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Guardian Group Fatum Annual Report 2017

ContentChairman’s and CEO’s Statement 6

Meet th e members of th e Supervisory Board 6

Meet th e members of th e Executive Board 10

FATUM HOLDING N.V. ABBREVIATED CONSOLIDATED

FINANCIAL STATEMENTS 31 DECEMBER 2017

Consolidated Statement of Financial Position 2017 12

Consolidated Statement of Comprehensive Income 2017 13

Signifi cant Accounting Policies 2017 15

Auditor’s Report 2017 22

LEARN FROM THE PAST AND EMBRACE THE FUTURE 25

Company information 28


Consolidated Financial Highlights(Expressed in thousands of Antillean Guilders)

Gross Premiums Written 2017

2016Life and pension business 148,074 122,138 Health business 27,816 28,259 Property and casualty business 160,551 143,743 Total Gross Premiums Written 336,441 294,140

RevenueRevenue from insurance operations 269,379 240,061 Revenue from investment activities 90,937 78,207 Commission income from brokerage activities 35,333 32,706

Total Revenue 395,649 350,974

Geographic Distribution of RevenueAruba 138,284 135,571BES 13,247 12,302Curaçao 186,416 155,877St. Maarten 18,403 15,746Netherlands 39,299 31,478Total Revenue 395,649 350,974

Results

Profit for the year 22,531 22,703 Other comprehensive income (4,685) (2,372)Total comprehensive income 17,846 20,331

Financial Position

Total assets 1,956,969 1,840,724 Liabilities 1,760,958 1,642,642 Net Equity 196,011 198,082

Operating expenses 95,325 90,875 Depreciations 7,415 7,807 Total operating expenses 102,740 98,682

Total Revenue (ANG’000)


Key Performance Indicators

Total Revenue 2013 2014 2015 2016 2017

Insurance activities 213,453 226,276 240,083 240,061 269,379

Investing activities 65,902 75,144 56,628 78,208 90,937

Brokerage activities 11,040 14,191 22,093 32,705 35,333

Total 279,355 301,420 318,804 350,974 395,649

Financial Position (ANG million)

Gross Premiums Written (ANG’000)

Geographic Distribution of Revenue Investment Mix

Financial Position 2013 2014 2015 2016 2017

Total assets 1,538 1,627 1,738 1,841 1,957

Liabilities 1,359 1,440 1,560 1,643 1,761

Net equity 179 187 178 198 196

Gross Premium 2013 2014 2015 2016 2017

Health 30,977 31,198 28,882 28,259 27,816

Life 101,772 108,270 123,719 122,138 148,074

Property & casualty

112,045 121,110 128,473 143,743 160,551

Total 244,794 260,578 281,074 294,140 336,441

2013

300,000

250,000

200,000

150,000

100,000

50,000

-

350,000

400,000

2014 2015 2016 2017

2013

2,000

1,800

1,600

1,400

1,200

1,000

800

600

400

200

-2014 2015 2016 2017

120,000

100,000

80,000

60,000

40,000

20,000

-

140,000

160,000

2013 2014 2015 2016 2017

44%

4%4%

9%39%

2016

5%

8%

17% 40%

10%

2016

20%48%

3%

4%10%

35%

2017

9%

8%

16% 36%

11%

1%

2017

19%

0%


Meet th e members of th e

Supervisory Board

At December 31, 2017

Mr. J.W.H. Richters

Chairman’s and CEO’s Statement

Mr. O.M. van der Dijs

It is with great pleasure th at we report on anoth er year’s achievements of Guardian Group Fatum, a member of th e Guardian Holdings Limited (GHL) group of companies. The calamitous eff ects of Hurricanes Irma and Maria caused 2017 to be th e worst year for incurred losses suff ered by Guardian Group Fatum companies since Hurricane Luis in 1995. However, aft er fully providing for and paying our share of th ese gross losses, amounting to ANG 2.3 million, we are pleased to report anoth er solid performance. Setting aside th e eff ect of th e catastrophic hurricanes, combined ratios were health y and th e structure of our reinsurance programme has been validated by our ability to with stand Irma and Maria with suffi cient remaining capacity to deal with any furth er potential catastrophic event during th e year.

