HALIFAX LIFE LIMITED

Transcription

1 Annual PRA Insurance Returns for the year ended 31 December 2014 IPRU(INS) Appendices 9.1, 9.3, 9.4, 9.6

2 Balance Sheet and Profit and Loss Account Contents Form 2 Statement of solvency - long-term insurance business 1 Form 3 Components of capital resources 3 Form 13 Analysis of admissible assets 6 Form 14 Long term insurance business liabilities and margins 12 Form 15 Liabilities (other than long term insurance business) 13 Form 16 Profit and loss account (non-technical account) 14 Form 17 Analysis of derivative contracts 15 Long Term Insurance Business: Revenue Account and Additional Information Form 40 Revenue account 16 Form 41 Analysis of premiums 17 Form 42 Analysis of claims 18 Form 43 Analysis of expenses 19 Form 44 Linked funds balance sheet 20 Form 45 Revenue account for internal linked funds 21 Form 46 Summary of new business 22 Form 47 Analysis of new business 23 Form 48 Assets not held to match linked liabilities 26 Form 49 Fixed and variable interest assets 27 Form 50 Summary of mathematical reserves 28 Form 51 Valuation summary of non-linked contracts (other than 29 accumulating with-profits contracts) Form 52 Valuation summary of accumulating with-profits contracts 31 Form 53 Valuation summary of property linked contracts 33 Form 54 Valuation summary of index linked contracts 35 Form 55 Unit prices for internal linked funds 37 Form 57 Analysis of valuation interest rate 38 Form 58 Distribution of surplus 39 Form 60 Long-term insurance capital requirement 40 Supplementary notes to the return 41 Additional information on derivative contracts 47 Additional information on controllers 48 Abstract of the Valuation Report 49 Statement of information on the with-profits actuary 60 Directors' Certificate 61 Auditor's Report 62

3

4 :09:32:38 Form 2 Statement of solvency - long-term insurance business Global business Adjusted solo solvency calculation Company GL/ registration UK/ day month year Units number CM R GL As at end of this financial year As at end of the previous year 1 2 Capital resources Capital resources arising within the long-term insurance fund Capital resources allocated towards long-term insurance business arising outside the long-term insurance fund Capital resources available to cover long-term insurance business capital resources requirement (11+12) Guarantee fund Guarantee fund requirement Excess (deficiency) of available capital resources to cover guarantee fund requirement Minimum capital requirement (MCR) Long-term insurance capital requirement Resilience capital requirement Base capital resources requirement Individual minimum capital requirement Capital requirements of regulated related undertakings Minimum capital requirement (34+35) Excess (deficiency) of available capital resources to cover 50% of MCR Excess (deficiency) of available capital resources to cover 75% of MCR Enhanced capital requirement With-profits insurance capital component 39 Enhanced capital requirement Capital resources requirement (CRR) Capital resources requirement (greater of 36 and 40) Excess (deficiency) of available capital resources to cover long-term insurance business CRR (13-41) Contingent liabilities Quantifiable contingent liabilities in respect of long-term insurance business as shown in a supplementary note to Form

5 :09:32:38 Form 2 Covering Sheet to Form 2 Global business A M Parsons Director D J Walkden Director R F C Taylor Director Date 24 March

6 :09:32:38 Components of capital resources Form 3 (Sheet 1) Global business Company GL/ registration UK/ day month year Units number CM R GL Core tier one capital General Long-term Total as at Total as at insurance insurance the end of the end of business business this financial the previous year year Permanent share capital Profit and loss account and other reserves Share premium account 13 Positive valuation differences 14 Fund for future appropriations Core tier one capital in related undertakings Core tier one capital (sum of 11 to 16) Tier one waivers Unpaid share capital / unpaid initial funds and calls for supplementary contributions Implicit Items 22 Tier one waivers in related undertakings Total tier one waivers as restricted ( ) 24 Other tier one capital Perpetual non-cumulative preference shares as restricted Perpetual non-cumulative preference shares in related undertakings Innovative tier one capital as restricted Innovative tier one capital in related undertakings Total tier one capital before deductions ( ) Investments in own shares Intangible assets Amounts deducted from technical provisions for discounting Other negative valuation differences Deductions in related undertakings Deductions from tier one (32 to 36) Total tier one capital after deductions (31-37)

