All notes

Select note 1–42
1 Insurance premiums written
P&C insurance
EURm 2016 2015
Premiums from insurance contracts
Premiums written, direct insurance 4,364 4,464
Premiums written, assumed reinsurance 94 95
Premiums written, gross 4,458 4,559
Reinsurers' share of premiums written -166 -181
Premiums written, net 4,292 4,378
Change in unearned premium provision -4 -39
Reinsurers' share -2 5
Change in unearned premium provision, net -6 -34
Premiums earned, total 4,286 4,344
Life insurance
EURm 2016 2015
Premiums from insurance contracts
Premiums written, direct insurance 644 723
Premiums written, assumed reinsurance 3 2
Insurance contracts total, gross 647 725
Premium revenue ceded to reinsurers on insurance contracts issued -6 -5
Insurance contracts total, net 641 720
Investment contracts 475 424
Premiums written, net 1) 1,116 1,144
Elimination items between segments -32 -
Group, total 5,375 5,522
1) The change in unearned premiums is presented in note 4, The change in insurance and investment liabilities.
Specification of premiums written in life insurance
EURm 2016 2015
Premiums from insurance contracts
Premiums from contracts with discretionary participation feature 144 146
Premiums from unit-linked contracts 498 575
Premiums from other contracts 2 2
Total 644 723
Assumed reinsurance 3 2
Premiums from investment contracts
Premiums from contracts with discretionary participation feature 0 30
Premiums from unit-linked contracts 475 394
Total 475 424
Insurance and investment contracts, total 1,122 1,149
Reinsurers' share -6 -5
Premiums written, total 1,116 1,144
Single and regular premiums from direct insurance
Regular premiums, insurance contracts 277 287
Single premiums, insurance contracts 367 436
Single premiums, investment contracts 475 424
Total 1,119 1,147
2 Net income from investments
P&C insurance
EURm 2016 2015
Financial assets
Derivative financial instruments
Gains/losses -7 -4
Loans and receivables
Interest income 9 18
Financial assets available-for-sale
Debt securities
Interest income 177 191
Impairment losses -15 10
Gains/losses -11 -5
Equity securities
Gains/losses 45 121
Impairment losses -16 -11
Dividend income 40 47
Total 221 353
Total from financial assets 223 366
Other assets
Investment properties
Gains/losses 0 -1
Other 1 0
Total from other assets 1 -1
Expense on other than financial liabilities -6 -4
Effect of discounting annuities -28 -38
Fee and commission expenses
Asset management -17 -19
P&C insurance, total 173 304
Included in gains/losses from financial assets available-for-sale is a net gain of EURm 12 (83) transferred from the fair value reserve.
Life insurance
Milj.e 2016 2015
Financial assets
Derivative financial instruments
Gains/losses -9 -90
Financial assets designated as at fair value through p/l
Debt securities
Interest income 1 1
Gains/losses -3 1
Total -3 2
Investments related to unit-linked contracts
Debt securities
Interest income 50 58
Gains/losses 4 -40
Equity securities
Gains/losses 198 219
Dividend income 32 22
Loans and receivables
Interest income 0 1
Other financial assets
Gains/losses -8 -21
Total 276 239
Loans and receivables
Interest income 4 3
Gains/losses 6 27
Total 10 30
Financial assets available-for-sale
Debt securities
Interest income 102 96
Gains/losses 30 48
Equity securities
Gains/losses 101 192
Impairment losses -15 -19
Dividend income 122 108
Total 340 423
Total financial assets 614 604
Other assets
Investment properties
Gains/losses 3 2
Other 6 13
Total other assets 9 15
Net fee income
Asset management -15 -17
Fee income 26 29
Total 11 13
Life insurance, total 634 632
Included in gains/losses from financial assets available-for-sale is a net gain of EURm 106 (259) transferred from the fair value reserve.
Holding
EURm 2016 2015
Financial assets
Derivative financial instruments
Gains/losses 12 7
Loans and receivables -5 9
Financial assets available-for-sale
Debt securities
Interest income 34 28
Gains/losses 10 15
Equity securities
Gains/losses -26 13
Impairment losses -1 0
Dividend income 12 5
Total 29 60
Holding, total 36 76
Included in gains/losses from financial assets available for-sale is a net gain of EURm -27 (12) transferred from the fair value reserve.
Elimination items between segments -16 -14
EURm 2016 2015
Group, total 827 998
The changes in the fair value reserve are disclosed in the Statement of changes in equity. Other income and expenses comprise rental income, maintenance expenses and depreciation of investment property. All the income and expenses arising from investments are included in Net income from investments. Gains/losses include realised gains/losses on sales, unrealised and realised changes in fair values and exchange differences. Unrealised fair value changes for financial assets available-for-sale are recorded in other comprehensive income and presented in the fair value reserve in equity. The effect of discounting annuities in P&C insurance is disclosed separately. The provision for annuities is calculated in accordance with actuarial principles taking anticipated inflation and mortality into consideration, and discounted to take the anticipated future return on investments into account. To cover the costs for upward adjustment of annuity provisions required for the gradual reversal of such discounting, an anticipated return on investments is added to annuity results.
3 Claims incurred
P&C insurance
2016 2015
EURm Gross Ceded Net Gross Ceded Net
P&C insurance
Claims cost attributable to current-year operations
Claims paid -1,643 11 -1,633 -1,607 17 -1,590
Change in provision for claims outstanding (incurred and reported losses) -666 40 -626 -691 20 -672
Change in provision for claims outstanding (incurred but not reported losses, IBNR) -557 11 -546 -574 12 -562
Claims-adjustment costs 1 - 1 -1 - -1
Change in claims provision for annuities -8 - -8 -8 - -8
Total claims cost attributable to current-year operations -2,873 62 -2,811 -2,881 48 -2,833
Claims costs attributable to prior-year operations
Claims paid -1,055 56 -999 -1,011 45 -966
Annuities paid -124 0 -124 -204 0 -204
Change in provision for claims outstanding (incurred and reported losses) 588 -20 568 635 -26 609
Change in provision for claims outstanding (incurred but not reported losses, IBNR) 721 -33 688 516 -16 500
Total claims cost attributable to prior-year operations 130 3 133 -64 3 -61
Insurance claims paid
Claims paid -2,698 67 -2,632 -2,618 61 -2,557
Annuities paid -132 - -132 -132 - -132
Claims portfolio 1 7 8 16 - -
Total claims paid -2,828 73 -2,755 -2,734 61 -2,689
Change in provision for claims outstanding
Change in provision for claims outstanding (incurred and reported losses) -78 20 -57 -56 -6 -62
Change in provision for claims outstanding (incurred but not reported losses, IBNR) 119 -22 97 -127 -4 -131
Change in claims provision for annuities 44 - 44 -11 0 -11
Claims-adjustment costs 1 - 1 -1 - -1
Total change in provision for claims outstanding 87 -2 85 -195 -10 -205
P&C insurance, total -2,741 71 -2,670 2,929 51 -2,894
The provision for annuities is valued in accordance with normal actuarial principles taking anticipated inflation and mortality into consideration, and discounted to take the anticipated future investment return into account. To cover costs for the costs for the upward adjustment of annuity provisions required for the gradual reversal of such discounting, an anticipated return is added to the annuity results. Provisions for incurred but not reported losses pertaining to annuities in Finland are discounted. The provisions in 2016 amounted to EURm 277 (261). The non-discounted value was EURm 367 (351). The exchange effect on the discounted provisions was a decrease of EURm 10. The real increase was EURm 9.
Interest rate used in calculating the technical provisions of annuities (%)
2016 2015
Sweden 1.65% 2.01%
Finland 1.50% 1.50%
Denmark 0.72% 1.71%
Life insurance
Claims paid Change in provision for claims outstanding Claims incurred
EURm 2016 2015 2016 2015 2016 2015
Insurance contracts
Life insurance
Contracts with discretionary participation feature (DPF) -43 -47 2 2 -41 -45
Other contracts 0 0 0 0 0 -1
Unit-linked contracts -205 -183 2 14 -203 -170
Total -248 -231 4 16 -244 -215
Pension insurance
Contracts with discretionary participation feature (DPF) -425 -397 92 -19 -334 -417
Unit-linked contracts -18 -15 -19 -21 -37 -36
Total -443 -412 73 -40 -370 -453
Assumed reinsurance -1 0 0 0 0 -1
Insurance contracts total, gross -692 -644 77 -25 -615 -668
Reinsurers' share 3 3 0 0 3 3
Insurance contracts total, net -689 -641 77 -25 -612 -666
Investment contracts
Capital redemption policies
Contracts with discretionary participation feature (DPF) 0 0 - - 0 0
Unit-linked contracts -355 -358 - - -355 -358
Investment contracts, total -355 -358 - - -355 -358
Life insurance, total -1,044 -999 77 -25 -967 -1,023
Claims paid by type of benefit
EURm 2016 2015
Insurance contracts
Life insurance
Surrender benefits -7 -8
Death benefits -21 -19
Maturity benefits -6 -10
Other -10 -10
Total -44 -48
Life insurance, unit-linked
Surrender benefits -149 -132
Death benefits -45 -41
Maturity benefits -10 -10
Total -205 -183
Pension insurance
Pension payments -415 -386
Surrender benefits -2 -6
Death benefits -9 -5
Total -425 -397
Pension insurance, unit-linked
Pension payments -4 -1
Surrender benefits -10 -11
Death benefits -4 -3
Total -18 -15
Assumed reinsurance -1 0
Insurance contracts total, gross -692 -644
Reinsurers' share 3 3
Insurance contracts total, net -689 -641
Investment contracts
Capital redemption policy, with-profit
Surrender benefits -372 -375
Loss adjustment expenses 17 17
Total -355 -358
Investment contracts total, gross -355 -358
Claims paid total, gross -1,047 -1,001
Claims paid total, net -1,044 -999
Elimination items between segments 10 -
EURm 2016 2015
Group, total -3,627 -3,917
4 Change in liabilities for insurance and investment contracts
P&C insurance
EURm 2016 2015
Change in unearned premium provision -4 -39
Reinsurers' share -2 5
Change in unearned premium provision, net -6 -34
Life insurance
EURm 2016 2015
Insurance contracts
Life-insurance
Contracts with discretionary participation feature (DPF) 23 15
Unit-linked contracts -252 -292
Total -228 -278
Pension insurance
Contracts with discretionary participation feature (DPF) 67 94
Unit-linked contracts -116 -143
Total -49 -49
Insurance contracts total -277 -327
Investment contracts
Capital redemption policy
Contracts with discretionary participation feature (DPF) 10 -33
Unit-linked contracts -198 -102
Investment contracts, total -188 -135
Change in liabilities for insurance and investment contracts in total, net -465 -462
Elimination items between segments 24 -5
Group, total -448 -502
5 Staff costs
P&C insurance
EURm 2016 2015
Staff costs
Wages and salaries -368 -373
Cash-settled share-based payments -6 -17
Pension costs
- defined contribution plans -66 213
- defined benefit plans (Note 31) 5 -137
Other social security costs -76 -57
P&C insurance, total -512 -371
Life insurance
EURm 2016 2015
Staff costs
Wages and salaries -36 -35
Cash-settled share-based payments -1 -4
Pension costs - defined contribution plans -6 -6
Other social security costs -3 -3
Life insurance, total -46 -47
Holding
EURm 2016 2015
Staff costs
Wages and salaries -9 -8
Cash-settled share-based payments -4 -8
Pension costs - defined contribution plans -2 -2
Other social security costs -1 -1
Holding, total -16 -20
EURm 2016 2015
Group, total -574 -438
More information on share-based payments in note 36 Incentive schemes.