GHL consists of a strong portfolio of non-bank fi nancial institutions spanning th e English and Dutch Caribbean and is headquartered in Port of Spain, Trinidad where th e parent company’s shares are listed on th e Trinidad and Tobago Stock Exchange. For th e majority of countries in which GHL operates, 2017 was anoth er challenging year, with a modest economic growth experienced th roughout th e region and a limited availability of solid invest-ment opportunities. Operating collectively as Guardian Group Fatum in th e Dutch Caribbean, we continue to hold leading market positions in all key lines of business delivering a steady stream of profi ts in a stable currency.

Insurance Operations The Gross Written Premium (GWP) from th e Guardian Group Fatum insurance operations increased by 14.3%, from ANG

Mr. H.P. Ganteaume


Mr. J.W.H. Richters Mrs. E.R. Croes-Marugg Mr. R.A. Tewari Mr. R.G. de V. Espinet

294.1 Million (2016) to ANG 336.4 Million (2017). Net premiums of the Life operations increased by ANG 26.4 Million (22%) from ANG 120.8 Million to ANG 147.2 Million. Net premiums from the Health operations decreased by ANG 7.4 Million (28%) from ANG 26.8 to ANG 19.4 Million. The General Health Care law introduced in 2013 in Curaçao resulted in more people eligible to be insured by the General Health care scheme which as a consequence led to a decrease in our Health portfolio. Net premiums from the Property and Casualty operations increased by ANG 4.1 Million (7%) from ANG 60.3 Million to ANG 64.4 Million. Guardian Group Fatum General Insurance continues to dominate its market segment in the Dutch Caribbean.

Investments Revenues from the Guardian Group Fatum investment activities increased by ANG 12.7 million (16.2%) from ANG 78.2 Million to ANG 90.9 Million. This increase is attributable to fair value gains of ANG 16.9 Million in our international portfolio. The overall income yield was 4.6%.

Operating expensesThe Guardian Group Fatum operating expenses increased by ANG 4.0 Million (4.1%) from ANG 98.7 Million in 2016 to ANG 102.7 Million in 2017 . This increase is mainly attributable to the expansion of the brokerage business.

Consolidated results The Guardian Group Fatum net profit for the year 2017 was ANG 22.5 Million, as compared to ANG 22.7 Million in 2016. The Guardian Group Fatum solvency position continued to be strong and well above the local requirements of the Central Bank of Curaçao and Sint Maarten and the Central Bank of Aruba and remains a solid base for future growth of our company.


The Supervisory Board of DirectorsIn 2017 the Board consisted of 6 members including 4 non-executive directors. All the powers of the Board have been duly exercised. The Board met four times in 2017. Major issues requiring an active engagement of the Board were the approval of the budget and strategic plan, the monitoring of the capital adequacy, setting and overseeing the invest-ment strategy and the ongoing monitoring of new initiatives for keeping the company performance in line with shareholders’ and customers’ expectations.

The Audit, Compliance and Risk Committee (ACRC)The ACRC, consisting of three non-executive directors, reports to the Supervisory Board and is governed by a charter which sets out its responsibilities in respect of the financial statements, internal controls, the internal audit function, external audit, compliance and risk matters. The ACRC met four times in 2017. All meetings were attended by representatives of the Supervisory and Executive Board and by the Guardian Group Fatum internal auditor and compliance officer. Ernst & Young, the external auditors, have a standing invitation to all ACRC meetings.

The Board is satisfied that the Internal Audit function as well as the Compliance function have been discharged in an objective and transparent manner and are not subject to management’s undue influence. Weaknesses in internal controls observed by the internal and external auditors and management’s risk corrective actions were presented to the ACRC. The ACRC members have confirmed that appropriate actions were taken to resolve the weaknesses. Additional subjects receiving dedicated attention from the ACRC in 2017 were compliance with regulatory requirements, Anti Money Laundering issues, Risk Management and Integrity and Governance issues in general.

Market expansion and distribution In 2017 we continued to invest in multi-channel distribution to consolidate our presence in the insurance value chain in the Dutch Caribbean and the Dutch market. We strength-ened our Direct Sales Unit and our Managing General Agents and offered the independent brokers with interesting value propositions.

The new direct sales operation, started in 2016 in Curaçao, continued to generate a steady stream of new business. This function is operated to the maximum extent possible on GHL



Group wide platforms and using GHL automated systems and procedures.Emphasis is being put on agent recruitment strategies to build a team of outstanding service providers.