7 :09:32:38 Components of capital resources Form 3 (Sheet 2) Global business Tier two capital Company GL/ registration UK/ day month year Units number CM R GL General Long-term Total as at Total as at insurance insurance the end of the end of business business this financial the previous year year Implicit items, (tier two waivers and amounts excluded from line 22) Perpetual non-cumulative preference shares excluded from line 25 Innovative tier one capital excluded from line 27 Tier two waivers, innovative tier one capital and perpetual noncumulative preference shares treated as tier two capital (41 to 43) Perpetual cumulative preference shares Perpetual subordinated debt and securities Upper tier two capital in related undertakings 47 Upper tier two capital (44 to 47) 49 Fixed term preference shares 51 Other tier two instruments 52 Lower tier two capital in related undertakings 53 Lower tier two capital ( ) 59 Total tier two capital before restrictions (49+59) 61 Excess tier two capital 62 Further excess lower tier two capital Total tier two capital after restrictions, before deductions ( )

8 :09:32:38 Components of capital resources Form 3 (Sheet 3) Global business Total capital resources Company GL/ registration UK/ day month year Units number CM R GL General Long-term Total as at Total as at insurance insurance the end of the end of business business this financial the previous year year Positive adjustments for regulated non-insurance related undertakings Total capital resources before deductions ( ) Inadmissible assets other than intangibles and own shares Assets in excess of market risk and counterparty limits Deductions for related ancillary services undertakings Deductions for regulated non-insurance related undertakings Deductions of ineligible surplus capital Total capital resources after deductions ( ) Available capital resources for GENPRU/INSPRU tests Available capital resources for guarantee fund requirement Available capital resources for 50% MCR requirement Available capital resources for 75% MCR requirement Financial engineering adjustments Implicit items Financial reinsurance - ceded Financial reinsurance - accepted Outstanding contingent loans Any other charges on future profits Sum of financial engineering adjustments ( )

9 :09:32:38 Analysis of admissible assets Form 13 (Sheet 1) Global business Category of assets Total other than long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL As at end of this financial year As at end of the previous year 1 2 Land and buildings 11 Investments in group undertakings and participating interests UK insurance dependants Other insurance dependants Non-insurance dependants Other group undertakings Participating interests Shares Shares Shares Shares Shares Debts and loans Debts and loans Debts and loans Debts and loans Debts and loans Other financial investments Equity shares 41 Other shares and other variable yield participations 42 Holdings in collective investment schemes Rights under derivative contracts 44 Fixed interest securities Variable interest securities Approved Approved Other Other Participation in investment pools 49 Loans secured by mortgages 50 Loans to public or local authorities and nationalised industries or undertakings 51 Loans secured by policies of insurance issued by the company Other loans 53 Bank and approved credit & financial institution deposits Other financial investments 56 Deposits with ceding undertakings 57 Assets held to match linked liabilities One month or less withdrawal More than one month withdrawal Index linked Property linked

10 :09:32:38 Analysis of admissible assets Form 13 (Sheet 2) Global business Category of assets Total other than long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL As at end of this financial year As at end of the previous year Reinsurers' share of technical provisions 1 2 Provision for unearned premiums Claims outstanding Provision for unexpired risks Other Debtors and salvage Direct insurance business Salvage and subrogation recoveries Reinsurance Dependants Other Other assets Policyholders Intermediaries Accepted Ceded due in 12 months or less due in more than 12 months due in 12 months or less due in more than 12 months Tangible assets Deposits not subject to time restriction on withdrawal with approved institutions Cash in hand Other assets (particulars to be specified by way of supplementary note) Accrued interest and rent Deferred acquisition costs (general business only) Other prepayments and accrued income Deductions from the aggregate value of assets 87 Grand total of admissible assets after deduction of admissible assets in excess of market risk and counterparty limits (11 to 86 less 87)

11 :09:32:38 Analysis of admissible assets Form 13 (Sheet 3) Global business Category of assets Total other than long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL As at end of this financial year As at end of the previous year 1 2 Reconciliation to asset values determined in accordance with the insurance accounts rules or international accounting standards as applicable to the firm for the purpose of its external financial reporting Total admissible assets after deduction of admissible assets in excess of market risk and counterparty limits (as per line 89 above) Admissible assets in excess of market and counterparty limits Inadmissible assets directly held Capital resources requirement deduction of regulated related undertakings Ineligible surplus capital and restricted assets in regulated related insurance undertakings Inadmissible assets of regulated related undertakings Book value of related ancillary services undertakings Other differences in the valuation of assets (other than for assets not valued above) Deferred acquisition costs excluded from line 89 Reinsurers' share of technical provisions excluded from line 89 Other asset adjustments (may be negative) Total assets determined in accordance with the insurance accounts rules or international accounting standards as applicable to the firm for the purpose of its external financial reporting (91 to 101) (291953) (231124) Amounts included in line 89 attributable to debts due from related insurers, other than those under contracts of insurance or reinsurance 103 8

