Technical reserves relating to prior year claims were strengthened by EUR 61 million in January - December 2015 (EUR 2 million released in the previous year). Return on equity (RoE) increased to 21.5% (18.1) and the fair value reserve on 31 December 2015 amounted to EUR 391 million (507).
Technical result increased to EUR 657 million (588). Insurance margin (technical result in relation to net premiums earned) improved to 15.1% (13.2).
The lowering of the annuities discount rate in Finland during the second quarter of 2015 affected all business areas' results negatively and weakened the Finnish country specific result in 2015. Business area Industrial suffered from a negative large claims outcome in the fourth quarter of the year, particularly in Norway, resulting in EUR 45 million worse than expected large claims outcome in 2015 and a 10.4 percentage points weaker combined ratio than a year before. Total large claims ended up EUR 32 million worse than expected in 2015.
In Sweden, combined ratio improved by 7.8 percentage points supported by a positive large claims outcome compared to the previous year. Swedish discount rate used to discount the annuity reserves decreased to 0.41% by the end of December 2015 and had a negative effect of EUR 12 million for full-year 2015 and a EUR 1 million positive effect in the fourth quarter of 2015 results.
Gross written premiums decreased to EUR 4,559 million (4,634) in 2015. Adjusted for currency, premium growth was slightly positive. Growth was positive in business areas Private and Baltic, and negative in business areas Commercial and Industrial. Geographically, gross written premiums grew by 5% in Sweden, while the growth was slightly negative in Norway and Denmark and stable in Finland.
Cost ratio improved to 18.8% (22.5) and expense ratio to 13.0% (16.7), both impacted by the positive effect of the non-recurring reform of the pension system in If Norway booked in the second quarter of the year. Excluding the non-recurring item the cost ratio was 22.3% and expense ratio 16.6%.
On 31 December 2015, the total investment assets of If P&C amounted to EUR 11.4 billion (11.5), of which fixed income investments constituted 74% (75), money market 12% (13) and equity 13% (12). Net income from investments amounted to EUR 304 million (353). Investment return marked-to-market for the full year 2015 decreased to 1.5% (4.1) as a result of widening credit spreads towards the end of the year. Duration for interest bearing assets was 1.2 years (1.0) and average maturity 2.6 years (2.4). Fixed income running yield as at 31 December 2015 was 1.8% (2.4).
SAMPO Group operates in the Baltic states insurance markets through its subsidiaries IF P&C Insurance (Estonia) and MANDATUM Life Insurance Baltic SE (Estonia), being a major player on the specialty markets of Estonia, Latvia and Lithuania.