Authorizations Granted to the Board . . . . . . . . . . . . .23
Tier 1 ratio was 15.5 per cent. In segment reporting the share of Nordea’s profit is included in the segment
The Nordic economies continued to grow at a brisk pace, but their growth outlook weakened closer to the year end.
In non-life insurance premiums earned increased 1.7 per cent to EUR 1,223 million (1,208). The level of large-scale claims increased in 2018. Compared to 2017, the level was approximately EUR 15 million higher, thus deteriorating the claims trend for the Topdanmark Group by 1.2 percentage points. Weather related claims amounted to EUR 1.2 million, which was approximately EUR 22 million lower (DKK 161 million) compared to normal level.
The expense result rose to a new record. The expense result for life insurance segment amounted to EUR 35 million (33) and risk result to EUR 33 million (35).
Intressenter’s EUR -4 million. Segment’s profit excluding the associated companies was EUR -3 million (-40).
April 2018. The parties of the transaction have appealed against the pre-ruling. If the tax treatment remains negative, Mandatum Life's financial risk is EUR 13 million.
The Annual General Meeting adopted the financial accounts for 2017 and discharged the Board of Directors and the Group CEO and President from liability for the financial year.
After the deferral period, a retrospective risk adjustment review shall be carried out and the Board of Directors of each Sampo Group company shall decide whether the deferred variable compensation shall be paid/released in full, partly or cancelled in whole. In 2018, altogether EUR
The size of assessed diversification benefit of the Group companies’ profits is reflected in Sampo’s decisions on own capital structure and liquidity position.
Average adjusted number of shares 1,000 554,152 554,152 558,800 558,800 558,800
± other comprehensive income before taxes - profit attributable to non-controlling interests
Segment reporting The Group’s segmentation is based on business areas whose risks and performance bases as well as regulatory environment differ from each other. The control and management of business and management reporting is organised in accordance with the business segments.
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 45FINANCIAL STATEMENTS 2018
Fees and commissions The fees and transaction costs of financial instruments measured at fair value through profit or loss are recognised in profit or loss when the instrument is initially recognised.
Hedge accounting Sampo Group may hedge its operations against interest rate risks, currency risks and price risks through fair value hedging and cash flow hedging. Cash flow hedging is used as a protection against the variability of the future cash flows, while fair value hedging is used to protect against changes in the fair value of recognised assets or liabilities.
Operating leases Assets in which the lessor retains substantially all the risks and rewards of ownership are classified as operating leases and they are included in the lessor’s balance sheet.
Payments made on operating leases are recognised on a straight-line basis over the lease term as rental expenses in profit or loss.
The provision for claims outstanding is intended to cover the anticipated future payments of all claims incurred,
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 57FINANCIAL STATEMENTS 2018
IFRS 16 Leases (effective for annual periods beginning on 1 Jan 2019 or after). The standard will supersede IAS 17 according to which leases were recognised either in the balance sheet as finance leases, or as other leases in which case the related liability was disclosed in the notes. The new standard requires all the leases, apart from low-value and short-term leases, to be recognised in the balance sheet. The adoption will have an effect on the Group’s balance sheet, when all current leases are recognised there, and on the income statement in the form of recognised interest expenses and amortisations. However, the number of the current leases is not significant in the
Share of associate's other comprehensive income - - - -61 - -61
Weighted average number of shares outstanding during the period 555 560
Net carrying amount at 1 January 118 40 158 4 22 27
For the purpose of testing goodwill for impairment, Sampo determines the recoverable amount of its cash-generating units, to which goodwill has been allocated, on the basis of value in use. Sampo has defined these cash-generating units as If Group, Topdanmark Group and Mandatum Life Insurance Company Ltd (Mandatum hereafter).
The associated company Nordea Bank Abp is applying IFRS 9. More information is available in the Financial Statement 2018 of Nordea Bank Abp.
In the comparison year 2017, the figures include also the financial assets classified as Assets held for sale.
EURm Level 1 Level 2 Level 3 Total FINANCIAL LIABILITIES AT 31 DECEMBER 2017
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 93FINANCIAL STATEMENTS 2018
As Topdanmark and especially If are exposed to various exchange rates, comparing the balance sheet data from year to year can be misleading.
The lower section shows how large a share of this is presented in the balance sheet. More information on insurance liabilities in the risk management note 41.
At the close of the claims year 18,828 2,555 2,660 2,743 2,785 2,690 2,670 2,696 2,738 2,776 2,921
At the close of the claims year 901 912 965 859 1,011 891 884 866 794 857
At the close of the claims year 855 855 825 807 855 838 828 804 768 806
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 100FINANCIAL STATEMENTS 2018
Preferred capital note, 2015 (nominal value 850 MDKK) 06/2026 3 month Cibor +270 bp 114 114
EURm 9 (9) of the provision consist of assets reserved for the already implemented or planned development of efficient administrative and claims-adjustment processes and structural changes in distribution channels, resulting in organisational changes that affect all business areas. In addition, the item includes a provision of about EURm 9 (24) for law suits and other uncertain liabilities.
