TSC Annual Report 2024 final - Flipbook - Page 58
Notes - Financial statements
Appointed by
Reports to
Inform
General Meeting
External
Audit
Board of Directors
Finance & Audit Committee
Risk Management Function
Risk Committee
Managing Director
Internal
Audit
Actuarial Function
Compliance Function
The 昀椀gure above illustrates important information flows and allocation of responsibilities.
• Follow up, review and reporting on regulatory compliance.
The Compliance function regularly reports to senior
management, the Board and relevant committees.
Internal audit function
Internal audit is an independent function responsible for
evaluating the effectiveness of the Club’s internal control
system and other governance processes. Its scope covers
the Swedish Club and all of the Club’s branches. It is an
independent body that reports directly to the Board of
Directors. Activities of the Internal audit function include:
• An overall review of corporate governance, including
independence of the Actuarial function and the
remuneration policy for employees.
• Regular reporting of observations and recommendations
for improving the Club’s processes.
The Internal Audit function’s activities follow a set audit plan
that is evaluated and updated annually.
Club’s comprehensive reinsurance programme balances out
variations in the claims result and protects against major
losses, including the aggregation of losses from multiple
insured interests.
There is quarterly follow up of the claims model via a
comparison of the actual and expected results for each
class of insurance. The claims model is also used to
simulate claims costs in the Club’s ICM, which enables a
consistent treatment of insurance risk based on the capital
requirements, ranging from the company level down to the
underwriting of an individual risk.
Vessels can be insured in several classes, which results in
concentration risk. A single event can thus result in claims in
several classes of insurance. Depending on the design of the
reinsurance protection, it can impact how the claims costs are
allocated between the reinsurer and Club. This is particularly true
for the classes of insurance speci昀椀ed in the table below.
Vessels Marine*
Risk analysis
The Club’s risk exposure is primarily associated with variations
in the outcome of claims for the insurance classes, as well as
variations in investment income. The scope of risk exposure
also covers a number of other risk categories that are managed
within the risk framework. Some risks have increased in
importance, which is who more time and attention is being
devoted to them.
Insurance risk
Insurance risk covers underwriting risk, concentration
risk and reserving risk. An effective management of
underwriting risks is fundamental to the Club’s operations.
Before new members can be accepted, a careful review of
their country organisation and vessels is carried out. Rating
systems and premium models are used to ensure that
correct premium levels have been selected. The Swedish
58 The Swedish Club | Annual Report 2024
FDD
X
Three classes
433
X
X
298
24
424
X
X
X
Two classes
5,959
340
191
X
One class
The components of insurance risk, counterparty risk,
operational risk and financial risks are presented below:
PI
No of Vessels
No of Vessels
per class
X
X
X
X
X
7,669
6,714
1,495
1,072
* Including Energy Risks
The table shows the concentration of insurance classes
per vessel as of 31 December 2024:
