Mandatum Life's premiums written increase as a result of successful sales of unit-linked products
Mandatum Life's result before taxes in January–June was EUR 69 million (65). The company's expense and risk result increased to EUR 15 million (10). The return on investment assets at fair value was 1.7 per cent (3.9). As the investment returns were lower than in the comparison year, the comprehensive income from investments at fair value after taxes declined to EUR 25 million (105).
Mandatum Life Group's premiums written on its own account grew 11 per cent to EUR 549 million (493). The rise in premiums written is entirely the result of the growth in unit-linked premiums written, which increased by EUR 69 million and amounted to EUR 462 million (393). Premiums written in the Baltic countries reached EUR 15 million (13). Despite the favourable development in premiums written, Mandatum Life's market shares declined as growth in premiums written elsewhere in the sector exceeded that of Mandatum Life. Mandatum Life's overall market share of direct business in Finland stood at 18.8 per cent (26.9) at the end of June, and its market share in unit-linked insurance was 18.8 per cent (28.8).
Mandatum Life's solvency position remained strong. Mandatum Life Group's solvency ratio as of 30 June 2013 was 26.1 per cent (27.7). The dividend of EUR 100 million paid out to Sampo plc in April 2013 reduced Mandatum Life's solvency capital. The parent company's solvency margin is nearly six times the required minimum. Mandatum Life's capital requirement is highly dependent on the with-profit technical reserves and the investment assets covering these reserves. Due to the structure of the portfolio, the with-profit technical reserve is shrinking relatively significantly, which in turn also lowers the company's capital requirement and enables it to pay dividends.
Mandatum Life Group's technical reserves amounted to EUR 8.1 billion (7.9). The unit-linked reserves stood at EUR 4.1 billion (3.8), and the continuously shrinking with-profit technical reserve was EUR 4.0 billion (4.1). The unit-linked reserves reached a record high of 51 per cent (48) of the total portfolio. In response to the low interest rate level, the with-profit technical reserve includes an increase of EUR 125 million (118) in the reserve for decreased discount rates.
Key figures H1/2013
Premiums written, own account: €549 million (493)
Profit before taxes: €69 million (65)
Return on equity: 4.6% (23.0)
Expense ratio: 113.7% (117.5)
Solvency ratio: 26.1% (12/2012: 27.7)
Return on investments: 1.7% (3.9)
Average number of staff: 557 (536)
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