In order to fulfil the vision of being the preferred insurance partner, If has adopted a strategy based on three goals: • MosMost sat satisfied custisfied custtomers thromers through sough strtrong fong focus onocus on cuscusttomer vomer valuealue To achieve this If must have the best in-depth understanding of the customers’ insurance needs and, correspondingly, the best underwriting skills. If strives to be the most service-oriented company in the industry and continues to develop its digital communication.
The occupational healthcare services focus on preventive wellness-at-work action. As a result, sick leave rates have been declining since 2011. Similarly, the disability pension category has remained on a low level for the past four years. As in 2015, the category in 2016 is 2.
• Climate conferences were arranged for both the authorities and commercial customers.
• If Denmark was named “Member of The Year” in a competition among the environmentally responsible purchasing network. The competitors included some of the largest offices in Denmark.
Mandatum Life’s risk insurance increases customers’ and their families’ financial security in case of serious illness, disability or death. The insurance helps to cover losses in income resulting from an illness. One out of five Finns falls seriously ill before the age of 65. Most survive, but their everyday life comes to a halt. The insurance provides security and allows people to concentrate on getting better without the extra burden of financial worries. In autumn 2015, the company started a campaign aimed at increasing Finns’ awareness of the risks of a serious illness.
Mandatum Life offers companies assistance in managing the risks related to the health and work ability of their employees. These related risks can occur throughout the lifecycle of an employment relationship, from recruitment to retirement. The insurance also secures the livelihood of the employee’s family if worse comes to worst.
In recent years, Mandatum Life has made significant investments in benefits linked to occupational wellbeing and the well-being of its personnel. These efforts have produced results: the sick-leave rate has decreased over 1 percentage points in five years, equaling 2.3 per cent in 2015. The sick-leave rate has been improved by systematic investments in healthy work environment and leadership.
The company has a strong focus on preventive wellbeing at work. The company offers comprehensive occupational health care services that include, among other things, consultations with a work psychologist, regular ergonomic visits to the workplace, specialist services, examinations related to women’s/men’s illnesses and support for returning to work following a long illness. Co-operation with the occupational health care services provider is close, and employees can consult an occupational health care nurse at the workplace every six weeks.
GrGroup Exoup Executivecutive Ce Committommitteeee ................................................................................................................................................... 5252 55Group Executive Committee's Duties
The Board convened 11 times in 2015. Veli-Matti Mattila and Anne Brunila were prevented from
Members of the AMembers of the Audit Cudit Committommittee and Nominaee and Nomination and Ction and Compensaompensationtion CCommittommitteeee, 31 Dec, 31 December 2015ember 2015
Member of Sampo Group Executive Committee since 2001. Stadigh holds 251,795 Sampo plc shares directly or through controlled companies or persons closely associated with him.
PPositions of Tositions of Trusrust, 12/31/2015t, 12/31/2015 Urzus Group AS, Chairman of the Board; Watercircles Danmark A/S, Board Member; Watercircles Norge AS, Board Member; Watercircles Skandinavia AS, Board Member; The Norwegian Financial Services Association, Member of BRS – Line of Business P&C Board
Sampo Group Sampo Group’s profit before taxes improved in all business areas in 2015 and amounted to a record high EUR 1,888 million (1,759). The total comprehensive income for the period, taking changes in the market value of assets into account, increased to EUR 1,564 million (1,179). P&C insurance and Nordea reported highest ever profits before taxes.
Balance sheet (at the end of period) 9.1895 9.4083 9.2150 9.2901 9.3930
Sampo plc complies with the new Code as of 1 January 2016. The companies can comply wholly or partly with the reporting requirements of the new Code also in respect of the financial year 2015. As permitted by the new Code, Sampo’s reporting in respect of the financial year 2015 follows the requirements of the old Code.
The average number of Sampo Group’s employees (FTE) in 2015 amounted to 6,755 (6,739). P&C insurance is Sampo Group’s largest business area and employed 91.4 per cent of the personnel. Life insurance had approximately 7.7 per cent of the work force and the parent company Sampo plc 0.8 per cent.
