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Strategy and Objectives

Sampo Group creates value for its shareholders through efficient and highly profitable operating units and by investments in situations offering significant upside potential with manageable downside risk

Shareholders benefit from the value creation through a high and stable dividend yield as Sampo plc upstreams the dividends it receives from its subsidiaries and associates to its shareholders.

Sampo Group's business areas are P&C insurance and life insurance. P&C insurance under If brand and Mandatum Life brand, respectively. The Group is also the largest shareholder in Nordea Bank, the leading Nordic banking franchise. On a Group level Sampo has no stated strategy but the business areas have well-defined strategies based on return on equity targets.

The parent company Sampo plc's A shares are listed on the Nasdaq Helsinki. The parent company sets financial targets for the subsidiaries. For both P&C and life insurance operations the return on equity target is to exceed 17.5 per cent. In addition a separate target has been set for the combined ratio in the P&C insurance operation, i.e. the annual combined ratio to be below 95 per cent each and every year.

Financial targets

If P&C Insurance – Security and Stability

If's vision is to offer insurance solutions that provide customers with security and stability in their daily lives and business operations with such excellence that If is the preferred insurance provider in the Nordic and Baltic markets. This vision is expressed through the customer promise "Relax, we'll help you".

If is the leading property and casualty insurer in the Nordic region, with over 3.7 million customers in the Nordic and Baltic countries. If offers a full range of P&C insurance solutions and services to a broad customer base, from private individuals to large corporate customers.

If operates on a pan-Nordic basis leveraging both scale and capabilities across all areas in If. If's key success factor is continuous improvement of its operations. Underwriting focus by understanding risk better than competitors, setting the right prices, and offer the best products and services, has been the strategic theme for more than a decade.

If's operations are divided into Nordic Business areas by customer segments. The Baltic countries constitute a separate business area and operates on one business platform across all three Baltic countries.

  • The Private business area is If's largest business area and the Nordic market leader with more than three million private individuals as customers.
  • The Commercial business area is the largest commercial insurer in the Nordic countries and accounts for nearly one third of If's insurance premiums. This business area insures companies with up to 500 employees and has about 350,000 companies as customers.
  • The Industrial business area is the leading insurer for large corporate customers in the Nordic region with approximately 1,300 customers. Customers are companies with a turnover of more than EUR 50 million and more than 500 employees.
  • The Baltic business area offers property and casualty insurances for both private individuals and corporate customers. If is the second largest P&C insurer in the Baltic region and market leader in Estonia, with approximately 350,000 customers.

In order to fulfil the vision of being the preferred insurance partner, If has adopted a strategy based on three goals:

  • Most satisfied customers through strong focus on customer value
    To achieve this If must have the best in-depth understanding of the customers' insurance needs and, correspondingly, the best underwriting skills. If strives to be the most service-oriented company in the industry and continues to develop its digital communication.
  • Europe's most professional and innovative P&C insurance people
    If continues to strengthen its underwriting competences within the "Best in Risk" concept. The concept focuses on understanding all aspects of risk management, including product, pricing and risk quality, throughout the organization.
  • Stable profitability through underwriting excellence and operational efficiency
    Profitability in the core business by accurate pricing of risk. Continuous focus on cost efficiency, an investment strategy based on balanced risk and creditworthiness also contribute to a strong and stable profitability.

If's financial targets are to achieve a return on equity (RoE) of at least 17.5 per cent and a combined ratio of less than 95 per cent.

Mandatum Life – an Expert in Money and Life

Mandatum Life is the leading provider of cover against health and life risks, and a well-respected manager of customer wealth in Finland and the Baltic countries. Mandatum Life Group offers its customers comprehensive services that include tailored unit-linked investments and wealth management, personal risk insurance for private customers, pension and reward services for companies and the related consultation services.

The parent company of Mandatum Life Group is Mandatum Life Insurance Company Limited, the subsidiaries of which are, following a change in corporate structure in 2014, Mandatum Life Services Ltd., Mandatum Life Investment Services Ltd., Mandatum Life Fund Management S.A. and Innova Services Ltd. and Mandatum Life Insurance SE Baltic, which continue to operate as before.

The focal point of Mandatum Life's new sales business is unit-linked insurances, capital redemption contracts, group pension insurance and risk insurance covering personal risks. For these, Mandatum Life has three sales channels in Finland: sales groups specialized in corporate sales, wealth managers focused on high-net-worth individuals and Danske Bank's distribution network. The fourth sales channel is customer services, which is responsible especially for the additional services offered to existing clientele.

Mandatum Life Group began offering its own wealth management services related to insurance and capital redemption contracts in 2008. These services are primarily focused on high-net-worth individuals, but the comprehensive range of investment baskets is also available to a broad spectrum of private customers. Institutions constitute a key segment of Mandatum Life's wealth management customers. Mandatum Life's fund business operations caters for the needs of institutional customers in particular.

Mandatum Life serves its private customers mainly through Danske Bank's distribution channel. Co-operation with Danske Bank has been successful for many years now.

Insurance for Corporate Customers and Entrepreneurs a Strong Strategic Focal Area

Mandatum Life's goal is to maintain its position as Finland's largest life insurer in the corporate customer segment. Mandatum Life estimates that there is still a growing need for Finns to secure their income during retirement and to prepare for health and life risks. The pension reform of 2017, which aims to lengthen careers and help close the sustainability gap in public finances, increases the level of preparedness for retirement. The company believes that voluntary corporate pension schemes will play an increasingly important role in complementing statutory earnings-related pensions. In addition, services intended for companies' personnel, such as personnel funds, are a key component of the service Mandatum Life provides companies.

In terms of the existing insurance portfolio with high guarantees, the strategy is to maintain a sufficiently strong solvency position which makes it possible to target a higher long-term return than that offered by low-risk fixed income instruments in the company's investment operations. The goal will be to actively accelerate the downward trend of the with-profit portfolio. The transition rules of the Solvency II framework, together with the downward trend of this insurance portfolio, will enable the company to carry out effective capital management in the future. The company is keen to find growth also in the area of new with-profit contracts, provided that this takes place on favorable terms, taking into account profitability, risk management and Solvency II, and brings added value to both customers and the company.

Mandatum Life's result consists of three components: investment result, risk result and expense result. In expense and risk result, Mandatum Life seeks growth through both higher operational efficiency and volume growth. The company's financial target is to produce an RoE of at least 17.5 per cent.

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Updated 03/15/2016