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5 May 2011

Finnish insurance in 2010

Federation of Finnish Financial Services

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Finnish insurance in 2010


Kimmo Koivisto

CONTENTS
Highlights ............................................................................. 1 Market developments ........................................................... 2 Corporate scene .................................................................... 3 Premiums written in Finland in 2010 ................................... 4 Non-life insurance ................................................................ 5 Mutual associations .............................................................. 8 Life insurance ....................................................................... 9 Statutory pension insurance.................................................. 12 Insurers investments ............................................................ 13 Statistical annexes

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Finnish insurance in 2010


HIGHLIGHTS
Finnish insurers investments returned more than 9% calculated at current values. Companies financial strength remained good. Insurance premiums written in Finland rose by 15% to a total of 19bn. Claims increased by 14%. Non-life insurers combined ratio increased to 102.1%. Loss ratio was 81.2%, expense ratio was 20.9%. Life premiums rose 56%. Increase was the largest in group pension and capital redemption policies.

Breakdown of gross premiums written by Finnish insurers in 2001-2010

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Market developments
The recession passed in Finland during 2010. Economic crisis in the euro area was prevented, at least for the time being. For insurers, this meant first and foremost that investment income at current values remained at a moderate level of more than 9%. The improving employment rate was also positively reflected in premiums. The gross premiums of Finnish insurers grew by 15% to a total of 19bn in 2010. Life insurers premiums grew the most, by as much as 56%. Non-life insurers premiums grew by 3%. After the recession had eased, employee pension premiums increased by 6.5%. Claims and pension benefits were paid by Finnish insurers for a total of 16.8bn in 2010, which is 14% more than in the year before. Non-life insurers in particular suffered as a result of the difficult year in terms of claims. However, operating profits and overall performance remained at a satisfactory level due to the relatively successful performance of investments. The solvency of Finnish insurers also remained good. A typical feature in the breakdown of Finnish insurance is that statutory lines generate a major share of premiums written. Last year, 63% of all premiums written came from statutory insurance, i.e. employee pension, workers compensation and motor liability insurance. Another feature typical of the Finnish insurance market is high concentration. Over 83% of all premiums were written by the four largest insurer groups.

Claims paid by Finnish insurers in 2001-

2010

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Corporate scene
At the end of 2010, there were 39 licensed Finnish insurers in Finland, with 21 specialising in non-life business and reinsurance, 11 in life insurance and 7 in statutory employee pension insurance. Mutual associations, or local mutuals, totalled 63 at the end of the year. Insurance companies employed an average of 10,472 persons in 2010. The number is slightly under 100 persons less than the previous year. The number of branches operated by non-Finnish insurers in Finland was 24 at the end of 2010. Notifications to carry out insurance business under the freedom to provide services had been received by the Financial Supervisory Authority from a total of more than 600 companies by the end of the year. At the end of 2010, the Insurance Brokers Register, maintained by the Financial Supervisory Authority, contained 65 insurance broker businesses. The volume of business done through brokers accounted for approximately 8% of the total premiums written at the end of 2010.

Number of insurers operating in Finland in 19802010


80 70 60
55 56 56 55 60 56 57 57 61 57 51 51 50 53 51 58 56 56 69 67 65 65 70 61 71 67 65 64 63 63 63

80 70 60 50 Foreign 40 insurers life 30 Noninsurers

50 40 30

Life insurers Pension insurers

20 10 0 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10

20 10 0

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Gross premiums written* in Finland in 2010 and loss ratio with claims paid
Premiums written m Change % Loss ratio % 1) Claims paid m 2) Change %

Pension insurance - statutory pension Life insurance - personal life, unit linked - capital redemption policies - other life insurance - employees group life - other group life insurance - personal pension, unit linked - other personal pension - group pension, unit linked - other group pension - reinsurance Life insurance total Non-life insurance - workers compensation - other accident and health - motor vehicle - marine, aviation and transport - fire and other damage to property - motor liability - general liability - credit and suretyship - legal expenses - other direct insurance Direct non-life business total - domestic reinsurance - foreign reinsurance Non-life insurance total TOTAL

10,653 1,009 1,646 395 37 104 480 205 61 850 4 4,791 532 329 631 110 786 712 174 41 65 55 3,434 63 62 3,559 19,003

6.5 52.9 130.6 -20.0 -10.4 8.4 -3.4 -16.8 23.2 220.9 -7.4 56.2 -3.2 8.9 3.9 6.1 3.8 2.7 5.1 11.9 10.6 -0.3 3.2 -1.1 -4.1 3.0 15.0 102.7 79.5 70.9 60.7 87.5 79.4 72.5 17.2 74.9 96.8 82.2 80.9 21.9 81.2

10,412

7.9

3,919 444 233 388 61 532 452 110 7 40 35 2,302 59 69 2,430 16,761

37.2 1.0 7.3 5.6 8.5 19.3 3.3 6.5 -52.1 6.6 5.7 7.0 41.9 94.6 9.0 13.8

* includes Finnish companies and local mutuals plus those foreign insurers whose figures have been reported to the Federation 1) Claims incurred / premiums earned, only Finnish insurers included 2) Claims paid, only Finnish insurers included

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Non-life insurance
Finnish non-life insurers premium income grew 3% to a total of 3.6bn. Non-life claims were paid for 2.4bn, which is 9% more than in 2009. The balance on the technical account before change in equalisation provision (premiums earned less claims incurred and operating expenses) was 15m in deficit. Non-life insurers combined ratio, which reflects both loss ratio and expense ratio, increased by more than 5 percentage points to 102.1%, the highest since 2003. Loss ratio (claims incurred to premiums earned) weakened from 75.9% to 81.2%. This was due to the difficult snow conditions early and late in the year and the storms and major fires in the summer. Expense ratio (expenses incurred to premiums earned), on the other hand, improved slightly, settling at 20.9%. Loss ratio before unwinding of discount was 77.9%, and the corresponding combined ratio before unwinding of discount was 98.7%.