6 Other operating expenses
P&C insurance
EURm 2016 2015
IT costs -103 -114
Other staff costs -14 -15
Marketing expenses -38 -38
Depreciation and amortisation -12 -9
Rental expenses -46 -45
Change in deferred acquisition costs -10 -5
Direct insurance comissions -163 -167
Commissions on reinsurance ceded 12 14
Other -98 -98
P&C insurance, total -472 -477
Life insurance
EURm 2016 2015
IT costs -18 -17
Other staff costs -2 -2
Marketing expenses -4 -4
Depreciation and amortisation -2 -2
Rental expenses -4 -4
Direct insurance comissions -8 -9
Comissions of reinsurance assumed -1 -1
Commissions on reinsurance ceded 2 1
Other -42 -38
Life insurance, total -78 -74
Item Other for P&C and Life Insurance includes e.g. expenses related to communication, external services and other administrative expenses.
Holding
EURm 2016 2015
IT costs -1 -1
Marketing expenses -1 -1
Rental expenses -1 -1
Other -15 -9
Holding, total -18 -12
Item Other includes e.g. consultancy fees and rental and other administrative expenses.
Elimination items between segments 16 17
EURm 2016 2015
Group, total -551 -545
7 Result analysis of P&C insurance
EURm 2016 2015
Insurance premiums earned 4,286 4,344
Claims incurred -2,905 -3,143
Operating expenses -713 -566
Other insurance technical income and expense -7 -1
Allocated investment return transferred from the non-technical account -3 23
Technical result 658 657
Net investment income account 188 325
Allocated investment return transferred to the technical account -26 -60
Other income and expense 63 38
Operating result 883 960
Specification of activity-based operating expenses included in the income statement
EURm 2016 2015
Claims-adjustment expenses (claims paid) -235 -249
Acquisition expenses (operating expenses) -490 -497
Joint administrative expenses for insurance business (operating expenses) -226 -78
Administrative expenses pertaining to other technical operations (operating expenses) -33 -71
Asset management costs (investment expenses) -17 -19
Total -1,002 -914
8 Performance analysis per class of P&C insurance
EURm Accident and health Motor, third party liability Motor, other classes Marine, air and transport Fire and other damage to property Third party liability Credit insurance
Premiums written, gross
2016 729 615 1,301 119 1,244 198 2
2015 754 635 1,294 125 1,296 202 2
Premiums earned, gross
2016 737 620 1,271 121 1,254 201 2
2015 740 636 1,266 123 1,299 204 2
Claims incurred, gross 1)
2016 -490 -372 -912 -72 -852 -93 -1
2015 -525 -581 -854 -83 -851 -132 -1
Operating expenses, gross 2)
2016 -129 -134 -191 -20 -197 -32 0
2015 -133 -136 -184 -21 -210 -33 0
Profit/loss from ceded reinsurance
2016 -4 0 -2 -11 -65 -31 0
2015 -9 -1 -1 -12 -76 -12 -
Technical result before investment return
2016 115 114 166 18 139 45 2
2015 73 -83 226 7 162 28 1
EURm Legal expenses Other Total direct insurance Reinsurance assumed Elimination Total
Premiums written, gross
2016 46 109 4,364 94 - 4,458
2015 45 114 4,465 94 0 4,559
Premiums earned, gross
2016 46 108 4,360 94 - 4,454
2015 44 111 4,424 96 0 4,520
Claims incurred, gross 1)
2016 -29 -72 -2,892 -89 4 -2,976
2015 -27 -99 -3,153 -48 7 -3,194
Operating expenses, gross 2)
2016 -7 -21 -731 -16 15 -732
2015 -7 -16 -740 -17 135 -622
Profit/loss from ceded reinsurance
2016 0 -12 -125 40 - -85
2015 - -7 -117 6 0 -112
Technical result before investment return
2016 10 4 613 28 19 660
2015 9 -10 414 37 142 592
1) Activity-based operating costs EURm 235 (249) have been allocated to claims incurred.
2) Includes other technical income EURm 26 (28) and other technical expenses EURm 33 (28).
9 Earnings per share
EURm 2016 2015
Earnings per share
Profit or loss attributable to the equity holders of the parent company 1,650 1,656
Weighted average number of shares outstanding during the period 560 560
Earnings per share (EUR per share) 2.95 2.96
10 Financial assets and liabilities
Financial assets and liabilities have been categorised in accordance with IAS 39.9. In the table are also included interest income and expenses, realised and unrealised gains and losses recognised in P/L, impairment losses and dividend income arising from those assets and liabilities. The financial assets in the table include balance sheet items Financial assets, Cash and cash equivalents and Assets held for sale.
2016
EURm Carrying amount Interest inc./exp. Gains/losses Impairment losses Dividend income
FINANCIAL ASSETS
Financial assets at fair value through p/l
Derivative financial instruments 45 -21 18 - -
Financial assets designated as at fair value through p/l 24 1 0 - 0
Loans and receivables 2,689 13 6 - -
Financial assets available-for-sale 17,705 298 146 -47 175
Financial assets, group total 20,463 290 169 -47 175
FINANCIAL LIABILITIES
Financial liabilities at fair value through p/l
Derivative financial instruments 81 - -
Other financial liabilities 3,766 -52 34
Financial liabilities, group total 3,847 -52 34
2015
EURm Carrying amount Interest inc./exp. Gains/losses Impairment losses Dividend income
FINANCIAL ASSETS
Financial assets at fair value through p/l
Derivative financial instruments 53 -9 -79 - -
Financial assets designated as at fair value through p/l 48 1 2 - 0
Loans and receivables 2,129 20 44 - -
Financial assets available-for-sale 16,955 295 382 -20 159
Financial assets, group total 19,185 307 350 -20 160
FINANCIAL LIABILITIES
Financial liabilities at fair value through p/l
Derivative financial instruments 63 - -
Other financial liabilities 2,312 -59 -8
Financial liabilities, group total 2,375 -59 -8
11 Property, plant and equipment
P&C insurance
EURm 2016
Equipment		 2015
Equipment
At 1 Jan.
Cost 65 63
Accumulated depreciation -47 -46
Net carrying amount at 1 Jan. 19 16
At 31 Dec.
Cost 65 65
Accumulated depreciation -46 -47
Net carrying amount at 31 Dec. 19 19
Life insurance
2016 2015
EURm Land and buildings Equipment Total Land and buildings Equipment Total
At 1 Jan.
Cost 4 8 12 4 8 12
Accumulated depreciation -1 -7 -8 -1 -7 -7
Net carrying amount at 1 Jan. 4 1 5 4 1 5
At 31 Dec.
Cost 4 8 12 4 8 12
Accumulated depreciation -1 -7 -8 -1 -7 -8
Net carrying amount at 31 Dec. 4 1 4 4 1 5
Holding
2016 2015
EURm Land and buildings Equipment Total Land and buildings Equipment Total
At 1 Jan.
Cost 2 4 6 2 5 7
Accumulated depreciation -1 -2 -3 -1 -3 -4
Net carrying amount at 1 Jan. 1 2 3 1 2 3
At 31 Dec.
Cost 2 4 5 2 4 6
Accumulated depreciation -1 -1 -2 -1 -2 -3
Net carrying amount at 31 Dec. 1 2 3 1 2 3
EURm 2016 2015
Group, total 27 26
Equipment in different segments comprise IT equipment and furniture.
12 Investment property
P&C insurance
EURm 2016 2015
At 1 Jan.
Cost 25 29
Accumulated depreciation -8 -8
Accumulated impairment losses -2 -1
Net carrying amount at 1 Jan. 15 20
Opening net carrying amount 15 20
Disposals - -4
Depreciation -1 -1
Impairment losses 0 -1
Exchange differences 0 0
Closing net carrying amount 14 15
At 31 Dec.
Cost 25 25
Accumulated depreciation -9 -8
Accumulated impairment losses -2 -2
Net carrying amount at 31 Dec. 14 15
Rental income from investment property 3 2
Property rented out under operating lease
Non-cancellable minimum rental
- not later than one year 1 1
- later than one year and not later than five years 1 1
Total 2 2
Expenses arising from investment property
- direct operating expenses arising from investment property generating rental income during the period -1 -1
- direct operating expenses arising from investment property not generating rental income during the period -1 -1
Total -2 -2
Fair value of investment property at 31 Dec. 22 22
Life insurance
EURm 2016 2015
At 1 Jan.
Cost 257 247
Accumulated depreciation -55 -51
Accumulated impairment losses -23 -17
Net carrying amount at 1 Jan. 180 179
Opening net carrying amount 180 179
Additions 41 27
Disposals -18 -17
Depreciation -3 -4
Impairment losses 1 -6
Closing net carrying amount 201 180
At 31 Dec.
Cost 280 257
Accumulated depreciation -58 -55
Accumulated impairment losses -22 -23
Net carrying amount at 31 Dec. 201 180
Rental income from investment property 20 21
Property rented out under operating lease
Non-cancellable minimum rental
- not later than one year 9 9
- later than one year and not later than five years 13 6
- later than five years 3 0
Total 25 14
Expenses arising from investment property
- direct operating expenses arising from investment property generating rental income during the period -9 -9
- direct operating expenses arising from investment property not generating rental income during the period -1 -1
Total -10 -10
Fair value of investment property at 31 Dec. 222 203
Elimination items between segments -4 -4
EURm 2016 2015
Group, total 211 191
Fair values for the Group's investment property are entirely determined by the Group based on the market evidence. The determination and hierarchy of financial assets and liabilities at fair value is disclosed in note 17. Based on the principles of this determination, the investment property falls under level 2.
The premises in investment property for different segments are leased on market-based, irrevocable contracts. The lengths of the contracts vary from those for the time being to those for several years.
13 Intangible assets
P&C insurance
2016
EURm Goodwill *) Other intangible assets Total
At 1 Jan.
Cost 547 24 570
Accumulated amortisation - -6 -6
Net carrying amount at 1 Jan. 547 17 564
At 31 Dec.
Cost 526 23 549
Accumulated amortisation - -8 -8
Net carrying amount at 31 Dec. 526 16 541
2015
EURm Goodwill *) Other intangible assets Total
At 1 Jan.
Cost 535 24 559
Accumulated amortisation - -5 -5
Net carrying amount at 1 Jan. 535 20 554
At 31 Dec.
Cost 547 24 570
Accumulated amortisation - -6 -6
Net carrying amount at 31 Dec. 547 17 564
*) The change in the cost is due to exchange differences.
Life insurance
2016 2015
EURm Goodwill Other intangible assets Total Goodwill Other intangible assets Total
At 1 Jan.
Cost 153 43 196 153 43 196
Accumulated amortisation - -36 -36 - -36 -36
Net carrying amount at 1 Jan. 153 7 160 153 7 160
At 31 Dec.
Cost 153 44 197 153 43 196
Accumulated amortisation - -38 -38 - -36 -36
Net carrying amount at 31 Dec. 153 6 159 153 7 160
Assets held for sale -89 - -89
Net carrying amount at 31 Dec. 64 6 70
EURm 2016 2015
Group, total 612 724
Other intangible assets in all segments comprise mainly IT software.
Depreciation and impairment losses are included in the income statement item Other operating expenses.