Employees: The driving force behind the Guardian Group Fatum success Motivated, engaged and skilled employees are a condition-sine-qua-non for our continued long-term endeavors. We are proud to have dedicated employees who work hard each and every day to help our customers understand and protect themselves from risk. In order to ensure that we continue to have the capabilities we need for the future, Guardian Group Fatum has adopted a reorganization strategy in 2017 to ensure an optimal level of efficiency combined with an ongoing high level of knowledge and expertise of our employees. In 2017 several training programs were successfully carried out, in groups as well as on an individual basis. Corporate governance, compliance and risk management

Guardian Group Fatum is committed to effective corporate governance for the benefit of our shareholders, customers, employees and other stakeholders based on the principles of fairness, transparency and accountability. Structures, rules and processes are designed to provide for proper organization and conduct of business throughout Guardian Group Fatum and to define the powers and responsibilities of our corporate bodies.To meet this important objective, various governance and control functions coordinate to help ensure that risks are identified and appropriately managed and internal controls are in place and operating effectively. Distinct mandates and responsibilities are assigned to dif-ferent levels of authority in the organization, which are closely aligned and co-operate with each other through a regular exchange of information, planning and other activities. This approach supports management in its responsibilities. It provides confidence that risks are appropriately addressed and that adequate mitigation actions are implemented.

Corporate Social responsibilityBeing a responsible corporate citizen, Fatum is dedicated to contribute to the well-being of the communities we live and work in. We actively encourage individual and societal devel-opment by financially supporting efforts to improve wellbeing and realize human potential. Our main financial support is targeted at the youth, sports and physical activity as well as through financial support for the work of various non-governmental organizations.


Guardian Group Fatum hosts th e largest annual run and walk event on th e island of Curaçao, th e Guardian Group Fatum Walk and Run with over 8,000 partici-pants. This event raised money for several good causes including th e promotion of good health in general and is also successfully being held every year in Aruba, Sint Maarten and as of 2015 also in Bonaire.

Moving forward, with optimismThe economies of Curaçao and Aruba continue to face challenges in achieving sustainable growth . We are optimistic th at th e public and private sectors will work togeth er to make th e necessary structural changes. Despite th ese realities, we are confi dent th at th ere remains tremendous value to be extracted from our core businesses and th at we possess th e people, th e products and support systems, articulated Group strategy, to achieve steady profi tability improvements. We th erefore look to th e future with optimism and indeed, confi dence.

In closing, we would like to th ank our shareholders and customers for th eir loyalty to Guardian Group, as well as our staff for th eir energy and commitment in pursuing our vision of becoming a world-class insurer. To our staff who displayed such selfl ess service and compassion in servicing th ose aff ected by th e catastrophic wind storms of 2017, we th ank you.

Henri Peter Ganteaume Chairman of th e Supervisory Board of Directors

Diego Fränkel President & CEO Fatum Holding N.V.


Diego FränkelPresident & CEO Fatum Holding N.V.

Diego Fränkel President & CEO Fatum Holding N.V.


Ronald KetellapperVice President Life, Health & Pension

Dorothy Romero-SprockelVice President Finance

Marten O’NielVice President Marketing & Sales

Francis GijsberthaVice President General Insurance

Meet the members of the Executive BoardAt December 31, 2017


Consolidated statement of financial position as at 31 December 2017(Expressed in thousands of Antillean Guilders)

AssetsProperty, plant and equipmentInvestment propertiesIntangible assetsInvestment in associated companiesFinancial assetsLoans and receivables including insurance receivablesPension plan assetsReinsurance assetsDue from affiliated companiesDeferred acquisition costsTaxation recoverable, netCash and cash equivalents TOTAL ASSETS

Equity and liabilitiesShare capitalShare premiumReservesRetained earningsTotal Equity

LiabilitiesInsurance contractsFinancial liabilitiesPost retirement medical benefit obligationsDeferred tax liabilitiesDue to affiliatesOther liabilitiesTotal liabilities

TOTAL EQUITY AND LIABILITES

2017 37,744 9,549 69,073 67,497 1,302,058 191,068 19,936 54,576 6,011 8,561 8,837 182,059 1,956,969

25,000 74,030 (2,636) 99,617 196,011

1,536,035 89,220 14,148 11,975 150 109,430 1,760,958

1,956,969

2016 37,533 1,200 66,112 63,178 1,234,460 206,005 26,514 42,624 5,743 8,015 7,243 142,097 1,840,724