12 :09:32:38 Analysis of admissible assets Form 13 (Sheet 1) Global business Category of assets Total long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL As at end of this financial year As at end of the previous year 1 2 Land and buildings 11 Investments in group undertakings and participating interests UK insurance dependants Other insurance dependants Non-insurance dependants Other group undertakings Participating interests Shares Shares Shares Shares Shares Debts and loans Debts and loans Debts and loans Debts and loans Debts and loans Other financial investments Equity shares 41 Other shares and other variable yield participations 42 Holdings in collective investment schemes Rights under derivative contracts Fixed interest securities Variable interest securities Approved Approved Other Other Participation in investment pools 49 Loans secured by mortgages 50 Loans to public or local authorities and nationalised industries or undertakings 51 Loans secured by policies of insurance issued by the company Other loans 53 Bank and approved credit & financial institution deposits Other financial investments 56 Deposits with ceding undertakings 57 Assets held to match linked liabilities One month or less withdrawal More than one month withdrawal Index linked Property linked

13 :09:32:38 Analysis of admissible assets Form 13 (Sheet 2) Global business Category of assets Total long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL As at end of this financial year As at end of the previous year Reinsurers' share of technical provisions 1 2 Provision for unearned premiums Claims outstanding Provision for unexpired risks Other Debtors and salvage Direct insurance business Salvage and subrogation recoveries Reinsurance Dependants Other Other assets Policyholders Intermediaries Accepted Ceded due in 12 months or less due in more than 12 months due in 12 months or less due in more than 12 months Tangible assets Deposits not subject to time restriction on withdrawal with approved institutions Cash in hand Other assets (particulars to be specified by way of supplementary note) Accrued interest and rent Deferred acquisition costs (general business only) Other prepayments and accrued income Deductions from the aggregate value of assets 87 Grand total of admissible assets after deduction of admissible assets in excess of market risk and counterparty limits (11 to 86 less 87)

14 :09:32:38 Analysis of admissible assets Form 13 (Sheet 3) Global business Category of assets Total long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL As at end of this financial year As at end of the previous year 1 2 Reconciliation to asset values determined in accordance with the insurance accounts rules or international accounting standards as applicable to the firm for the purpose of its external financial reporting Total admissible assets after deduction of admissible assets in excess of market risk and counterparty limits (as per line 89 above) Admissible assets in excess of market and counterparty limits Inadmissible assets directly held Capital resources requirement deduction of regulated related undertakings Ineligible surplus capital and restricted assets in regulated related insurance undertakings Inadmissible assets of regulated related undertakings Book value of related ancillary services undertakings Other differences in the valuation of assets (other than for assets not valued above) Deferred acquisition costs excluded from line 89 Reinsurers' share of technical provisions excluded from line 89 Other asset adjustments (may be negative) Total assets determined in accordance with the insurance accounts rules or international accounting standards as applicable to the firm for the purpose of its external financial reporting (91 to 101) Amounts included in line 89 attributable to debts due from related insurers, other than those under contracts of insurance or reinsurance

15 :09:32:38 Long term insurance business liabilities and margins Form 14 Global business Total business/sub fund LONG TERM BUSINESS FUND - NON PROFIT Units 000 As at end of As at end of this financial the previous year year 1 2 Mathematical reserves, after distribution of surplus Cash bonuses which had not been paid to policyholders prior to end of the financial year Balance of surplus/(valuation deficit) Long term insurance business fund carried forward (11 to 13) Claims outstanding Provisions 12 Gross Reinsurers' share 16 Net (15-16) Taxation 21 Other risks and charges 22 Deposits received from reinsurers 23 Creditors Debenture loans Direct insurance business 31 Reinsurance accepted Reinsurance ceded Secured 34 Unsecured 35 Amounts owed to credit institutions 36 Creditors Taxation Other Accruals and deferred income 39 Provision for "reasonably foreseeable adverse variations" Total other insurance and non-insurance liabilities (17 to 41) Excess of the value of net admissible assets 51 Total liabilities and margins Amounts included in line 59 attributable to liabilities to related companies, other than those under contracts of insurance or reinsurance Amounts included in line 59 attributable to liabilities in respect of property linked benefits Total liabilities ( ) Increase to liabilities - DAC related Reinsurers' share of technical provisions Other adjustments to liabilities (may be negative) 74 (4512) (4961) Capital and reserves and fund for future appropriations Total liabilities under insurance accounts rules or international accounting standards as applicable to the firm for the purpose of its external financial reporting (71 to 75)

