Financial targets

Sampo Group’s new financial targets and capital management framework for 2024-2026 were announced at the Capital Markets Day on 6 March 2024. 

The new financial targets and capital management framework reflect Sampo’s transformation into a pure P&C insurance group during the previous strategic period and its continued focus on increasing shareholder value by growing underwriting profits and managing capital in a disciplined manner. The Group financial targets are based on detailed operational ambitions.

Capital Markets Day 2024 webcastexternal link

Financial targets and capital management for 2024-2026

Group financial targets 

  • Operating EPS growth: >7% (period average)
  • Combined ratio: <85% (annual)*
  • Deployable capital generation: >EUR 4 bn**

*) Target assumes a discount rate benefit of 2 percentage points.
**) Defined as the sum of cumulative operating result and capital optimisation actions in the period.

Operational ambitions*

  • If P&C cost ratio reduction: ~20bps (annual)
  • If P&C GWP growth in PI: >7.5% (period average)
  • If P&C online reported claims: >70% by 2026

Private

  • Customer retention: 89% or higher
  • GWP growth in Property: >5% (period average)
  • Digital sales: >160 EURm by 2026

Commercial

  • GWP growth in SME: >6% (period average)
  • Digital sales: 45 EURm by 2026

UK

  • Underwriting profit growth: 10-15% (period average)

*) In operational ambitions, Private and Commercial refers to If P&C’s Business Areas, UK to Hastings

Group capital management framework

  • Solvency II ratio: 150-190%
  • Financial leverage: <30%
  • Capital optimization: ≤ EUR 1.2 billion deployable capital*Stable regular dividend that grows with operating result (payout ratio of at least 70%)

*) defined as own funds released through capital optimisation actions

Calculation formulas

The operating result:

+ net income 

- discontinued operations

- non-controlling interests 

- unrealised gains or losses 

- effects from changes in discount rates 

- non-operational amortisations 

- non-recurring items


In 2023, operating EPS amounted to EUR 2.07.

Combined ratio:

Claims incurred + operating expenses / insurance revenue, net (including brokerage) x 100%

Solvency II ratio:

Own funds / solvency capital requirement

Financial leverage:

Group financial debt / (Group financial debt + IFRS equity)

Previous targets and capital management framework

Financial targets and capital management framework for 2021-2023 were announced at the Capital Markets Day on 24 February 2021.

Financial targets and outcome for 2021-2023

    2021 2022 2023
Sampo Group Mid-single digit underwriting profit growth annually on average* 19% 13% 13%
Group combined ratio <86% 81.4% 82.1% 84.6%
If Mid-single digit underwriting profit growth annually on average* 15% 26% 25%
Combined ratio <85% 81.3% 80.3% 83.1%
Cost ratio reduction of 20bps annually on average -10bps -30bps -30bps
Hastings Operating ratio <88% 80.3% 89.7% 89.8%

* Excluding reported COVID-19 effects.

Capital management framework and outcome for 2021-2023

  2021 2022 2023
Solvency II ratio: 170-190% 185% 210% 182%
Financial leverage: <30% 28.6% 23.8% 25.3%
Dividend payout ratio: >70%* 143% 108% 86%
Progressive regular dividend** EUR 1.40 (+8%) EUR 1.50 (+7%) EUR 1.60 (+7%)
Return excess capital During the strategic period, Sampo returned EUR 4.4 billion of excess capital to shareholders through extra dividends and buybacks.

*) For 2021 and 2022, based on EPS excluding extraordinary items; for 2023, based on operational result per share.
**) Dividends for 2021 and 2022 adjusted for the partial demerger. 

Updated