For Mandatum Life, 2010 began as 2009 ended – with excellent profit, record premiums written and a solid performance in terms of solvency.
Premiums written on Mandatum Life Group's own account increased markedly, to EUR 348 million (144). Unit-linked products showed the most vigorous growth, with the related premiums written increasing from EUR 92 million in the reference year to EUR 239 million. Compared with 2009, all sales channels improved their performance and, in particular, Wealth Management and Investment Solutions registered an excellent performance. Premiums written for life insurance operations in the Baltic countries increased by 108 per cent, to EUR 12.7 million (6.1).
In Finland, Mandatum Life's overall market share in direct business rose to 25.3 per cent (21.2) and to 32.8 per cent (27.3) in unit-linked life insurance. In the Baltic countries, the company's market share in unit-linked life insurance came to 32 per cent (17).
Mandatum Life Group's profit before taxes totalled EUR 36 million (27). For unit-linked operations, the parent company showed a loss of slightly more than EUR 1 million, while the Baltic operations reported a profit of slightly less than EUR 1 million. Profit at fair value, recognising changes in the market values of investment assets, came to EUR 133 million (-32) after taxes. This excellent profit at fair value improved the company's solvency, raising the solvency ratio from 18.5 per cent at the turn of the year to 21.4 per cent. Solvency margin is more than 4.8 times the set minimum solvency margin.
Unit-linked technical provisions increased to EUR 2,645 million (2,359), due to strong growth in premiums written together with solid returns on the underlying investments. Technical provisions related to with-profit products remained almost unchanged, at EUR 4,472 million (4,431). With-profit insurance savings were credited with guaranteed interest and customer bonuses for a total of EUR 44.3 million. From this with-profit product portfolio, EUR 75 million (72) was paid out in pensions. In total, EUR 176 million was paid out on claims.
On 31 March 2010, Mandatum Life Group's investments covering technical provisions related to with-profit products totalled EUR 5.7 billion (5.4). Fixed income investments accounted for 67 per cent (68), shares for 25 per cent (23), private equity for 4 per cent (4), investments in land and buildings 3 per cent (3) and other investments for 2 per cent (2).
Key figures Q1/2010
Total premiums written, on own account: EUR 348 million (144)
Profit before taxes: EUR 36 million (27)
Return on equity: 65.4% (-52.0)
Expense ratio: 127.8% (131.2)
Solvency ratio: 21.4% (18.5)
Investment return at fair values: 3.9% (-0.2%)
Average number of staff: 461