Non-life insurance ratios 20012010

Non-life insurers net income from investments at current terms fell by 35% but still amounted to 630m. Investment return on capital employed amounted to 5.4% at current values. The companies reported an aggregate operating profit of 488m. When valuation gains/losses on investments are added to operating profit, the figure stands at 608m.

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Non-life insurers solvency capital, which is made up of solvency margin and equalisation provision, rose to 4.7bn. This increase also influenced solvency ratio, which rose to 149%. Non-life insurers solvency margin was 3.9 times the amount needed to meet the requirement imposed in the Insurance Companies Act.

Non-life insurers' solvency capital in 2001-2010


* Solvency ratio = solvency capital / premiums earned

*149% *190% *137% *132% *134% *131% *130% *144% *145% *126%

Insurance against fire and other damage to property continued as the largest group of non-life classes. Premiums written rose 3% to 768m. This group of insurance classes, which covers both business and personal property cover, presented a rapid increase in loss ratio to 87.5%. Premiums written in motor liability insurance rose 3% to 712m. The loss ratio of motor liability insurance increased slightly to 79.4%. The number of road accidents reported to motor liability insurers was 134,893, up 14.2% from the previous year. Fatal accidents decreased. According to data filed with Statistics Finland, road accidents claimed 270 lives. The number of injured also decreased, amounting to a total of 7,661 persons. The recession in the Finnish economy continued to affect the volume of workers compensation premiums written, totalling at 532m. This is more than 3% less than in 2009. The amount of compensation paid was only slightly larger than a year earlier, but due to the decreased volume of premiums written the loss ratio increased noticeably, settling at 102.7%.

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Voluntary motor vehicle insurance grew 4% in terms of premiums written, which amounted to 631m. Loss ratio weakened slightly to 70.9%. The number of cars was approximately 1.5% more in 2010 compared to 2009. The number of cars damaged in road accidents rose 15% on the previous years, with a total of 308,399 claims received by insurers. The difficult snow conditions early and late in the year were the main reason for the steep increase in the number of accidents. Other accident and health insurance premiums grew to 329m. This is an increase of slightly under 9% from the year before. Premiums written on accepted reinsurance fell 3% to a total of 125m. Foreign reinsurance contributed 62m to the total and domestic reinsurance covered the remaining 63m.

Breakdown of non-life business in 2010


Total 3,559 million
million

0 78 6 71 2 63 1 53 2

100

200

300

400

500

600

700

800

900

Fire and other damage to property Motor liability Motor vehicle Workers' compensation Other accident and health General liability Marine, aviation and transport Legal expenses Domestic reinsurance Foreign reinsurance Other direct insurance Credit and suretyship

22.1% 20.0% 17.7% 15.0 %

9.2% 4.9%

3.1% 32 9 1.8% 17 1.8% 4 1.7% 11 0 1.5% 65 63 62 55 41 1,1%

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

The volume of direct premiums written by non-life insurers in Finland rose 3% to 3.4bn. Market shares changed only slightly. OP-Pohjola Group kept its number one position by raising its market share to 28.3%. If P&C Insurance Company Ltd lost market share and claimed 24.8% of the total. Tapiola retained its market share of 18.9% while Fennias share decreased to 9.7%. The Local Insurance Group, which comprises most of the local mutuals operating around Finland, boosted its market share to 9.5%. The five largest insurer groups commanded more than 91% of the non-life market in 2010.

Non-life insurers' market shares in 2010


Gross direct premiums written in Finland total 3,418 million
million

0 96 6 84 9 64 7 33 1

100

200

300 400

500

600 700

800

900 1000 1100 28.3% 24.8 %

OP Pohjola Group If P&C Tapiola Group Fennia Local Insurance Group Pohjanthti Turva Aktia Non-Life Insurance

18.9 % 9.7% 9.5% 2.5%

32 2.3% 6 84 77 66 1.9%

Alandia Group Others

35 1.0% 36 1.1%

Mutual associations
For several years now, the number of local mutual insurance associations has been on the decline in Finland. In 2010, they numbered 63. Most of the local mutuals are members of the Local Insurance Group.

Direct premiums written by Finnish mutual associations totalled 194m in 2010, up 5% on 2009. The market share of local mutuals was slightly under 6% of all direct business at the year- end. The average loss ratio of the local mutuals was 78%. The figure is not directly comparable to insurance companies loss ratios, because mutual associations administer insurance portfolios very different in structure from the portfolios of most insurance companies in Finland. Operating profit totalled 3m, representing 2% of turnover. 8

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Life insurance
Finnish life insurers 2010 premium income was nearly 56% higher than the 2009 volume. Premiums written in Finland totalled 4.8bn. Increase was the largest in group pension and capital redemption policies. The total volume of new policies sold were on the decline due to the sales of guaranteed-return life policies coming to a standstill. On the other hand, sales of other products offered by life insurers increased clearly on the previous year, also in terms of volume. The figure shows that the regular premiums received by insurers have been increasing slightly throughout the period under review, while one-time premiums written have fluctuated strongly.

Life insurance premiums written in 2001 2010

Claims paid under life insurance increased by 37% to 3.9bn. Policy surrenders amounted to 1.6bn, policy benefits covered 1.1bn, pensions were paid out for 0.9bn and other benefit and compensation payouts totalled 0.3bn. Pension payouts amounted to 12% more than in 2009, while 15% less of policy benefits were paid out. Policy surrenders increased by 103% in the course of the year. It should be noticed that capital redemption policies made in 2010 and replaced before the end of the year accounted for a majority of the policy surrenders.