25,000 74,030 (7,814) 106,866 198,082

1,424,354 89,195 11,138 13,495 484 103,976 1,642,642

1,840,724


(Expressed in thousands of Antillean Guilders)

InSurance activitiesInsurance premium incomeInsurance premium ceded to reinsurersReinsurance commission income

Net underwriting revenue

Policy acquisition expensesNet insurance benefits and claims

Underwriting expenses

Net result from insurance activities

Investing activitiesInvestment incomeNet realized gains on financial instrumentsNet fair value losses on financial instrumentsFee incomeOther incomeNet income from investing activities

Commission income from brokerage activities

Net income from all activities

Operating expensesFinance chargesOperating profit

Share of profit of associated companies

Profit before taxation

Taxation

Profit for the year

Other comprehensive income/(loss)

Items that may be reclassified subsequently to profit or loss:Exchange differences on translating foreign operations

Net other comprehensive loss that may be reclassified subsequently to profit or loss

Items that will not be reclassified subsequently to profit or loss:Property revaluationRemeasurment of plan assetsActuarial gains/(losses) on post retirement medical benefit obligationOther reserve movements

Net other comprehensive income that will not be reclassified subsequently to profit or loss

Total comprehensive income for the year, net of tax

Consolidated statement of comprehensive income for the year ended 31 December 2017

2017 339,213 (104,069) 34,235

269,379

(44,052) (222,099)

(266,151)

3,228

61,853 1,409 20,345 4,237 3,093 90,937

35,333

129,498

(102,740) (4,266) 22,492

3,813

26,305

(3,774)

22,531

5,787 5,787

– (7,676) (2,868) 72

(10,472) 17,846

2016 297,216 (84,692) 27,537

240,061

(33,682) (193,617)

(227,299)

12,762

62,953 10,304 (541) 3,715 1,941 78,372

32,705

123,839

(98,682) (4,878) 20,279

8,102

28,381

(5,678)

22,703

(4,265) (4,265)

898 (1,367) 2,362 –

1,893 20,331

2009: “When it’s all over, it’s not who you were. It’s wheth er you made a diff erence.”– Bob Dole


2014: “With th e generations we have come to realize th at we can connect to th e world with a single touch”– Unknown


Signifi cant Accounting PoliciesThe consolidated statement of fi nancial position and statement of comprehensive income as presented on page 12 and 13 have been derived from th e consolidated fi nancial statements of Fatum Holding N.V. These explanatory notes are an extract of th e detailed notes included in th e consolidated fi nancial statements.

Basis of preparation

These consolidated fi nancial statements are prepared in accordance with International Financial Reporting Standards (IFRS). They have been prepared under th e historical cost convention, as modifi ed by th e revaluation of land and buildings, investment properties, derivative fi nancial instruments and fi nancial assets at fair value th rough profi t or loss, which are carried at fair value.

The preparation of fi nancial statements in conformity with IFRS requires th e use of certain critical accounting estimates. It also requires management to exercise its judgment in th e process of applying th e Group’s accounting policies.

Consolidation

Subsidiaries are all entities over which th e Group has control. Control is achieved when th e Group is exposed, or has rights, to variable returns from its involvement with th e investee and has th e ability to aff ect th ose returns th rough its power over th e investee. Specifi cally, th e Group controls an invest-ee if and only if th e Group has:

Power over th e investee (i.e. existing rights th at give it th e current ability to direct th e relevant activities of th e investee)

Exposure, or rights, to variable returns from its involvement with th e investee, and

The ability to use its power over th e investee to aff ect its returns.

When th e Group has less th an a majority of th e voting or similar rights of an investee, th e Group considers all relevant facts and circumstances in assessing wheth er it has power over an investee, including:

The contractual arrangement with th e oth er vote holders of th e investee;

Rights arising from oth er contractual arrange-ments;

The Group’s voting rights and potential voting rights.

The Group re-assesses wheth er or not it controls an investee if facts and circumstances indicate th at th ere are changes to one or more of th e th ree elements of control. Consolidation of a subsidiary begins when th e Group obtains control over th e subsidiary and ceases when th e Group loses control of th e subsidiary. Specifi cally, income and expenses of a subsidiary acquired or disposed of during th e year are included in th e consolidated statement of income and oth er comprehensive income from th e date th e Group gains control until th e date when th e Group ceases to control th e subsidiary.

