In 2020, the change of distribution partner had a negative impact of 1.1pp on Topdanmark’s total non-life premium income, split between 1.0pp growth from the new distribution agreement with Nordea and a decline of 2.1pp from the previous distribution agreement with Danske Bank.
The claims trend was negatively impacted by the lower level of interest rates. The discounting effect (movements in the yield curve used for discounting the provisions) had a negative impact on the claims trend of 0.2pp compared with 2019.
Unlisted equities and hedge funds 0.4 0.4 6 1.6 46 14.6 21 6.4 26 7.8 non-life insurance provisions 335 (56) (616) (374) Investment return after return on non-life insurance provisions 230 292 179 52
Parent company etc. The parent company, Topdanmark, does not perform any independent activities. The profit of the parent company etc. includes the profits of subsidiaries not within the insurance business (primarily Topdanmark Asset Management), finance costs and other expenses. The profit of the parent company decreased DKK 26m to DKK 34m in 2020.
Storm claims up to DKK 5,100m (78) (78) (Plus reinstatement premium etc.)
In addition to a policy on salaries, the remuneration policy also includes the pension policy and the guidelines for granting variable salary components, severance pay and identification of other employees whose activities have material impact on Topdanmark’s risk profile.
On 26 June 2020, the Danish FSA decided to recommend Danish financial companies not to complete capital distribution for the remainder of 2020. Based on the Danish FSA’s recommendation Topdanmark’s Board of Directors decided to postpone the pay-out of the
Consequently, the Board will propose to the AGM on 25 March 2021 to pay out an ordinary dividend for 2020 of DKK 1,035m and an extraordinary dividend for 2019 of DKK 765m. In total a dividend pay-out of DKK 1,800m corresponding to DKK 20 per share.
Offices held: Member of the Board of Directors of: • Mandatum Life Insurance Company Limited
Member of the Board of Directors of: • Bornholms Brandforsikring A/S • Forsikringsakademiet A/S (Deputy Chairman) • Finanssektorens Arbejdsgiverforening.
Lars Thykier CFO of Topdanmark A/S. Born 1955, joined Topdanmark in 1986, joined Topdanmark's Executive Board on 1 June 2009.
Profit for the year 7 (683) 1,800 1,124 Other comprehensive income 1 1 Total comprehensive income for the year 1 7 (683) 1,800 1,125
Note 9. Income from investment properties Rental income 246 281 Operating expenses from properties rented out (103) (79) Operating expenses from properties not rented out (1) (1) Gross profit 142 201 Administrative expenses (7) (10) Income from investment properties 135 191
An increase in the required rate of return of 0.5pp will reduce the total fair value by 476 490
Net present value of expected future cashflows 66 21 Profit margin 29 75
Note 27. Profit margin, life insurance and investment contracts With-profit products 79 86 Unit-linked products 250 281 Profit margin, life insurance and investment contracts 329 367
Ricard Wennerklint 1,380 1,733 Jens Aaløse 963 962 Elise Bundgaard 257 385 Anne Louise Eberhard 385 578 Mette Jensen 481 481 Cristina Lage 385 578 Ole Lomholt Mortensen 257 385 Petri Niemisvirta 385 385 Morten Thorsrud 257 385
Loans and receivables at amortised cost Receivables from policyholders 265 283 Receivables from insurance companies 151 71 Other receivables 225 584 Liquid funds 550 846
CLO investments are measured based on the present value of expected future cashflow. The cashflows are estimated by modelling the collateral pool in each CLO ensuring that the deal is in compliance with e.g. collateral quality tests on each payment date. If such tests are breached, cashflows for lower rated tranches are diverted to buy additional collateral and/or redeem tranches with the highest rating. Cashflows are to be diverted as long as collateral tests are breached. Lower rated tranches might receive Paid-In-Kind coupons during such periods which are to be paid in full before cashflows to unrated tranches are resumed.