16 :09:32:38 Form 15 Liabilities (other than long term insurance business) Global business Company GL/ registration UK/ day month year Units number CM R GL Technical provisions (gross amount) As at end of As at end of this financial the previous year year 1 2 Provisions for unearned premiums 11 Claims outstanding 12 Provision for unexpired risks 13 Equalisation provisions Credit business 14 Other than credit business 15 Other technical provisions 16 Total gross technical provisions (11 to 16) 19 Provisions and creditors Provisions Taxation 21 Other risks and charges 22 Deposits received from reinsurers 31 Creditors Debenture loans Direct insurance business 41 Reinsurance accepted 42 Reinsurance ceded 43 Secured 44 Unsecured 45 Amounts owed to credit institutions 46 Creditors Taxation 47 Foreseeable dividend 48 Other Accruals and deferred income 51 Total (19 to 51) Provision for "reasonably foreseeable adverse variations" 61 Cumulative preference share capital 62 Subordinated loan capital 63 Total (59 to 63) Amounts included in line 69 attributable to liabilities to related insurers, other than those under contracts of insurance or reinsurance Amounts deducted from technical provisions for discounting 82 Other adjustments (may be negative) 83 (0) Capital and reserves Total liabilities under insurance accounts rules or international accounting standards as applicable to the firm for the purpose of its external financial reporting ( )

17 :09:32:38 Form 16 Profit and loss account (non-technical account) Global business Company GL/ registration UK/ day month year Units number CM R GL This financial year Previous year 1 2 Transfer (to)/from the general insurance business technical account From Form Equalisation provisions 12 Transfer from the long term insurance business revenue account Income Value re-adjustments on Investment income 15 investments Gains on the realisation of investments Investment management charges, including interest Value re-adjustments on Investment charges 18 investments Loss on the realisation of investments Allocated investment return transferred to the general insurance business technical account Other income and charges (particulars to be specified by way of supplementary note) Profit or loss on ordinary activities before tax ( ) Tax on profit or loss on ordinary activities Profit or loss on ordinary activities after tax (29-31) Extraordinary profit or loss (particulars to be specified by way of supplementary note) 41 Tax on extraordinary profit or loss 42 Other taxes not shown under the preceding items 43 Profit or loss for the financial year (39+41-(42+43)) Dividends (paid or foreseeable) Profit or loss retained for the financial year (49-51) (40033) 14

18 :09:32:38 Form 17 Analysis of derivative contracts Global business Category of assets Total long term insurance business assets Company GL/ Category registration UK/ day month year Units of number CM assets R GL Derivative contracts Value as at the end of this financial year Notional amount as at the end of this financial year Futures and contracts for differences In the money options Out of the money options 11 Assets Liabilities Bought / Long Sold / Short Interest rates Inflation Credit index / basket 14 Credit single name Equity stock 17 Land 18 Currencies 19 Mortality 20 Other Equity index calls Equity stock calls 33 Equity index puts 34 Equity stock puts 35 Other 36 Swaptions 41 Equity index calls 42 Equity stock calls Equity index puts 44 Equity stock puts 45 Other 46 Total (11 to 46) Adjustment for variation margin Total ( ) Fixed-interest securities Equity index Swaptions THE NOTIONAL AMOUNTS IN COLUMNS 3 AND 4 ARE NOT A MEASURE OF EXPOSURE. Please see instructions 11 and 12 to this Form for the meaning of these figures. 15

19 :09:32:38 Long-term insurance business : Revenue account Form 40 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 Financial year Previous year 1 2 Income Earned premiums Investment income receivable before deduction of tax Increase (decrease) in the value of non-linked assets brought into account Increase (decrease) in the value of linked assets (33379) Other income Total income Expenditure Claims incurred Expenses payable Interest payable before the deduction of tax Taxation Other expenditure 25 Transfer to (from) non technical account Total expenditure Business transfers - in 31 Business transfers - out 32 Increase (decrease) in fund in financial year ( ) 39 (109013) Fund brought forward Fund carried forward (39+49)

20 :09:32:38 Long-term insurance business : Analysis of premiums Form 41 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life UK Pension Overseas Total Financial year Total Previous year Gross Regular premiums Single premiums Reinsurance - external Regular premiums Single premiums 14 Reinsurance - intra-group Regular premiums Single premiums Net of reinsurance Regular premiums Single premiums Total Gross Reinsurance Net

