Folksamgruppen’s total premium volume during the second quarter of 2023 amounted to just over SEK 39 billion, which is slightly less than the previous year. At the same time, Folksamgruppen’s managed capital and unit-linked insurance assets increased to SEK 795 billion, an increase of SEK 79 billion or 11 percent compared to mid-year 2022. Both rising stock prices and positive net premium flows have contributed to the development.
Within the Folksam Liv group, premiums are slightly down compared to the corresponding period last year, even though premiums within collectively agreed business are increasing. The reduced premiums in individual business are mainly explained by a challenging environment for savings with a lower cash-back rate than the previous year, and high inflation that has reduced customers’ savings space. Even if the reimbursement rate in Folksam Life and Folksam Tjänstepension is lower than in the previous year, the current level, 5 percent, can be considered very competitive.
– The financial and earnings development during the second quarter has been stable given challenging external factors, such as inflation. At the turn of the year, Folksamgruppen’s companies continue to show a strong financial position in line with the previous quarter, says Ylva Wessén, president and CEO of Folksamgruppen.
The return on capital during the first half of the year has been good and driven by strong development on the stock exchanges. The stock market’s development is also an important explanation for the good solvency development during the quarter. In the parent company Folksam Liv, the solvency ratio at the end of the first half of the year is 191 percent, in Folksam Employment Insurance to 216 percent and KPA Employment Insurance to 239 percent.
Premium growth in the Folksam Sak group amounts to 2 percent compared to the corresponding period last year. It is primarily premium adjustments that explain the increase. The premium adjustments have, by conscious choice, been lower than what was required to fully compensate for the impact of inflation on claim costs. This has resulted in a higher total cost percentage compared to the same period last year, but lower than the previous quarter.
At the turn of the year, the degree of consolidation in the parent company Folksam Sak amounts to 182 percent. The good return on capital during the period contributes to the continued very strong financial position.
The total return amounted to:
- Folksam Employment Pension 5.1 (-) percent
- KPA Occupational pension insurance 4.9 (-10.3) percent
- Folksam Liv 4.1 (-8.9) percent
- Folksam Sak to 2.1 (-4.5) percent.
During the quarter, Folksamgruppen also broke new ground in the area of road safety.
– Folksamgruppen’s sustainability work is important to us and our ambitions are high. Through our size and operations, we have the opportunity to be a positive force for both our customers and society at large. Therefore, during the quarter we invested one billion kroner in a road safety bond. The bond is the first of its kind and has been produced in a collaboration between Folksamgruppen and the World Bank. We were the only investor this time, but the need for capital is great and more private investors are needed, concludes Ylva Wessén.
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