GROUP FINANCIAL POSITION IN THE PROPERTY&CASUALTY SEGMENT

Investments

Property and casualty segment: investments

(in € million) 31/12/2016Weight (%)31/12/2015Weight (%)
Equity instruments 2,151 5.5% 2,489 6.3%
Fixed income instruments 29,136 73.9% 26,680 67.3%
Bonds 25,827 65.5% 23,793 60.0%
Other fixed income instruments 3,310 8.4% 2,887 7.3%
Land and buildings (investment properties) 3,778 9.6% 4,338 10.9%
Other investments 1,475 3.7% 1,524 3.8%
Investments in subsidiaries, associated companies and joint ventures 1,494 3.8% 1,541 3.9%
Derivatives -27 -0.1% -72 -0.2%
Other investments 8 0.0% 55 0.1%
Cash and cash equivalents 2,901 7.4% 4,593 11.6%
Total investments 39,440 100.0% 39,624 100.0%

Total investments in the property&casualty segment fell from € 39.624 million at 31 December 2015 to € 39,440 million (-0.5%).
With reference to the exposure to the various asset classes, the fixed income portfolio was up to € 29,136 million, accounting for 73.9% of the total. On the other hand, there was a fall in the exposure to equity instruments, from 6.3% at 31 December 2015 to 5.5%, while the exposure to real estate investments fell from 10.9% to 9.6%.

Finally, the percentage of cash and cash equivalents decreased from 11.6% at 31 December 2015 to 7.4%.
With reference to the breakdown of the bond investment portfolio, exposure to government bonds increased, standing at € 12,346 million (€ 10,317 million at 31 December 2015), amounting to 47.8% of the portfolio (43.4% at 31 December 2015), against a substantially stable corporate component, of € 13,480 million, with a ratio of 52.2% (56.7% at 31 December 2015).

The main movements in the asset allocation compared to 31 December 2015 were due to the increase in government bonds and to the decrease of equities and cash.
The reduction of the equity exposure is attributable to the prudent approach taken due to the volatility and the negative performance of the equity markets, in order to protect income statement and equity position. Cash was reduced in order to limit the dilution of yelds, which are currently negative for bank deposits.

Finally, the average duration of the bond portfolio was 5.4 years (5.0 years at 31 December 2015), in line with the Group’s ALM strategy.

Property&Casualty segment: return on investments

31/12/2016  31/12/2015
Current return (*) 3% 3.2%
Harvesting rate 0.5% 1.4%
P&L return 3.2% 4.1%

(*) Net of depreciations.

The net current return of total investments in the property& casualty segment fell slightly to 3% (3.2% at 31 December 2015), with related incomes amounting at € 1,195 million (€ 1,267 million at 31 December 2015). The harvesting rate decreased to 0.5% (1.4% at 31 December 2015).

Property and Casualty insurance provisions 

Propery&Casualty: technical reserves 

(€ million) 31/12/201631/12/2015
Net provisions for unearned premiums 5,011 4,972
Net provisions for outstanding claims 25,158 25,036
Other net provisions 476 475
Property&Casualty insurance provisions 30,645 30,482
  of which motor 13,631 13,487
  of which non-motor 17,014 16,996