4.16. Acquisition costs and administrative expenses
4.16.1. Acquisition costs
Total commissions expense for direct insurance business, particularly commissions for acquisition and renewal of the portfolio comprised the following:
| (CZK’000) | 2016 | 2015 | ||||
|---|---|---|---|---|---|---|
| Non-life insurance | Life insurance | Total | Non-life insurance | Life insurance | Total | |
| Direct commissions | 819,113 | 540,817 | 1,359,930 | 816,192 | 839,181 | 1,655,373 |
| Internal acquisition costs | 525,956 | 169,871 | 695,827 | 323,265 | 225,559 | 548,824 |
| Subtotal | 1,345,069 | 710,688 | 2,055,757 | 1,139,457 | 1,064,740 | 2,204,197 |
| Change in deferred acquisition costs | (18,489) | 11,601 | (6,888) | (15,904) | 35,331 | 19,427 |
| Total acquisition costs | 1,326,580 | 722,289 | 2,048,869 | 1,123,553 | 1,100,071 | 2,223,624 |
4.16.2. Administration expenses
| (CZK’000) | 2016 | 2015 adjusted |
|---|---|---|
| Administrative expenses – non-life | 369,255 | 483,254 |
| Administrative expenses – life | 188,774 | 140,659 |
| Total administrative expenses | 558,029 | 623,913 |
The administration expenses consist of:
| (CZK’000) | 2016 | 2015 adjusted |
|---|---|---|
| Personnel costs | 333,428 | 443,609 |
| Depreciation and amortization of fixed assets | 44,589 | 86,129 |
| Other administrative expenses | 833,008 | 612,484 |
| Other expenses | 42,831 | 30,516 |
| Subtotal | 1,253,856 | 1,172,738 |
| Portion included in internal acquisition costs | (695,827) | (548,825) |
| Total administrative expenses | 558,029 | 623,913 |
4.16.3. Personnel costs
Staff costs can be analyzed as follows:
| (CZK’000) | 2016 | 2015 |
|---|---|---|
| Emoluments of Board of Directors | 8,282 | 42,441 |
| Emoluments of other members of senior management | 61,938 | 62,654 |
| Other wages, personal costs and emoluments of employees | 164,246 | 217,742 |
| Social costs and health insurance | 76,528 | 101,998 |
| Other | 22,434 | 18,774 |
| Total personnel expenses | 333,428 | 443,609 |
| 2016 | 2015 | |
|---|---|---|
| Staff statstics | ||
| Average number of employees | 439 | 574 |
| Average number of members of the Board of Directors | 3 | 4 |
| Average number of other members of senior management | 36 | 42 |
| Average number of members of the Supervisory Board | 3 | 3 |
| Total staff statistics | 481 | 623 |
The Company’s cars at a cost of CZK 4,119 thousand (2015: CZK 6,674 thousand) are made available for use of management. As at 31 December 2016, the Company did not register any loans granted either to members of the Board of Directors, Supervisory Board or to the management.
4.16.4. Other administration overheads
| (CZK’000) | 2016 | 2015 |
|---|---|---|
| Rent | 87,338 | 97,977 |
| Office expenses and information technology | 131,052 | 188,517 |
| Travelling costs | 15,079 | 16,449 |
| Advertising and representation costs | 141,630 | 115,470 |
| Other | 457,909 | 194,071 |
| Total other administrative overheads | 833,008 | 612,484 |
Caption ‘Other‘ in Other administrative overheads comprise other corporate expenses in the amount of CZK 350,884 thousand (2015: CZK 136,309 thousand) represented mostly by shared services expenses paid by the Company to other related parties for outsourcing of management of certain areas (e.g. claims handling, asset management and HR services) and group expenses for IT services in the amount of CZK 29,068 thousand (2015: CZK 12,735 thousand). In addition to it, there is a write-off of lost investment in the amount of CZK 25,859 thousand (2015: nil).