LocalTapiola Life’s result was good despite the coronavirus pandemic
17.2.2021 - Economy
Operating profit stood at EUR 52 million and total result was EUR 46 million. The decline in total result was due to investment income being poorer than the previous year.
Comments by LocalTapiola Life Managing Director Minna Kohmo:
The global coronavirus (COVID-19) pandemic, resulting in a decrease in interest rate levels and investment market volatility, had an accentuated impact on life insurance companies and pension insurance companies. The coronavirus pandemic also dominated the development of LocalTapiola Life’s business in 2020.
The coronavirus pandemic sensitised our customers to think about their own security and that of their loved ones, which was evident in increased online sales and a reduced number of leaving customers. The demand for savings products weakened in early 2020, but the level of surrenders remained moderate. We are extremely pleased that our customers’ trust in Life has stayed strong over the exceptional year.
The risk life insurance claims and pensions paid out and payouts on savings have supported our customers in a difficult financial environment. LocalTapiola Life paid out EUR 392 million in claims and EUR 57 million in returns on insurance savings to its customers. Of these, EUR 8 million were customer bonuses.
The company’s operating profit developed well despite the coronavirus pandemic. Operating profit stood at EUR 52 million and total result was EUR 46 million. The decline in total result was due to investment income being poorer than the previous year. Investment income at fair value was 2.2 per cent, or EUR 72 million. The result for risk premiums collected was good at EUR 33 million and total expense loadings increased by 2.3 per cent to EUR 56 million. With a decrease in interest rate levels, a new interest rate supplement of EUR 36 million was made.
The good development of premiums written continued in risk life insurance and in group pension insurance. In risk life insurance, premiums written grew by 4.4 per cent, and in group pension it grew by 6.0 per cent. In savings, premiums written decreased by 29.6 per cent in comparable terms. Total premiums written decreased with the development of premiums written in savings by 16.8 per cent in comparable terms and ended up at EUR 434 million.
The company’s good solvency position has played an important role during the coronavirus pandemic. In recent years, preparations have been made for investment market volatility by strengthening the company’s solvency, which has indeed remained at a good level during the pandemic. Life’s own funds total 1.84 times the Solvency Capital Requirement. Without the transitional provisions of solvency calculation, Life’s own funds total 1.49 times the Solvency Capital Requirement.
LocalTapiola Life’s goal is to be a pioneer in customer experience in personal insurance – in all channels. In 2020, we expanded the range of products sold online and streamlined and expedited purchasing processes. The development work of our digital services continues in 2021. To support this goal, we have started preparations for a core system reform.
"The global coronavirus (COVID-19) pandemic, resulting in a decrease in interest rate levels and investment market volatility, had an accentuated impact on life insurance companies and pension insurance companies. "
17.2.2021 | Economy
LocalTapiola Group’s total result was EUR 245.9 million. The positive total result was influenced by investment income and the strong result of the insurance business.
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