Interim Q1 2021: Growing real estate business and financially record-breaking life business
10 May 2021
During the first quarter of 2021, the Folksam Group passed several important milestones with more than SEK 500 billion in assets under management and more than SEK 200 billion in unit-linked insurance assets, a total of more than SEK 700 billion. Folksam Sak’s assets under management grew to more than SEK 50 billion and consolidation capital to just over SEK 25 billion.
– Our customers continue to be satisfied and the business grew strongly during the quarter, while the life business showed a financial strength with a record-breaking solvency ratio. The good return on capital has had a positive effect on the return to our customers. In the life business, the bonus rate is now higher than before the pandemic and the customers in Folksam Sak will receive a record-breaking bonus starting this May, says Ylva Wessén, President and CEO.
The total return, which was primarily driven by a strong stock market development, was good during the first quarter and amounted to 4.2 percent in Folksam Liv, 2.0 percent in Folksam Sak and 4.6 percent in KPA Pension. During the quarter, Folksamgruppen decided on an interim target for 2025 for how the investment portfolios will reach net zero emissions of greenhouse gases by 2050. The interim target means that the climate footprint from equities, corporate bonds and real estate will be reduced by 29 percent.
Through increased activity, the life insurance business has reached a premium volume on a par with the previous year. Premiums amounted to SEK 20,517 million and the solvency ratio in Folksam Liv to a record 182 percent thanks to a strong balance sheet as a result of good market development and slightly higher long-term interest rates. Folksam Liv has been able to continue to raise the bonus rate during the spring as a result of its strong financial position.
The non-life insurance business developed strongly and premiums amounted to SEK 3,768 million, a growth of 4.3 percent compared with the previous year. The increase is visible in all branches except housing where the stock has increased, but where premium reductions have been made to compensate for low travel damage as a result of the pandemic. During the quarter, a new agreement was signed with Jaguar / Land Rover and agreements were extended with our partners Hyundai, Suzuki, Swedish Athletics and Swedish Parasport. The total cost percentage was 87 percent and the consolidation rate in Folksam Sak was 181 percent.
KPA Livförsäkring was transformed on March 1 into an occupational pension company and has thus also changed its name to KPA Tjänstepension AB. Work is underway to adapt further occupational pension activities within Folksam Liv to the new occupational pension regulations.
Source: Folksam
