LRF and Länsförsäkringar intensify cooperation

Länsförsäkringar and Lantbrukarnas Riksförbund, LRF (Federation of Swedish Farmers) today signed an agreement covering increased cooperation. Under the agreement, Länsförsäkringar is acquiring LRF’s individual insurances and concept brand for SEK 400 M. All related personnel are included. Concurrently, LRF is guaranteed continued insight and the possibility to influence its own members’ insurance.

“The cooperation aims to increased benefit for LRF’s members in the agricultural market, while at the same time Länsförsäkringar’s customer offering is strengthened in this customer group,” says Tommy Persson, President of Länsförsäkringar AB. “The acquisition is part of Länsförsäkringar’s ongoing growth strategy. As part of this strategy, Länsförsäkringar will also offer LRF’s members customized banking services.”

“Combined, LRF and Länsförsäkringar have excellent knowledge of the driving forces on the market as well as the business farmers’ conditions and needs and, consequently, can jointly create favorable solutions, concepts and offerings adapted to LRF’s members. Accordingly, the agreement means that LRF’s membership benefits can be developed further,” says Karl-Gunnar Burman, President of LRF.

In cooperation with LRF, Länsförsäkringar will launch a new product in 2008 for farming, forestry and rural entrepreneurs with expanded insurance possibilities for new operations and with extended investment protection. In addition, Länsförsäkringar will develop a product package with banking services for LRF’s members.

“Being able to offer LRF members favorable insurance is important since insurance is an important membership benefit. LRF’s Basic Insurance will also continue to be financed by LRF,” says Karl-Gunnar Burman.

The terms, conditions and premiums for the insurance policies signed with LRF Insurance will remain unchanged during 2008. The only exception is LRF's Children’s Insurance policies, for which LRF Insurance previously decided on a necessary adjustment.

“The employees at LRF Insurance will be offered employment within Länsförsäkringar. Most are being offered employment within the Non-Life Division, Länsförsäkringar AB, primarily in the Health business area, and others will be offered employment in some of the 24 regional insurance companies. However, LRF will retain a number of key personnel to maintain a continued high level of expertise in the insurance field. The transaction will not result in any redundancies,” says Tommy Persson.

The agreement is contingent upon receipt of the required approvals from authorities.

For further information, contact:
Karl-Gunnar Burman, President Lantbrukarnas Riksförbund (LRF), +46 (0)70-544 54 96
Johan Taubert, Press Secretary, Lantbrukarnas Riksförbund (LRF), +46 (0)70-543 25 89
Tommy Persson, President Länsförsäkringar AB, +46 (0)8-588 40 000
Christer Baldhagen, Senior Vice President Corporate Communications, Länsförsäkringar AB. +46 (0)70-579 70 66


Market facts:

• Currently, about 30 percent of about 190,000 agriculture customers with non-life insurance at Länsförsäkringar also have life assurance or pension insurance at Länsförsäkringar. About 45,000 bank customers at Länsförsäkringar are also farmers.
• LRF and Länsförsäkringar have most of Sweden’s farmers and forest owners as customers and, consequently, as owners. The agreement between LRF and Länsförsäkringar means that insurance operations are combined into one location.
• Premium income for the acquired business amounts to about SEK 250 M annually, which means that Länsförsäkringar’s health business increases by 35 percent. For formal reasons, the takeover is expected to occur in the first quarter of 2008.
• The insurance business being acquired by Länsförsäkringar comprises individual and group insurance within life, medical and accident risks for LRF Insurance’s approximately 205,000 customers. Customers are mainly LRF’s about 165,000 members, but also others with farming or forestry connections.
• Länsförsäkringar’s share of the agriculture and forestry market is currently limited mainly to non-life insurance, with about 75 percent of all agriculture and forestry as customers. Total insurance premiums in the agriculture market are estimated at about SEK 3 billion, and Länsförsäkringar’s premium income amounts to approximately SEK 2.4 billion.

The insurance business being acquired by Länsförsäkringar
The insurance business being acquired by Länsförsäkringar comprises individual and group insurance within life, medical and accident risks for LRF Insurance’s approximately 205,000 customers. Customers are mainly LRF’s about 165,000 members, but also others with farming or forestry connections. TFA insurance, compensation insurance in the event of occupational injuries as well as the company business conducted within LRF insurance is not included in the acquisition.

Key figures 2006
Premium income, SEK M 251
No. of insurance policies 685,000
No. of insurance customers 205,000