LocalTapiola Life January–June 2020: Our customers' confidence in LocalTapiola Life's products has continued to grow even during the coronavirus epidemic
18.8.2020 - Economy
The coronavirus epidemic characterised the development of LocalTapiola Life's business operations in the first half of 2020. The pandemic prompted our customers to consider their own safety and that of their families, which was seen as increased online sales and changes in beneficiaries.
Furthermore, the uncertainty in the investment markets caused concern for our savings customers, and contacts increased.
Despite the concerns, LocalTapiola Life has remained a strong partner in lifelong security.
We continue to be the market leader in risk life insurance in Finland with a market share of over 30 per cent, and premiums written in risk life insurance continued to increase by 8% in the first half of the year. Premiums written in group pension insurance policies has also continued to grow despite the difficult market situation.
The result of LocalTapiola Life decreased in the period from January to June due to the coronavirus epidemic. The operating profit and total result have decreased compared to the previous year as a result of the decrease in investment income. Operating profit EUR -14 million (EUR 107 million) and the total result EUR -74 million (EUR 144 million).
Investment income at current value was -2.0% at the end of the second quarter, or EUR -65 million (4,3%, EUR 130 mil-lion). The result for risk premiums was good, EUR 14 million (EUR 16 million). Total expense loadings and bonus pay-ments increased by 4%.
Total premiums written decreased by 8 per cent to EUR 225 million (EUR 243 million) as a result of a decrease in savings premiums written.
LocalTapiola Life’s solvency and financial position have remained strong throughout the spring. LocalTapiola Life's own funds are 1.77-fold in relation to the solvency capital requirement. Without the transitional provisions used in solvency calculation, LocalTapiola Life's own funds are 1.40-fold in relation to the solvency capital requirement. Balance sheet at current value is EUR 5.5 billion.
Further information on the Group's solvency is provided in reports on LocalTapiola Group’s solvency and financial position from 2019.
Comments by Minna Kohmo, LocalTapiola Life's CEO:
The exceptional actions caused by the coronavirus epidemic characterised spring 2020. The epidemic prompted custom-ers to consider their own safety and that of their families, which was evident in the first half of the year as risk life insurance online sales nearly doubling. We will continue to develop our online services so that accessing services will in future be possible even more extensively and easily also from home.
The confidence of our savings customers also remained good throughout the corona crisis, which was evident as low surrender volumes, considering the situation. The confidence has been supported by our active care and communication, the significance of which increases when the situation in the investment market is uncertain.
According to a customer satisfaction survey conducted by Taloustutkimus, corporate customers consider LocalTapiola Life the best life insurance company. We are glad about the recognition and will continue our work to enhance the customer experience of our corporate customers.
The company's good solvency position has been in an important role during the coronavirus epidemic. Preparations have been made in the past few years for volatility in the investment market by strengthening the company's solvency, which has remained at a good level during the crisis.
The corona spring demonstrated that we are a trusted partner in the daily life, also in the more challenging moments of life. Customers wanted to safeguard their own lifelong security, and we were able to help and support them over the worst crisis. We are developing our operations further so that we can act as the best providers of lifelong security for our customers also in the future.
"The exceptional actions caused by the coronavirus epidemic characterised spring 2020. The epidemic prompted custom-ers to consider their own safety and that of their families, which was evident in the first half of the year as risk life insur-ance online sales nearly doubling."
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