XPRIMM: What can you tell us about the company's reinsurance practices? Do you have a reinsurance expertise (survey) department?
Andrey T. UNTON: At present there is no necessity to create a reinsurance expertise (survey) department in BELARUS Re. This is why the risks having been ceded from the Belarusian insurance market for the last 5 years are examined adequately. When it comes to the carrying on large-scale projects, our organization resorts to services provided by first-rate brokers; they necessarily arrange a survey with the purpose of further risk placement in the international market.

The inward risks are accepted by BELARUS Re generally by reinsurance brokers; being qualified experts and advisers in risk management, they consider all aspects of risks and are engaged in the elaboration of the best reinsurance programmers; also they may implement surveying inspections and provide reports on such surveys.

XPRIMM: What was the major loss in Belarus and abroad covered by the company?
A. U.: Among the risks reinsured by the state enterprise there were no losses recently occurring on the territory of the Republic of Belarus that may be considered as major.

BELARUS Re has participated in reinsurance for the risks of Express-AM4 communications satellite; it was a part of the Express series of geostationary communications satellites owned by the Russian State Company for Satellite Communications. Express-AM4 was placed into the wrong orbit from a faulty Briz-M rocket stage, in August, 2011. In connection with insufficient relative velocity to enter a geostationary orbit and the impossibility of its further designated use, the total loss of spacecraft Express-AM4 was declared. The satellite was de-orbited into the Pacific Ocean.

The sum insured amounted to USD 270.8 million, out of which BELARUS Re paid an indemnity of USD 500,000.00.

XPRIMM: On what basis are the financial statements of the company provided: national or international standards?
A. U.: The balance sheet of RUE "Belarusian National Reinsurance Organization" is drawn up and provided to the superior body in accordance with the national standards.

Nowadays a number of regulatory legal acts are being adopted in order to make the accounting system compliant with the International Standards of Accounting and Reporting. In spite of this, since 2010, the auditing of financial statements has been carried out in accordance with the International Financial Reporting Standards.

XPRIMM: What principles are guiding the investment policy of the company? What financial instruments does BELARUS Re use to place reserves?
A. U.: In regard to the investment policy, the state enterprise is committed to the principles of reliability, diversification and liquidity.

In accordance with the legislation of the Republic of Belarus the state enterprise allocates the funds in Belarusian rubles and in foreign currencies on deposits and in securities (bonds) of state banks.

Actuarial reserves are allocated on bank deposits on the basis of the possible ahead-of-time return, which ensures its absolute liquidity.

XPRIMM: BELARUS Re intends to extend integration in the insurance markets of CIS and Western Europe. What are the main criteria for choosing partners for outward reinsurance?
A. U.: The main criteria for choosing partners regarding outward reinsurance are:

• financial standing of the Reinsurer;
• financial strength rating;
• goodwill;
• position in the domestic insurance market;
• experience in insuring the required risks;
• portfolio volume of the managed risks;
• awareness of domestic specific character, language and legislation.
  

XPRIMM: What about company's goal for the next five years?
A. U.: The main strategic goal of BELARUS Re is the creation of an international standard reinsurance company, offering a full range of reinsurance services and providing its clients with comprehensive protection according to international standards.

The main strategic objective for the next five years is still to receive the amount of reinsurance premiums proportionally to the authorized capital, whose structure, including the inward (from non-residents) and internal (from residents) revenues will be balanced. For this purpose, we plan to increase a number of mandatory and combined contracts in order to develop cooperation with the international reinsurance market and to improve underwriting policy and the risk-management system.