Testing goodwill for impairment
Goodwill is tested for impairment in accordance with IAS 36 Impairment of assets. No impairment losses have been recognised based on these tests.
For the purpose of testing goodwill for impairment, Sampo determines the recoverable amount of its cash-generating units, to which goodwill has been allocated, on the basis of value in use. Sampo has defined these cash-generating units as If Group and Mandatum Life.
The recoverable amounts for If have been determined by using a discounted cash flow model. The model is based on Sampo’s management’s best estimates of both historical evidence and economic conditions such as volumes,interest rates, margins, capital structure and income and cost development. The value in use model for Mandatum Life is greatly influenced by the long-term development of insurance liabilities, affecting e.g. the required solvency capital and thus the recoverable amount. That is why the forecast period is longer for Mandatum Life, 10 years. The derived cash flows were discounted at the pre-tax rates of the weighted average cost of capital which for If was 7.2% and for Mandatum Life 7.6%. These are lower than last year due to the decrease in the interest rates of Nordic bonds.
Forecasts for If, approved by the management, cover years 2017 – 2019. The cash flows beyond that have been extrapolated using a 2% growth rate. A 2% growth rate for years beyond 2026 has been used for the for Mandatum Life as well, as it is believed to be close to the anticipated inflation.
In Mandatum Life, the recoverable amount exceeds its carrying amount by some EURm 410. With the calculation method used, e.g. an increase of about 2% in the weighted average cost of capital could lead to a situation where the recoverable amount of the entity would equal its carrying amount.
As for the If Group, the management believes that any reasonably possible change in any of these key assumptions would not cause the aggregate carrying amount to exceed the aggregate recoverable amount.
14 Investments in associates
Associates that have been accounted for by the equity method at 31 Dec. 2016
EURm

Name		 Domicile Carrying amount Fair value*) Interest held %
Nordea Bank Abp Sweden 7,554 9,124 21.25
Topdanmark A/S Denmark 554 955 45.38
Autovahinkokeskus Oy Finland 3 35.54
CAP Group AB Sweden 2 21.98
Svithun Assuranse AS Norway 1 33.00
Contemi Holding AS Norway 0 28.57
SOS International A/S Denmark 7 25.20
Associates that have been accounted for by the equity method at 31 Dec. 2015
EURm

Name		 Domicile Carrying amount Fair value*) Interest held %
Nordea Bank Abp Sweden 7,305 8,735 21.25
Topdanmark A/S Denmark 362 827 32.9
Autovahinkokeskus Oy Finland 3 35.54
CAP Group AB Sweden 2 21.98
Urzus Group AS Norway 1 28.57
Svithun Assuranse AS Norway 1 33.00
Watercircles Skandinavia AS (Norway) Norway 3 35.75
Contemi Holding AS Norway 1 28.57
*) Published price quatation
Changes in investments in associates
2016 2015
EURm Nordea Other associates Total Nordea Other associates Total
At beginning of year 7,305 374 7,679 7,065 382 7,447
Share of loss/profit 773 65 837 751 42 793
Additions - 205 205 - 1 1
Disposals -551 -5 -555 -533 -1 -534
Changes in the equity of associates 27 -86 -59 23 -51 -28
Exchange differences - 0 0 - 0 0
At end of year 7,554 553 8,107 7,305 374 7,679
The carrying amount of investments in associates included goodwill EURm 1,201 (1,101), including goodwill from the Nordea acquisition EURm 978 (978).
Sampo's holding in Nordea
Nordea is an universal bank with positions within corporate merchant banking as well as retail banking and private banking. With approximately 700 branches, call centers in all Nordic countries and an e-bank, Nordea also has a large distribution network for customers in the Nordic and Baltic sea region.
Financial information on Nordea
EURm 2016 2015
Assets 615,659 646,868
Liabilities 583,249 615,836
Revenue 9,927 10,140
Other comprehensive income items 165 13
Comprehensive income statement 3,766 3,675
Dividend income from the associate during the financial year 551 533
Sampo's share of Nordea's loss/profit consists of the following as of 31 Dec. 2016
EURm 2016 2015
Share of loss/profit of the associate 800 778
Amortisation of the customer rlations -35 -35
Change in deferred tax 8 8
Share of the loss/profit of an associate 773 751
15 Financial assets
Group's financial assets comprise investments in derivatives, financial assets designated as at fair value through p/l, loans and receivables, available-for-sale financial assets and investments in subsidiaries. The Holding segment includes also investments in subsidiaries.
The Group uses derivative instruments for trading and for hedging purposes. The derivatives used are foreign exchange, interest rate and equity derivatives. Fair value hedging has been applied during the financial year both in P&C and Life insurance.
EURm 2016 2015
P&C insurance
Derivative financial instruments 14 21
Loans and receivables 84 108
Financial assets available-for-sale 11,569 10,437
P&C insurance, total 11,667 10,566
Life insurance
Derivative financial instruments 13 11
Financial assets designated as at fair value through p/l 24 48
Loans and receivables 20 24
Financial assets available-for-sale 5,612 5,956
Total 5,670 6,039
Assets held for sale -210 -
Life insurance, total 5,459 6,039
Holding
Derivative financial instruments 18 21
Loans and receivables 0 1
Financial assets available-for-sale 814 852
Investments in subsidiaries 2,370 2,370
Holding, total 3,201 3,243
Elimination items between segments -2,659 -2,659
Group, total 17,668 17,189
P&C insurance
Derivative financial instruments
2016 2015
Contract/ Fair value Contract/ Fair value
EURm notional amount Assets Liabilities notional amount Assets Liabilities
Derivatives held for trading
Interest rate derivatives
OTC derivatives
Intrerest rate swaps 67 0 4 2,069 0 2
Foreign exchange derivatives
OTC derivatives
Currency forwards 3,148 13 63 2,777 19 15
Currency options, bought and sold 30 0 0 101 1 0
Total foreign exchange derivatives 3,178 13 63 2,878 21 15
Equity derivatives
OTC derivatives
Equity and equity index options 0 1 - - - -
Total derivatives held for trading 3,245 14 67 4,948 21 17
Other financial assets
EURm 2016 2015
Loans and receivables
Deposits with ceding undertakings 1 1
Other 83 108
Total loans and receivables 84 108
Financial assets available-for-sale
Debt securities
Issued by public bodies 1,246 1,392
Certificates of deposit issued by banks 3,407 3,120
Other debt securities 5,370 4,404
Total debt securities 10,022 8,916
Equity securities
Listed 1,524 1,497
Unlisted 23 25
Total 1,547 1,522
Total financial assets available-for-sale 11,569 10,437
Financial assets available-for-sale for P&C insurance include impairment losses EURm 227 (197).
P&C insurance, total financial assets 11,667 10,566
Life insurance
Derivative financial instruments
2016 2015
Contract/ Fair value Contract/ Fair value
EURm notional amount Assets Liabilities notional amount Assets Liabilities
Derivatives held for trading
Interest rate derivatives
OTC derivatives
Interest rate swaps 144 1 0 4,618 0 1
Credit risk swaps - - - 643 - 0
Total 144 1 0 5,261 0 2
Foreign exchange derivatives
OTC derivatives
Currency forwards 1,691 10 11 1,633 8 22
Currency options, bought and sold 63 0 0 156 1 1
Total foreign exchange derivatives 1,754 10 11 1,789 9 22
Total derivatives held for trading 1,898 10 11 7,050 9 24
Derivatives held for hedging
Fair value hedges
Currency forwards 534 2 0 602 2 9
Total 534 2 0 602 2 9
Total derivatives held for hedging 534 2 0 602 2 9
Total derivatives 2,432 13 11 7,651 11 33
Fair value hedges
Fair value hedging is used to hedge a proportion of foreign exchange and interest risk in available-for-sale financial assets. The interest elements of forward contracts have been excluded from hedging relationships in foreign exchange hedges. Net result from exchange derivatives designated as fair value hedges amounted to EURm 19 (-69). Net result from hedged risks in fair value hedges of available for sale financial assets amounted to EURm -19 (68).
Other financial assets
EURm 2016 2015
Financial assets designated as at fair value through p/l
Debt securities
Issued by public bodies 15 13
Issued by banks 7 10
Other debt securities 0 23
Total debt securities 22 47
Listed equity securities 2 2
Total financial assets designated as at fair value through p/l 24 48
Loans and receivables
Loans 20 24
Financial assets available-for-sale
Debt securities
Issued by public bodies 19 30
Issued by banks 563 488
Other debt securities 2,523 2,896
Total debt securities 3,105 3,414
Equity securities
Listed 1,727 1,669
Unlisted 779 873
Total 2,507 2,542
Total financial assets available-for-sale 5,612 5,956
Financial assets available-for-sale for life insurance include impairment losses EURm 15 (19).
Total financial assets 5,670 6,039
Assets held for sale -210 -
Life insurance, total financial assets 5,459 6,039
Financial assets available for sale / debt securities: Debt securities available for sale include EURm 2,925 (3,334) investments in bonds and EURm 180 (95) investments in money market instruments.
Financial assets available for sale / shares and participations: Listed equity securities include EURm 913 (831) listed equities. Unlisted equity securities include EURm 727 (768) investments in capital trusts.
Holding
Derivative financial instruments
2016 2015
Contract/ Fair value Contract/ Fair value
EURm notional amount Assets Liabilities notional amount Assets Liabilities
Derivatives held for trading
Interest derivatives
OTC-derivatives
Interest rate swaps 523 12 - 800 10 -
Foreign exchange derivatives
OTC-derivatives
Currency forwards 478 4 1 74 1 2
Equity derivatives
OTC-derivatives
Equity and euqity index options 9 2 3 60 10 10
Total derivatives 1,010 18 3 933 21 12
Other financial assets
EURm 2016 2015
Loans and receivables
Deposits 0 1
Financial assets available-for-sale
Debt securities
Certificates of deposit issued by banks 250 196
Other debt securities 415 407
Total debt securities 666 603
Equity securities
Listed 129 228
Unlisted 20 20
Total 148 248
Total financial assets available-for-sale 814 852
Financial assets available-for-sale for Holding business do not include impairment losses.
Investments in subsidiaries 2,370 2,370
Holding, total financial assets 3,201 3,243
Elimination items between segments -2,659 -2,659
EURm 2016 2015
Group, total 17,668 17,189
16 Fair values
2016 2015
EURm Fair value Carrying ammount Fair value Carrying amount
Financial assets, group
Financial assets 17,880 17,879 17,192 17,189
Investments related to unit-linked contracts 3,427 3,427 5,847 5,847
Other assets 49 49 28 28
Cash and cash equivalents 2,585 2,585 1,997 1,997
Total 23,941 23,940 25,064 25,060
Financial liablities, group
Financial liabilities 3,910 3,847 2,424 2,375
Other liabilities 31 31 64 64
Total 3,941 3,878 2,488 2,439
In the table above are presented fair values and carrying amounts of financial assets and liabilities. Assets held for sale are included in the figures. The detailed measurement bases of financial assets and liabilities are disclosed in Group Accounting policies.
The fair value of investment securities is assessed using quoted prices in active markets. If published price quotations are not available, the fair value is assessed using discounting method. Values for the discount rates are taken from the market’s yield curve.
The fair value of the derivative instruments is assessed using quoted market prices in active markets, discounting method or option pricing models.
The fair value of loans and other financial instruments which have no quoted price in active markets is based on discounted cash flows, using quoted market rates. The market’s yield curve is adjusted by other components of the instrument, e.g. by credit risk.