The Group uses th e purchase meth od of accounting

for th e acquisition of subsidiaries. The cost of an acquisition is measured as th e fair value of th e assets given, equity instruments issued and liabilities incurred or assumed at th e date of exchange, plus costs directly attributable to th e acquisition. Identifi able assets acquired and liabilities and contingent liabilities assumed in a business combi-nation are measured initially at th eir fair values at th e acquisition date, irrespective of th e extent of any non-controlling interest. The excess of th e cost of acquisition over th e fair value of th e Group’s share of th e identifi able net assets acquired is recorded as goodwill. If th e cost of acquisition is less th an th e fair value of th e net assets of th e


subsidiary acquired, the difference is recognized in the consolidated statement of income.

All intra-group transactions and balances are eliminated on consolidation. Subsidiaries’ account-ing policies have been changed where necessary to ensure consistency with the policies adopted by the Group.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the Group loses control over a subsidiary, it:

Derecognizes the assets (including goodwill) and liabilities of the subsidiary;

Derecognizes the carrying amount of any non-controlling interests;

Derecognizes the cumulative translation differences recorded in equity;

Recognizes the fair value of the consideration received;

Recognizes the fair value of any investment retained;

Recognizes any surplus or deficit in profit or loss; Reclassifies the parent’s share of components previously recognized in other comprehensive income to profit or loss or retained earnings, as appropriate, as would be required if the Group had directly disposed of the related assets or liabilities.

The following subsidiaries have been included in the consolidation:

Fatum Health N.V. Fatum General Insurance Aruba N.V. Fatum General Insurance N.V. Fatum Life Aruba N.V. Fatum Brokers Holding B.V. Fatum Life N.V. Homes & Properties N.V. Thoma Exploitatie B.V.

Kruit en Venema Assuradeuren B.V. Fatum Internationale Financieringsmaatschappij VBA

Associated companies

The Group’s investment in associated companies is accounted for using the equity method of accounting. An associate is an entity in which the Group has significant influence and which is neither a subsidiary nor a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control or joint control over those policies.

Under the equity method, the investment in associates is carried in the consolidated statement of financial position at cost plus post acquisition changes in the Group’s share of net assets of the associates. Good-will relating to associates is included in the carrying amount of the investment and is not amortized. The consolidated statement of income reflects the share of the results of operations of the associates. When there has been a change recognized directly in the equity of the associates, the Group recognizes its share of any changes and discloses this, when applicable, in the statement of changes in equity.

The financial statements of the associates are pre-pared for the same reporting period as the parent company. Where necessary, adjustments are made to bring their accounting policies in line with the Group.

After application of the equity method, the Group determines whether it is necessary to recognize an additional impairment loss on the Group’s invest-ment in associates. The Group determines at each consolidated statement of financial position date, whether there is any objective evidence that the investment in associates is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount


of the associates and its carrying value and recog-nizes the amount in the consolidated statement of income.

The Group discontinues the use of the equity meth-od from the date when the investment ceases to be an associate or when the investment is classified as held for sale.

The Group holds 42.3% interest in Guardian Resorts International Inc.

Financial Assets

(a) Initial recognition and measurement Financial assets within the scope of IAS 39 are

classified as financial assets at fair value through profit or loss, loans and receivables, or held-to- maturity investments as appropriate. The Group determines the classification of its financial assets at initial recognition. The classification depends on the purpose for which the investments were acquired or originated.

Financial assets are recognized initially at fair value plus, in the case of investments not at fair value through profit or loss, directly attributable transaction costs.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognized on the settle-ment date.

The Group’s financial assets include cash and short-term deposits, debt securities, equity securi-ties, interest receivable, receivables arising from insurance contracts and reinsurance contracts and other loans and receivables.

(b) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss include financial assets held-for-trading and those designated at fair value through profit or loss at inception. Investments typically bought with the intention to sell in the near future are classified as held-for-trading. The Group’s subsidiaries, with the exception of its asset management company, do not engage in trading financial assets. For invest-ments designated at fair value through profit or loss, the following criteria must be met:

The designation eliminates or significantly reduces the inconsistent treatment that would otherwise arise from measuring the assets or liabilities or recognizing gains or losses on a different basis; or

The assets and liabilities are part of a group of financial assets, financial liabilities or both which are managed, and their performance evaluated, on a fair value basis, in accordance with a documented risk management or investment strategy.