21 :09:32:38 Long-term insurance business : Analysis of claims Form 42 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life UK Pension Overseas Total Financial year Total Previous year Gross Death or disability lump sums Disability periodic payments 12 Surrender or partial surrender Annuity payments Lump sums on maturity Total Reinsurance - external Death or disability lump sums 21 Disability periodic payments 22 Surrender or partial surrender 23 Annuity payments 24 Lump sums on maturity 25 Total 26 Reinsurance - intra-group Death or disability lump sums Disability periodic payments 32 Surrender or partial surrender Annuity payments Lump sums on maturity Total Net of reinsurance Death or disability lump sums Disability periodic payments 42 Surrender or partial surrender Annuity payments Lump sums on maturity Total

22 :09:32:38 Long-term insurance business : Analysis of expenses Form 43 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life UK Pension Overseas Total Financial year Total Previous year Gross Commission - acquisition 11 Commission - other Management - acquisition Management - maintenance Management - other 15 Total Reinsurance - external Commission - acquisition 21 Commission - other 22 Management - acquisition 23 Management - maintenance 24 Management - other 25 Total 26 Reinsurance - intra-group Commission - acquisition 31 Commission - other 32 Management - acquisition 33 Management - maintenance Management - other 35 Total Net of reinsurance Commission - acquisition 41 Commission - other Management - acquisition Management - maintenance Management - other 45 Total

23 :09:32:38 Long-term insurance business : Linked funds balance sheet Form 44 Total business Units 000 Financial year Previous year 1 2 Internal linked funds (excluding cross investment) Directly held assets (excluding collective investment schemes) Directly held assets in collective investment schemes of connected companies Directly held assets in other collective investment schemes Total assets (excluding cross investment) ( ) Provision for tax on unrealised capital gains Secured and unsecured loans 16 Other liabilities Total net assets ( ) Directly held linked assets Value of directly held linked assets Total Value of directly held linked assets and units held (18+21) Surplus units Deficit units Net unit liability ( )

24 :09:32:38 Long-term insurance business : Revenue account for internal linked funds Form 45 Total business Units 000 Financial year Previous year 1 2 Income Value of total creation of units Investment income attributable to the funds before deduction of tax Increase (decrease) in the value of investments in the financial year Other income Total income Expenditure Value of total cancellation of units Charges for management Charges in respect of tax on investment income Taxation on realised capital gains Increase (decrease) in amount set aside for tax on capital gains not yet realised Other expenditure (21) (272) Total expenditure Increase (decrease) in funds in financial year (19-29) Internal linked fund brought forward Internal linked funds carried forward (39+49) 39 (137451)

25 :09:32:38 Long-term insurance business : Summary of new business Form 46 Total business Units 000 UK Life UK Pension Overseas Total Financial year Total Previous year Number of new policyholders/ scheme members for direct insurance business Regular premium business Single premium business Total Amount of new regular premiums Direct insurance business External reinsurance Intra-group reinsurance 23 Total Amount of new single premiums Direct insurance business External reinsurance Intra-group reinsurance (3237) Total

26 :09:32:38 Form 47 Long-term insurance business : Analysis of new business Total business Units 000 UK Life / Reinsurance accepted intra-group Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums Life property linked single premium 1253

27 :09:32:38 Form 47 Long-term insurance business : Analysis of new business Total business Units 000 UK Pension / Direct Insurance Business Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums Annuity non-profit (CPA) Individual pensions property linked Group money purchase pensions property linked

28 :09:32:38 Form 47 Long-term insurance business : Analysis of new business Total business Units 000 UK Pension / Reinsurance accepted external Product code number Product description Regular premium business Number of policyholders / scheme members Amount of premiums Single premium business Number of policyholders / scheme members Amount of premiums Miscellaneous non-profit (ELAS)

29 :09:32:38 Long-term insurance business : Assets not held to match linked liabilities Form 48 Category of assets 10 Total long term insurance business assets Units 000 Unadjusted assets Economic exposure Expected income from assets in column 2 Yield before adjustment Return on assets in financial year Assets backing non-profit liabilities and non-profit capital requirements Land and buildings 11 Approved fixed interest securities Other fixed interest securities Variable interest securities (0.53) UK listed equity shares Non-UK listed equity shares 16 Unlisted equity shares 17 Other assets Total Assets backing with-profits liabilities and with-profits capital requirements Land and buildings 21 Approved fixed interest securities 22 Other fixed interest securities 23 Variable interest securities 24 UK listed equity shares 25 Non-UK listed equity shares 26 Unlisted equity shares 27 Other assets 28 Total 29 Overall return on with-profits assets Post investment costs but pre-tax 31 Return allocated to non taxable 'asset shares' 32 Return allocated to taxable 'asset shares' 33 26

