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<br /> NHBC Solvency and Financial<br /> Condition Report 2017<br /> Contents <br /> <br /> Executive Summary 3<br /> Directors' Responsibility Statement 6<br /> Independent Auditor's Opinion 7<br /> A. Business and Performance 10<br /> A.1 Business 11<br /> A.2 Underwriting performance 13<br /> A.3 Investment performance 14<br /> A.4 Performance of other activities 16<br /> A.5 Any other information 16<br /> B. System of Governance 17<br /> B.1 General information on the<br /> system of governance 18<br /> B.2 Fit and proper requirements 21<br /> B.3 Risk management system including<br /> the own risk and solvency assessment 22<br /> B.4 Internal control system 24<br /><a title="Solvency-II-Annual-Report-2017 page 1" href="http://viewer.zmags.com/publication/584060a7?page=1"> NHBC Solvency and Financial Condition Report 2017</a> <a title="Solvency-II-Annual-Report-2017 page 2" href="http://viewer.zmags.com/publication/584060a7?page=2"> Contents Executive Summary </a> <a title="Solvency-II-Annual-Report-2017 page 3" href="http://viewer.zmags.com/publication/584060a7?page=3"> ECxoencutetnivtes Summary This is the Solvency an</a> <a title="Solvency-II-Annual-Report-2017 page 4" href="http://viewer.zmags.com/publication/584060a7?page=4"> Executive Summary NHBC's system of governance ha</a> <a title="Solvency-II-Annual-Report-2017 page 5" href="http://viewer.zmags.com/publication/584060a7?page=5"> Executive Summary NHBC also undertakes an on</a> <a title="Solvency-II-Annual-Report-2017 page 6" href="http://viewer.zmags.com/publication/584060a7?page=6"> Directors' Responsibility Statement We ackno</a> <a title="Solvency-II-Annual-Report-2017 page 7" href="http://viewer.zmags.com/publication/584060a7?page=7"> Independent Auditor's Opinion Report of the exte</a> <a title="Solvency-II-Annual-Report-2017 page 8" href="http://viewer.zmags.com/publication/584060a7?page=8"> Independent Auditor's Opinion In connection with</a> <a title="Solvency-II-Annual-Report-2017 page 9" href="http://viewer.zmags.com/publication/584060a7?page=9"> Appendix Relevant elements of the Solvency and F</a> <a title="Solvency-II-Annual-Report-2017 page 10" href="http://viewer.zmags.com/publication/584060a7?page=10"> A. Business and Performance A.1 Business A.2 Unde</a> <a title="Solvency-II-Annual-Report-2017 page 11" href="http://viewer.zmags.com/publication/584060a7?page=11"> A. Business and Performance This section of the </a> <a title="Solvency-II-Annual-Report-2017 page 12" href="http://viewer.zmags.com/publication/584060a7?page=12"> A. Business and Performance NHBC's activities NH</a> <a title="Solvency-II-Annual-Report-2017 page 13" href="http://viewer.zmags.com/publication/584060a7?page=13"> A. Business and Performance UK's referendum on E</a> <a title="Solvency-II-Annual-Report-2017 page 14" href="http://viewer.zmags.com/publication/584060a7?page=14"> A. Business and Performance Investment income In</a> <a title="Solvency-II-Annual-Report-2017 page 15" href="http://viewer.zmags.com/publication/584060a7?page=15"> A. Business and Performance Unrealised gains Unr</a> <a title="Solvency-II-Annual-Report-2017 page 16" href="http://viewer.zmags.com/publication/584060a7?page=16"> A. Business and Performance A.4 Performance of o</a> <a title="Solvency-II-Annual-Report-2017 page 17" href="http://viewer.zmags.com/publication/584060a7?page=17"> B. System of Governance B.1 General information o</a> <a title="Solvency-II-Annual-Report-2017 page 18" href="http://viewer.zmags.com/publication/584060a7?page=18"> B. System of Governance This section sets out in</a> <a title="Solvency-II-Annual-Report-2017 page 19" href="http://viewer.zmags.com/publication/584060a7?page=19"> B. System of Governance The Audit Committee is a</a> <a title="Solvency-II-Annual-Report-2017 page 20" href="http://viewer.zmags.com/publication/584060a7?page=20"> B. System of Governance Remuneration Committee T</a> <a title="Solvency-II-Annual-Report-2017 page 21" href="http://viewer.zmags.com/publication/584060a7?page=21"> B. System of Governance The variable components </a> <a title="Solvency-II-Annual-Report-2017 page 22" href="http://viewer.zmags.com/publication/584060a7?page=22"> B. System of Governance by the firm to select a c</a> <a title="Solvency-II-Annual-Report-2017 page 23" href="http://viewer.zmags.com/publication/584060a7?page=23"> B. System of Governance The following table prov</a> <a title="Solvency-II-Annual-Report-2017 page 24" href="http://viewer.zmags.com/publication/584060a7?page=24"> B. System of Governance of development of insura</a> <a title="Solvency-II-Annual-Report-2017 page 25" href="http://viewer.zmags.com/publication/584060a7?page=25"> B. System of Governance NHBC also operates a rob</a> <a title="Solvency-II-Annual-Report-2017 page 26" href="http://viewer.zmags.com/publication/584060a7?page=26"> B. System of Governance B.6 Actuarial function W</a> <a title="Solvency-II-Annual-Report-2017 page 