Now, we're going to take a look at the balance sheet in more detail. Let's just review some of the key line items first though. In this case, we've got the assets and the liabilities section. One of the important assets are the reinsurance assets, and this is the receivables because we've handed the reinsurance company cash, and that's how much we should receive back to help satisfy the liabilities, which we're also recording on the balance sheet because the liabilities on the balance sheet will be shown gross. Then we have deferred acquisition costs. This is where we've paid a third party a commission for getting the policy in. And this means that what we'll do is we'll recognize the cost of that commission, not immediately, even though it's paid in cash immediately, we will spread it over the period that we'll recognize the policy. So, for example, if you recognize, or you write a policy on June 30th, and the year-end is December 31st, you will recognize 50% of the premium and you'll also recognize 50% of the acquisition cost as well. The rest of it will sit on the balance sheet as a deferred acquisition cost asset, like a prepaid expense. The unknown premium reserve, of course, is part of this because if you've only recognized half the premium income, the rest of that has to sit on the balance sheet as a liability. And the reason this is a liability is because if the policyholder cancels for any reason, then you're going to have to repay them the money. So, the next big item is the insurance liabilities, which is four billion in this case. And here we've just got one single line item, but often you see this split into three components. The first key one will be the incurred but not reported, and the whole claims expense will go into this account first. And this is the estimate that you make. So, if you write a premium which is $100, and you estimate that 70% of that is going to be paid out, that 70% will go into the incurred but not reported account. But of course, as time goes on, then you get notified that somebody's had an accident if it's a car policy, and you've got a claim. And that means you can then make a more accurate assessment. And at that point, it moves from the incurred but not reported into the claims provision.

Now, when you have a claim claim it needs to be assessed, and of course, there costs in assessing a claim, and that means you'll also have a liability which is a claim assessment costs liability, and those are sometimes split out into three line items in Kerpen or reported the claims provision, and the claims assessment provision. But in this case, it's all lumped into one line item. The next step, of course, when you're building a model is to take that four billion liability, and figure out when exactly it's going to be paid out. And that is known as a payoff diagram. And it's a triangular diagram representing exactly when a claim's expense number is paid out in the future. And of course, even though the policy may be a one-year policy, if it's car insurance, for example, and somebody has an accident, there may be healthcare claims, and often those healthcare claims can be paid out not just in one year, but in multi years if they need additional treatment on an ongoing basis.