The fair value for short-term non-interest-bearing receivables and payables is their carrying amount.
Disclosed fair values are "clean" fair values, i.e. less interest accruals.
17 Determination and hierarchy of fair values
A large majority of Sampo Group's financial assets are valued at fair value. The valuation is based on either published price quatations or valuation techniques based on market observable inputs, where available. For a limited amount of assets the value needs to be determined using other techniques. The financial instruments measured at fair value have been classified into three hierarchy levels in the notes, depending on e.g. if the market for the instrument is active, or if the inputs used in the valuation technique are observable.

On level 1, the measurement of the instrument is based on quoted prices in active markets for identical assets or liabilities.

On level 2, inputs for the measurement of the instrument include also other than quoted prices observable for the asset or liability, either directly or indirectly by using valuation techniques.

In level 3, the measurement is based on other inputs rather than observable market data.

The figures include the financial assets classified as Assets held for sale.
EURm Level 1 Level 2 Level 3 Total
FINANCIAL ASSETS AT 31 DEC. 2016
Derivative financial instruments
Interest rate swaps - 12 - 12
Foreign exchange derivatives - 30 - 30
Equity derivatives - 3 - 3
- 45 - 45
Financial assets designated at fair value through profit or loss
Equity securities 2 - - 2
Debt securities 18 4 0 22
20 4 0 24
Financial assets related to unit-linked insurance
Equity securities 664 13 14 692
Debt securities 748 650 27 1,424
Derivative financial instruments 2,954 902 154 4,009
Mutual funds - 2 - 2
4,366 1,567 194 6,128
Financial assets available-for-sale
Equity securities 2,123 - 48 2,171
Debt securities 9,410 4,036 58 13,504
Mutual funds 1,212 60 758 2,030
12,746 4,096 863 17,705
Total financial assests measured at fair value 17,132 5,713 1,057 23,902
FINANCIAL LIABILITIES AT 31 DEC. 2016
Derivative financial instruments
Interest rate derivatives - 4 - 4
Foreign exchange derivatives - 74 - 74
Equity derivatives - 3 - 3
Total financial liabilities measured at fair value - 81 - 81
EURm Level 1 Level 2 Level 3 Total
FINANCIAL ASSETS AT 31 DEC. 2015
Derivative financial instruments
Interest rate swaps - 10 - 10
Foreign exchange derivatives - 33 - 33
Equity derivatives - 10 - 10
- 53 - 53
Financial assets designated at fair value through profit or loss
Equity securities 2 - - 2
Debt securities 18 29 0 47
20 29 0 48
Financial assets related to unit-linked insurance
Equity securities 616 7 17 639
Debt securities 751 453 27 1,231
Derivative financial instruments 2,720 987 46 3,753
Mutual funds - 7 - 7
4,087 1,454 89 5,630
Financial assets available-for-sale
Equity securities 2,129 - 46 2,175
Debt securities 9,227 3,327 89 12,643
Mutual funds 1,296 39 801 2,136
12,652 3,366 936 16,954
Total financial assests measured at fair value 16,759 4,901 1,026 22,686
EURm Taso 1 Taso 2 Taso 3 Total
FINANCIAL LIABILITIES AT 31 DEC. 2015
Derivative financial instruments
Interest rate derivatives - 4 - 4
Foreign exchange derivatives - 48 - 48
Equity derivatives - 10 - 10
Total financial liabilities measured at fair value - 63 - 63
Transfers between levels 1 and 2
2016 2015
Transfers from level 2 to level 1 Transfers from level 1 to level 2 Transfers from level 2 to level 1 Transfers from level 1 to level 2
Financial assets related to unit-linked insurance
Debt securities 3 4 324 4
Financial assets available-for-sale
Debt securities 459 502 339 257
Sensitivity analysis of fair values
The sensitivity of financial assets and liabilites to changes in exchange rates is assessed on business area level due to different base currencies. In P&C insurance, 10 percentage point depreciation of all other currencies against SEK would result in an increase recognised in profit/loss of EURm 10 (9) and in a decrease recognised directly in equity of EURm 8 (3). In Life insurance, 10 percentage point depreciation of all other currencies against EUR would result in an increase recognised in profit/loss of EURm 12 (23) and in a decrease recognised directly in equity of EURm 94 (79). In Holding, 10 percentage point depreciation of all other currencies against EUR would have no impact in profit/loss, but a decrease recognised in equity of EURm 163 (68).
The sensitivity analysis of the Group's fair values of financial assets and liabilities in differenct market risk scenarios is presented below. The effects represent the instantaneous effects of a one-off change in the underlying market variable on the fair values on 31 Dec. 2016.
The sensitivity analysis includes the effects of derivative positions. All sensitivities are calculated before taxes.
The debt issued by Sampo plc is not included.
Interest rate Equity Other financial investments
1% parallel shift down 1% parallel shift up 20% fall in prices 20% fall in prices
Effect recognised in profit/loss 0 -2 0 0
Effect recognised directly in equity 255 -239 -670 -195
Total effect 256 -241 -670 -195
18 Movements in level 3 financial instruments measured at fair value
EURm At 1 Jan. Total gains/losses in income statement Total gains/losses recorded in other comprehensive income Purchases Sales Transfers between levels 1 and 2 At 31 Dec. Gains/losses included in p/l for financial assets 31 Dec. 2016
FINANCIAL ASSETS AT 31 DEC. 2016
Financial assets related to unit-linked insurance
Equity securities 17 -6 - 12 -9 - 14 -4
Debt securities 27 0 - 0 0 - 27 0
Mutual funds 46 -3 - 129 -19 - 154 -2
89 -9 - 142 -29 - 194 -5
Financial assets available-for-sale
Equity securities 46 2 -1 6 -4 0 48 -2
Debt securities 90 1 0 213 -246 0 58 0
Mutual funds 801 0 -20 174 -198 0 757 -21
936 4 -22 393 -448 0 863 -22
Total financial assests measured at fair value 1,026 -5 -22 535 -477 0 1,057 -27
2016
EURm Realised gains Fair value gains and losses Total
Total gains or losses included in profir or loss for the financial year -5 -22 -26
Total gains or losses included in profit and loss for assets held at the end of the financial year -6 -22 -27
EURm At 1 Jan. Total gains/losses in income statement Total gains/losses recorded in other comprehensive income Purchases Sales Transfers between levels 1 and 2 At 31 Dec. Gains/losses included in p/l for financial assets 31 Dec. 2015
FINANCIAL ASSETS AT 31 DEC. 2015
Financial assets related to unit-linked insurance
Equity securities 16 2 - 3 -4 - 17 1
Debt securities 24 0 - 0 0 3 27 0
Mutual funds 57 2 - 11 -23 - 46 2
96 3 - 14 -27 3 89 3
Financial assets available-for-sale
Equity securities 228 14 -2 0 -194 - 46 2
Debt securities 78 9 0 90 -86 - 90 0
Mutual funds 748 25 13 174 -159 - 801 7
1,054 48 10 264 -440 - 936 9
Total financial assests measured at fair value 1,150 51 10 278 -467 3 1,026 12
2015
EURm Realised gains Fair value gains and losses Total
Total gains or losses included in profir or loss for the financial year 51 6 57
Total gains or losses included in profit and loss for assets held at the end of the financial year 6 6 12
19 Sensitivity analysis of level 3 financial instruments measured at fair value
2016 2015
EURm Carrying amount Effect of reasonably possible alternative assumptions (+ / -) Carrying amount Effect of reasonably possible alternative assumptions (+ / -)
Financial assets
Financial assets available-for-sale
Equity securities 48 -10 46 -9
Debt securities 58 -2 89 -2
Mutual funds 758 -152 801 -160
Total 863 -163 936 -171
The value of financial assets regarding the debt security instruments has been tested by assuming a rise of 1 per cent unit in interest rate level in all maturities. For other financial assets, the prices were assumed to go down by 20 per cent. Sampo Group bears no investment risks related to unit-linked insurance, so a change in assumptions regarding these assets does not affect profit or loss. On the basis of the these alternative assumptions, a possible change in interest levels would cause a descend of EURm 2 (2) for the debt instruments, and EURm 162 (169) valuation loss for other instruments in the Group's other comprehensive income. The reasonably possible effect, proportionate to the Group's equity, would thus be 1.4 per cent (1.5).
20 Investments related to unit-linked insurance contracts
Life insurance
EURm 2016 2015
Financial assets designated at fair value through p/l
Debt securities
Issued by public bodies 68 49
Other debt securities 1,358 1,199
Total 1,426 1,248
Equity securities
Listed 4,388 4,328
Unlisted 313 64
Total 4,701 4,392
Total financial assets designated at fair value through p/l 330 217
Other 2 7
Total 6,460 5,865
Assets held for sale -2,992 -
Investment related to unit-linked contracts, total 3,468 5,865
Elimination items between segments -41 -18
Group total 3,427 5,847
The historical cost of the equity securities related to unit-linked contracts was EURm 3,813 (3,645) and that of the debt securities EURm 1,437 (1,305).
21 Deferred tax assets and liabilities
Changes in deferred tax during the financial period 2016
EURm 1.1. Recognised in comprehensive income statement Recognised in equity Exchange differences 31.12.
Deferred tax assets
Tax losses carried forward 15 0 0 0 15
Employee benefits 35 -8 1 0 28
Other deductible temporary differences 19 -7 0 1 13
Total 68 -15 1 1 56
Netting of deferred taxes -28
Deferred tax assets in the balance sheet 27
Deferred tax liabilities
Depreciation differences and untaxed reserves 251 6 0 0 257
Changes in fair values 221 -2 48 -2 265
Other taxable temporary differences 28 4 1 0 33
Total 500 8 49 -2 555
Netting of deferred taxes -28
Total deferred tax liabilities in the balance sheet 527
Changes in deferred tax during the financial period 2015
EURm 1.1. Recognised in comprehensive income statement Recognised in equity Exchange differences 31.12.
Deferred tax assets
Tax losses carried forward 15 0 - 0 15
Changes in fair values 85 -50 -3 3 35
Other deductible temporary differences 8 -14 4 -1 -3
Total 107 -63 0 2 46
Netting of deferred taxes -12
Deferred tax assets in the balance sheet 35
Deferred tax liabilities
Depreciation differences and untaxed reserves 275 -21 - -3 251
Changes in fair values 231 4 -16 2 221
Other taxable temporary differences 19 12 -25 1 7
Total 526 -5 -41 0 479
Netting of deferred taxes -12
Total deferred tax liabilities in the balance sheet 468
In Sampo plc, EURm 24 of deferred tax asset has not been recognised on unused tax losses. The first losses will expire in 2019.

In life insurance, EURm 4 of deferred tax asset has not been recognised on unused tax losses.
