Sustainable insurance operations

The Sampo Group Code of Conduct sets the guidelines for sustainable insurance operations in Sampo Group. The Code of Conduct states that Sampo Group strives to act in the interests of its customers, providing products and services that are fair, comprehensible, and designed to help meet the evolving needs of customers. The aim is to take ESG considerations, including climate change, into account in the product and service offering and insurance underwriting.

In addition to the Code of Conduct, each Group company has adopted supplementary and more detailed policies, guidelines, processes and governance structures regarding ESG integration into insurance underwriting for their own purposes. For example, If has an Underwriting Committee which acts as an advisory and preparatory body to the company’s CEO. The Committee gives its opinion on proposals to underwrite certain risks and on new products or pricing methodologies that might lead to a significant change in risk, for example. All deviations from If’s Underwriting Policy are reported to the Underwriting Committee and the Risk Committee, and material deviations are reported to If’s Board of Directors.

Sustainability is an integral part of Sampo Group’s core business. In terms of insurance operations this means, for example, that Sampo Group

• Integrates ESG considerations into insurance underwriting (e.g. norms-based screening of corporate clients, integration of sustainability considerations (including climate-related risks) into underwriting principles, pricing, and/or other relevant policies and processes).
• Provides loss prevention services (e.g. risk management services).
• Handles claims in a sustainable way.

• Develops products and services in accordance with relevant legal requirements (e.g. the EU Taxonomy).

Integration of ESG into underwriting

Sampo Group has integrated sustainability into its underwriting standards and into the existing customer due diligence process for corporate clients. Underwriting policies include expectations on corporate clients to respect international norms and standards on human rights, labour rights, the environment, and anti-corruption, as defined by the UN Global Compact.

Sampo Group uses research and gradings from external service providers to analyse whether corporate clients respect the UN Global Compact. If clients do not meet expectations, a further assessment will be conducted.  The assessment is made, for example, based on the service provider’s research, other relevant data (e.g. publicly available information), and internal analysis.

In case of a verified violation or unsatisfactory performance, Sampo Group will initiate a dialogue with the client. Sampo Group can, for example, insure the client but set the company under observation; grant conditional approval for an insurance, but require the company to take action; or decide not to offer insurance for the client or renew an already existing insurance contract. If the client does not take any corrective actions, Sampo Group will consider additional steps, including termination of the customer relationship.

Relevant employees receive training, for example, on the principles of the Global Compact, norms-based research, and applicable ESG frameworks.

Loss prevention services

Loss prevention is an essential part of Sampo Group’s sustainable insurance operations, as it helps customers reduce economic losses and environmental impacts. Loss prevention services play an important role in Sampo Group’s climate change mitigation, as preventing damage from occurring means less need for repairs and rebuilding. By providing loss prevention services, Sampo Group can help its customers manage risks, including those related to climate change. This means that the Group places a lot of emphasis on loss prevention. Below are some examples of Sampo Group’s loss prevention activities.

Property

Sampo Group offers its major corporate clients risk management services, in which a comprehensive approach is taken to understand their specific insurance and risk management requirements. Sampo Group has its own property risk engineers, who provide risk management services on site to the Group’s corporate customers. In addition, Sampo Group has access to an external risk engineering network.

To help its small and medium-sized (SME) customers avoid claims, Sampo Group focuses on the fire-prone segments and provides loss prevention services that can prevent fire-related damage. For example, Sampo Group’s priority is to ensure that as many customers as possible have fire alarms and sprinklers installed.

Sampo Group also offers house assessments to private customers who own their own house and have insurance policies with top coverage. The house assessment provides the customer with a report that helps them both plan the maintenance of the property and minimise the risk of unpleasant surprises. Customers can get a house assessment done every fourth year.

Mobility

Sampo Group is working to incentivise drivers to adopt safer driving habits, as this has been identified within automotive insurance as having the greatest potential for preventing damage from occurring. For example, Usage Based Insurance (UBI) programmes utilising data from cars and smartphones enables Sampo Group to identify the potential for improvement for each individual driver, and offer the right incentives to improve driving behaviour. Safer driving is more sustainable, both by avoiding accidents, and because safe driving habits are also more efficient, resulting in less unnecessary fuel consumption.

In addition, Sampo Group’s customised insurance offerings to the sharing economy and new mobility providers contribute to loss prevention through better road safety. For example, the shared cars, insured with Sampo Group, enable thousands of customers to not own their own cars, reducing the number of cars in traffic, unnecessary trips and the need for parking spaces in urban areas, which is beneficial from a road safety perspective. Sampo Group also collaborates closely with its automotive partners to improve vehicle design and understand the extent to which the safety systems work as intended.

Health

To identify customers’ health-related risks and means to prevent them, Sampo Group conducts research regarding preventive health, focusing on work environment and family health (including parents and children). Based on the research, the Group produces annually a Nordic Health report, which aims to raise awareness and provide facts and good advice to encourage employers to act.

Sustainable claims handling

Sampo Group wants to offer its customers easy and fair claims handling. The aim is for customers to receive compensation quickly, efficiently, with great service, and according to the terms of the policy. Sampo Group uses different kinds of analyses to assess whether customers are satisfied with claims handling. In addition, the company aims to continuously improve its solutions, processes, communications, and advice related to the topic.

Due to a large number of claims each year, errors in claims handling cannot be completely avoided. When Sampo Group becomes aware of an error, it is fixed as quickly as possible. To minimise the number of errors, claims handling is continuously monitored, for example, through internal controls, dialogue with employees, and feedback from customers.

P&C insurance products and services affect the amount of resources used mainly through the policyholders’ claims related to vehicles, buildings, furniture, electronics, and other property. Sampo Group’s suppliers and business partners are central to the claims handling process, and Sampo Group is committed to taking environmental and climate considerations into account, for example, by encouraging and supporting circular efforts in these processes. Sampo Group measures the progress of its resource use and circular economy efforts, for instance, with metrics related to the share of reused parts and the share of glass repairs in car repair claims. These have been selected as key metrics, as they reflect Sampo Group’s goals of promoting circular economy and reducing resource use. The metrics are reported as part of Sampo Group’s quarterly and annual sustainability reporting.

Development of sustainable products and services

Sampo Group integrates the EU Taxonomy Regulation into its business strategy and product development processes while monitoring the market expectations and customer needs in this area. In the coming years, Sampo Group aims to increase the share of Taxonomy-aligned underwriting activities in its insurance portfolio.

Every year, Sampo Group analyses to what extent its underwriting and investment activities are Taxonomy-eligible and Taxonomy-aligned according to the EU Taxonomy. This information is reported as part of Sampo Group’s annual sustainability reporting.