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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2018 (CONTINUED)
19. Fair Values of Financial Instruments (continued)
For financial assets, other than those recognized at fair value, the fair value hierarchy is principally Level 2.
20. Outstanding Claims Reserve – Actuarial Valuation
During 2018, the Group engaged an appointed Actuary to perform a valuation of RSA’s policy liabilities as at 31 December 2018. The policy liabilities consist of a provision for unpaid claims and adjustment expenses on the expired portion of policies (claim liabilities), and a provision for future obligations on the unexpired portion of policies (premium liabilities). The valuation is in accordance with generally accepted actuarial practice, including the selection of appropriate methods and assumptions. Actuarial methods used in determining the claim liabilities include the Paid Development method, the Incurred Development method, the Paid Bornhuetter-Ferguson method, the Incurred Bornhuetter-Ferguson method and the Expected Loss Ratio method. (See Note 9 (a) and 9 (b) for details related to claims liabilities and premium liabilities).
21. Subsequent Events
Subsequent to the year end, the Directors approved a dividend of $156,250 ($0.313 per share) on Series B preference shares.
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