22 Taxes
EURm 2016 2015
Profit before tax 1,871 1,888
Tax calculated at parent company's tax rate -374 -378
Different tax rates on overseas earnings -14 -25
Income not subject to tax 7 2
Expenses not allowable for tax purposes -4 -2
Consolidation procedures and eliminations 165 168
Tax losses for which no deferred tax asset has been recognised 2 0
Changes in tax rates 0 5
Tax from previous years -3 -1
Total -221 -232
23 Components of other comprehensive income
EURm 2016 2015
Other comprehensive income:
Items reclassifiable to profit or loss
Exchange differences -80 -35
Available-for-sale financial assets
Gains/losses arising during the year 302 257
Reclassification adjustments -66 -353
The share of the segretated Suomi portfolio -11 -10
Share of associate's other comprehensive income 19 16
Taxes -49 21
Total items reclassifiable to profit or loss, net of tax 115 -103
Items not reclassifiable to profit or loss
Actuarial gains and losses from defined pension plans -6 14
Taxes 1 -3
Total items not reclassifiable to profit or loss, net of tax -5 11
24 Tax effects relating to components of other comprehensive income
2016 2015
Before-tax amount Tax Net-of-tax amount Before-tax amount Tax Net-of-tax amount
Items reclassifiable to profit or loss
Exchange differences -80 - -80 -35 - -35
Available-for-sale financial assets 225 -49 176 -106 21 -85
Share of associate's other comprehensive income 19 - 19 16 - 16
Total 164 -49 115 -124 21 -103
25 Other assets
P&C insurance
EURm 2016 2015
Interests 55 54
Assets arising from direct insurance operations 1,174 1,132
Assets arising from reinsurance operations 51 38
Settlement receivables 2 2
Deferred acquisition costs 1) 123 131
Assets related to Patient Insurance Pool 120 120
Other 66 62
P&C insurance, total 1,593 1,541
Other assets include non-current assets EURm 114 (112).
Item Other comprise rental deposits, salary and travel advancements and assets held for resale.
1) Change in deferred acquisition costs in the period
EURm 2016 2015
At 1 Jan. 131 138
Net change in the period -10 -4
Exchange differences 2 -2
At 31 Dec. 123 131
Life insurance
EURm 2016 2015
Interests 26 30
Receivables from policyholders 8 9
Assets arising from reinsurance operations 0 0
Settlement receivables 47 21
Assets pledged for trading in derivatives 18 19
Other 63 48
Life insurance, total 162 127
Item Other comprise e.g. pensions paid in advance and receivables from co-operation companies.
Holding
EURm 2016 2015
Interests 10 38
Settlement receivables 0 5
Other 5 8
Holding, total 15 51
Item Other includes e.g. asset management fee receivables.
Elimination items between segments -9 -10
EURm 2016 2015
Group, total 1,761 1,708
26 Cash and cash equivalents
P&C insurance
EURm 2016 2015
Cash at bank and in hand 441 368
Short-term deposits (max 3 months) 22 407
P&C insurance, total 463 775
Life insurance
EURm 2016 2015
Cash at bank and in hand 682 378
Short-term deposits (max 3 months) - 104
Life insurance, total 682 482
Holding
EURm 2016 2015
Cash 1,439 739
Group, total 2,585 1,997
27 Liabilities from insurance and investment contracts
P&C insurance
Change in insurance liabilities
2016 2015
EURm Gross Ceded Net Gross Ceded Net
Provision for unearned premiums
At 1 Jan. 2,017 46 1,971 1,999 41 1,958
Exchange differences 20 1 21 -20 1 -20
Change in provision 4 -2 2 39 5 44
At 31 Dec. 2,042 44 1,997 2,017 46 1,971
2016 2015
EURm Gross Ceded Net Gross Ceded Net
Provision for claims outstanding
At 1 Jan. 7,416 193 7,223 7,185 197 6,988
Acquired/disposed insurance holdings 28 - 28 38 - 38
Exchange differences -19 1 -20 -1 6 -8
Change in provision -87 -2 -86 195 -10 205
At 31 Dec. 7,338 192 7,146 7,416 193 7,223
Liabilities from insurance contracts
EURm 2016 2015
Provision for unearned premiums 2,042 2,017
Provision for claims outstanding 7,338 7,416
Incurred and reported losses 1,596 1,657
Incurred but not reported losses (IBNR) 3,327 3,352
Provisions for claims-adjustment costs 267 269
Provisions for annuities and sickness benefits 2,148 2,138
P&C insurance total 9,379 9,433
Reinsurers' share
Provision for unearned premiums 44 46
Provision for claims outstanding 192 193
Incurred and reported losses 114 95
Incurred but not reported losses (IBNR) 78 98
Total reinsurers' share 236 239
As the P&C insurance is exposed to various exchange rates, comparing the balance sheet data from year to year can be misleading.
­
P&C insurance
The tables below show the cost trend for the claims for different years. The upper part of the tables shows how an estimate of the total claims costs per claims year evolves annually. The lower section shows how large a share of this is presented in the balance sheet. More information on P&C insurance's insurance liabilities in the Risk Management section of the Annual accounts.
Claims costs before reinsurance
Estimated claims cost
EURm < 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Total
At the close of the claims year 14,689 2,570 2,696 2,699 2,810 2,893 2,932 2,831 2,814 2,845 2,886
One year later 14,631 2,566 2,653 2,650 2,849 3,007 2,919 2,859 2,807 2,864
Two years later 14,543 2,531 2,597 2,622 2,796 3,003 2,935 2,860 2,815
Three years later 14,551 2,500 2,570 2,582 2,794 2,991 2,924 2,865
Four years later 14,542 2,455 2,547 2,564 2,787 2,963 2,892
Five years later 14,449 2,431 2,533 2,541 2,785 2,948
Six years later 14,347 2,422 2,514 2,539 2,768
Seven years later 14,342 2,409 2,520 2,511
Eight years later 14,352 2,408 2,500
Nine years later 14,462 2,390
Ten years later 14,429
Current estimate of total claims costs 14,429 2,390 2,500 2,511 2,768 2,948 2,892 2,865 2,815 2,864 2,886 41,868
Total disbursed 11,640 2,177 2,278 2,280 2,506 2,649 2,562 2,477 2,332 2,255 1,640 34,797
Provision reported in the balance sheet 2,788 213 223 231 262 298 330 388 483 609 1,246 7,071
of which established vested annuities 1,523 82 71 61 77 75 71 81 64 37 8 2,148
Provision for claims-adjustment costs 267
Total provision reported in the BS 7,338
Claims costs after reinsurance
Estimated claims cost
EURm < 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Total
At the close of the claims year 13,663 2,473 2,580 2,586 2,673 2,736 2,737 2,782 2,775 2,799 2,825
One year later 13,589 2,462 2,549 2,554 2,719 2,809 2,722 2,810 2,764 2,814
Two years later 13,510 2,436 2,496 2,524 2,677 2,796 2,738 2,812 2,756
Three years later 13,480 2,406 2,470 2,498 2,671 2,791 2,738 2,819
Four years later 13,489 2,363 2,451 2,481 2,668 2,760 2,711
Five years later 13,418 2,340 2,439 2,457 2,665 2,749
Six years later 13,332 2,332 2,420 2,455 2,648
Seven years later 13,333 2,319 2,427 2,431
Eight years later 13,354 2,318 2,408
Nine years later 13,454 2,300
Ten years later 13,417
Current estimate of total claims costs 13,417 2,300 2,408 2,431 2,648 2,749 2,711 2,819 2,756 2,814 2,825 39,877
Total disbursed 10,676 2,089 2,188 2,204 2,391 2,458 2,390 2,445 2,305 2,223 1,630 32,998
Provision reported in the balance sheet 2,741 210 220 227 257 291 321 373 451 591 1,195 6,879
of which established vested annuities 1,523 82 71 61 77 75 71 81 64 37 8 2,148
Provision for claims-adjustment costs 267
Total provision reported in the BS 7,146
­
Life insurance
Change in liabilities arising from other than unit-linked insurance and investment contracts
EURm Insurance contracts Investment contracts Total
At 1 Jan. 2016 4,979 36 5,014
Premiums 149 0 149
Claims paid -469 0 -470
Expense charge -37 0 -37
Guaranteed interest 138 0 138
Bonuses 5 - 5
Other 29 -8 21
Total at 31 Dec. 2016 4,794 28 4,821
Liabilities related to assets held for sale -210
Life insurance, total 4,611
Reinsurers' share -3 0 -3
Net liability at 31 Dec. 2016 4,791 28 4,608
EURm Insurance contracts Investment contracts Total
At 1 Jan. 2015 5,058 4 5,062
Premiums 148 30 178
Claims paid -445 0 -445
Expense charge -38 0 -38
Guaranteed interest 153 0 153
Bonuses 0 - 0
Portfolio transfers 17 - 17
Other 85 1 86
At 31 Dec. 2015 4,978 36 5,014
Reinsurers' share -3 - -3
Net liability at 31 Dec. 2015 4,976 36 5,012
Change in liabilities arising from unit-linked insurance and investment contracts
EURm Insurance contracts Investment contracts Total
At 1 Jan. 2016 4,042 1,817 5,858
Premiums 498 475 973
Claims paid -222 -355 -577
Expense charge -43 -20 -64
Other 153 97 250
At 31 Dec. 2016 4,427 2,013 6,440
Liabilities related to assets held for sale -2,992
Life insurance total 3,448
At 1 Jan. 2015 3,599 1,714 5,312
Premiums 575 394 969
Claims paid -198 -358 -556
Expense charge -44 -22 -66
Other 110 89 200
At 31 Dec. 2015 4,042 1,817 5,858
The liabilities at 1 Jan. and at 31 Dec. include the future bonus reserves and the effect of the reserve for the decreased discount rate. The calculation is based on items before reinsurers' share. A more detailed specification of changes in insurance liabilities is presented in Group's Risk Management.
EURm 2016 2015
Insurance contracts
Liabilities for contracts with discretionary participation feature (DPF)
Provision for unearned premiums 2,425 2,516
Provision for claims outstanding 2,366 2,461
Total 4,791 4,976
Assumed reinsurance
Provision for unearned premiums 0 1
Provision for claims outstanding 1 1
Total 1 2
Insurance contracts total
Provision for unearned premiums 2,426 2,517
Provision for claims outstanding 2,368 2,462
Total 4,794 4,978
Investment contracts
Liabilities for contracts with discretionary participation feature (DPF)
Provision for unearned premiums 28 36
Liabilities for insurance and investment contracts total
Provision for unearned premiums 2,454 2,552
Provision for claims outstanding 2,368 2,462
Life insurance total 4,821 5,014
Liabilities related to assets held for sale -210 -
Liabilities for insurance and investment contracts total, life insurance 4,611 5,014
Reinsurers' share
Provision for claims outstanding -3 3
Investment contracts do not include a provision for claims outstanding.
Liability adequacy test does not give rise to supplementary claims.
Exemption allowed in IFRS 4 Insurance contracts has been applied to investment contracts with DPF or contracts with a right to trade-off for an investment contract with DPF. These investment contracts have been valued like insurance contracts.
EURm 2016 2015
Group, total 13,990 14,447
28 Liabilities from unit-linked insurance and investment contracts
Life insurance
EURm 2016 2015
Unit-linked insurance contracts 4,427 4,042
Unit-linked investment contracts 2,013 1,817
Total 6,440 5,858
Liabilities related to assets held for sale -2,992 -
Life insurance, total 3,448 5,858
Elimination items between segments -41 -18
EURm 2016 2015
Group, total 3,407 5,841
29 Financial liabilities
The segment financial liabilities include derivatives, debt securities and other financial liabilities.