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

The volume of assets held under life policies rose 9.5% to 33.2bn. The increase concentrated in unit-linked assets, which totalled 12.8bn, 32.6% more than in 2009. Traditional savings amounted to 20.3bn.

Life insurance assets 2001 2010

New capital redemption policies were sold at a brisk rate; 62% more than in 2009 in terms of volume. Their premiums rose 130%, totalling at 1.6bn. The vigorous growth of unit-linked contracts continued, and their premiums written doubled. In addition, a few exceptionally large guaranteed-return policies were made, increasing the premiums of guaranteed-return policies six-fold on the previous year. The vigorous growth of unit-linked products was also accentuated in the rest of the premiums written in personal life insurance. Premiums written in unit-linked life insurance grew by more than 50% and amounted to more than a billion euro. Pure risk policies rose 5% to 302m in terms of premiums written, and the premiums of voluntary group pension policies totalled 104m, 8% more than in 2009. On the other hand, other guaranteed-return life policies fared less well and fell 53% to 97m. The impairments brought about by the new legislation on long-term savings had a visible impact on voluntary personal pension policies. Sales of new personal pension policies collapsed. Only 11,494 new personal pension policies were bought in 2010, compared to 48,618 in 2009. The average amount of regular contributions paid to new pension plans was 189 a month. Premiums written decreased by 8% to 685m.

10

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Voluntary group pension insurance increased by 190% in terms of premiums written. Premiums totalled 911m, out of which 61m was covered by unit-linked business. Portfolio transfers from wound up pension funds, which may add unusually large amounts to premiums written in this line, amounted to a record-high figure of 623m, when a year earlier the sum was 42m. Even though unusual premiums accounted for a majority of the growth in premiums, regular contributions paid to new policies also increased by 7%. Premiums on employees group life insurance, a cover agreed between social partners, paid 37m, which is a decrease of 10%.

Breakdown of life business in 2010


Total 4,787 million
million

34.4% 21.1% 19.0% 14.3%

8.3% 2.2% 0.8%

Calculated at current values, life insurers investments gave a return of 7.6%. All in all the investments generated 2.0bn. Operating expenses rose 11% to 255m. Operating profit amounted to 856m. Valuation differences rose slightly under 600m, bringing the total figure to 1.4bn. Bonuses and rebates were paid for a total of 252m. Life insurers solvency ratio rose to 21%. The figure means that Finnish life insurers solvency capital was 21% larger than the amount needed for future benefit payouts to customers. These assets serve as a buffer to tide over years of poor investment performance. Life insurers aggregate solvency capital increased 20% to 5.3bn. Life insurers solvency margin expanded and was 4.6 times the amount needed to meet the requirement imposed in the Insurance Companies Act.

11

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

In terms of premiums written, OP Life Assurance Company retained its market leader position: its share increased to 38.6%. Nordea Life Assurance (22.5%) overtook Mandatum Life (22.0%), while all other companies fell a little. In terms of assets held under life policies, the market shares were more stable. Nordea Life Assurance (24.7%) was the largest, followed by Mandatum Life (21.5%) and OP Life Assurance Company (21.3%), of which the latter increased its share vigorously.

Life insurers' market shares in 2010


OP Life Nordea Life Mandatum Life Others 22.0 % 21.5 % 16.8 % 22.5 % 24.7 % 38.6 % 21.3 %

By premium income By assets under management

32.4 %

Statutory pension insurance


Statutory pension insurance premiums written depend strongly on the total payroll. The total payroll continued its decline in early 2010 but started to grow vigorously after March. This returned the premiums written by authorised pension providers to a positive growth track. Premiums written by authorised pension providers increased by 6.5% to 10.7bn. Pension benefits were paid out for a total of approximately 10.4bn. Calculated at current values, the value of assets held in cover of pension liabilities grew 11% to 85bn. Pension insurers derive much of their income from investments. Equities are the largest class in the companies investment portfolio, and their values fluctuated during the course of the year but were strongly positive during the year as a whole. Pension insurers investments returned 10.6% at current values. Net investment income was 4.6bn calculated at current values. Loading profit amounted to 95m, and underwriting business generated a profit of 343m. These formed a total figure of 5.0bn. A portion of 217m was used for bonuses, and the remaining 4.8bn was used for strengthening equalisation provision. 12

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Pension insurers solvency margin continued to improve and accounted for 28% of technical provisions eligible for calculation of solvency limit. Pension insurers solvency capital increased by 32% to 19.4bn. The validity of the temporary law which relaxed pension insurers capital requirements was extended by two years until the end of 2012. This was done in order to allow the companies to continue their long-term investment policy until the new permanent capital adequacy regulations are completed.

Pension insurers' solvency capital in 20012010


* Ratio of solvency capital to technical provisions used for solvency calculation
*28% *30%

*31%

*28%

*22%

*23% *20% *21% *16% *15%

Employee pension insurers market shares underwent only slight changes which had no effect on the companies relative positions. Varma maintained its leader position with a 35.1% market share. The second largest, Ilmarinen, retained its market of 31.8%. Tapiola Pension saw its market share drop to 13.4%. Fennia Pensions share also decreased to 10.6%. Eteras market share decreased slightly to 5.3%. Veritas Pension decreased its market share to 3.6%, and the smallest company, Alandia Pension, kept its share of 0.3% from the year before.