These investments are initially recorded at fair value. Subsequent to initial recognition, these investments are remeasured at fair value. Fair value adjustments and realized gains and losses are recognized in the consolidated statement of income.

(c) Held-to-maturity financial assets Non-derivative financial assets with fixed or

determinable payments and fixed maturities are classified as held-to-maturity when the Group has the positive intention and ability to hold until maturity. These investments are initially recognized at cost, being the fair value of the consideration paid for the acquisition of the investment. All trans-action costs directly attributable to the acquisition are also included in the cost of the investment. After initial measurement, held-to-maturity financial


assets are measured at amortized cost, using the effective interest rate method. Gains and losses are recognized in the consolidated statement of income when the investments are derecognized or im-paired, as well as through the amortization process.

(d) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The invest-ments are initially recognized at cost, being the fair value of the consideration paid for the acquisition of the investment. All transaction costs directly attributable to the acquisition are included in the cost of the investment. After initial measurement, loans and receivables are measured at amortized cost, using the effective interest rate method. Gains and losses are recognized in the consolidated statement of income when the investments are derecognized or impaired, as well as through the amortization process.

(e) Fair value of financial assets The fair value of quoted investments (primarily

equity securities) are based on current bid prices at the consolidated statement of financial position date. If the market for a financial asset is not active (primarily government securities, debentures and corporate bonds), the Group establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same and discounted cash flow analysis making maximum use of market inputs and relying as little as possible on entity-specific inputs.

If the fair value of unquoted equities cannot be measured reliably, these financial assets are measured at cost, being the fair value of the consideration paid for the acquisition of the invest-

ment. All transaction costs directly attributable to the acquisition are also included in the cost of the investment.

(f) Derecognition of financial assets A financial asset (or when applicable, a part of a

financial asset or part of a group of similar financial assets) is derecognized when:

The rights to receive cash flows from the asset have expired;

The Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a ‘pass-through’ arrangement;

The Group has transferred its rights to receive cash flows from the asset and either:• has transferred substantially all the risk and

rewards of the asset, or• has neither transferred nor retained substan-

tially all the risks and rewards of the asset, but has transferred control of the asset.

When the Group has transferred its right to receive cash flows from an asset and has neither trans-ferred nor retained substantially all the risks and rewards of the asset nor transferred control of the asset, the asset is recognized to the extent of the Group’s continuing involvement in the asset. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Group could be required to repay.

Insurance contracts/Net insurance premium revenue/Net insurance benefits and claimsThe Group issues contracts that transfer insurance risk or financial risk or both. Insurance contracts are those contracts that transfer significant insurance risk.


(a) Short-term insurance contracts These contracts are principally property, motor,

casualty (employers’ liability, public liability), marine, and health insurance contracts. Health insurance contracts include both group and individual health insurance.

For all these contracts, premiums are recognized as revenue (earned premiums) proportionally over the period of coverage. The portion of premiums received on in-force contracts that relate to unexpired risks at the consolidated statement of financial position date is reported as an unearned premium liability. Premiums are shown before deduction of commissions payable to agents and brokers and exclude any taxes or duties levied on such premiums. Premium income includes premiums collected by agents and brokers not yet received by the Group.

Unearned premiums represent the portion of premiums written in the current year that relate to periods of insurance subsequent to the consoli-dated statement of financial position, date calculated using either the three hundred and sixty-fifths method or the twenty-fourths method. Unearned premiums relating to marine cargo are calculated using 180 days after the first date of sailing.

Claims and loss adjustment expenses are charged to income as incurred based on the estimated lia-bility for compensation owed to contract holders. They arise from events that have occurred up to the consolidated statement of financial position date, even if they have not yet been reported to the Group. The Group does not discount its liabilities for unpaid claims other than for disability claims. Liabilities for unpaid claims are estimated using techniques such as the input of assessments for individual cases reported to the Group and statistical analyses for the claims incurred but not reported (“IBNR”), and to estimate the expected ultimate

cost of more complex claims that may be affected by external factors such as court decisions. Esti-mates are continually revised as more information becomes available and for the effects of anticipated inflation. Adjustments arising on these revisions are recognized within claims expense in the current year.

(b) Long-term insurance contracts with fixed and guaranteed terms and without DPF

These contracts insure events associated with human life over a long duration. Premiums are recognized as revenue when they become payable by the policyholder. Premiums are shown before deduction of commission. Benefits are recorded as an expense when incurred.