P&C insurance
EURm 2016 2015
Derivative financial instruments (note 15) 67 17
Subordinated debt securities
Subordinated loans
Euro-denominated loans Maturity Interest
Preferred capital note, 2011 (nominal value EURm 110) 30 years 6.00% 109 109
Preferred capital note, 2013 (nominal value EURm 90) perpetual 4.70% 92 90
Preferred capital note, 2016 (nominal value 1,500 MSEK) 30 years 3 months Stibor + 2,25% 154 -
Preferred capital note, 2016 (nominal value 500 MSEK) 30 years 2.42% 52 -
Total subordinated debt securities 407 199
P&C insurance, total financial liabilities 474 216
The loan 2011 was issued with fixed interest rates for the first ten years, after which it becomes subject to variable interest rates. The subordinated loan issued in 2013 has a fixed interest rate for the first 5.5 years afther which it becomes subject to variable interest rates. At the point of change, there is the possibility of redemption for all the loans.
The loan of 1 500 MSEK issued in 2016 is issued with variable interest rate terms. After ten years the margin is increased by one percentage point. It includes terms stating the right of redemption after five years and at any interest payment date thereafter.
The loan of 500 MSEK issued in 2016 is issued with fixed interest rate terms for the first five years. After that period, the loan becomes subject to variable interest rate but it also includes terms stating the right of redemption at this point in time or at any interest payment date thereafter.
The loan issued in 2011 and both loans issued in 2016 are all listed on the Luxembourg Exchange.
The purpose of the loans is to secure the good financial standing. All loans and their terms are approved by supervisory authorities and they are utilised for solvency purposes.
Life insurance
EURm 2016 2015
Derivative financial instruments (note 15) 11 33
Subordinated debt securities
Subordinated loans 100 100
Life insurance, total 111 133
Mandatum Life issued in 2002 EURm 100 Capital Notes. The loan is perpetual and pays floating rate interest. The interest is payable only from distributable capital. The loan is repayable only with the consent of the Insurance Supervisory Authority and at the earliest on 2012 or any interest payment date after that. The loans is wholly subscribed by Sampo Plc.
Holding
EURm 2016 2015
Derivative financial instruments (note 15) 3 12
Debt securities in issue
Commercial papers 671 305
Bonds *) 2,877 1,997
Total 3,548 2,302
Holding, total 3,551 2,314
*) The determination and hierarchy of financial assets and liabilities at fair value is disclosed in note 17. Based on the principles of this determination, the bonds of the Holding Company fall under level 2.
Elimination items between segments -289 -339
EURm 2016 2015
Group, total 3,847 2,375
30 Provisions
P&C insurance
EURm 2016
At 1 Jan. 2016 51
Exchange rate differences -1
Additions 9
Amounts used during the period -22
Unused amounts reversed during the period -1
At 31 Dec. 2016 35
Current (less than 1 year) 8
Non-current (more than 1 year) 27
Total 35
EURm 11 of the provision consist of assets reserved for the development of efficient administrative and claims-adjustment processes and structural changes in distribution channels result in organisational changes that affect all business areas. In addition, the item includes a provision of about EURm 21 for law suits and other uncertain liabilities.
31 Employee benefits
Employee benefits
Sampo has defined benefit plans in P&C insurance business in Sweden and Norway.
In addition to statutory retirement pension insurance, the Group has certain voluntary defined benefit plans. The voluntary defined benefit plans are intra-Group and included in the insurance liabilities of Mandatum Life. The amount is negligible and they have no material impact on the Group profit or loss or equity.
Employee benefit obligations of P&C Insurance 31 Dec.
EURm 2016 2015
Present value of estimated pension obligation, including social costs 294 303
Fair value of plan assets 214 213
Net pension obligation recognised in the balance sheet 79 90
Since January 1, 2008, the main Swedish pension plan has been closed to new employees born in 1972 or later and the corresponding Norwegian pension plan has been closed to new employees since January 1, 2006 regardless of age. In May 2015, If decided that all employees born in 1958 or later that were covered by the Norwegian defined-benefit pension plan would be switched to a defined-contribution plan as of January 2016. As of the same date, it was also decided that existing retirees would no longer be covered by the plan, and that future retirees would cease being covered by the plan when they are no longer employed by If. Accordingly, the Norwegian pension plan now consists solely of active people employed prior to 2006 and born no later than 1957.
The pension benefits referred to are old-age pension and survivors’ pension in Sweden. For Norway, old-age pension and survivors’ pension are included, as well as disability pension up to July, 1, 2016. Following an amendment to the plan, all employees will instead be covered by a defined-contribution plan for disability pension. A common feature of the defined-benefit plans is that the employees and survivors encompassed by the plans are entitled to a guaranteed pension that depends on the employees’ service period and pensionable salary at the time of retirement. The dominating benefit is the old-age pension, which refers in part to temporary pension before the anticipated retirement age and in part to a life-long pension after the anticipated retirement age.
The retirement age for receiving premature pension is normally 62 years in Sweden and normally 65 years in Norway. In Sweden, premature old-age pension following a complete service period is payable at a rate of approximately 65% of the pensionable salary and applies to all employees born in 1955 or earlier and who were covered by the insurance sector’s collective bargaining agreement of 2006. In Norway, premature old-age pension following a complete service period is payable at a rate of approximately 70% of the pensionable salary and applies to all employees born in 1957 or earlier and who were employed by If in 2013.
The anticipated retirement age in connection with life-long pension is 65 years for Sweden and 67 years for Norway. In Sweden, life-long old-age pension following a complete service period is payable at a rate of approximately 10% of the pensionable salary between 0 and 7.5 income base amounts, 65% of salary between 7.5 and 20 income base amounts and 32.5% between 20 and 30 income base amounts. In Norway, life-long old-age pension following a complete service period is payable at a rate of approximately 70% of the pensionable salary up to 12 National Insurance base amounts, together with the estimated statutory old-age pension. Paid-up policies and pension payments from the Swedish plans are normally indexed upwards in an amount corresponding to the change in the consumer price index. However, there is no agreement guaranteeing the value and future supplements in addition to the contractual pension benefit could either rise of fall. Pension payments from the Norwegian plans are were earlier indexed upwards in an amount corresponding to 80 -100% of the change in the consumer price index. Instead, as of January 2016, a paid-up policy is issued on retirement, whereby If is no longer responsible for and has no obligation in respect of future indexation of the insured plans.
The pensions are primarily funded through insurance whereby the insurers establish the premiums and disburse the benefits. If’s obligation is primarily fulfilled through payment of the premiums. Should the assets that are attributable to the pension benefits not be sufficient to enable the insurers to cover the guaranteed pension benefits, If could be forced to pay supplementary insurance premiums or secure the pension obligations in some other way. In addition to insured pension plans, there are also unfunded pension benefits in Norway for which If is responsible for ongoing payment.
To cover the insured pension benefits, the related capital is managed as part of the insurers’ management portfolios. In such management, the characteristics of the investment assets are analyzed in relation to the characteristics of the obligations, in a process known as Asset Liability Management. New and existing asset categories are evaluated continuously in order to diversify the asset portfolios with a view to optimizing the anticipated risk-adjusted return. Any surplus that arises from management of the assets normally accrues to If and/or the insured and there is no form of transfer of the asset value to other members of the insurance collective.
The insurers and If are jointly responsible for monitoring the pension plans, including investment decisions and contributions. The pension plans are essentially exposed to similar material risks regarding the final amount of the benefits, the investment risk associated with the plan assets and the fact that the choice of discount interest rate affects their valuation in the financial statements.
When applying IAS 19, the pension obligations are calculated, as is the pension cost attributable to the fiscal period, using actuarial methods. Pension rights are considered to have been vested straight line during the service period. The calculation of pension obligations is based on future anticipated pension payments and includes assumptions regarding mortality, employee turnover and salary growth. The nominally calculated obligation is discounted to the present value using interest rates based on the extrapolated yield-curves in Sweden and in Norway for AAA and AA corporate bonds, including mortgage-backed bonds, as at 30 November, approximately updated to reflect market conditions mid-December. The discount rate chosen takes into account the duration of the company’s pension obligations. After a deduction for the plan assets, a net asset or net liability is recognized in the balance sheet.
The following tables contain a number of material assumptions, specifications of pension costs, assets and liabilities and a sensitivity analysis showing the potential effect on the obligations of reasonable changes in those assumptions as at the end of the fiscal year. As apparent from the tables, the said amendments to the insured plan in Norway have been taken into account when preparing the annual accounts for 2015 and had a material impact on both recognized costs and assets and obligations.
The carrying amounts have been stated including special payroll tax in Sweden (24.26%) and a corresponding fee in Norway (19.1%).
Specification of employee benefit obligations by country
2016 2015
Sweden Norway Total Sweden Norway Total
Recognised in income statement and other comprehensive income
Current service cost 5 4 9 6 9 15
Past service cost 0 -7 -6 0 -156 -156
Interest expense on net pension liability 1 1 2 1 3 4
Total in income statement 7 -2 5 7 -144 -137
Remeasurement of the net pension liability 8 -2 6 -9 -4 -14
Total in comprehensive income statement 15 -4 11 -2 -148 -150
Recognised in balance sheet
Present value of estimated pension liability, including social costs 206 87 294 196 107 303
Fair value of plan assets 166 49 214 156 57 213
Net liability recognised in balance sheet 41 39 79 40 49 90
2016 2015
Distribution by asset class Sweden Norway Sweden Norway
Debt instruments, level 1 39% 54% 39% 50%
Debt instruments, level 2 0% 13% 1% 13%
Equity instruments, level 1 28% 6% 26% 5%
Equity instruments, level 3 10% 3% 10% 3%
Property, level 3 11% 12% 10% 12%
Other, level 1 2% 9% 4% 14%
Other, level 2 6% 3% 6% 3%
Other, level 3 4% 0% 4% 0%
The following actuarial assumptions have been used for the calculation of defined benefit pension plans in Norway and Sweden:
Sweden Sweden Norway Norway
31.12.2016 31.12.2015 31.12.2016 31.12.2015
Discount rate 2.75% 3.00% 2.75% 2.50%
Future salary increases 2.75% 2.75% 3.00% 3.00%
Price inflation 1.75% 1.75% 2.00% 2.00%
Mortality table FFFS 2007:31 +1 year FFFS 2007:31 +1 year K2013 K2013
Average duration of pension liabilities 22 years 21 years 13 years 14 years
Expected contributions to the defined benefit plans during 2017 and 2016 91 10 25 4
2016 2015
Sensitivity analysis of effect of reasonably possible changes Sweden Norway Total Sweden Norway Total
Discount rate, +0,50% -25 -6 -31 -23 -7 -30
Discount rate, -0,50% 28 6 35 27 8 35
Future salary increases, +0,25% 8 1 9 8 1 9
Future salary increases, -0,25% -8 -1 -8 -7 -1 -9
Expected longevity, +1 year 8 2 10 7 2 10
2016 2015
EURm Funded plans Unfunded plans Total Funded plans Unfunded plans Total
Analysis of the employee benefit obligation
Present value of estimated pension liability, including social costs 260 33 294 267 36 303
Fair value of plan assets 214 - 214 213 - 213
Net pension liability recognised in the balance sheet 46 33 79 54 36 90
Analysis of the change in net liability recognised in the balance sheet
EURm 2016 2015
Pension liabilities:
At the beginning of the year 303 664
Earned during the financial year 9 15
Costs pertaining to prior-year service -6 -156
Interest cost 8 15
Actuarial gains (-)/losses (+) on financial assumptions 8 4
Actuarial gains (-)/losses (+), experience adjustments 2 -14
Exchange differences on foreign plans -2 -7
Benefits paid -22 -25
Settlements -7 -194
Defined benefit plans at 31 Dec. 294 303
Reconciliation of plan assets:
At the beginning of the year 213 399
Interest income 6 11
Difference between actual return and calculated interest income 5 4
Contributions paid 16 26
Exchange differences on foreign plans -3 -10
Benefits paid -14 -16
Settlements -7 -200
Plan assets at 31 Dec. 214 213
Other short-term employee benefits
There are other short-term staff incentive programmes in the Group, the terms of which vary according to country, business area or company. Benefits are recognised in the profit or loss for the year they arise from. An estimated amount of these short-term incentives, social security costs included, for 2016 is EURm 48.