Insurers investments
The investment climate was varied in 2010. Uncertainty about the development of the global economy, and in particular the fear of a possible European financial crisis, were the most characteristic features. The market prices of equities were very turbulent, but vigorous growth towards the end of the year ultimately resulted in excellent return on equities.

13

Federation of Finnish Financial Services

Finnish insurance in 2010 5 May 2011

Calculated at current values, the value of insurers investment portfolio increased by 9% to 124bn. Authorised pension insurance companies held the most investments with 85bn. Life insurance companies held 27bn and non-life insurance companies held 12bn.

Finnish insurers' investments in 20012010


at current values
billion

65 60 55 50 45 40 35 30 25 20 15 10 5 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

65
billion

60 55 50 45 40 35 30 25 20 15 10 5 0 Loans Other investments Debt securities Equity holdings

The breakdown of investments changed considerably, with equities claiming the largest weight in the portfolio. The market value of equities was 31% higher than the previous year, standing at 59bn. Equities expanded to cover 48% of the portfolio, up from 40% in the course of a year. Calculated at current values, equities returned 19.5%. Debt securities, which comprise mostly bonds, totalled 43bn at the end of 2010. The amount decreased by 11% and their proportion of investments decreased to 34%. Return on debt securities was 4.5%. The weight of property in Finnish insurers aggregate portfolio remained at 10% and the value of properties rose 7% to 12bn. The return on property was 5%. Insurers lending remained unchanged. Finnish insurers lending amounted to a total of a bit under 9bn, out of which slightly over 5bn was covered by premium loans. The proportion of lending decreased by one percentage point to 7%. The return on the loan portfolio was 2.4%.

14

Federation of Finnish Financial Services

Annex 1

Non-life insurers' gross premiums written in 2010 broken down by lines, '000
Market share % Direct domestic insurance Gross premiums Workers written compensation Other accident and health Marine, Motor aviation and vehicle transport Fire and other damage to property Motor liability General Credit and liability suretyship Legal expenses Other direct Domestic International insurance reinsurance reinsurance

If P & C Insurance Company Ltd Pohjola Insurance Ltd Tapiola General Mutual Insurance Company Fennia Mutual Insurance Company Local Insurance Mutual Company A-Insurance Ltd Pohjanthti Mutual Insurance Company Turva Mutual Insurance Company Aktia Non-Life Insurance Company Ltd Eurooppalainen Insurance Company Ltd Frskringsaktiebolaget Alandia Osuuspankkien Keskininen Vakuutusyhti Aaland Mutual Insurance Company Garantia Insurance Company Ltd. Redarnas msesidiga Frskringsbolag Spruce Insurance Ltd. Valion Keskininen Vakuutusyhti IngoNord Insurance Company Ltd. Keskininen Vakuutusyhti Palonvara Alma Insurance Company Ltd Bothnia International Insurance Company Ltd Companies total 2010 Companies total 2009 Change, % Local mutual insurance associations If P&C Insurance Ltd (publ), branch in Finland Total premiums 2010 Total premiums 2009 Change, %

24.6 23.9 18.9 9.7 3.9 2.6 2.5 2.3 1.9 1.2 0.7 0.5 0.5 0.4 0.3 0.1 0.1 0.0 0.0 0.0 0.0

840,059 817,401 646,701 331,170 133,338 90,070 83,787 77,205 66,293 41,952 24,559 17,104 16,911 13,682 10,730 2,721 1,913 462 125 0 0

854,540 852,778 691,916 331,548 155,225 90,070 83,791 77,330 66,430 41,952 32,544 17,104 25,543 13,682 13,293 2,721 1,913 1,795 1,145 37 0 3,355,358 3,278,056 2.4 194,362 9,263 3,558,984 3,472,517 2.5

132,133 139,697 109,309 71,927 23,578 21,349 10,024 4,184 12,163 0 0 0 2,685 0 3,876 0 1,313 0 0 0 0 532,239 549,952 -3.2 0 0 532,239 549,952 -3.2

84,532 160,820 77,556 136,609 63,410 120,970 26,174 58,034 22,495 1,385 0 32,906 11,139 16,276 8,448 17,924 2,714 13,727 30,532 0 1,685 0 81 0 0 2,952 0 0 0 0 0 0 1 0 94 58 125 0 0 0 0 0 328,986 561,661 302,204 543,125 8.9 3.4 0 0 62,593 6,253

23,469 13,044 9,199 8,834 195 34 550 540 2,092 11,420 29,496 0 30 0 6,854 0 0 214 0 0 0 105,971 108,370 -2.2 3,557 0 109,527 111,599 -1.9

184,782 197,832 152,844 65,975 1,237 2,361 20,830 18,650 16,530 0 0 116 11,514 0 0 2,025 599 999 0 0 0 676,295 656,768 3.0 109,729 0 786,023 762,175 3.1

164,824 160,802 141,770 69,254 82,242 28,052 19,810 24,072 14,713 0 0 0 3,687 0 0 0 0 -13 0 0 0

46,080 55,230 27,101 19,221 1,245 4,585 2,998 1,903 2,909 0 1,342 1,236 2,121 0 0 0 0 157 0 0 0

5,925 2,427 2,677 534 0 0 1 0 0 0 0 15,671 0 13,682 0 0 0 0 0 0 0 40,916 36,579 11.9 0 0 40,916 36,579 11.9

18,767 16,826 10,455 5,931 537 698 1,641 1,418 909 0 0 0 861 0 0 0 0 0 0 0 0 58,042 52,925 9.7 6,749 0 64,791 59,098 9.6

18,726 17,378 8,968 5,287 424 85 517 65 536 0 0 0 0 0 0 696 0 244 0 0 0 52,926 53,892 -1.8 2,042 0 54,967 55,885 -1.6

