Market Guide: Life Insurance and Pensions in Norway 2006

Table of Contents

• Overview
  • Catalyst
  • Summary
• Executive Summary
  • Following compound annual growth of 14.5% in the last five years, between 2006 and 2010, growth in the Norwegian life and pensions market is set to slow to 6.4%
    • The Norwegian life and pensions market expanded by a compound annual rate of 14.5% between 2001 and 2005
    • Slower growth in life insurance will produce lower compound annual growth in the total market between 2006 and 2010
    • The market will continue to be shaped by EU legislation
    • The market is led by Norwegian firms
    • Many of the market leaders are subsidiaries of the largest financial services groups in Norway
• Table of Contents
• Table of figures
• Table of tables
• MARKET OVERVIEW
  • The Norwegian life and pensions market expanded by a compound annual rate of 14.5% between 2001 and 2005
    • Premium income increased at a compound annual rate of 14.5% between 2001 and 2005, primarily driven by growth in pensions
    • The proportion of premium income attributed to group policies has declined between 2001 and 2005
    • Premium income from unit-linked insurance has remained negligible throughout the 2001-2005 period despite substantial growth
    • Bonds account for almost half of the investment assets of life and pensions insurance companies in Norway
• MARKET FORECASTS
  • The Norwegian life and pensions market is expected to expand by a compound annual rate of 6.4% between 2006 and 2010
    • Over the next 5 years, growth in premium income will increase at a compound annual rate of 6.4%
• MARKET REGULATION
  • The market will continue to be shaped by EU legislation
    • The Norwegian Financial Supervisory Authority regulates financial markets in Norway, including life & pensions
    • The Norwegian regulator, Kredittilsynet, reduced the guaranteed interest rate in life insurance
    • Further amendments from Kredittilsynet include a compulsory occupational pension scheme in addition to new life insurance and insurance mediation acts
    • The national regulator has introduced legislation allowing employees stationed abroad to obtain membership to the National Insurance Scheme
    • The Norwegian parliament has introduced legislation on compulsory pension schemes
    • The Insurance Mediation Directive creates a single passport for insurance intermediaries and enhances consumer choice
    • Insurance companies which belong to financial conglomerates face additional supervisory requirements
    • Distance marketing rules define sales practices
    • Proposed anti-money laundering legislation implies an additional administrative burden for insurers
    • Upcoming laws will enhance consumer protection
    • Providers may be required to fund a new insurance guarantee scheme
• COMPETITIVE MARKET STRUCTURE
  • The market is led by Norwegian firms
    • The top 5 life and pensions insurers control 96% of the market, by premium income
• MARKET LEADERS
  • Many of the market leaders are subsidiaries of the largest financial services groups in Norway
    • Vital & Vital Link is the life and pensions insurance market leader, based on premium income in 2005
    • Storebrand Liv & Forsikring trails the market leader in the life and pensions insurance sector
    • KLP ranks third among life and pensions insurance companies
    • Nordea Liv & Link is the fourth highest ranked life insurer by premium income
    • Sparebank 1 Liv & Fondsforsikring rounds out the top 5 life insurers
• APPENDIX
  • Definitions
    • Prudent Person Principle
    • Capital redemption policy / bond
    • Composite insurer
    • Defined contribution pension scheme
    • Defined benefits pension scheme
    • Group policy
    • Individual pension scheme
    • Individual policy
    • Life assurance
    • Occupational pension scheme
    • Pension insurance policy
    • Premium income
    • Regular premium
    • Single premium
    • Technical provisions
    • Traditional insurance
    • Unit-linked insurance
  • Further reading
    • Interactive Databases
    • Reports and Briefs
  • Ask the analyst
  • Datamonitor consulting
  • Disclaimer
  • List of Tables
    • Table 1: Life and pensions insurance premium income, segmented by product, EURm, 2001-2005
    • Table 2: Life and pensions insurance premium income, segmented by product, in percentages, 2001-2005
    • Table 3: Life and pensions insurance premium income, segmented by buyer, EURm, 2001-2005
    • Table 4: Life and pensions insurance premium income, segmented by buyer, in percentages, 2001-2005
    • Table 5: Life and pensions insurance premium income, segmented by investment risk, EURm, 2001-2005
    • Table 6: Life and pensions insurance premium income, segmented by investment risk, in percentages
    • Table 7: Investment assets of life and pensions insurance companies, EURm, 2001-2005
    • Table 8: Investment assets of life and pensions insurance companies, in percentages, 2001-2005
    • Table 9: Life and pensions insurance premium income, segmented by product, EURm, 2006-2010
    • Table 10: Life and pensions insurance premium income, segmented by product, in percentages, 2006-2010
    • Table 11: Top 5 life and pensions insurers by gross premium income, as at Dec 2005
    • Table 12: Figures for supervised entities, as at December 2005
  • List of Figures
    • Figure 1: Pension premiums accounted for nearly two thirds of total premium income in 2005
    • Figure 2: Group policies account for 54% of life and pensions premium income in 2005
    • Figure 3: Premium income from unit-linked insurance has remained negligible throughout the 2001-2005 period despite substantial growth
    • Figure 4: Approximately half of investment assets have been held in bonds throughout the 2001-2005 period
    • Figure 5: Pensions will continue to account for the majority of premium income between 2006 and 2010
    • Figure 6: Vital & Vital Link leads the life and pensions sector in Norway, by premium income as at December 2005