32 Other liabilities
P&C insurance
EURm 2016 2015
Liabilities arising out of direct insurance operations 177 163
Liabilities arising out of reinsurance operations 29 30
Liabilities related to Patient Insurance Pool 118 115
Premium taxes 49 49
Tax liabilities 114 91
Prepayments and accrued income 174 181
Other 39 39
P&C insurance, total 700 669
The non-current share of other liabilities is EURm 96 (108).
Item Other includes e.g. witholding taxes, social expenses related to Workers Compensation insurance policies and employee benefits, unpaid premium taxes and other accruals.
Life insurance
EURm 2016 2015
Interests 7 10
Tax liabilities 0 5
Liabilities arising out of direct insurance operations 30 21
Liabilities arising out of reinsurance operations 5 4
Settlement liabilities 31 61
Guarantees received 2 0
Other liabilities 73 66
Life insurance, total 148 167
Item Guarantees received comprise assets accepted as guarantees required in derivative trading and securities lending.
Item Other includes e.g. liabilities arising from withholding taxes and social security costs, liabilities to creditors and insurance premium advances.
Holding
EURm 2016 2015
Interests 25 34
Guarantees for trading in derivatives 17 38
Liability for dividend distribution 38 35
Other 16 26
Holding, total 96 133
Item Other includes e.g. reservations for share-based incentive programmes and other incentive salaries.
Elimination items between segments -10 -11
EURm 2016 2015
Group, total 933 957
33 Contingent liabilities and commitments
P&C insurance
EURm 2016 2015
Off-balance sheet items
Guarantees 4 5
Other irrevocable commitments 15 15
Total 19 20
Assets pledged as collateral for liabilities or contingent liabilities
2016 2015
EURm Assets pledged Liabilities/ commitments Assets pledged Liabilities/ commitments
Assets pledged as collateral
Investments
- Investment securities 231 147 242 159
Total 231 147 242 159
EURm 2016 2015
Assets pledged as security for derivative contracts, carrying value
Investment securities 16 0
The pledged assets are included in the balance sheet item Other assets.
EURm 2016 2015
Commitments for non-cancellable operating leases
Minimum lease payments
not later than one year 31 32
later than one year and not later than five years 103 98
later than five years 45 48
Total 180 178
Lease and sublease payments recognised as an expense in the period
- minimum lease payments -33 -20
The subsidiary If P&C Insurance Ltd provides insurance with mutual undertakings within the Nordic Nuclear Insurance Pool, Norwegian Natural Perils’ Pool and the Dutch Terror Pool.
In connection with the transfer of property and casualty insurance business from the Skandia group to the If Group as of March 1, 1999, If P&C Holding Ltd and If P&C Insurance Ltd issued a guarantee for the benefit of Försäkringsaktiebolaget Skandia (publ.) whereby the aforementioned companies in the If Group mutually guarantee that companies in the Skandia group will be indemnified against any claims or actions due to guarantees or similar commitments made by companies in the Skandia group within the property and casualty insurance business transferred to the If Group.
If P&C Insurance Holding Ltd and If P&C Insurance Ltd have separately entered into contracts with Försäkringsaktiebolaget Skandia (publ.) and Tryg-Baltica Forsikrings AS whereby Skandia and Tryg-Baltica will be indemnified against any claims attributable to guarantees issued by Försäkringsaktiebolaget Skandia (publ.) and Vesta Forsikring AS, on behalf of Skandia Marine Insurance Company (U.K.) Ltd. (now Marlon Insurance Company Ltd.) in favor of the Institute of London Underwriters. Marlon Insurance Company Ltd. was disposed during 2007, and the purchaser issued a guarantee in favour of If for the full amount that If may be required to pay under these guarantees.
If P&C Insurance Company Ltd has outstanding commitments to private equity funds totalling EURm 15, which is the maximum amount that the company has committed to invest in the funds. Capital will be called to these funds over several years as the funds make investments.
With respect to certain IT systems If and Sampo use jointly, If P&C Insurance Holding Ltd has undertaken to indemnify Sampo for any costs caused by It that Sampo may incur in relation to the owners of the systems.
Life insurance
EURm 2016 2015
Off-balance sheet items
Investment commitments 657 397
Acquisition of IT-software 2 1
Total 658 398
EURm 2016 2015
Assets pledged as security for derivative contracts, carrying value
Cash and cash equivalents 18 19
The pledged assets are included in the balance sheet item Other assets.
EURm 2016 2015
Commitments for non-cancellable operating leases
Minimum lease payments
not later than one year 2 2
later than one year and not later than five years 7 8
later than five years 6 7
Total 15 18
Lease and sublease payments recognised as an expense in the period
- minimum lease payments -4 -4
- sublease payments 0 0
Total -4 -4
Holding
EURm 2016 2015
Commitments for non-cancellable operating leases
Minimum lease payments
not later than one year 1 1
later than one year and not later than five years 4 0
later than five years 1 -
Total 6 1
The Group had at the end of 2015 premises a total of 159,160 m2 (171,254) taken as a lessee. The contracts have been made mainly for 3 to 10 years.
34 Equity and reserves
Equity
The number of Sampo plc’s shares at the end of the financial year was 560,000,000, of which 558,000,000 were A-shares and 1,200,000 B-shares. There was no change in the company's share capital of EURm 98 during the financial year.

At the end of the financial year, the mother company or other Group companies held no shares in the parent company.
Reserves and retained earnings
Legal reserve
The legal reserve comprises the amounts to be transferred from the distributable equity according to the articles of association or on the basis of the decision of the AGM.
Invested unrestricted equity
The reserve includes other investments of equity nature, as well as issue price of shares to an extent it is not recorded in share capital by an express decision.
Other components of equity
Other components of equity include fair value changes of financial assets available for sale and derivatives used in cash flow hedges, and exchange differences.

Changes in the reserves and retained earnings are presented in the Group's statement of changes in equity.
35 Related party disclosures
Key management personnel
The key management personnel in Sampo Group consists of the members of the Board of Directors of Sampo plc and Sampo Group’s Executive Committee, and the entities over which the members of the key management personnel have a control.
Key management compensation
EURm 2016 2015
Short-term employee benefits 9 8
Post employment benefits 2 4
Other long-term benefits 14 13
Total 26 25
In addition, deferred compensation EUR 66,786 (119,269) was paid to former members of the Group Executive Committee during the financial year.
Short-term employee benefits comprise salaries and other short-terms benefits, including profit-sharing bonuses accounted for for the year, and social security costs.
Post employment benefits include pension benefits under the Employees’ Pensions Act (TyEL) in Finland and voluntary supplementary pension benefits.
Other long-term benefits consist of the benefits under long-term incentive schemes accounted for for the year (see Note 36).
Related party transactions of the key management
The key management does not have any loans from the Group companies.
Associates
Outstanding balances with related parties/Associate Nordea
EURm 2016 2015
Assets 2,500 2,004
Liabilities 90 102
The Group's receivables from Nordea coprise mainly long-term investments in bonds and deposits. In addition, the Group has several on-going derivative contracts related to the Group's risk management of investments and liabilities.
36 Incentive schemes
Long-term incentive schemes 2011 I - 2014 I
The Board of Directors of Sampo plc has decided on the long-term incentive schemes 2011 I - 2014 I for the management and key employees of Sampo Group. The Board has authorised the CEO to decide who will be included in the scheme, as well as the number of calculated incentive units granted for each individual used in determining the amount of the incentive reward. In the schemes, the number of calculated incentive units granted for the members of the Group Executive Committee is decided by the Board of Directors. Some 120 persons were included in the schemes at the end of year 2016.
The amount of the performance-related bonus is based on the value performance of Sampo's A share and on the insurance margin (IM) and on Sampo's return on the risk adjusted capital (RORAC). The value of one calculated incentive unit is the trade-weighted average price of Sampo's A-share at the time period specified in the terms of the scheme, and reduced by the starting price adjusted with the dividends per share distributed up to the payment date. The pre-dividend starting prices vary between eur 18.37 - 43.38. The maximum value of one incentive unit varies between eur 33.37 - 62.38, reduced by the dividend-adjusted starting price. In all the schemes, the incentive reward depends on two benchmarks. If the IM is 6 per cent or more, the IM-based reward is paid in full. If the IM is between 4 - 5.99 per cent, half of the incentive reward is paid. No IM-related reward will be paid out, if the IM stays below these. In addition, the return on the risk adjusted capital is taken into account. If the return is at least risk free return + 4 per cent, the RORAC-based incentive reward is paid out in full. If the return is risk free return + 2 percent, but less than risk free return + 4 per cent, the payout is 50 per cent. If the return stays below these benchmarks, no RORAC-based reward will be paid out.
Each plan has three performance periods and incentive rewards are settled in cash in three installments. The employee shall authorise Sampo plc to buy Sampo's A-shares with 60 per cent of the amount of the reward after taxes and other comparable charges. The shares are subject to transfer restrictions for three years from the day of payout. A premature payment of the reward may occur in the event of changes in the group structure or in the case of employment termination on specifically determined bases. The fair value of the incentive schemes is estimated by using the Black-Scholes pricing model.
2011 I 2011 I/2 2014 I 2014 I/2
Terms approved *) 14.9.2011 14.9.2011 17.9.2014 17.9.2014
Granted (1,000) 31 Dec. 2013 4,134 100 - -
Granted (1,000) 31 Dec. 2014 2,855 100 4,434 -
Granted (1,000) 31 Dec. 2015 1,415 70 4,380 62
Granted (1,000) 31 Dec. 2016 0 35 4,211 62
End of performance period I 30 % Q2-2014 Q2-2015 Q2-2017 Q2-2018
End of performance period II 35 % Q2-2015 Q2-2016 Q2-2018 Q2-2019
End of performance period III 35 % Q2-2016 Q2-2017 Q2-2019 Q2-2020
Payment I 30 % 9-2014 9-2015 9-2017 9-2018
Payment II 35 % 9-2015 9-2016 9-2018 9-2019
Payment III 35 % 9-2016 9-2017 9-2019 9-2020
Price of Sampo A at terms approval date *) 18.10 18.10 37.22 37.22
Starting price **) 18.37 24.07 38.26 43.38
Dividend-adjusted starting price at 31 Dec. 2016 10.07 16.97 34.16 41.23
Sampo A - closing price 31 Dec. 2016 42.59
Total intrinsic value, meur 0 1 21 0
Total debt 22
Total cost for the financial period, meur (incl. social costs) 15
*) Grant dates vary
**) Trade-weighted average for ten trading days from the approval of terms
37 Assets and liabilities related to assets held for sale
In October 2016, Mandatum Life Insurance Company announced that it will not continue the distribution agreement of insurance policies with Danske Bank Plc after 31 December 2016 and that it will use its right to sell the insurance portfolio acquired via Danske Bank to Danske Bank A/S. The value evaluation will last approximately until the summer 2017. The porfolio transfer requires the approval of the authorities, expected to take place at the earliest at the end of year 2017.
