Strong operational momentum in a challenging claims environment
In 2023, we completed our transformation into a pure P&C insurance group and delivered an operationally strong year with robust topline growth, resilient margins and an excellent investment result. We achieved this in a challenging claims environment, illustrating our underwriting discipline and the benefits of our scale and diversification.
Sampo delivered strong top line growth of 11 per cent on currency adjusted basis in 2023. In the Nordics, growth was mainly driven by high retention, balanced with rate increases. We continued to see particularly positive development in our target growth areas: personal, home, and SME insurance. Retention in Private in the Nordics remained historically high at over 89 per cent. Nonetheless, the UK was the stand-out performer in terms of top line growth, delivering an increase in gross written premiums of 32 per cent, on a currency adjusted basis, on the back of substantial rate increases in motor, and volume and price growth in home.
In 2023, the claims landscape proved demanding, featuring adverse weather events, large claims, fluctuations in claims frequency, and elevated UK claims inflation. Despite this, we outperformed our financial targets by achieving an underwriting profit growth of 13 per cent and a combined ratio of 84.6 per cent. Our robust performance illustrates the strength of our scale, diversification, and underwriting discipline.
We will invest further in digitalisation and automation to maintain our high levels of customer satisfaction and enhance productivity to deliver attractive earnings growth. Our emphasis on underwriting profitability and efficiency is demonstrated by our track record of improving the cost ratio in If P&C over 14 consecutive years. Importantly, our efficiency gains have not come at the expense of volume growth or cutting investments in the business. On the contrary, we expect to continue to invest heavily in further operational improvements in the future.
Looking at the asset side of our balance sheet, Sampo enjoyed strong investment returns in the year, driven by higher fixed income running yields and the broad-based positive market value movements seen in the fourth quarter of 2023. As a Group, we are comfortable taking measured investment risk in order to enhance earnings over the medium term.
In 2023, we achieved a significant milestone on our strategic agenda as we successfully listed Mandatum on Nasdaq Helsinki through a partial demerger. I am pleased to see the great investor appetite for both Sampo and Mandatum after the demerger.
Last year marked the completion of our transformation, making Sampo the leading P&C insurance group in the Nordics, serving over 7 million customers. We are more focused than ever on ensuring that we remain competitive across all our business areas and offerings. This includes refining our value proposition to customers and leveraging our superior digital and operational capabilities.
In conclusion, I firmly believe that Sampo is well-positioned to deliver on its targets for the next strategic period. As communicated at our Capital Markets Day in March 2024, we aim to grow our operating EPS by more than 7 per cent on average on an annual basis. In total, our target is to generate more than EUR 4 billion of deployable capital, which we will manage in the same disciplined manner as in the previous strategic period. I look forward to continuing on this journey with our customers, staff, and shareholders during our next strategic period.
Torbjörn Magnusson
Group CEO