My first Publication ocbc_ar17_fullreport_english | Page 240

NOTES TO THE FINANCIAL STATEMENTS
For the financial year ended 31 December 2017
39. RISK MANAGEMENT (continued)
39.5 INSURANCE-RELATED RISK MANAGEMENT (continued)
Insurance risk (continued)
Table 39.5(B2): Profit/(loss) after tax and shareholders’ equity sensitivity for the Malaysia segment
Impact on 1-year’s profit/(loss) after tax and shareholders’ equity
$ million
Scenario 1
Scenario 2
Scenario 3
Scenario 4
Scenario 5
Scenario 6
Scenario 7
2017
Gross impact
Reinsurance ceded
Net impact (80.4)
–
(80.4) 67.8
–
67.8 (15.0)
–
(15.0) 12.0
–
12.0 (5.1)
–
(5.1) 6.9
–
6.9 (19.7)
–
(19.7)
2016
Gross impact
Reinsurance ceded
Net impact (70.4)
–
(70.4) 59.1
–
59.1 (11.9)
–
(11.9) 10.5
–
10.5 (6.5)
–
(6.5) 7.7
–
7.7 (11.7)
–
(11.7)
The above tables demonstrate the sensitivity of GEH Group’s profit and loss after tax to a reasonably possible change in actuarial
valuation assumptions on an individual basis with all other variables held constant.
The effect of sensitivity analysis on reinsurance ceded for the Singapore and Malaysia segments are not material.
The method used, including the significant assumptions made, for performing the above sensitivity analysis did not change from the
previous year.
Insurance risk of non-life insurance contracts
Risks under non-life insurance policies usually cover a twelve-month duration. The risk inherent in non-life insurance contracts is
reflected in the insurance contract liabilities which include the premium and claims liabilities. The premium liabilities comprise reserve
for unexpired risks, while the claims liabilities comprise the loss reserves which include both provision for outstanding claims notified
and outstanding claims incurred but not reported.
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OCBC ANNUAL REPORT 2017