Sampo Oyj (LON:0HAG) reported accelerating premium growth and higher underwriting profit in the third quarter, prompting the Nordic insurer to raise its full-year outlook for insurance revenue and underwriting results.
Group CEO Morten Thorsrud said the company’s like-for-like gross written premium growth accelerated to 6% from 5% in the second quarter, with growth across its major divisions. Private Nordic premiums rose 6%, U.K. premiums increased 7%, and Commercial Nordics grew 7%, including 9% growth in small and medium-sized enterprise business.
“The growth is also increasingly volume-based, which is good to see now that inflation is tapering off a little bit,” Thorsrud said, adding that customer and insured-object counts increased in all three major divisions.
Higher Revenue and Underwriting Outlook
Insurance revenue increased 9% in the third quarter, supported by development across all segments. Thorsrud highlighted the industrial business, where changes in business mix following property de-risking measures and lower reinsurance prices became more visible in insurance revenue.
On a currency-adjusted basis, underwriting result rose 9% during the quarter, helped by disciplined underwriting and favorable development in severe weather and large claims. Operating earnings per share increased 8% in the first nine months, though third-quarter operating EPS increased 2%, as higher underwriting profit and share buybacks were largely offset by lower realized investment gains compared with the prior-year period.
The company raised its full-year guidance to:
- Insurance revenue of EUR 9.75 billion to EUR 9.85 billion.
- Underwriting result of EUR 1.60 billion to EUR 1.65 billion.
The revised outlook implies annual top-line growth of 7% to 9% and underwriting-result growth of 8% to 11%, according to Thorsrud.
Looking at its strategy period since 2024, Sampo said it has delivered average annual top-line growth of 8% and underwriting-result growth of 11%. Based on the midpoint of its 2026 guidance, the company expects underwriting profit to increase about 40% over the three-year period. Thorsrud said performance was primarily supported by broad-based growth, disciplined underwriting, cost efficiency initiatives and the realization of Topdanmark acquisition synergies ahead of initial expectations.
Investment Markets and Solvency
Group CFO Lars Kufall Beck said the quarter brought volatility in fixed-income markets. While the investment portfolio continued to generate “very solid” interest and dividend income, rising interest rates resulted in mark-to-market losses.
Beck said higher rates should support long-term returns as the company reinvests maturing assets at higher yields. The average yield on new fixed-income investments during the quarter was 4.2%, above the portfolio’s 4.0% running yield at the end of the quarter.
Sampo also sold just under 15 million NOBA shares during the quarter, generating EUR 111 million in gross proceeds. Both NOBA and Nexi, described as legacy assets, contributed positively to net investment income.
The insurer ended the quarter with a 175% solvency coverage ratio, including its full 90% distribution accrual. Beck said that, holding other factors constant, the ratio would have been 179% if the symmetric adjustment had been zero.
The company added further prudence to reserves amid uncertainty surrounding claims inflation, including risks associated with higher oil prices. Beck said this increased reserve-related solvency capital requirements as higher reserves raise modeled reserve risk, while the company’s risk margin remained at the 85th percentile.
Cost Efficiency, U.K. Conditions and Product Growth
Thorsrud said underlying Nordic cost-ratio improvement remained in line with the company’s 40-basis-point ambition, though segment-level trends were affected by portfolio and cost-allocation changes connected with Topdanmark’s integration. He said Sampo continues to invest in distribution while expecting underlying cost-ratio improvement to continue into 2027.
In the U.K., management described market conditions as gradually improving. Thorsrud said renewal prices were increasing, while competition in new business remained strong. He attributed growth in the company’s U.K. motor operations chiefly to investments in data and pricing capabilities, which have improved competitiveness in selected market segments, including newer vehicles.
The company continues to target an 88% to 90% operating ratio in the U.K. Its telematics customer base stood at slightly more than 600,000 customers, which Thorsrud said was the largest telematics portfolio in the U.K. market.
Sampo included its best estimate of the full impact from summer subsidence claims in U.K. third-quarter reserves. The insurer also experienced elevated motor claim frequencies in July and August, which returned to more normal levels in September.
In the Nordic private market, management said its pricing approach had not changed and remained focused on risk-correct pricing and stable customer prices. Thorsrud said personal insurance continued to post double-digit growth, partly driven by upselling to existing customers, while retention in private insurance remained above 89%.
Reporting Changes and AI Discussion
Beginning in 2027, Sampo will rename its operating result and operating EPS metrics as “core result” and “core EPS,” respectively, to avoid confusion with the IFRS 18 operating-profit line item.
The revised calculation will include interest expense on restricted Tier 1 notes, exclude certain derivatives to create more consistent treatment of mark-to-market effects, and use a 22% fixed tax rate rather than 21%. Beck said the changes were not material and should reduce year-over-year volatility. The existing operating-result and operating-EPS definitions will remain in effect for 2026.
Thorsrud also addressed concerns around artificial intelligence’s potential impact on Nordic property-and-casualty insurance. He said AI may affect distribution as customer behavior evolves, but argued the Nordic market remains service-oriented rather than purely price-driven.
He noted that customers frequently bundle policies with one insurer and that Sampo households hold more than four policies on average. More than 70% of motor claims involve repair services procured on customers’ behalf, he said, underscoring the importance of scale, claims-handling capabilities and partner networks.
Sampo plans to provide further details on its next strategic period at an investor update in London on Nov. 17.
About Sampo Oyj (LON:0HAG)
Sampo Oyj, together with its subsidiaries, engages in the provision of non-life insurance products and services in Finland, Sweden, Norway, Denmark, Estonia, Lithuania, Latvia, and the United Kingdom. The company operates through If, Topdanmark, Hastings, Mandatum, and Holding segments. It offers property, casualty, liability, accident, sickness, household, homeowner, motor, travel, marine, aviation, transport, forest, livestock, health, workers compensation, car, van, and bike insurance services, as well as reinsurance services.