In geographical terms Finland had 33 per cent of the personnel, Sweden 27 per cent and Norway 20 per cent. The share of Baltic countries, Denmark and other countries was 20 per cent.
Sampo plc made no repurchases during 2015 and has not purchased its own shares after the end of the reporting period.
32-0174421) and its funds directly or through financial instruments had decreased below 5 per cent or increased above 5 per cent. The notified changes are illustrated in the table below. No other flagging notifications were received.
The notification of 27 November 2015 was based on the implementation of changes to the EU Transparency Directive.
SharShareholders beholders by Secty Sectoror Sampo plc (A and B shares), 31 December 2015
Premiums written before reinsurers' share EURm 1,149 1,110 1,068 983 854
• IT systems in investment activities are common throughout the Group, facilitating consistent analysis and reporting of risks both at the company and at the group level.
Profitability, Risks and Capital Sampo Group operates under a holding company structure and the parent company does not have any business activities of its own. Sampo Group’s business activities are conducted in three separately managed independent business areas, with each business area managing their own risks and reserving sufficient capital to cover their risks.
The Solvency II rules, which entered into force in 1 January 2016, do not recognize insurance sub-groups that have a holding company as a parent company. Since this is the case for If P&C group this has two implications: • The operative insurance companies are reporting to their local supervisors and If P&C group is reported as a part of Sampo Group SII figures.
(iii) The company is able to pay targeted dividends to shareholders in the long run without endangering the balance between risk and capital.
At the group level, the regulatory capital requirement and the actual amount of capital are also exposed to foreign currency translation risk. Translation risk may realize when the capital and the capital requirement of If P&C are converted from Swedish kronas (“SEK”) to euros in the Group’s consolidated figures. When SEK depreciates, the Group’s own funds in euros decreases and the SCR of the If P&C will be lower in euros. As a result, the net effect on the Group solvency ratio is negative.
GrGroup Aoup Actual Capital:ctual Capital: The starting point of the Group’s own funds is the Group’s cconsolidaonsolidatted equityed equity. Sampo’s share of Nordea’s own funds is consolidated into the Group own funds.
• Due tDue to the busineso the business entities’ good prs entities’ good profits and loofits and loww vvolaolatilities, thertilities, there is no need fe is no need for eor extrxtra buffa buffers.ers. If P&C and Nordea have strong capitalization and sound profitability. The OF of If P&C is maintained above the capital level based on the Single-A rating target. Nordea’s amount of capital is affected by the Swedish rules that are one of the strictest within European jurisdictions. In addition, both If P&C and Nordea have maintained high profitability and low volatility of profits. In Sampo plc’s opinion, If P&C and Nordea have themselves relatively high buffers included in their capital and the parent company needs only minor additional reserves for them, if any.
From an ALM point of view, surrender and lapse risks are less significant because in Mandatum Life, around 90 per cent of with profit technical provisions consist of pension policies in which surrender is possible only in exceptional cases. For ALM risk, surrender risk is therefore only relevant in individual life and capital redemption policies of which the related technical provisions amounts to only 5 per cent (EUR 233 million) of the total with profit technical provisions. Furthermore, the supplements to technical provisions are not paid out at surrender which also reduces the surrender risk related to the with profit policies. Surrender and lapse risks are taken into account when the company is analyzing its ALM risk.
FuturFuture bonus re bonus reserveserveses 00 00 00 00 00 00 -0-0 00 00
In Sampo Group, performance and market risks related to investment portfolios are mostly straightforward to analyse and manage, because Group applies mark-tomarket procedures to most of its investments and only seldom are there instruments that require mark-tomodel procedures.
In Mandatum Life, the importance of reinsurance agreements is limited and thus the credit risk of reinsurance counterparties in Mandatum Life is immaterial.
ALM in If P&C The ALM risk in If P&C is managed in accordance with Sampo Group’s principles. ALM is taken into account through the risk appetite framework and is governed by If P&C’s Investment Policies.