1,188 260 33,890 42 21,862 0 4 95 3 0 0 0 19 0 2,536 0 0 0 1,020 0 0 60,918 59,350 2.6 1,972 0 62,890 63,566 -1.1

13,293 35,118 11,324 336 25 0 0 30 134 0 21 0 1,674 0 27 0 0 42 0 37 0 62,062 64,697 -4.1 0 0 62,062 64,697 -4.1

94.1 3,216,184 94.3 3,139,130 2.5 5.6 0.3 192,390 9,263

709,213 166,129 690,276 159,918 2.7 3.9 0 3,010 7,722 0

100.0 3,417,837 100.0 3,329,375 2.7

328,986 630,508 302,204 606,726 8.9 3.9

712,223 173,850 693,360 166,676 2.7 4.3

Annex 2 Federation of Finnish Financial Services

Non-life insurers' financial ratios for 2010


Turnover 000 If P & C Insurance Company Ltd Pohjola Insurance Ltd Tapiola General Mutual Insurance Company Fennia Mutual Insurance Company Local Insurance Mutual Company A-Insurance Ltd Pohjanthti Mutual Insurance Company Turva Mutual Insurance Company Aktia Non-Life Insurance Company Ltd Eurooppalainen Insurance Company Ltd Frskringsaktiebolaget Alandia Aaland Mutual Insurance Company Osuuspankkien Keskininen Vakuutusyhti Garantia Insurance Company Ltd. Redarnas msesidiga Frskringsbolag Spruce Insurance Ltd. Valion Keskininen Vakuutusyhti IngoNord Insurance Company Ltd. Keskininen Vakuutusyhti Palonvara Alma Insurance Company Ltd Bothnia International Insurance Company Ltd Finnish total/average Local mutual insurance associations If P&C Insurance Ltd (publ), branch in Finland Total/average 954,381 988,505 803,778 395,211 180,389 109,161 89,117 81,263 73,840 42,260 36,873 32,023 35,874 16,828 21,745 2,901 2,842 2,563 1,403 317 974 3,872,248 203,810 4,076,058 Loss ratio % 79.6 77.2 88.8 87.0 81.0 88.5 71.5 77.6 82.6 65.5 73.4 93.9 21.7 18.7 129.8 38.5 82.7 71.0 74.2 516.2 81.2 77.6 76.2 81.0 Expense ratio % 16.4 20.4 26.2 23.2 17.2 15.6 23.3 23.8 24.7 19.7 20.5 24.3 22.9 27.8 1.9 37.6 41.5 181.0 11.2 256.8 20.9 29.6 15.0 21.3 Combined ratio % 96.0 97.7 115.0 110.2 98.1 104.1 94.7 101.4 107.3 85.1 93.9 118.2 44.6 46.6 131.7 76.1 124.2 252.0 85.5 773.0 102.1 107.2 91.2 102.3 Operating profit 000 146,457 160,717 7,221 38,623 33,354 16,022 9,978 5,209 4,144 7,106 7,495 4,330 28,242 10,143 6,604 323 580 -624 392 12 1,446 487,774 3,232 491,006 Operating margin % 15.3 16.3 0.9 9.8 18.5 14.7 11.2 6.4 5.6 16.8 20.3 13.5 78.7 60.3 30.4 11.1 20.4 -24.3 27.9 3.8 148.5 12.6 1.6 20.0

Annex 3 Federation of Finnish Financial Services

Non-life insurers' profit and loss account for 2010, '000


Change in provision for joint guarantee system Change in accelerated depreciation and optional provisions

Premiums earned

Claims incurred

Operating expenses

Change in equalisation provision

Net Other investment income and income expenses

Indirect taxes

Profit/Loss for the year

If P & C Insurance Company Ltd Pohjola Insurance Ltd Tapiola General Mutual Insurance Company Fennia Mutual Insurance Company Local Insurance Mutual Company A-Insurance Ltd Pohjanthti Mutual Insurance Company Aktia Non-Life Insurance Company Ltd Turva Mutual Insurance Company Eurooppalainen Insurance Company Ltd Aaland Mutual Insurance Company Osuuspankkien Keskininen Vakuutusyhti Frskringsaktiebolaget Alandia Garantia Insurance Company Ltd. Redarnas msesidiga Frskringsbolag Valion Keskininen Vakuutusyhti Keskininen Vakuutusyhti Palonvara IngoNord Insurance Company Ltd. Spruce Insurance Ltd. Alma Insurance Company Ltd Bothnia International Insurance Company Ltd Total non-life

818,324 794,949 655,954 324,206 148,398 89,489 75,840 60,609 44,068 40,993 18,660 17,104 16,949 11,059 5,196 1,415 908 652 431 37 0 3,125,241

-651,127 -614,000 -582,532 -282,126 -120,134 -79,189 -54,199 -50,091 -34,201 -26,832 -17,530 -3,708 -12,446 -2,072 -6,743 -1,170 -674 -463 -166 -191 736 -2,538,858

17,486 11,868 8,378 6,160 2,196 3,176 -32 496 863 0 382 0 0 0 -8 -7 0 0 0 0 0 50,958

-134,330 -162,519 -171,903 -75,149 -25,480 -13,934 -17,633 -14,958 -10,479 -8,059 -4,535 -3,924 -3,473 -3,078 -98 -587 -102 -1,180 -162 -95 -264 -651,942

-18,477 -10,702 25,305 -491 -2,040 3,504 -1,533 -2,541 -1,575 435 656 -6,111 -3,982 -6,359 314 -820 0 34 -153 0 634 -23,902

