Varma

Workability and good working life

Workability management promotes companies’ competitiveness and productivity and the societal goal of longer careers. Our workability services improve employee well-being and working life at our client companies.

The shift in working life is apparent in many ways. Varma is an expert in workability management and rehabilitation. We help our clients to forecast workability challenges and to save in pension and sick leave costs.

Workability management promotes good leadership, focuses on company productivity, supports employees’ recovery from work and prevents disability. It also reduces absences due to illness, lowers disability costs and improves well-being at work and productivity.

Workability projects produce results for client companies

We co-operate with our client companies in diverse workability management projects. The projects support our clients’ competitiveness and have a positive financial outcome.

Together with our clients we analyse the disability risks of the company, and the means for lowering them. The goal is to take timely control of the client’s disability risks. We also assess the company’s future concerns and need for renewal, and their impact on supervisory work and workability.

Workability management is goal-oriented and systematic. The goals and indicators are tangible, and they can relate to absences due to illness, improving the disability contribution category, the fluency of work, and supervisory work.

We had more than 800 ongoing workability management co-operation projects in client companies; they covered a total of around 270,000 employees and supervisors in various work communities. 

We provide up-to-date information to support activities

We offer an online Workability Management Information Service to our customers. It is a digital tool for controlling earnings-related pension costs. The tool allows employers to examine the up-to-date disability risk and the savings potential achievable through a lower disability contribution category. The employer can also compare the development of the company’s contribution category to that of the sector or Varma’s client base.

The Workability Management Information Service was enhanced with the possibility to draw up digital workability management action plans directly in the service. The information service now also better matches the needs of smaller companies, and it is already being used by more than 1,300 of our client companies.

How does Varma typically assist its client companies?

Rehabilitation helps people continue in working life

When an entrepreneur’s or employee’s workability is threatened, statutory vocational rehabilitation gives them the opportunity to continue in working life. Workability can be influenced in many ways.

Varma’s rehabilitation work produces results. 73%, or around 1,200, of Varma’s vocational rehabilitation customers returned to working life. We spent EUR 34 million on rehabilitation – which translates to estimated savings in pension expenditure of EUR 372 million.

Since 2010, the number of rehabilitation applications have increased 80%, while new disability pensions are down 22%. In 2015, Varma received around 2,200 rehabilitation applications, which represents an increase of 2.8% over 2014. The volume of rehabilitation applications reflected, similar to the previous year, Finland’s poor economic situation: in 2015 many of the applicants were unemployed or in co-determination negotiations.

New disability pensions and rehabilitants

Vocational rehabilitation on the rise

In 2015, the number of those who received a positive vocational rehabilitation decision increased 41%, while disability pensions granted by Varma were down by approximately 8%.

The hike in the number of vocational rehabilitation decisions is explained by a change in legislation as of 1 January 2015, according to which Varma may issue a rehabilitation decision when processing a pension application even if rehabilitation was not applied for. According to a preliminary survey, around 25% of these rehabilitation decisions led to a rehabilitation programme. Rehabilitation decisions pursuant to the new law totalled more than 700 over the year.

Early intervention measures have an effect on the number of disability pensions. For example, more efficient measures by the occupational health care provider in the case of prolonged absences due to illness bring positive results.

Disability pension is not a matter of fate

The path from the early signs of disability to disability pension is normally long. Upon retirement, the employee has suffered from the illness for seven years on average. Thanks to good workability management practices there is more time to respond than in a situation where the processes for maintaining workability are not in order and workability management is not part of the company’s strategic management. Investing in workability management pays off.

Varma helps companies to identify and prevent problems that threaten workability at an early stage. When it comes to individual employees, Varma joins the process only in the final stages.

Read more about Varma's rehabilitation services.

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The year in brief

In 2015, Varma’s return on investments stood at 4.2 per cent. 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.

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President & CEO review

2015 was a good year for Varma, and we succeeded well according to all key indicators: we maintained our strong solvency position, our premium income increased, we processed pension applications faster than before and our operational efficiency is at a competitive level.

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Lower earnings-related pension contributions for customers

Varma is a solvent company. That means the best client bonuses in the sector and lower pension contributions for our customers. Our modern digital services provide our customers with a comprehensive set of tools that enable them to take care of their pension matters easily.

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Varma for entrepreneurs

Varma is a solvent company and thus a safe choice. Varma’s extensive services, provided through various channels, make attending to insurance matters easy.

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Pension cover

The number of pensioners and the euro amount of pensions paid is constantly rising at Varma. Our task is to pay pensions correctly and on time to an increasing number of pensioners.

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Workability and good working life

Workability management promotes companies’ competitiveness and productivity and the societal goal of longer careers. Our workability services improve employee well-being and working life at our client companies.

  • #workinglife
  • #responsibility
  • #pensioncover
  • #finance

Varma’s targets and strategy

Varma's core task is to secure pensions. Our main goals of strong solvency, good development in premiums written, high quality pension services and efficient operations, also stem from this.

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Operating environment

The economic year 2015 ended in a climate of turbulence. Uncertainty in the global economy is again on the rise.

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Solvency

Varma’s strong solvency secures pensions. Thanks to its high solvency, Varma has been paying very competitive client bonuses for several years now.

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Fixed income investments

The return on fixed-income investments remained slightly negative, at -0.4 per cent. They accounted for 30 (32) per cent of investments and had a market value of EUR 12.3 (12.8) billion.

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Equity investments

Equity investments performed the best of all asset classes. They accounted for 45 (41) per cent of Varma’s investments and yielded a return of 8.8 (9.1) per cent.

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Real estate investments

Varma’s real estate investment portfolio amounted to EUR 3.9 (3.8) billion at the end of 2015, and the total return stood at 3.3 (3.8) per cent.

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Other investments

Other investments accounted for 17 (20) per cent of Varma’s portfolio.

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Varma’s investment principles

With EUR 41.3 billion in investment assets, Varma is Finland’s largest private investor. We invest the assets to secure present and future pensions.

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Targets and measures

On the basis of the materiality assessment, we defined Varma’s CSR targets, indicators and measures.

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Personnel

Varma’s success is based on competent personnel efficiently handling our customers’ pension cover. Customer focus is at the core of Varma’s expert work and operational development. Service that is appreciated by our customers is the result of broad competence and co-operation.

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Responsible investment

Responsibility is an integral part of our investment operations and ownership practices. In 2015, we looked into the responsibility of our hedge funds and decided to determine the carbon footprint of our investments.