30 :09:32:38 Form 49 Long-term insurance business : Fixed and variable interest assets Category of assets 10 Total long term insurance business assets Units 000 Value of assets Mean term Yield before adjustment Yield after adjustment UK Government approved fixed interest securities Other approved fixed interest securities Other fixed interest securities AAA/Aaa AA/Aa A/A BBB/Baa 34 BB/Ba 35 B/B 36 CCC/Caa 37 Other (including unrated) 38 Total other fixed interest securities Approved variable interest securities (0.77) (0.77) Other variable interest securities Total ( )

31 :09:32:38 Long-term insurance business : Summary of mathematical reserves Form 50 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life UK Pension Overseas Total Financial year Total Previous year Gross Form 51 - with-profits 11 Form 51 - non-profit Form Form 53 - linked Form 53 - non-linked Form 54 - linked Form 54 - non-linked Total Reinsurance - external Form 51 - with-profits 21 Form 51 - non-profit 22 Form Form 53 - linked 24 Form 53 - non-linked 25 Form 54 - linked 26 Form 54 - non-linked 27 Total 28 Reinsurance - intra-group Form 51 - with-profits 31 Form 51 - non-profit 32 Form Form 53 - linked 34 Form 53 - non-linked 35 Form 54 - linked 36 Form 54 - non-linked 37 Total Net of reinsurance Form 51 - with-profits 41 Form 51 - non-profit Form Form 53 - linked Form 53 - non-linked Form 54 - linked Form 54 - non-linked Total

32 :09:32:38 Long-term insurance business : Valuation summary of non-linked contracts (other than accumulating with-profits contracts) Form 51 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 435 Miscellaneous non-profit (ELAS)

33 :09:32:38 Long-term insurance business : Valuation summary of non-linked contracts (other than accumulating with-profits contracts) Form 51 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Pension / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 325 Level term assurance Miscellaneous protection rider Deferred annuity non-profit Annuity non-profit (CPA) (per annum) Miscellaneous non-profit Additional reserves non-profit OB 4293

34 :09:32:38 Long-term insurance business : Valuation summary of accumulating with-profits contracts Form 52 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Pension / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 525 Individual pensions UWP

35 :09:32:38 Long-term insurance business : Valuation summary of accumulating with-profits contracts Form 52 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Pension / Reinsurance ceded intra-group Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 525 Individual pensions UWP

36 :09:32:38 Long-term insurance business : Valuation summary of property linked contracts Form 53 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 700 Life property linked single premium Life property linked single premium (SAL) Life property linked endowment regular premium - target cash (SAL) Miscellaneous property linked

37 :09:32:38 Long-term insurance business : Valuation summary of property linked contracts Form 53 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Pension / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 725 Individual pensions property linked Group money purchase pensions property linked Income drawdown property linked Trustee investment plan Miscellaneous property linked Miscellaneous property linked (ELAS)

38 :09:32:38 Long-term insurance business : Valuation summary of index linked contracts Form 54 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Life / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 910 Miscellaneous index linked (ELAS)

39 :09:32:38 Long-term insurance business : Valuation summary of index linked contracts Form 54 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 UK Pension / Gross Product code number Product description Number of policyholders / scheme members Amount of benefit Amount of annual office premiums Nominal value of units Discounted value of units Other liabilities Amount of mathematical reserves 905 Index linked annuity Index linked annuity (ELAS) Miscellaneous index linked ELAS

40 :09:32:38 Long-term insurance business : Unit prices for internal linked funds Form 55 Total business Units 000 Fund name Type of fund Net assets Main series Unit management charge Price at previous valuation date Price at current valuation date Change in price during year HL PROPERTY LIFE DUAL PRICED 7 - life - property Property Life DP HL MANAGED PENSION DUAL PRICED 14 - individual pension - other managed fund Managed Pension Fund DP HL PELICAN PENSION GROSS 15 - individual pension - UK equity Pelican Pension DP HL PELICAN PENSION 2000 GROSS 15 - individual pension - UK equity Pelican Pension SP (0.69) HL HIGH INCOME PENSION GROSS 15 - individual pension - UK equity High Income Pension DP (0.76) HL HIGH INCOME PENSION 2000 GR 15 - individual pension - UK equity High Income Pension SP (1.70) HL UK ALL SHARE PENSION 2000 G HL UK FTSE PENSION GROSS HL FITS PENSION GROSS 11 - individual pension - stock market managed fund 11 - individual pension - stock market managed fund 11 - individual pension - stock market managed fund UK FTSE All Share Pension F (0.12) UK FTSE 100 Pension Fund D (0.04) Leeds Linked Pension Founda HL FAR EAST PENSION GROSS 16 - individual pension - overseas equity Far Eastern Pension DP HL INTL GROWTH PENSION GROSS 16 - individual pension - overseas equity International Growth Pension D HL INTL GROWTH PENSION 2000 GR 16 - individual pension - overseas equity International Growth Pension S HL STERLING MONEY PENS GROSS 14 - individual pension - other managed fund Money Pension Fund DP GILT & FIXED GROSS ASSET 14 - individual pension - other managed fund Gilt & Fixed Interest Pension F