96,057 130,442 98,944 65,757 28,374 17,827 6,002 8,088 4,787 1,004 6,853 18,770 6,317 4,234 8,198 929 260 359 220 231 974 504,627

47 -23 -1,620 -225 0 -1,347 0 0 171 0 500 0 148 0 59 0 0 8 0 30 0 -2,252

-33,480 -38,407 -7,976 -9,727 -7,902 -5,002 -1,970 4 -950 -1,971 -1,164 -5,675 -732 -978 -1,774 -1 -99 0 -44 0 -544 -118,392

779 3,184 47 74 0 -21 -16 76 9 40 10 -331 -21 0 65 0 0 0 0 0 0 3,895

95,279 114,792 24,597 28,479 23,412 14,503 6,459 1,683 2,693 5,610 3,832 16,125 2,760 2,806 5,209 -241 293 -590 126 12 1,536 349,375

Annex 4 Federation of Finnish Financial Services

Finnish non-life insurers' balance sheet for 2010, '000


ASSETS L IABILITIES

Intangible assets Investments

Total debtors

Other assets

Prepayments and accrued income

Total assets

Capital and reserves

Untaxed reserves

S bordinated debt

Technical provisions

Total creditors

Accruals and deferred income

Total liabilities

If P & C Insurance Company Ltd Pohjola Insurance Ltd Tapiola General Mutual Insurance Company Fennia Mutual Insurance Company Local Insurance Mutual Company Osuuspankkien Keskininen Vakuutusyhti A-Insurance Ltd Turva Mutual Insurance Company Pohjanthti Mutual Insurance Company Aktia Non-Life Insurance Company Ltd Aaland Mutual Insurance Company Garantia Insurance Company Ltd. Redarnas msesidiga Frskringsbolag Frskringsaktiebolaget Alandia Eurooppalainen Insurance Company Ltd Bothnia International Insurance Company Ltd Valion Keskininen Vakuutusyhti Spruce Insurance Ltd. IngoNord Insurance Company Ltd. Alma Insurance Company Ltd Keskininen Vakuutusyhti Palonvara Total non-life

1,818 31,795 37,963 25,209 3,290 1,422 1,338 4,783 3,273 1,090 1 993 117 14 0 0 5 0 0 0 28

2,875,189 2,464,787 2,447,800 1,133,327 535,064 353,217 268,344 125,168 121,050 129,201 111,024 89,492 82,272 43,760 35,832 22,296 18,045 9,735 7,264 8,675 3,161

229,606 268,136 173,870 87,944 43,728 4,837 26,154 18,133 18,222 12,208 7,903 3,205 2,647 8,170 7,971 236 271 0 1,459 165 526

30,095 15,102 75,775 54,676 24,382 5,973 148 3,690 7,570 3,866 6,106 1,593 6,296 9,653 54 200 277 21 101 94 1,366

97,884 40,503 33,351 15,695 5,029 2,021 5,333 1,802 829 2,369 746 1,348 876 1,261 1,084 150 199 40 871 1 4

3,234,592 2,820,323 2,768,759 1,316,851 611,493 367,470 301,317 153,576 150,944 148,734 125,780 96,631 92,208 62,858 44,941 22,882 18,797 9,796 9,695 8,935 5,085

268,355 233,121 609,808 194,820 117,972 74,306 40,155 27,318 25,131 5,497 46,000 26,756 40,999 10,066 14,525 5,425 3,136 6,016 5,103 3,919 3,232 1,761,660

2,819 3,559 5,482 2,149 0 331 1,859 267 16 1,887 0 0 640 332 0 0 7 0 0 0 0 19,348

65,000 50,000 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 700

2,781,799 2,313,277 2,074,477 1,048,050 475,638 291,705 241,275 118,509 116,510 134,558 75,779 67,594 44,920 47,527 29,398 14,997 15,132 3,755 2,938 3,277 463

49,160 170,109 42,908 44,540 12,030 229 16,937 5,665 6,175 4,178 565 1,354 2,735 2,678 811 2,235 406 25 909 1,677 632 365,958

67,459 50,257 36,084 27,292 5,853 899 1,091 1,817 3,112 2,614 3,436 927 2,914 2,255 207 225 116 0 745 62 58

3,234,592 2,820,323 2,768,759 1,316,851 611,493 367,470 301,317 153,576 150,944 148,734 125,780 96,631 92,208 62,858 44,941 22,882 18,797 9,796 9,695 8,935 5,085