The insurance porfolio targeted in the agreement is mainly included in the 'Unit-linked contracts' segment. Assets and liabilities are valued at book value. The effect of the with profit insurance portfolio on the investment result in the 'Other contracts' segment is deemed insignificant. The insurance risk result in the 'Other contrats' segment also consists mainly of other insurance portfolio than that targeted in the agreement. The effect of the transfer of the insurance portflio is expected to weaken the result significantly and this will mainly show in the 'Unit-linked contract' segment. The premium income of the insurance porflio in 2016 was EUR 304 and claims cost EUR 253.
Assets and liabilities of the portfolio at 31 Dec. 2016
Assets
Financial assets 210
Investments related to unit-linked insurance contracts 2,992
Goodwill 89
Total 3,291
Liabilities
Liabilities for insurance and investment contracts 210
Liabilities for unit-linked insurance and investment contracts 2,992
Total 3,202
38 Auditors' fees
EURm 2016 2015
Auditing fees -2 -2
Other fees 0 0
Total -3 -3
39 Legal proceedings
There are a number of legal proceedings against the Group companies outstanding on 31 Dec. 2016, arising in the ordinary course of business. The companies estimate it unlikely that any significant loss will arise from these proceedings.
40 Investments in subsidiaries
Name Group holding % Carrying amount
P&C insurance
If P&C Insurance Holding Ltd 100 1,886
If P&C Insurance Ltd 100 1,265
If P&C Insurance Company Ltd 100 464
If P&C Insurance AS 100 46
Support Services AS 100 0
CJSC If Insurance 100 9
If Livförsäkring Ab 100 8
Life insurance
Mandatum Life Insurance Company Ltd 100 484
Innova Services Ltd 100 3
Mandatum Life Services Ltd 100 1
Mandatum Life Investment Services Ltd 100 2
Saka Hallikiinteistöt GP Oy 100 0
Mandatum Life Vuokratontit I GP Oy 100 0
Mandatum Life Fund Management S.A. 100 1
Mandatum Life Insurance Baltic SE 100 11
Other business
If IT Services A/S 100 0
Sampo Capital Oy 100 1
The table excludes property and housing companies accounted for in the consolidated accounts.
41 Investments in shares and participations other than subsidiaries and associates
Holdings exceeding EURm 5 and holdings in listed companies exceeding five per cent specified.
The table does not include life insurance's investments related to unit-linked insurance contracts.
P&C insurance
Country Holding % Carrying amount/Fair value
Listed companies
A P Moller - Maersk Denmark 0.03% 9
ABB Switzerland 0.20% 89
Atlas Copco A+B Sweden 0.14% 45
BB Tools Sweden 0.64% 4
Clas Ohlson Sweden 4.75% 44
CTT Systems Sweden 4.08% 6
Beijer Ab Gl Sweden 0.44% 4
Gunnebo AB Sweden 11.67% 36
Hennes Mauritz AB Sweden 0.21% 94
Husqvarna AB Sweden 1.01% 43
Husqvarna AB Sweden 0.39% 17
Investor AB Sweden 0.13% 35
Lindab Intl AB Sweden 4.94% 30
Nederman Holding AB Sweden 9.90% 23
Nobia AB Sweden 10.10% 157
Nolato AB Sweden 0.92% 7
Sandvik AB Sweden 0.44% 65
Sectra AB Sweden 11.04% 57
Svedbergs i Dalstrop Sweden 11.45% 11
Teliasonera AB Sweden 0.37% 62
VBG Group AB Sweden 3.94% 9
Veidekke ASA Norway 6.90% 125
Volvo AB Sweden 0.06% 14
Volvo AB Sweden 0.40% 95
Yara Intl ASA Norway 0.38% 39
Marine Harvest ASA Norway 0.23% 16
Team Tankers Intl AS Norway 0.91% 2
Dof ASA Norway 4.50% 8
Solstad Offshore ASA Norway 0.70% 1
Total listed companies 1,144
Other 1
Unit trusts
Danske Invest Finland 79
Danske Invest Finland 20
PEQ Eqt III Guernsey 0
PEQ Eqt IV Guernsey 0
PEQ GS Loan Partn I Cayman islands 2
Investec Asset Mgmt Great Britain 52
Lyxor Int AM France 0
PEQ Mandatum I Finland 1
PEQ Mandatum II Finland 2
PEQ Mandatum II Finland 4
PEQ Private Egy mkt Finland 0
State Street Global Finland 68
PEQ Eqt Mid Market Great Britain 10
Handelsbanken Fonder Sweden 25
Hermes Investment Ireland 52
Blackrock AM DE Denmark 20
PEQ OMP Capital Norway 2
Blackrock AM DE Denmark 63
Total unit trusts 401
P&C insurance, total shares and participations 1,547
Life insurance
Country Holding % Carrying amount/Fair value
Listed companies
Amer Sports Plc - A Finland 3.21% 96
Asiakastieto Group Plc Finland 9.27% 27
BASF SE Germany 0.01% 9
Bayerische Motoren Werke AG Germany 0.02% 12
British American Tobacco Plc United Kingdom 0.01% 8
CapMan Plc - B Finland 7.49% 13
Caverion Plc Finland 2.27% 23
Comptel Plc Finland 18.79% 49
Continental AG Germany 0.03% 10
Deutsche Post AG Germany 0.02% 9
DNA Oy Finland 1.02% 14
Elecster Plc - A Finland 6.43% 1
F-Secure Plc Finland 3.65% 20
GlaxoSmithKline Plc United Kingdom 0.01% 9
Kuehne + Nagel International AG Switzerland 0.06% 9
Lassila & Tikanoja Plc Finland 5.96% 44
LVMH Moet Hennessy Louis Vuitton SA France 0.01% 6
Metso Plc Finland 0.73% 30
Nestle SA Switzerland 0.00% 10
Nokia Plc Finland 0.03% 8
Nokian Renkaat Plc Finland 0.44% 21
Oriola-KD Plc Finland 2.51% 20
Roche Holding AG Switzerland 0.01% 11
Royal Dutch Shell Plc United Kingdom 0.01% 6
SAP AG Germany 0.01% 10
Schneider Electric SA France 0.03% 11
Stora Enso Plc - R Finland 0.17% 10
Syngenta AG Switzerland 0.02% 7
Teleste Plc Finland 8.84% 15
Tikkurila Plc Finland 3.66% 30
Tokmanni Group Plc Finland 3.99% 20
Unilever NV - CVA Netherlands 0.01% 8
UPM-Kymmene Plc Finland 0.69% 86
Uponor Plc Finland 1.44% 17
Vaisala Plc Finland 4.21% 26
Valmet Corp Finland 0.62% 13
Wärtsilä Plc Abp Finland 0.16% 14
YIT Plc Finland 0.79% 8
Total listed companies 740
Other listed companies 177
Listed companies in total 918
Other equity securities
Pension Corporation Group Limited Guernsey 8
Total 8
Unit trusts
Allianz RCM Europe Equity Growth W Luxembourg 75
Comgest Growth Asia Ex Japan USD I Acc Class Ireland 62
Danske Invest Europe High Dividend I Luxembourg 60
DJ STOXX 600 Opt Healthcare Ireland 30
Financial Select Sector Spdr United States 11
Fourton Odysseus Finland 47
Fourton Stamina Non-Ucits Finland 27
Investec Gsf-Asia Pacific-I United Kingdom 72
iShares Core S&P 500 ETF United States 251
iShares SMI ETF Switzerland 56
KJK Fund SICAV-SIF Baltic States B1 C Finland 13
Lansdowne Clean Energy Funds United Kingdom 5
LUX Mandatum Life Nordic High Yield Total Return Fund SICAV-SIF G EUR Share Class Luxembourg 14
MFS European Value Fund Z Luxembourg 56
MFS Mer-Europe Sm Cos-I1Eur Luxembourg 18
The Forest Company Limited Guernsey 7
Unideutschland XS Germany 27
Total unit trusts 831
Capital trusts
Activa Capital Fund II FCPR France 6
Amanda III Eastern Private Equity L.P. Finland 12
Amanda IV West L.P. Finland 19
Apollo Offshore Energy Opportunity Fund Limited Cayman Islands 9
Avenue Energy Opportunities Fund L.P. United States 19
Avenue Special Situations Fund VI (C-Feeder), L.P. Cayman Islands 11
Broad Street Loan Partners 2013 Europe L.P. United Kingdom 45
Broad Street Real Estate Credit Partners II Treaty Fund, L.P. Cayman Islands 10
Capman Buyout IX Fund A L.P. Guernsey 5
CapMan Hotels RE Ky Finland 10
CapMan RE II Ky Finland 7
Capman Real Estate I Ky Finland 11
Capman Real Estate II Ky Finland 8
EQT Auris Co-Investment L.P. United Kingdom 18
EQT Credit (No.2) L.P. Guernsey 37
EQT kfzteile24 Co-Investment L.P. United Kingdom 9
EQT Mid Market (No.1) Feeder Limited Partnership United Kingdom 10
EQT VI (No.1) L.P. Guernsey 37
Financial Credit Investment I, L.P. Cayman Islands 16
Fortress Credit Opportunities Fund II (C) L.P. Cayman Islands 46
Fortress Credit Opportunities Fund III (C) L.P. Cayman Islands 29
Fortress Credit Opportunities Fund IV (C) L.P. Cayman Islands 16
Fortress Life Settlement Fund (C) L.P. Cayman Islands 10
Highbridge Liquid Loan Opportunities Fund, L.P Cayman Islands 61
Lunar Capital Partners III L.P. Cayman Islands 9
M&G Debt Opportunities Fund United Kingdom 7
M&G Debt Opportunities Fund II Ireland 29
MB Equity Fund IV Ky Finland 12
Mount Kellet Capital Partners (Cayman), L.P. Cayman Islands 10
Mount Kellett Capital Partners (Cayman) II, L.P. Cayman Islands 11
Oaktree Real Estate Debt Fund (Cayman), L.P. Cayman Islands 7
Petershill II Offshore LP Cayman Islands 13
Russia Partners II, L.P. Cayman Islands 5
Specialty Fund III Cayman Islands 33
Verdane Capital VII K/S Denmark 14
Verdane Capital VIII K/S Denmark 8
Victory Park Capital Fund II (Cayman), L.P. Cayman Islands 17
Total capital trusts 640
Other shares and participations 112
Life insurance, total shares and participations 2,509
Holding
Country Holding % Carrying amount/Fair value
Listed companies
Aktia Plc Finland 5.7% 37
Asiakastieto Group Plc Finland 10.1% 29
Domestic other than listed companies
LUX Mandatum Life European Small & Mid Cap Equity Fund SICAV-SIF G EUR Share Class Luxembourg 0.0% 11
LUX Mandatum Life Finland Equity Fund SICAV-SIF G EUR Share Class Luxembourg 0.0% 11
Keskinäinen työeläkevakuutusyhtiö Varma Finland 80.3% 14
Other 47
Holding, total shares and participations 148
42 Events after the balance sheet date
In the meeting of 8 Feb. 2017, the Board of Directors decided to propose at the Annual General Meeting on 27 April 2017 a dividend distribution of EUR 2.30 per share, or total EUR 1.288.000.000, for 2016. The dividends to be paid will be accounted for in the equity in 2017 as a deduction of retained earnings.
The tables for the Financial Statements are also available in Excel format.