41 :09:32:38 Long-term insurance business: Analysis of valuation interest rate Form 57 Total business LONG TERM BUSINESS FUND - NON PROFIT Units 000 Product group HL PROPERTY LIFE DUAL PRICED 1 Net mathematical reserves Net valuation interest rate Gross valuation interest rate Risk adjusted yield on matching assets UK Pens NP Form 51 ELAS Annuities UK Pens Form 51 ELAS Pensions Term Assurance UK Pens Form 53 Pensions UK Life Form 53 Life UK Pens Form 54 Index linked annuity (1.61) (1.61) (1.65) UK Pens Form 54 ELAS Index linked annuity (0.27) (0.27) (0.28) Misc 7553 n/a n/a 1.02 Total

42 :09:32:38 Long-term insurance business : Distribution of surplus Form 58 Total business / subfund LONG TERM BUSINESS FUND - NON PROFIT Units 000 Financial year Previous year 1 2 Valuation result Fund carried forward Bonus payments in anticipation of a surplus 12 Transfer to non-technical account Transfer to other funds / parts of funds 14 Subtotal (11 to 14) Mathematical reserves Surplus including contingency and other reserves held towards the capital requirements (deficiency) (15-21) Composition of surplus Balance brought forward Transfer from non-technical account 32 Transfer from other funds / parts of fund 33 Surplus arising since the last valuation Total Distribution of surplus Bonus paid in anticipation of a surplus 41 Cash bonuses 42 Reversionary bonuses 43 Other bonuses 44 Premium reductions 45 Total allocated to policyholders (41 to 45) 46 Net transfer out of fund / part of fund Total distributed surplus (46+47) Surplus carried forward Total (48+49) Percentage of distributed surplus allocated to policyholders Current year 61 Current year Current year Current year

43 :09:32:38 Long-term insurance capital requirement Global business Units 000 LTICR factor Insurance death risk capital component Life protection reinsurance % Classes I (other), II and IX % Gross reserves / capital at risk Net reserves / capital at risk Reinsurance factor LTICR Financial year Form 60 LTICR Previous year Classes I (other), II and IX % 1.00 Classes I (other), II and IX % Classes III, VII and VIII % Total Insurance health risk and life protection reinsurance capital component Class IV supplementary classes 1 and 2 and life protection reinsurance Insurance expense risk capital component Life protection and permanent 31 0% health reinsurance 21 Classes I (other), II and IX 32 1% Classes III, VII and VIII (investment risk) Classes III, VII and VIII (expenses fixed 5 yrs +) Classes III, VII and VIII (other) Class IV (other) 36 1% Class V 37 1% Class VI 38 1% 33 1% % % Total Insurance market risk capital component Life protection and permanent 41 0% health reinsurance Classes I (other), II and IX 42 3% Classes III, VII and VIII (investment risk) Classes III, VII and VIII (expenses fixed 5 yrs +) Classes III, VII and VIII (other) Class IV (other) 46 3% Class V 47 0% Class VI 48 3% 43 3% % % Total Long term insurance capital requirement

44 RETURNS UNDER THE ACCOUNTS AND STATEMENTS RULES FINANCIAL YEAR ENDED 31 DECEMBER 2014 NOTES TO THE FORMS *0201* Waiver and modification rules The FSA, on the application of the firm, made a direction under section 148 of the Financial Services and Markets Act 2000 in December The effect of the direction is to modify the provisions of INSPRU R and IPRU(INS) Appendix 9.3 so that a more appropriate rate of interest is used for assets taken in combination. *0301* Form 3 reconciliation of net admissible assets to total capital resources after deductions Total of admissible assets - other than long term business assets Form 13 Line 89 Total of admissible assets - long term business assets Form 13 Line 89 Less: Mathematical reserves, after distribution of surplus Form 14 Line ,313 5,565,192 (5,429,147) Total other long term business liabilities Form 14 line 49 (93,666) Total liabilities - other than long term insurance business Form 15 Line 69 Capital requirements of regulated related undertakings Form 2 Line 35 Net admissible assets / total capital resources after deductions Form 3 Line 79 (101) 78, ,824 *0310* Details of positive and negative valuation differences 000 Positive valuation differences on liabilities 11,380 Negative valuation differences on liabilities 10,423 Positive valuation difference Form 3 line The positive valuation difference is due to the deferred tax liability and deferred income reserve. Negative valuation differences due to inclusion of Sterling reserves on investment contract business. 41