Norway Total Sweden Norway Total Yhteensä Recognised in income statement and other comprehensive income
Average duration of pension liabilities 21 years 21 years 12 years 13 years
Fair value of plan assets 217 - 217 211 - 211
If P&C Insurance Company Ltd has outstanding commitments to private equity funds totalling EURm 11, which is the maximum amount that the company has committed to invest in the funds. Capital will be called to these funds over several years as the funds make investments. In addition, If P&C Insurance Ltd has outstanding commitments to borrowers totalling approximately EURm 9.
Other long-term benefits consist of the benefits under long-term incentive schemes accounted for for the year (see Note 35).
Mandatum Life and Danske Bank agreed on 24 April 2018 to continue their co-operation and that the transfer of the insurance portfolio agreed earlier will not take place. Commission structures in the new co-operation agreement differ from the ones used earlier and Mandatum Life will pay higher commissions for both the new sales and the existing portfolio. The agreed transaction was subject to confirmation of the tax treatment. Despite the negative pre-ruling on the tax treatment the parties have agreed to continue their co-operation as agreed and appeal against the pre-ruling. Danske Bank has paid EUR 197 million in June 2018 . If the tax treatment remains negative, Mandatum life's financial risk is EUR 13 million.
When the above-mentioned core activities are successfully implemented, a balance between profits, risks and capitalization can be achieved at both company and group level and shareholder value can be created.
The following adjustments from IFRS LoBs to Solvency II LoBs are made: • IFRS Line of Business Motor other and Motor third party liability (1,890) include Solvency II Line of Business Motor vehicle liability insurance (551) and Other motor insurance (1,339). • IFRS Line of Business Accident (615) includes Solvency II Line of Businesss Income protection insurance (423), Other life (41), Medical expense insurance (138) and Assistance (13). • The item Other (including group eliminations) is not shown in the breakdowns above but is included in total gross written premiums.
Commercial Business Area is based to a greater extent on principles and individual underwriting than on strict tariffs. In general, pricing is based on statistical analyses of historical claims data and assessments of the future development of claims frequency and claims inflation.
100 million (approximately EUR 9.8 million) and SEK 250 million (approximately EUR 24.4 million) per risk and SEK
The anticipated inflation trend is considered when calculating all provisions and is of the utmost importance for claims settled over a long period of time, such as Motor other and
Notes to Sampo plc’s Financial StatementsGroup's Notes to the Accounts 124FINANCIAL STATEMENTS 2018
from a financial accounting perspective, mainly exposed to changes in inflation and the regulatory discount rates.
If writes insurance policies that are mostly denominated in the Scandinavian currencies and in euro. The FX transaction risk is reduced by matching technical provisions with investment assets in the corresponding currencies or by using currency derivatives. Hence, the so called structural FX risk is first mitigated as a rule after which If can open short or long FX positions (active FX risk) within its
The maturities of technical provisions and financial assets and liabilities are presented in the table Cash Flows
Composition of Non-Life Provisions for Outstanding Claims Topdanmark, 31 December 2018 and 31 December 2017
At the same time, the policy sets the framework for investment of customers' savings, schemes of right to bonus and unit-linked savings (customer funds) in Topdanmark
DC in its original currency. As a net result, Topdanmark’s equity holdings are well-diversified.
Market Risk Sensitivities Topdanmark, 31 December 2018 and 31 December 2017
Claims Ratios After Reinsurance Mandatum Life, 31 December 2018 and 31 December 2017
Mandatum Life, 31 December 2018. The table shows the net transaction risk exposures and the changes in the value of positions given a 10 per cent decrease in the value of the base currency.
The counterparty risk of bilaterally settled derivatives is mitigated by careful selection of counterparties, by diversification of counterparties to prevent risk concentrations and by using collateral techniques, e.g. ISDA Master
15 Pension liabilities The basic and suplementary pension insurance of Sampo plc's staff is handled through insurances in Varma Mutual Insurance Company and in Mandatum Life Insurance Company Limited.
We involved our internal actuarial specialists to assist us in assessing the appropriateness of assumptions used.
29.805 (31.12.2017: mEUR 30.158) which represents 82 % of the Group’s total liabilities and it is thus the single largest liability of the Group. The insurance contract liabilities comprise life and non-life insurance contract liabilities.
Fair value measurement can be subjective, specifically in areas where fair value is based on a model based valuation. Valuation techniques for private equity funds, non-listed bonds and non-listed equities involve setting various assumptions regarding pricing factors. The use of different valuation techniques and assumptions could lead to different estimates of fair value. Specific areas of audit focus include the valuation of level 2 and 3 assets according to IFRS where valuation techniques use unobservable inputs. The investment portfolio include level 2 assets amounting to mEUR 8.086 and level 3 assets amounting to mEUR 2.148 (refer to note 17).
Meeting on 10.4.2002, and our appointment represents a total period of uninterrupted engagement of 17 years.