113,139 10,884,703

915,391 247,038

211,396 12,371,667

115,700 9,901,578

207,423 12,371,667

Annex 5 Federation of Finnish Financial Services

Life insurers' gross premiums written in Finland in 2010, '000


Personal life unit linked OP Life Assurance Company Ltd Nordea Life Assurance Finland Ltd Mandatum Life Insurance Company Limited Tapiola Mutual Life Assurance Company Aktia Life Insurance Ltd. Suomi Mutual Life Assurance Company Fennia Life Insurance Company Ltd Kaleva Mutual Insurance Company Duo Life Insurance Company Ltd Frskringsaktiebolaget Liv-Alandia Retro Life Assurance Company Ltd. Finnish total 2010 Finnish total 2009 Growth, % Skandia Life Assurance Co Ltd, Fb SHB Liv Forsikringsaktieselskab, fiF Grand total 2010 Grand total 2009 Growth, % 411,222 188,256 196,832 51,126 48,726 0 11,682 0 13,521 160 0 921,525 584,602 57.6 59,772 27,242 1,008,539 659,563 52.9 Capital redemption policies 531,495 636,958 455,016 18,605 303 0 3,436 0 490 0 0 1,646,303 713,923 130.6 0 0 1,646,303 713,923 130.6 Empoyees group life 11,303 0 11,973 7,086 414 0 4,320 614 752 367 0 36,829 41,093 -10.4 0 0 36,829 41,093 -10.4 Other group life 1,934 37,824 4,800 24,814 10,242 0 3,898 19,653 0 850 0 104,015 95,941 8.4 0 0 104,015 95,941 8.4 Personal pension unit linked 90,814 101,759 92,811 41,030 9,975 0 6,520 0 6,743 319 0 349,971 356,450 -1.8 125,446 4,650 480,067 497,056 -3.4 Other Group personal pension pension unit linked 50,177 40,125 33,808 31,738 12,123 25,620 9,808 0 994 595 10 204,998 246,345 -16.8 0 0 204,998 246,345 -16.8 5,760 5,050 41,803 4,051 1,140 0 3,382 0 50 0 0 61,236 49,705 23.2 0 0 61,236 49,705 23.2 Other group pension 612,708 4,665 168,741 30,196 4,407 19,483 9,240 0 0 463 0 849,903 264,903 220.8 0 107 850,010 264,903 220.9 Total premiums written 1,846,605 1,079,157 1,057,374 256,130 101,529 60,711 60,165 56,522 51,118 3,201 1,657 4,574,169 2,851,228 60.4 185,217 31,999 4,791,386 3,066,796 56.2 Market share, direct business % 38.6 22.5 22.0 5.3 2.1 1.3 1.3 1.2 1.1 0.1 0.0 95.5

Other life 131,049 64,520 49,205 47,440 14,164 15,567 7,862 36,168 28,568 447 0 394,990 493,516 -20.0 0 0 394,990 493,516 -20.0

Total direct business 1,846,462 1,079,157 1,054,989 256,086 101,494 60,670 60,148 56,435 51,118 3,201 10 4,569,770 2,846,477 60.5 185,217 31,999 4,786,987 3,062,045 56.3

Reinsurance 143 0 2,385 44 35 41 17 87 0 0 1,647 4,399 4,751 -7.4 0 0 4,399 4,751 -7.4

3.9 0.7 100.0

Annex 6 Federation of Finnish Financial Services

Finnish life insurers' profit and loss account for 2010, '000
Unrealised gains/ losses Change in provision for Claims unearned incurred premiums Other income and expenses Change in accelerated depreciation Indirect and optional taxes provisions

Premiums written

Investment income

Operating expenses

Investment expenses

Profit/Loss for the year

OP Life Assurance Company Ltd Nordea Life Assurance Finland Ltd Mandatum Life Insurance Company Limited Tapiola Mutual Life Assurance Company Aktia Life Insurance Ltd. Suomi Mutual Life Assurance Company Fennia Life Insurance Company Ltd Kaleva Mutual Insurance Company Duo Life Insurance Company Ltd Frskringsaktiebolaget Liv-Alandia Retro Life Assurance Company Ltd. Total life sector

1,818,619 1,677,964 1,097,211 255,252 101,012 60,634 59,637 56,288 51,036 4,782 1,188 5,183,623

620,883 440,701 796,562 200,054 37,069 986,675 68,136 135,174 8,204 7,109 4,165 3,304,732

296,991 672,788 258,010 59,773 32,881 20,342 29,299 0 5,524 1,332 0 1,376,940

-1,619,289 -830,698 -260,530 -89,266 -449,411 -58,848 -129,831 -11,865 -4,452 -4,852

-632,736 -671,575 -132,422 -57,243 173,292 -58,595 -11,607 -41,603 -5,618 1,307

-57,639 -35,510 -74,799 -37,782 -10,760 -14,631 -8,405 -7,151 -7,575 -585 -601 -255,438

-229,853 -144,809 -424,281 -81,408 -9,003 -667,920 -16,098 -47,388 -1,438 -1,570 -2,068 -1,625,836

2,781 0 -27 991 0 -4,498 0 -2 0 15 683 -57

-36,195 57 -39,386 2,596 -1,101 -300 -445 -42 -2 -35 3 -74,850

-18 0 188 174 0 -58 -27 127 6 23 0 415

163,544 127,618 111,205 6,698 3,589 104,125 14,654 -4,432 2,287 1,001 -175 530,114

-1,033,163 -1,450,410

-4,492,205 -2,887,210

Finnish life insurers' balance sheet for 2010, '000


ASSETS Covering unit-linked business Prepayments Other and accrued assets income LIABILITIES Technical provisions for Technical unit-linked provisions business Accruals and deferred income

Intangible assets

Investments

Total debtors

Total assets

Capital and reserves

Untaxed Subordinated reserves debt

Total creditors

Total liabilities

Nordea Life Assurance Finland Ltd Mandatum Life Insurance Company Limited OP Life Assurance Company Ltd Suomi Mutual Life Assurance Company Tapiola Mutual Life Assurance Company Kaleva Mutual Insurance Company Aktia Life Insurance Ltd. Fennia Life Insurance Company Ltd Duo Life Insurance Company Ltd Frskringsaktiebolaget Liv-Alandia Retro Life Assurance Company Ltd. Total life sector

161 11,025 27,148 899 15,187 428 1,813 3,842 2,087 6 0 62,596

4,795,434 5,221,981 4,418,395 5,755,438 2,385,499 1,136,933 655,023 579,454 106,679 47,981 28,186 25,131,003

5,930,269 3,041,813 3,147,450 0 637,359 0 279,964 300,154 84,954 5,229 0 13,427,192