45 RETURNS UNDER THE ACCOUNTS AND STATEMENTS RULES FINANCIAL YEAR ENDED 31 DECEMBER 2014 NOTES TO THE FORMS (CONTINUED) *0313* Reconciliation of profit and loss and other reserves to Form 16 Profit and Loss Account and other reserves as at 31 st December 2013 Form 3 Line 12 Column 4 Profit and Loss Account and other reserves as at 31 st December 2014 Form 3 Line 12 Column , ,759 Movement in Profit and Loss Account and Other Reserves 33,915 Reporting basis differences 7,493 Less Long Term Business Fund (profit)/loss retained for the financial year (1,247) Profit retained for the financial year - Form 16 Line 59 40,161 *1301* Aggregate value of certain securities The company held no other assets meeting the specified criteria. *1308* Aggregate value of certain securities The company held no assets meeting the specified criteria. *1304 & 1310* Set off of amounts Amounts have been set off to the extent permitted by generally accepted accounting principles. *1305 & 1319* Maximum Counterparty Limits The Company s investment guidelines set maximum counterparty limits in order to maintain the admissibility of assets in accordance with INSPRU This is with the exception of approved securities and any holdings under the UCITS Directive, and includes exposures with both approved counterparties and other than approved counterparties. The exposure applies to long term business assets and other than long term business assets combined. There were no occasions during the financial period when limits were exceeded. *1306 & 1312* Amount and nature of exposure at the year end to large counterparties There were no exposures to any counterparty subject to limits in INSPRU R(3) at 31 December 2014 which exceeded 5% of the base capital resource requirement and its long term insurance business liabilities, excluding property linked. *1307 & 1313* Aggregate value of fully secured rights Value of Rights - 8,900,000 This represents the value of derivative assets secured by derivative collateral received from counterparties as disclosed in the financial statements. *1318* Details of other adjustments to assets 000 Reclassification of unit linked liabilities included in Net Asset Value of unit 7,839 linked funds on Form 13 Line 59 Other adjustments to assets Form 13 Line 101 7,839 42

46 RETURNS UNDER THE ACCOUNTS AND STATEMENTS RULES FINANCIAL YEAR ENDED 31 DECEMBER 2014 NOTES TO THE FORMS (CONTINUED) *1401* Provision for adverse changes No provision for adverse changes under either GENPRU R to GENPRU R or INSPRU R and INSPRU R has been made. The Company considers asset valuations in the context of the requirements of GENPRU R to GENPRU R. The need for a provision for adverse variation is also considered by the Actuarial Function Holder. The Company's mark to model valuations are formally reviewed and signed off to provide additional comfort over robustness. The Company reviews any potential liquidity issues on assets on a regular basis and incorporates valuation adjustments if required. The Company reviews its investments to identify whether any provisions are required pursuant to INSPRU R and INSPRU R. Sufficient cover is held for all positions to match reasonably foreseeable adverse variations and no non-approved derivatives or quasiderivatives are held. *1402 & 1502* Details of contingencies and commitments: a) Charges over assets There are no charges over assets. b) Potential capital gains tax liability There is no potential capital gains tax liability should the Company dispose of its assets, based on asset values as at 31 st December c) Contingent liabilities There are no contingent liabilities. d) Guarantees, indemnities or other contractual commitments affected other than in the ordinary course of insurance business and in respect of related companies There are no such items. e) Other fundamental uncertainties There are no other uncertainties which it is necessary to disclose. *1405* Details of other adjustments to liabilities 000 Reclassification of unit linked liabilities included in Net Asset Value of unit 7,839 linked funds on Form 13 Line 59 Deferred income reserve recognised in IFRS accounts 519 Differences between IFRS and PRA mathematical reserves (11,380) Other adjustments (1,490) Other adjustments to liabilities (4,512) Differences between IFRS and PRA mathematical reserves are detailed in note *0310* 43