The experience of the new managers in the insurance business, the considerable material and human resources
provided by Mutualidad Divina Pastora, including the award of a participation loan of 8,806,695.70 euro (see
Note 5.6 in the attached annual accounts report) and the signing of over 100 sureties to doctors and clinics so
that they could continue to supply healthcare assistance to Cisne Aseguradora policyholders, came up against
an insuperable obstacle in the prior dismantling of the company, irremissibly condemned to liquidation, without
prejudice to starting the necessary legal measures to claim compensation from the previous managers and
shareholders at the company for asset damages caused thereto and its subsidiary company Cisne Outsourcing,
S.L. in recent years.
When these annual accounts were being compiled and this management report drafted, the company was
preparing to put itself in administration which is expected to be done very soon.
150
A.2. Earnings for the period.
In 2009, the company went into losses of 11,879 thousand euro, according to the profit and loss account for
said year.
The non-life technical account (a company business) saw a negative result of 5,438 thousand euro due to:
a) the high accident rate the company had been working with due to, amongst other causes, the imbalance
in rates based on policyholder age, the assumption in 2009 of expenses for claims before 2008, this despite
the measures implemented to reduce it (the extended and more competitive hospital offer to policyholders
over that of August 2008, the end of the elimination of the medical service for those professionals contracted
by the previous managers via the ‘capitation’ system, etc.) b) the high level of general expenses (acquisition
and administration expenses) the company had which, although reduced from the previous year through office
closures, the transfer of main functions and operation of the company to Valencia (using the parent company’s
services), the cancellation of staff labour contracts for those who did not transfer to Valencia, with the subsequent
compensation expenses, etc, was not enough to balance the profit and loss account.
Collected premiums went from 31,248,751 euro in 2008 to 22,325,666 euro in 2009, i.e. around a 29%
decrease. This decrease was basically due to the correction for incorrectly accounted premiums in previous years
and which were adjusted in 2009, the cancellation of incidental accident policies and the substantial reduction
in policies in the illness field, as well as a portfolio clean-out when records began in Valencia in 2009, in addition
to a fall in the portfolio due to the company’s situation at the start of 2009 which was not compensated by
a new issuance (except for new policyholders related to existing policies) since at the end of 2008 it was
considered prudent to not issue new policies until resolving the company’s asset situation detected in the
inspection report from the DGSFP on 2nd July 2008 and the Resolution from the same body on 24th November
2009. Despite this situation, the fall in the healthcare area (the company’s main area) of collected premiums
in 2009 with regards to 2008 was only 11.64%, this despite the lack of any new policies being issued due to
the reasons set out above.
The claim rate cost as per the technical profit and loss account accounted for 109.7% of collected premiums.
The company is implementing corrective measures for the claims rate such as electronic card identification
allowing medical professionals to know if policyholders have all rights before treating them, the complete
elimination of professionals from the medical service with a ‘capitation’ system, etc. However, in 2009 said
measures were still not in operation.
The non-technical account ran to additional net losses of just above 5.438 thousand euro. The main expense
in this figure was the compensation agreed by the Works Committee (final cost: 2.289 thousand euro) for
employees who did not accept a transfer to the company’s head office in Valencia.
With regards to the losses for the period, the proposal to be put to the General Shareholders Meeting will be to
apply the losses with a charge to the ‘Earnings from previous years’ account.
2 0 0 9
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B. Forecast company performance
In 2010 until the portfolio transfer date (1st February 2010) the company will likely incur losses. After this
transfer date, the company will enter liquidation.
OTHER SUBSIDIARY COMPANIES
With regards to the other subsidiary companies:
• Viajes Divina Pastor ran into operating losses in 2009 of 53,050 euro. New equivalent measures will be
assessed in 2010 to balance out the subsidiary’s expenses level so that the result is nil.
• Gesmutual Inmobiliaria and Valenciana de Sistemas Integrales:
These companies saw practically no business in 2009, explaining their negative results almost in entirety due
to financial costs accrual for loans granted by the Parent Company. However, said effect was neutralised in the
consolidated accounts.
The directors of Mutualidad General de Previsión del Hogar, Divina Pastora, Mutualidad de Previsión Social a Prima
Fija, formulated the consolidated management report for 2009, included in pages 1 to 6.
In Valencia, 31st March 2010.
© Divina Pastora Seguros
C/ Colón, 74 - 46004 Valencia - ESPAÑA
www.divinapastora.com
Total or partial reproduction of this book is forbidden, as is its
storage on any computer system or transfer in any way or on any
media, whether electronic, mechanical, photocopy, file or others
without prior written permission from the Copyright holders.
Head Office
C/ Colón, 74
46004 Valencia - ESPAÑA
www.divinapastora.com
Entidad Aseguradora
Oficial de la Real Federación
Española de Atletismo

Policyholder Service Department Report

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