Impact of Covid-19 on Achmea’s annual results on health insurance activities

Mon, 25 Jan 2021 08:00:00 +0100

The outbreak of Covid-19 has held the Netherlands and the world in its grip for almost a year and it is having an ever-greater impact in many areas. There have been major consequences for society as a whole, and the lives of very many people have been under severe pressure for some time. As a cooperative insurer, Achmea supports its customers and society more broadly and so, in these times too, we are making an active contribution to combatting the adverse effects on them as far as possible. Through our brands, such as Centraal Beheer, Interpolis and Zilveren Kruis, we are involved in a range of initiatives that contribute to this.

In the Netherlands, health insurers’ increased costs because of Covid-19 are to a large extent being mitigated by additional compensation from the Health Insurance Fund under a statutory catastrophe scheme. As an industry, Zorgverzekeraars Nederland recently drew attention to this scheme, which partly offsets higher unforeseen healthcare costs, including those from hospital admissions resulting from Covid-19.

In addition to this statutory compensation scheme, we also saw a reduction in regular healthcare in 2020. Despite the loss provision of some € 135 million formed for premiums in 2021, this results in a positive overall result on basic health insurance. Furthermore, despite the continuity contribution to care providers, the result on supplementary insurance is substantially higher than expected as a result of a decline in demand for care services.

Achmea expects that the overall result for health activities will be above the ambition of € 150 million, improving the financial buffers and solvency of our health insurance entities. In previous years Achmea has used its reserves to moderate and stabilise the change in health insurance premiums, as it did when setting premiums for 2021. Similar action will also be considered when setting premiums in the future.

Achmea will present its annual results for 2020 on Friday, 12 March 2021 when we will give more details of these developments.

Achmea announces proposed issuance of new senior bond

Mon, 18 May 2020 09:20:00 +0200

Achmea announces the proposed issuance of a new senior bond. This bond will be used to refinance the senior unsecured bond of €750 million that matures in November 2020.

Achmea published its annual figures on 12 March and reported a solvency ratio of 219% and liquidity of €732 million. In the light of the global Covid-19-pandemic, Achmea confirms that its Q1 2020 capital and liquidity positions are robust and that the solvency ratio is substantially above target levels. Depending on the duration and intensity of the outbreak, Achmea sees potential negative effects on the financial results of the non-life and health insurance business for 2020 in addition to a negative impact on the investment portfolio from the financial markets.

The negative impact from financial markets per Q1 2020 is manageable as a result of a prudent investment portfolio and limited sensitivities to developments on financial markets. Although the financial markets developed sharply negative, the changes in solvency are limited and in line with previously disclosed sensitivities.

In addition, Achmea sees a relatively low impact on insurance operations in Q1.

At Non-life, Travel and Event insurance policies are resulting in increased claims and payments for the time being. Claims in Income and Absenteeism are so far in line with previous years but could increase over time if the pandemic and resulting cases of illness last longer. Meanwhile, we are currently seeing lower claims in the Motor and Fire portfolios. The combined net impact on Non-life and Income is expected to be small, but this depends on the duration, development and nature of the government measures.
In Health, we are seeing a lower demand for elective care combined with higher hospital and ICU admissions as a result of Covid-19. However, total claims will depend on the duration and intensity of the pandemic as well as the effect of the sector-wide agreed upon measures that are currently still being worked out in further detail.
The effect at Pension & Life is limited as a result of the composition of the portfolio and a higher longevity than mortality risk.
The impact on International and Other activities has been limited to a decrease in sales volume, with the commercial consequences depending partly on the duration and intensity of the Covid-19 pandemic.

Thanks to our diversified profile, there are positive and negative effects as a result of the Covid-19 pandemic. Combined with a prudent investment policy and a robust capital position, Achmea has a strong position to weather this crisis.

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Impact of Covid-19 on Achmea’s annual results on health insurance activities

Achmea announces proposed issuance of new senior bond