A liability for policyholders’ benefits that are expected to be incurred in the future is established on acceptance of the insurance risk. The liability is based on the present value of estimated amounts for projected future premiums, claims, benefits, investment income and policy maintenance expens-es. The liability is based on key assumptions made with respect to variables such as mortality, persis-tency, investment returns and expense inflation.

The liabilities are actuarially recalculated at each reporting date and the change in the liability is recognized as an expense in the consolidated statement of income.

(c) Long-term insurance contracts without fixed terms

These contracts insure human life events (for example death or survival) over a long duration. Insurance premiums are recognized directly as liabilities whereas the change in the liabilities is reflected in the consolidated statement of income. These liabilities are increased by credited interest or change in the unit prices and are decreased by policy administration fees, mortality and surrender charges and any withdrawals.

(d) Long-term insurance contracts with fi xed and guaranteed terms and with DPF

In addition to death or life benefi ts, th ese contracts contain a DPF th at entitles th e holders to a bonus or dividend declared by th e company from time to time. The discretionary element of th e benefi ts payable under th ese policies, as well as th e guaranteed elements are treated as liabilities. The actuarial calculations make allowance for future expected policyholder bonuses and dividends. Any changes in th e total benefi ts due are recog-nized as charges in th e consolidated statement of income and form part of increases in reserves for future benefi ts of policyholders.

(e) Investment contracts The Group issues investment contracts including

deposit administration contracts and individual deferred annuity contracts. Insurance premiums are recognized directly as liabilities. These liabilities are increased by credited interest or change in th e unit prices and are decreased by policy administra-tion fees, mortality and surrender charges and any with drawals. Revenue consists of investment income and interest credited is treated as an expense.

Revenue RecognitionRevenue comprises th e fair value for services rendered aft er eliminating revenue with in th e Group. Revenue is recognized as follows:

(a) Premium income Premium income is recognized on th e accrual basis

in accordance with th e terms of th e underlying contracts.

(b) Investment income Interest income is recognized using th e eff ective

interest meth od. Rental income is recognized in th e consolidated statement of income on th e accrual basis. Dividend income is recognized when th e right to receive payment is established. Real-ized and unrealized investment gains and losses are recognized in th e consolidated statement of income in th e period in which th ey arise.

(c) Commission income Commissions are recognized on th e accrual basis

when th e services have been provided.

(d) Fee income Fees are earned from th e management of th e

assets of th e segregated funds and deposit admin-istration funds and from general policy administration and surrenders. Fees are recognized in th e period in which th e services are rendered.

Subsequent eventsThere are no oth er material subsequent events.


Solvency Margin 2017 2016 (ANG’000) (ANG’000)

Regulatory required margin 99,516 92,681 Available margin 196,011 198,082

Surplus 96,495 105,401


2008: “The future belongs to th ose who understand th at doing more with less is compassionate, prosperous and enduring, and th us more intelligent even competitive.”– Paul Hawken

Independent Auditors’ Report


Opinion The consolidated glossy financial statements of Fatum Holding N.V. for the year ended December 31, 2017 are derived from the audited consolidated financial statements of Fatum Holding N.V.

In our opinion, the accompanying consolidated glossy financial statements are consistent, in all material respects, with the audited consolidated financial statements 2017 of Fatum Holding N.V., in accordance with the notes to the consolidated glossy financial statements.

The consolidated glossy financial statements comprise: • The consolidated statement of financial position as at December 31, 2017 • The consolidated statement of income for the year ended December 31, 2017• The notes comprising a summary of the accounting policies and other explanatory

information

Consolidated Glossy Financial StatementsThe consolidated glossy financial statements do not contain all the disclosures required by International Financial Reporting Standards. Reading the consolidated glossy financial statements and the auditor’s report thereon, therefore, is not a substitute for reading the audited consolidated financial statements and the auditor’s report thereon. The consolidated glossy financial statements do not reflect the effects of events that occurred subsequent to the date of our report.

The Audited Consolidated Financial Statements and Our Report ThereonWe expressed an unmodified audit opinion on the consolidated financial statements in our report dated 23 March 2018.

Management’s Responsibility for the Consolidated Glossy Financial StatementsManagement is responsible for the preparation of the consolidated glossy financial statements on the bases described in the notes to the consolidated glossy financial statements.

