|Premiums written, € million||4,576.4||4,343.6|
|Pension payments to pensioners, € million 1)||5,183.0||5,010.1|
|TyEL insured 31 December||486,960||488,200|
|Investments, € million||41,293.3||40,038.8|
|Investment income, € million||1,679.3||2,698.9|
|Return on invested capital, %||4.2||7.1|
|Total result, € million||-164.0||1,223.0|
|Loading profit, € million||36.1||33.4|
|Operating expenses as % of loading profit||74.0||75.0|
|Transfer to client bonuses, € million||115.0||117.0|
|% of TyEL payroll||0.6||0.7|
|Technical provisions, € million||31,865.6||32,069.7|
|Solvency capital, € million||9,956.1||10,252.5|
|Solvency capital/technical provisions, % 2)||31.4||34.0|
|Solvency capital/solvency limit||1.9||2.2|
|Parent company staff 31 December||534||561|
|1)||Before the reduction of received clearing of pay-as-you-go (PAYG) pensions|
|2)||Ratio calculated as a percentage of the technical provisions used in calculating the solvency limit|
The year in brief
In 2015, Varma’s return on investments stood at 4.2%. The value of investments increased to EUR 41.3 billion. Premiums written increased clearly, and operating expense efficiency also showed positive development. Solvency capital was strong at EUR 10.0 billion.
Exceptionally large movements were experienced in the capital markets in both equities and fixed income investments in 2015. Despite volatility in the markets, Varma’s equity investments produced good returns.
Of Varma’s investments, equity investments generated the highest returns, at 8.8% (9.1%), and Finnish equities in particular performed strongly, yielding 19.4% (6.7%). Broad diversification of investments muted the risks caused by strong market movements, and returns were generated consistently by the different asset classes. Other investments yielded a return of 3.5% (8.4%), and real estate investments 3.3% (3.8%). The return on fixed-income investments remained slightly negative, at -0.4% (5.8%).
Read more about market developments and asset classes in the section Investments.
Solvency and operating expense efficiency benefit our customers
Varma's solvency capital stood at EUR 9,956 million (10,252) at year-end. Varma’s solvency ratio, i.e. solvency capital in relation to technical provisions, was at 31.4% (34.0%). Solvency capital was at a strong level: 1.9 (2.2) times higher than the solvency limit.
Strong solvency and good operating expense efficiency benefit our customers. EUR 115 (117) million was set aside for client bonuses, equalling around 0.6% (0.7%) of the estimated TyEL payroll of the insured.
We secure pensions for more than 860,000 people
The number of Varma’s pension recipients increased in 2015. Varma paid out EUR 5.2 billion in TyEL and YEL pensions to 337,100 (334,500) pension recipients.
At the end of the year, 524,340 (527,140) individuals were insured by Varma. At year-end, the number of valid insurance policies totalled 64,530 (66,140), covering 37,380 (38,937) self-employed persons and 486,960 (488,190) employees.
The TyEL payroll of those insured by Varma totalled about EUR 18.4 (17.8) billion in 2015. The payroll is estimated to have grown by around 3.0%.
Vocational rehabilitation helps prevent disability pensions. The volume of rehabilitation provided by Varma continued to increase. Rehabilitation produces excellent results. We spent EUR 34 million on rehabilitation – which translates to estimated savings in pension expenditure of EUR 372 million. In 2015, about 73% of those who received Varma’s rehabilitation returned to the job market either in full or partly.