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Credit Risks Related to Reinsurance Counterparties

The distribution of reinsurance receivables and reinsurers' portion of outstanding claims in If P&C on 31 December, 2010 per rating category is presented in table "Reinsurance receivables and reinsurers' portion of outstanding claims per rating category, If P&C, 31 Dec 2010 and 31 Dec 2009". In the table, EUR 120 million (EUR 120 million in 2009) are excluded, which mainly relates to captives and statutory pool solutions.

Reinsurance receivables and reinsurers' portion of outstanding claims per rating category, If P&C, 31 Dec 2010 and 31 Dec 2009

  31 Dec 2010 31 Dec 2009

Rating

Total EURm

%

Total EURm
%

AAA

0 0%
6
2%

AA+ - A-

354

96%

336 91%

BBB+ - BBB-

1 0%
1 0%

BB+ - C

0 0% 0 0%

D

0 0%
0 0%

Not rated

13 3%
13 3%

Total

368 100%
356 97%

The proportion of reinsurance recoverables related to the ten largest individual reinsurance counterparties amounts to EUR 344 million, which is 68.8 per cent of total recoverables. The largest individual reinsurance counterparty is Munich Re (AA-rating) which accounts for 30.5 per cent of total recoverables.

In Mandatum Life, the amount of reinsurance agreements is small and the credit risk related to reinsurance counterparties in Mandatum Life is immaterial. At inception of reinsurance, the accepted credit risk of the reinsurer is considered and the credit risks of reinsurance assets are followed.

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