NON-LIFE INSURANCE Unearned premiums represent the unearned part of premiums received for both property and casualty insurance and for accident and health insurance. The provision for  unexpired risks includes a provision to compensate for the increasing age of persons insured under health and personal accident policies. 2003 2002 DEFERRED POLICY ACQUISITION COSTS Balance at January 1 1,109 1,202 Deferred during the year 291 401 Amortization charged to the income statement (273) (328) Other changes 1 (180) (166) BALANCE AT DECEMBER 31 947 1,109 Of which value of business acquired non-life (VOBA) 244 379 $^{1 }$Mainly caused by currency exchange rate differences. These policy acquisition costs are costs that are directly or indirectly related to the conclusion or renewal of non-life insurance contracts. The deferred policy acquisition costs are deducted from the technical provision for unearned premiums and include both renewal commission paid related to unearned premiums, amortized over the related premium period, and first year commission on health insurance policies, amortized over the contract period.  2003 2002 CLAIMS OUTSTANDING Balance at January 1 2,315 2,398 Less reinsurance recoverables (475) (486) Net balance 1,840 1,912 Incurred related to: — current year 1,363 1,506 — prior years (25) 18 Total incurred 1,338 1,524 Paid related to: — current year (654) (738) — prior years (553) (700) Total paid (1,207) (1,438) Other changes (148) (158) Net balance at December 31: — current year 710 768 — prior years 1,113 1,072 1,823 1,840 Plus reinsurance recoverables 421 475 BALANCE AT DECEMBER 31 2,244 2,315 The provision for  claims outstanding relates to claims incurred in the current and previous years, still unsettled at year-end. Calculation takes place either on an item by item basis or on the basis of statistical information, taking into account claims incurred but not yet reported. In calculating the provision, the future costs of processing claims are considered. A different method is applied to marine, aviation and transport insurance. The calculation is based on the ’underwriting years system’ with premiums deferred and claims combined in a fund. This provision consists of the amounts earmarked for insured or beneficiaries, as far as their accounts have not yet been credited. This consists mainly of insurance deposits under Dutch group life contracts, which are designated for improvement of retirement benefits under such contracts. Maturity is undetermined. Interest credited to such deposits is linked with the average yield on long-term Dutch government bonds. PROFIT SHARING AND REBATES OTHER TECHNICAL PROVISIONS AEGON GROUP ANNUAL REPORT 2003 100 NOTES TO THE CONSOLIDATED BALANCE SHEETS Amounts in EUR millions