Skandia’s market position in Sweden

On 20 May the Swedish Insurance Federation will publish the industry’s quarterly statistics for the first quarter of 2005. These statistics also include information about Skandia’s sales development. Consequently, Skandia is today releasing sales information for the first quarter of 2005. Skandia’s sales in the Swedish market were stable during the first quarter. The fee reduction for unit linked assurance that was carried out in November has not had any effect on new sales during the first quarter mainly since new sales were weaker during the first two months. However, March and April shows a positive trend within unit linked assurance. Sales during the first quarter Combined sales (excluding Skandia Liv) increased by 4% compared with the same quarter a year ago and amounted to SEK 4.0 billion (3.9). Unit linked assurance Sales of unit linked insurance amounted to SEK 2.7 billion in the first quarter, which is 4% higher than in the same period last year. Accumulated new sales for the first quarter amounted to SEK 0.5 billion which is 9% lower than in 2004. Compared with the fourth quarter of 2004, on the other hand, new sales increased by 4%. Skandia Liv Sales within Skandia Liv for the first quarter of 2005 amounted to SEK 3.0 billion compared with SEK 3.1 billion in the same quarter of 2004. New sales for the first quarter amounted to SEK 0.6 billion, which is 7% higher than in 2004. Healthcare & Group Insurance Within the Healthcare & Group Insurance business area premiums written amounted to SEK 0.2 billion, which corresponds to an increase of 13% compared with 2004. The portfolio totalled 123,000 insured at the end of the first quarter of 2005. This makes Skandia market leader in the Nordic region within private healthcare insurance. SkandiaBanken SkandiaBanken’s lending increased by 4% to SEK 36.5 billion. Deposits increased by 5% to SEK 42.6 billion. The number of customers increased by 17,000 to 858,000 during the first quarter. Preliminary market shares Skandia’s market share of the life assurance market on a moving 12-month basis is estimated at 19.0% at the end of the first quarter compared with 19.6% in the previous quarter. For Skandia Unit Linked Assurance, the market share was 17.3% in the first quarter of 2005 compared with 18.0% in the previous quarter. The corresponding market share for Skandia Liv in the traditional life segment amounted to 21.0% compared with 21,6% in the previous quarter. Skandia’s quarter-on-quarter market share of the life assurance market is 14.4% for the first quarter of 2005 compared with 16.1% in the first quarter of 2004. The market share for Unit Linked Assurance amounts to 14.3% for the first quarter of 2005 compared with 16.6% for the same period last year. During the first quarter the market scenario is affected by so-called tick-the-box products where Skandia both historically and today holds a lower market share. During the first quarter the market was also affected by changed legislation relating to inheritance and gift tax and the introduction of the new Kapitalpension savings product. This has contributed to a degree of redistribution within the total savings market and consequently led to some shift in market shares. Skandia does not, to the same extent, have the same possibilities as other market players to carry out transfers between different savings forms. New market offerings and competitive situation The market has shown considerable interest in the new savings product Kapitalpension. Total new sales for the first quarter amounted to SEK 0.5 billion (including insurance registered outside Sweden). New sales of this product also give rise within Skandia to a redistribution from existing contracts which is indicated by an increased proportion of repurchases among private customers. This effect is expected to continue during the remainder of 2005 and then decline in coming years. Skandia established a strong position in the market for risk insurance during the first quarter. In Sweden’s largest-ever pension procurement process, UIG II, Skandia was chosen as sole supplier of disability insurance. Within the Private Healthcare and Group insurance product area there was considerable market interest in the rehabilitation insurance Skandia Health which is expected to have a positive impact on sales in the latter part of 2005. Customer surveys The results of Skandia’s customer surveys during the first quarter show a significant improvement among Skandia’s private customers. A total of 60% of customers (life and unit linked assurance and occupational pension customers) rated Skandia as very good or fairly good as an overall assessment. The corresponding figure for the fourth quarter of 2004 was 51%. Customer satisfaction among Skandia’s corporate customers amounted to 62% compared with 68% at the previous survey. During the first survey, performed in June 2004, the customer satisfaction was 52%. For further information, please contact: Harry Vos, Head of Investor Relations, Skandia, tel. +46 8 788 36 43 Gunilla Svensson, Head of Public Relations, Skandia, tel. +46 8 788 42 97 SALES Unit Linked assurance Mutual Funds Other 1) Total 2005 2004 2005 2004 2005 2004 2005 2004 SEK billion 3 mos. 3 mos. 3 mos. 3 mos. 3 mos. 3 mos. 3 mos. 3 mos. Sweden 2.7 2.6 1.1 1.1 0.2 0.2 4.0 3.9 1) Includes Life and Other Business. NEW SALES UNIT LINKED ASSURANCE Total annualised Single premium Annual premium 1) new sales 2) 2005 2004 2005 2004 2005 2004 SEK billion 3 mos. 3 mos. 3 mos. 3 mos. 3 mos. 3 mos. Sweden 0.9 0.7 0.4 0.4 0.5 0.5 1) Periodic premiums recalculated to full-year figures. 2) Single and regular premiums from unit linked contracts written during the period. According to industry practice, new sales are defined as regular premiums recalculated to full-year figures plus 1/10 of single premiums during the period.