14,580 42,369 214,692 83,195 3,535 3,137 1,055 8,639 0 725 2,216 374,143

53,714 86,311 67,189 45,068 51,269 11,881 7,274 15,950 488 2,149 278 341,571

69,421 10,863,579 72,721 23,794 34,301 37,377 14,236 14,635 7,046 1,092 610 449 8,476,220 7,898,668 5,918,901 3,130,226 1,166,615 959,764 915,085 195,300 56,700 31,129

241,868 565,892 529,156 802,799 151,084 188,918 73,415 72,805 24,955 7,358 4,417 2,662,667

0 3,387 18 239 3,240 1,919 0 90 10 142 0 9,045

70,000 100,000 90,830 0 55,000 0 2,100 0 0 0 0 317,930

4,552,436 4,397,252 4,015,601 5,008,693 2,272,416 938,342 595,141 534,296 83,214 44,094 25,782 22,467,267

5,927,413 3,138,586 0 621,266 0 283,031 301,595 84,954 4,746 0 13,400,696

38,762 103,600 31,968 17,364 36,485 1,765 4,616 16 23 748 535,478

33,100 70,453 20,877 75,202 9,856 951 4,312 1,683 2,151 337 182 219,104

10,863,579 8,476,220 7,898,668 5,918,901 3,130,226 1,166,615 959,764 915,085 195,300 56,700 31,129 39,612,187

3,039,105 300,131

275,682 39,612,187

Federation of Finnish Financial Services

Annex 7

Pension insurers' gross premiums written in 2010, '000


Employee pension Varma Mutual Pension Insurance Company Ilmarinen Mutual Pension Insurance Company Tapiola Mutual Pension Insurance Company Mutual Insurance Company Pension-Fennia Etera Mutual Pension Insurance Company Veritas Pension Insurance Company Ltd Frskringsaktiebolaget Pensions-Alandia Total pension premiums Pension premiums 2009 Growth, % 3,586,700 3,152,001 1,248,518 990,058 558,624 331,134 29,285 9,896,320 9,289,053 6.5 Self-employed persons pension 148,500 231,190 177,197 136,189 10,982 49,231 3,093 756,382 717,233 5.5 Total direct business Reinsurance 3,735,200 3,383,191 1,425,715 1,126,247 569,606 380,365 32,378 10,652,702 10,006,286 6.5 0 24 0 0 0 0 0 24 132 -81.8 Total premiums written 3,735,200 3,383,215 1,425,715 1,126,247 569,606 380,365 32,378 10,652,726 10,006,418 6.5 Market share 2010 % 35.1 31.8 13.4 10.6 5.3 3.6 0.3 100.0

Pension insurers' profit and loss account for 2010, '000


Change in provision for unearned premiums 243,700 -112,156 -76,964 -142,015 -55,686 -78,583 -9,895 -231,599 Other income and expenses 0 -666 -240 3 0 0 0 -903 Change in accelerated depreciation and optional provisions 0 5,427 0 -50 -26 9 49 5,409

Premiums written Varma Mutual Pension Insurance Company Ilmarinen Mutual Pension Insurance Company Tapiola Mutual Pension Insurance Company Mutual Insurance Company Pension-Fennia Etera Mutual Pension Insurance Company Veritas Pension Insurance Company Ltd Frskringsaktiebolaget Pensions-Alandia Total pension 3,735,200 3,383,215 1,425,715 1,126,247 569,605 380,366 32,378 10,652,726

Investment income 4,278,500 5,174,526 764,391 699,882 653,235 210,378 19,217 11,800,129

Claims incurred -5,024,200 -4,392,300 -1,699,433 -1,335,840 -758,325 -422,123 -37,097 -13,669,318

Operating expenses -82,900 -75,872 -47,987 -31,364 -27,064 -13,216 -1,326 -279,729

Investment expenses -3,141,100 -3,975,412 -362,178 -315,557 -371,441 -75,736 -3,286 -8,244,710

Indirect taxes -4,900 -1,819 -1,167 0 -8,629 -76 0 -16,591

Profit/Loss for the year 4,300 4,943 2,137 1,306 1,669 1,019 40 15,414

Pension insurers' balance sheet for 2010, '000


ASSETS Intangible assets Varma Mutual Pension Insurance Company Ilmarinen Mutual Pension Insurance Company Tapiola Mutual Pension Insurance Company Mutual Insurance Company Pension-Fennia Etera Mutual Pension Insurance Company Veritas Pension Insurance Company Ltd Frskringsaktiebolaget Pensions-Alandia Total pension 37,100 8,647 10,557 99 3,087 1,868 6 61,364 Total debtors 692,900 1,920,287 61,815 232,647 164,031 45,420 5,210 3,122,310 Other assets 312,600 285,828 10,692 21,958 171,816 14,428 6,179 823,501 Prepayments and accrued income 142,300 228,950 223,337 47,766 27,270 31,025 3,665 704,313 Total assets 29,814,900 27,294,266 8,328,307 6,298,822 5,347,201 1,930,252 205,960 79,219,708 LIABILITIES Capital and reserves 89,400 102,857 55,559 33,904 43,359 20,647 834 346,560 Untaxed reserves 0 2,405 9 154 49 1,855 0 4,472 Technical provisions 29,088,800 24,657,376 8,219,075 6,200,650 5,163,192 1,882,725 199,627 75,411,445 Total creditors 608,900 2,122,744 26,816 30,512 102,400 15,300 3,994 2,910,666 Accruals and deferred income 27,800 408,884 26,848 33,602 38,201 9,725 1,505 546,565 Total liabilities 29,814,900 27,294,266 8,328,307 6,298,822 5,347,201 1,930,252 205,960 79,219,708

Investments 28,630,000 24,850,554 8,021,906 5,996,352 4,980,997 1,837,511 190,900 74,508,220

Federation of Finnish Financial Services


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