Folksam AUM increase whilst Covid-19 deals a blow to life insurance business

The life insurance business of Swedish financial group Folksam was negatively affected by the coronavirus pandemic. However, solvency and assets under management of the total group increased during the first half of 2020, according to Q2 report.

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Swedish insurance and financial group Folksam could note an increase in assets under management by the end of the second quarter of 2020 mainly due to the stock market rise during the second quarter this year.

According to the Q2 financial report from Folksam Group, assets under management amounted to EUR 45bn (SEK 462bn), which is an increase of almost EUR 2bn (SEK 20bn) relative to the same period last year. By the end of 2019, assets under management amounted to EUR 44bn (SEK 455bn).

Even if Folksam describes its financial situation as stable with solvency going up, some parts of the business have experienced setbacks due to the coronavirus pandemic.

"The life insurance business of Folksam has, however, been negatively affected by the corona pandemic with reduced sales in all channels. Low interest rates have had a negative effect on the long-term occupational pension business, and other life savings were affected by larger repurchases than normally during the period. Overall, this has contributed to the technical result in Folksam Liv's parent company being negative for the first half of the year," Folksam writes in its Q2 financial report.

The total return in Folksam Liv during the first half of the year was -0.4 percent and in KPA, a pension insurance company, which is part of the Folksam group, -0.6 percent, according to the report.

English Edit: Nielsine Nielsen

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