Information on Aktia Life Insurance Ltd.'s investment strategy and arrangements with the asset manager
According to the Insurance Companies Act, the funds that cover the technical provisions must be invested as the company's business requires, taking into account the nature of the technical provisions, own funds, the minimum capital requirement (MCR) and solvency capital requirement (SCR).
The funds must be invested
- in a secure manner and in accordance with the insured's interest
- according to legislation in force at the time so that they cover the amount of the technical provisions
- so that the requirements regarding equity, minimum capital requirement (MCR) and solvency capital requirement (SCR) are fulfilled
- so that the funds can be changed into money as the development of the technical provisions requires
- so that the funds achieve in economic cycles a profit that corresponds to the interest requirement of the technical provisions.
Aktia Life Insurance Ltd.'s investment activities and investment strategy are based on achieving all the above-mentioned requirements and the targets set on solvency and the result of the business operations, and the order of priority is following:
- The use of capital is restricted by cash flow matching adjustment.
- Capitalisation owing to regulation is avoided.
- Volatility is restricted in the group level and segment level results.
In the medium and long term, the return from the assets that are invested is affected by interest rate risks, equity market risks, currency risks, real estate risks, counter-party risks and operative risks.
Aktia Life Insurance Ltd has outsourced its investment activities to Aktia Asset Management Ltd. Aktia Life Insurance Ltd defines its investment strategy, according to which Aktia Asset Management Ltd operates. This arrangement is valid until further notice.
The investment strategy takes into account the nature of Aktia Life Insurance Ltd.'s liabilities, and investment activities are carried out taking into account the needs and return requirements both in the short and longer term. The Board of Directors of Aktia Life Insurance Ltd approves annually the investment plan and the limits per investment instrument based on its investment strategy. The principal mathematician of Aktia Life Insurance Ltd makes a statement about the return requirement of the investment activities in proportion to the company's technical provision before the confirmation of the investment plan.
The Board of Directors of Aktia Life Insurance Ltd constantly evaluates the results of the investment activities. Aktia Asset Management Ltd reports regularly to the Board of Directors of Aktia Life Insurance Ltd by presenting an account of the implemented measures and of the materialisation of the investment plan and the limits.
The asset management fee is not profit-linked.