Länsförsäkringar Alliance: 2011 Annual Review

Sten Dunér, President of Länsförsäkringar AB, the Alliance’s jointly owned company:

“The combined ratio for non-life insurance has improved to 100% and work is continuing to achieve a lower level. Both earnings and solvency were impacted by negative investment income in 2011, but the start of 2012 has been significantly more positive and the Alliance has regained most of what it lost.
Länsförsäkringar stands strong in times of uncertainty. In such times, our brand is perceived as reliable and stable, which, for example, can be seen in our growth in the banking operations. Growth is following our plans and profitability remains stable. In 2011, almost 10% of new sales were in the retail sector in both savings and loans. Confidence in Länsförsäkringar as a bank was significantly bolstered over the past year, as proven by having the most satisfied customers and receiving the award of Bank of the Year.
We succeeded in restructuring the life-assurance operations and the sale of the unit-linked life assurance company to Länsförsäkringar AB. We have thereby laid the foundation for the clear future focus on offering unit-linked insurance solutions to companies and private individuals”.

The Year in brief:

• The technical result from non-life insurance rose to SEK 802 M (511), primarily due to healthy growth and lower claims ratio, although claims costs remain at a high level. The combined ratio improved to 100% (102).
• The Länsförsäkringar Alliance maintained a strong level of solvency in non-life insurance. Solvency capital totalled SEK 32,754 M (34,724) and the solvency margin amounted to 172% (190). The decline was due to the negative impact on investment income in most regional insurance companies during the year.
• In the autumn, Länsförsäkringar AB acquired the unit-linked insurance company Fondliv from Länsförsäkringar Liv, which was a key step in the focus on the occupational pension market and to further strengthen the unit-linked insurance offering. Profit for Länsförsäkringar Fondliv amounted to SEK 297 M (132).
• Low interest rates have led to changes in the long-term conditions for offering traditional guarantee products with high guarantee commitments. As a result, underwriting new insurance policies under traditional management was discontinued in September.
• The banking operations’ operating profit strengthened to SEK 385 M (345) due to an increase of SEK 1,728 M (1,363) in net interest income. Business volumes rose to SEK 251 billion (232). Länsförsäkringar was named Bank of the Year 2011.

Figures in parentheses pertain to 2010.

The full report is available attached.
 

For further information please contact:

Sten Dunér, President of Länsförsäkringar AB
Phone: +46 8 588 411 15

Malin Rylander Leijon, CFO Länsförsäkringar AB
Phone: +46 8 588 408 64

Christer Baldhagen, Director of Corporate Communications Länsförsäkringar AB
Phone: +46 8-588 415 01