Auditor’s responsibilityOur responsibility is to express an opinion on whether the consolidated glossy financial statements which are consistent, in all material respects, with the audited consolidated financial statements based on our procedures, which were conducted in accordance with International Standards on Auditing, including the Standard on Auditing (ISA) 810 (Revised), Engagements to report on summary financial statements.

Curaçao, 19 September 2018for Ernst & Young Accountants

C. Smorenburg RA AA F. de Windt-Ferreira CPA

2013: “Always do your best. What you plant now, you will harvest later.”– Og Mandino


In 1983, The United Nations defi ned sustainability as “choices th at meet th e needs of th e present generation with out compromising th e ability of future generations to meet th eir needs. That was almost 35 years ago and yet Guardian Group Fatum’s philosophy for sustainable enterprising is still th eir raison d’etre today.

Circumstances change, people change, but embracing th e challenges is what makes Guardian Group Fatum, a company th at is innovative and constantly on th e move. The New Dutch Caribbean, are six very unique islands, united by th e Dutch Kingdom and Guardian Group Fatum has always been actively engaged in th e economies of th ese islands by off ering employment, investing actively and heavily in th e local economies and by off ering a wide range of insurance products and services. Operating in th ese diff erent jurisdictions and now in The Neth erlands as well, awards a vast array of new opportunities and ideas for a better future for all by understanding and accepting th e diverse cultures of each of th ese economies.

Service and client care is oft en th e diff erence between a good company and a great one. Guardian Group Fatum understands th at customer loyalty and customer satisfaction are th e main contributors to th e sustainable profi t growth , so our success depends on th e performance of each individual in th e Company. Guardian Group Fatum has adopted a continuous learning strategy, by implementing several training programs so as to ensure th at our talented employees obtain th e capabilities th at are needed for th e future. Teamwork and open communication is th e back-bone to achieving our common objectives and celebrating each success inspires more hard work and more success.

As a responsible corporate citizen, Guardian Group Fatum is dedicated to th e well-being of th e local communities. Financially supporting eff orts to improve and realize human potential, our main targets are youth programs, sports and physical activities. Guardian Group Fatum hosts th e largest annual “walk and run” event and has seen th is grow to a spectacular 8,000 participants, both young and old. People from Aruba, Sint Maarten, Curacao, and more recently, Bonaire helped raise money for several great causes, including th e promotion of good health in general…..”The children are our future.”

Economic uncertainties abound, but Guardian Group Fatum is committed to remaining well positioned while delivering seamless fi nancial security to our customers. Guardian Group Fatum’s commitment to our shareholders, customers, employees and communities in which we live and work, requires th at we maintain Guardian Group Fatum as th e leading company of th e Insurance industry th rough hard work, strong corporate governance, off ering better products and service, actively participating in local communities and ensuring sustainable growth for our customers and stakeholders.

Learn from th e past, embrace th e future

“Change is inevitable, change is constant.”

(Benjamin Disraeli)

“Life can only be under-stood backwards, but it

must be lived forwards.” (Soren Kierkegaard)

“The strength of th e team is each individual

member… th e strength of each member is th e team.”

(Coach Phil Jackson, Chicago Bulls)

“The past cannot be changed. The future is

yet in your power.” (Unknown)


2008: “Planning is bringing th e future into th e present so th at you can do someth ing about it now.”– Alan Lakein

Guardian Group Fatum Annual Report 2017 Guardian Group Fatum Annual Report 2017 Page 28

Colofon

Editorial Staff Richeline Martina-Joe

Marketing Team, Guardian Group Fatum

Desktop PublishingErvina Design

PhotographyTerry van OmmenRoberto Moentadj

PrintingOne Media Group

Company information

Offi ce ArubaL.G. Smith Boulevard 162P.O. Box 510ArubaTel.: (297) 582 1111Fax: (297) 582 6138

Offi ce BonaireKaya Gobernador N. Debrot 35P.O. Box 152BonaireTel.: (599) 717 8811Fax: (599) 717 5222

Offi ce Neth erlandsBrainpark IILichtenauerlaan 102-1203062 ME RotterdamTel.: (31) 10 798 2455Fax: (31) 10 204 5555

Offi ce CuraçaoCas Coraweg 2P.O. Box 3002CuraçaoTel.: (599-9) 777 7100Fax: (599-9) 736 6333

Offi ce Sint MaartenA.J.C. Brouwers Road 6P.O. Box 201Sint MaartenTel.: (1-721) 542 2248Fax: (1-721) 542 3127

[email protected]

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