201 The following table details the Group’s liquidity analysis for its derivative financial instruments, based on the undiscounted contractual  net cash inflows and outflows on derivative instruments that settle on a net basis, and the undiscounted gross inflows and outflows on  those derivatives that require gross settlement.  1  Financial derivatives include all derivatives regardless whether they have a positive or a negative value. It does not include bifurcated embedded derivatives. These  are presented together with the host contract. For interest rate derivatives only cash flows related to the pay leg are taken into account for determining the gross  undiscounted cash flows. 1  Financial derivatives include all derivatives regardless whether they have a positive or a negative value. It does not include bifurcated embedded derivatives. These  are presented together with the host contract. For interest rate derivatives only cash flows related to the pay leg are taken into account for determining the gross  undiscounted cash flows. Aegon’s earnings depend significantly upon the extent to which actual claims experience differs from the assumptions used in setting  the prices for products and establishing the technical liabilities and liabilities for claims. To the extent that actual claims experience is  less favorable than the underlying assumptions used in establishing such liabilities, income would be reduced. Furthermore, if these  higher claims were part of a permanent trend, Aegon may be required to increase liabilities, which could reduce income. In addition,  certain acquisition costs related to the sale of new policies and the purchase of policies already in force have been recorded as assets  on the statement of financial position and are being amortized into income over time. If the assumptions relating to the future  profitability of these policies (such as future claims, investment income and expenses) are not realized, the amortization of these costs  could be accelerated and may even require write offs due to unrecoverability. This could have a materially adverse effect on Aegon’s  business, results of operations and financial condition. Sources of underwriting risk include policy lapses and policy claims (such as mortality and morbidity). In general, Aegon is at risk if  policy lapses increase as sometimes Aegon is unable to fully recover up front expenses in selling a product despite the presence of  commission recoveries or surrender charges and fees. For mortality and morbidity risk, Aegon sells certain types of policies that are at  risk if mortality or morbidity increases, such as term life insurance and accident insurance, and sells certain types of policies that are  at risk if mortality decreases (longevity risk) such as annuity products. Aegon is also at risk if expenses are higher than assumed by  management. Aegon monitors and manages its underwriting risk by underwriting risk type. Attribution analysis is performed on earnings and reserve  movements in order to understand the source of any material variation in actual results from what was expected. Aegon’s units  also perform experience studies for underwriting risk assumptions, comparing Aegon’s experience to industry experience as well as  combining Aegon’s experience and industry experience based on the depth of the history of each source to Aegon’s underwriting  assumptions. Where policy charges are flexible in products, Aegon uses these analyses as the basis for modifying these charges, with  a view to maintain a balance between policyholder and shareholder interests. Aegon also has the ability to reduce expense levels over  time, thus mitigating unfavorable expense variation. Maturity analysis (derivatives  1) ) (Contractual cash flows) 2013 On demand < 1 yr  amount 1 < 5 yrs  amount 5 < 10 yrs  amount > 10 yrs  amount Total  amount Gross settled Cash inflows - 12,653 18,622 27,077 55,301 113,652 Cash outflows - (12,505) (18,014) (26,708) (53,826) (111,054) Net settled Cash inflows - 384 1,563 3,162 5,713 10,822 Cash outflows - (323) (1,164) (2,970) (5,323) (9,781) Maturity analysis (derivatives  1) ) (Contractual cash flows) 2012 On demand < 1 yr amount 1 < 5 yrs  amount 5 < 10 yrs  amount > 10 yrs  amount Total amount Gross settled Cash inflows - 11,346 15,435 19,038 38,762 84,581 Cash outflows - (11,414) (15,738) (19,264) (37,479) (83,895) Net settled Cash inflows - 1,049 6,528 560 2,525 10,662 Cash outflows - (930) (4,951) (294) (2,033) (8,208) Underwriting risk