27" href="http://viewer.zmags.com/publication/584060a7?page=27"> B. System of Governance Reporting Aligned with t</a> <a title="Solvency-II-Annual-Report-2017 page 28" href="http://viewer.zmags.com/publication/584060a7?page=28"> C. Risk Profile Title C.1 Underwriting risk C.2 </a> <a title="Solvency-II-Annual-Report-2017 page 29" href="http://viewer.zmags.com/publication/584060a7?page=29"> C. Risk Profile This section of the report provid</a> <a title="Solvency-II-Annual-Report-2017 page 30" href="http://viewer.zmags.com/publication/584060a7?page=30"> C. Risk Profile Some of NHBC's investments are su</a> <a title="Solvency-II-Annual-Report-2017 page 31" href="http://viewer.zmags.com/publication/584060a7?page=31"> C. Risk Profile Lastly, NHBC also purchases vario</a> <a title="Solvency-II-Annual-Report-2017 page 32" href="http://viewer.zmags.com/publication/584060a7?page=32"> C. Risk Profile resources available to meet its fi</a> <a title="Solvency-II-Annual-Report-2017 page 33" href="http://viewer.zmags.com/publication/584060a7?page=33"> C. Risk Profile Strategic risk Strategic risk ref</a> <a title="Solvency-II-Annual-Report-2017 page 34" href="http://viewer.zmags.com/publication/584060a7?page=34"> D. Valuation for Solvency Purposes D.1 Assets D.2</a> <a title="Solvency-II-Annual-Report-2017 page 35" href="http://viewer.zmags.com/publication/584060a7?page=35"> D. Valuation for Solvency Purposes This section </a> <a title="Solvency-II-Annual-Report-2017 page 36" href="http://viewer.zmags.com/publication/584060a7?page=36"> D. Valuation for Solvency Purposes Reinsurance T</a> <a title="Solvency-II-Annual-Report-2017 page 37" href="http://viewer.zmags.com/publication/584060a7?page=37"> D. Valuation for Solvency Purposes D.2 Technical</a> <a title="Solvency-II-Annual-Report-2017 page 38" href="http://viewer.zmags.com/publication/584060a7?page=38"> D. Valuation for Solvency Purposes Stochastic re</a> <a title="Solvency-II-Annual-Report-2017 page 39" href="http://viewer.zmags.com/publication/584060a7?page=39"> D. Valuation for Solvency Purposes  Investment </a> <a title="Solvency-II-Annual-Report-2017 page 40" href="http://viewer.zmags.com/publication/584060a7?page=40"> D. Valuation for Solvency Purposes D.3 Other lia</a> <a title="Solvency-II-Annual-Report-2017 page 41" href="http://viewer.zmags.com/publication/584060a7?page=41"> D. Valuation for Solvency Purposes Insurance and</a> <a title="Solvency-II-Annual-Report-2017 page 42" href="http://viewer.zmags.com/publication/584060a7?page=42"> E. Capital Management E.1 Own funds E.2 Solvency </a> <a title="Solvency-II-Annual-Report-2017 page 43" href="http://viewer.zmags.com/publication/584060a7?page=43"> E. Capital Management This section of the report</a> <a title="Solvency-II-Annual-Report-2017 page 44" href="http://viewer.zmags.com/publication/584060a7?page=44"> E. Capital Management The Solvency II balance sh</a> <a title="Solvency-II-Annual-Report-2017 page 45" href="http://viewer.zmags.com/publication/584060a7?page=45"> E. Capital Management Other information about ow</a> <a title="Solvency-II-Annual-Report-2017 page 46" href="http://viewer.zmags.com/publication/584060a7?page=46"> F. Quantitative Reporting Templates Title </a> <a title="Solvency-II-Annual-Report-2017 page 47" href="http://viewer.zmags.com/publication/584060a7?page=47"> F. Quantitative Reporting Templates The fol</a> <a title="Solvency-II-Annual-Report-2017 page 48" href="http://viewer.zmags.com/publication/584060a7?page=48"> S.02.01.02 Balance sheet Solvency II value Assets</a> <a title="Solvency-II-Annual-Report-2017 page 49" href="http://viewer.zmags.com/publication/584060a7?page=49"> S.02.01.02 Balance sheet Solvency II value Liabil</a> <a title="Solvency-II-Annual-Report-2017 page 50" href="http://viewer.zmags.com/publication/584060a7?page=50"> S.05.01.02 Premiums, claims and expenses by line </a> <a title="Solvency-II-Annual-Report-2017 page 51" href="http://viewer.zmags.com/publication/584060a7?page=51"> S.05.02.01 Non-life R0010 Premiums w</a> <a title="Solvency-II-Annual-Report-2017 page 52" href="http://viewer.zmags.com/publication/584060a7?page=52"> S.17.01.02 Non-Life Technical Provisions </a> <a title="Solvency-II-Annual-Report-2017 page 53" href="http://viewer.zmags.com/publication/584060a7?page=53"> S.19.01.21 Non-Life insurance claims Total Non-l</a> <a title="Solvency-II-Annual-Report-2017 page 54" href="http://viewer.zmags.com/publication/584060a7?page=54"> S.23.01.01 Own Funds Basic own funds before de</a> <a title="Solvency-II-Annual-Report-2017 page 55" href="http://viewer.zmags.com/publication/584060a7?page=55"> S.25.01.21 Solvency Capital Requirement - for und</a> <a title="Solvency-II-Annual-Report-2017 page 56" href="http://viewer.zmags.com/publication/584060a7?page=56"> S.28.01.01 Minimum Capital Requirement - Only lif</a> <a title="Solvency-II-Annual-Report-2017 page 57" href="http://viewer.zmags.com/publication/584060a7?page=57"> NHBC is authorised by the Prudential Regulation A</a>