Note 43. Contingent liabilities Contract liabilities 0 501 Adjustments to VAT liabilities 136 136 Other liabilities 4 1 Capital commitments made to loan funds and private equity funds etc. 398 356 All companies in the Topdanmark Group and other Danish companies and branches in the Sampo Group are jointly taxed with Topdanmark A/S being the management company. Pursuant to the specific rules on corporation taxes etc. in the Danish Companies Act, the companies are liable for the jointly taxed companies and for any obligations to withhold tax on interest, royalties and dividend for companies concerned.
Prices relating to death and disability are regularly adjusted to the market situation and the observed claims record.
Compliance Most important risks Risk preferences Risk reducing activities Insufficient knowledge of current or future legislation and rules
During such a long period of settlement, the levels of compensation could be significantly affected by changes in legislation, case-law or practice in the award of damages adopted by, for example, the Danish Labour Market Insurance which awards compensation for injury
Topdanmark pays or receives cash security for any changes in value. The extent of these daily changes is limited so that there is no challenge to liquidity.
The expected cash f low s of the bond portfolio are calculated based on option adjusted durations that are used to measure the duration of the bond portfolio. The option adjustment relates primarily to Danish mortgage bonds and reflects the expected duration capturing the shortening effect of the borrow er´s option to cause the bond to be redeemed through the mortgage institution af any point in time.
The robots are working according to the specified rules. In case that the correct parameters have not been implemented in the robot enabling it to find and register the required information, the task is channeled to the relevant employee. Subsequently, the employee will ensure that the parameters are updated.
individual bonus potential. A deficit which is not covered by the bonus potentials is assigned to a shadow account for the group which can be restored at a later time when bonus potential is sufficient.
Claims provisions are assessed for each line of business, either on a claim-by-claim basis (individual provisions), or by using statistical methods (collective as well as incurred but not reported (IBNR) and incurred but not enough reported (IBNER) provisions). Claims exceeding a fixed amount, dependent on the line of business, are assessed individually, and provisions for smaller claims are assessed collectively. IBNR provisions cover expenses on post-notified large claims. IBNER provisions cover extra expenses on claims already reported for which the individually assessed provisions are not sufficient due to, for example, inadequate information at the time of assessment. The collective provisions are calculated using de Vylder's credibility model adjusted for each line of business. The IBNR and IBNER provisions are calculated using models developed in-house. In agricultural and commercial lines, claims are assessed individually. IBNR and IBNER provisions are also included in the total provision. In personal lines, claims not exceeding DKK 100,000 are assessed collectively while larger claims, and all claims on change of ownership policies are assessed individually. IBNR and IBNER provisions are also included in the total provision. In motor and accident lines, total provisions comprise the sum of the collective and individual provisions. Individual provisions are the result of an assessment where the claims handler has assessed the total claim payment to exceed DKK 1.5m, and the case is estimated to exceed the amount paid out. Large claims and claims relating to previous years are individually assessed within personal liability in motor insurance.
Provisions for claims already incurred for disability in illness and accident insurance are calculated using an inhouse statistical model that is based on the relationship
Deferred tax on security funds comprises deferred tax on untaxed amounts transferred to the security funds under shareholders' equity. The security funds will be taxed in the proportion of 10% for every 10pp decline in technical provisions net of reinsurance from the level at 31 December 1994. A decline of 10% from the 1994 level is considered improbable as long as Topdanmark Forsikring, in which the transfers were made, continues its current operations. Therefore, the security funds will only be taxed if the insurance portfolio is transferred or the company ceases to conduct insurance business.
Note 5. Equity investments in affiliates Topdanmark Forsikring A/S 6,269 6,672 Topdanmark Kapitalforvaltning A/S 108 92 Topdanmark Invest A/S 54 51 Equity investments in affiliates 6,431 6,816 For detailed information please see note 44 to the financial statements for the Group.
All companies in the Topdanmark Group and other Danish companies and affiliates in the Sampo Group are jointly taxed with Topdanmark A/S being the management company. Pursuant to the specific rules on corporation taxes etc. in the Danish Companies Act, the companies are liable for the jointly taxed companies and for any obligations to withhold tax on interest, royalties and dividend for companies concerned.