Mandatum Life's result for 2019: Unit-linked premium income again reaches record-high level
Comparable result and premium income both increased on the previous year
Mandatum Life's result before taxes for 2019 was EUR 280 million (450). The result for the comparison year includes a EUR 197 million transaction received in connection with a co-operation agreement that was concluded with Danske Bank in the second quarter of 2018. Comprehensive income after taxes, taking into account changes in market values, grew to EUR 308 million (112). The return on equity was 23.5 per cent (8.7), and the expense result decreased to EUR 24 million (35) in 2019. The risk result was EUR 35 million (33).
Premiums written on the company's own account increased to EUR 1,596 million (1,074). Premiums written on unit-linked insurance grew to EUR 1,476 million (976). Premiums written for 2019 include approximately EUR 400 million in exceptional items.
The return on Mandatum Life's investment assets at fair value was 9.2 per cent (–2.4) in 2019, and the return on the segregated portfolio's investment assets at fair value during the same period was 6.4 per cent (–1.9).
The investment assets covering Mandatum Life's original with-profit liabilities on 31 December 2019 totalled EUR 4.7 billion (4.6) at market values. The value of the investments covering the segregated portfolio was EUR 1.0 billion (1.0).
Mandatum Life's technical provisions stood at EUR 12.0 billion (11.2) at the end of 2019. Unit-linked technical provisions amounted to EUR 8.1 billion (7.0), representing 67 per cent (62) of the total technical provisions. The with-profit technical provisions decreased according to plan in 2019, and amounted to EUR 3.9 billion (4.2) at the end of the year. The insurance portfolios with a high technical rate of interest (4.5 and 3.5 per cent) shrunk by EUR 264 million in the course of 2019 to EUR 2.2 billion. Mandatum Life has strengthened its technical provisions by EUR 230 million (232) in response to the low interest rate level. The figures do not include items related to the segregated portfolio.
At the end of December 2019, Mandatum Life's solvency ratio was 176 per cent (176), and without the application of the transitional provisions, it was 142 per cent (131).
In 2019, Mandatum Life paid out a total of EUR 427 million (403) in pensions to approximately 64,000 pensioners. A total of approximately 67,000 other claims were also paid out.
Statement by CEO Petri Niemisvirta:
"2019 was a good year in terms of Mandatum Life's result. In particular, comprehensive income clearly exceeded the previous year's level. The good result can be attributed to exceptionally strong investment returns, especially equity returns.
In addition, unit-linked premium income reached a record-high level for the second year in a row. Our customers have been very receptive to the co-investment model we offer, in which their assets are invested according to the same principles and in the same investment objects as our own assets. For customers who wish to invest actively themselves, we launched the Trader securities trading service offered by Saxo Bank in the spring. The Trader service features world-class technology.
2019 marked the first year of our new long-term co-operation agreement with Danske Bank. Loan insurance, which has been the focus of the co-operation, reached a new, sought-after trajectory, and it is nice to see that our customers understand that they can secure their finances through their own initiative and that they consider it important. In 2020, the co-operation will focus on measures related to investment insurance.
Both our customer and employee satisfaction are at a high level. The NPS figure that measures customer satisfaction has remained good, and as much as 92 per cent of our employees feel that overall they work in a very good workplace," says Mandatum Life's CEO Petri Niemisvirta.
Mandatum Life's key figures 2019
Premiums written, own account: EUR 1,596 million (1,074) Result before taxes: EUR 280 million (450)
RoE: 23.5% (8.7)
Solvency ratio: 176% (176), and without transitional provisions 142% (131)
Return on investments: 9.2% (–2.4) and on the segregated portfolio 6.4% (–1.9)
Average number of employees: 563 (531)
Mandatum Life's result in its entirety is available at: www.sampo.com/result
Petri Niemisvirta, CEO: petri.niemisvirta@mandatumlife.fi, tel. +358 10 516 7200
Jukka Kurki, CFO: jukka.kurki@mandatumlife.fi, tel. +358 50 424 6630
Niina Riihelä, Vice President, Marketing and Communications: niina.riihela@mandatumlife.fi, tel. +358 40 728 1548