In Sampo Group, liquidity risk is managed by the legal entities, which are responsible for liquidity planning and maintaining adequate liquidity buffers. Liquidity risk is monitored based on the expected cash flows resulting from assets, liabilities and other business. In the subsidiaries, the adequacy of liquidity buffers is dependent on the underwriting cash flows. In the parent company, the adequacy of liquidity buffers is dependent also on potential strategic arrangements and a strong liquidity in general is preferred. At the end of 2015, the liquidity position in each legal entity was in accordance with internal requirements.
Group Chief Risk Officer (“CRO”) is responsible for the appropriateness of risk management on the group level. The CRO’s responsibility is to monitor Sampo Group’s aggregated risk exposure as a whole and coordinate and monitor company specific and group level risk management.
In life insurance, catastrophe events include – as in non-life insurance – rare single events or a series of events, usually over a short period of time and, albeit even less frequently, longer lasting events. When a low frequency, high severity event or series of single events lead to a significant deviation in actual benefits and payments from the total expected payments, a catastrophe risk, i.e. an extreme case of biometric risk, has been realized.
Operational risk refers to the risk of loss resulting from inadequate or failed processes or systems, from personnel or from external events. This definition includes compliance risk but excludes risks resulting from strategic decisions. The risks may realize for instance as a consequence of: • Internal misconduct • External misconduct • Insufficient human resources management • Insufficiencies in operating policies as far as customers, products or business activities are concerned
During the financial year, Sampo adopted the following revised standard relating to its business: The revised IAS 19 Pension Benefits (effective for annual periods beginning on 1 Feb 2015 or after) clarified the accounting method when an employee or a third party is expected to make contributions to the defined benefit plan. The adoption of the revised standard did not have a material impact on the Group’s financial statements reporting.
The interest rate used in discounting liabilities is, at most, the maximum rate accepted by the authorities in each country. The guaranteed interest used in the direct insurance premium basis varies on the basis of the starting date of the insurance from zero to 4.5 per cent. The interest rate used in discounting liabilities is the same or lower than that used in premium calculation. Most of the liabilities of the accrued benefits of pension business with DPF are discounted by an interest rate of 3.5 per cent, also being the highest discount rate used. In addition, Mandatum Life has for the year 2016 lowered the maximum rate to 1.0%, for the year 2017 to 1.25% and for the year 2018 to 2.25%. The segregated liabilities of the accrued benefits of group pension portfolio, transferred from Suomi Mutual to Mandatum Life on 30 December 2014, have been discounted by 0.75%.
The total return for the segregated group pension portfolio, transferred from Suomi Mutual to Mandatum Life on 30 December 2014, is based on the profit distribution policy outlined in the transfer plan of the portfolio. The profit sharing policy of the segregated group pension portfolio is explained in detail on the company’s website pages.
The amendments to IAS 1 Presentation of Financial Statements under the Disclosure Initiative (effective for annual periods beginning on 1 Jan 2016 or after) clarifies the instructions on materiality; aggregation of line items in statement of financial position and statement of profit or loss; presentation of subtotals and the structure of the notes and accounting policies. The changes will not have a material impact on the Group’s financial statements reporting.
Included in gains/losses from financial assets available-for-sale is a net gain of EURm 83 (133) transferred from the fair value reserve.
Change in claims provision for annuities -11 -0 -11 37 0 37
Financial asFinancial assets designasets designatted aed at ft fair vair value thralue through p/lough p/l
DerivDerivaativtive financial inse financial instruments (nottruments (note 15)e 15) 12 11
The Group had at the end of 2015 premises a total of 171,254 m
(171,598) taken as a lessee. The contracts have been made mainly for 3 to 10 years.
Net cash used in financing activitiesNet cash used in financing activities -999-999 -725-725
Over one year but not more than five years 0 1
Sampo will publish two Interim Statements and a Half-yearly Report in 2016. These quarterly reports and related supplementary materials are published on Sampo’s website at www.sampo.com/result. Press and stock exchange releases, the monthly updated list of shareholders and other investor information published by Sampo are available on the site as well.