According to the Insurance Sector and Pension Funds Report for 2020, published by the Insurance and Pension Funds Supervisory Authority (ASF), “a global output of insurance companies under the prudential supervision of the ASF recorded, in global terms, a reduction of 20.4% in 2020, to 8,975 million euros, explained by the 36.6% decrease in the production of the Life branch”.

“In the opposite direction, and despite the contraction of economic activity that marked 2020, gross premiums issued in Non-Life branches continued to show a positive evolution, with an increase of 4% compared to the previous year”, he referred.

As for the overall technical result, it increased by 229 million euros compared to 2019, to 608 million euros, which corresponds to an increase of 60.6%.

According to the ASF, “the results of the Life and Non-Life technical accounts contributed to this improvement, although more significantly in the latter case”.

With regard to the financial and equity situation of insurance companies, last year there was an increase of 11.7% in the overall net worth compared to the previous year, reflecting “the fact that the decrease in liabilities exceeded the reduction in the active “.

“In 2020, with regard to the solvency position, compared to the previous year, there was an improvement in the global levels of coverage of the Solvency Capital Requirement (SCR) and the Minimum Capital Requirement (MCR), to 193% and 537%, respectively, in both cases through increases in own funds to cover them”, notes the regulator.

Regarding insurance mediation, the year 2020 “reinforced the downward trend in the number of mediators that has been observed for over a decade”, with a drop of 5.6%, for a total of 15,831 mediators.

The remuneration received by insurance intermediaries increased by 7.5% compared to 2019, to 1,035 million euros, after having decreased by 1.1% in 2019, “mainly due to the better performance of the Non-Life branches”.

In the pension funds sector, ASP reports that the total amount managed reached, for the first time, 23 billion euros, which represents an increase of 5.6% compared to the previous year. In the opposite direction, the total value of contributions decreased by 14.5%.

At the end of 2020, the funding level of defined benefit pension plans, in aggregate terms, stood at 98%, according to the funding scenario, and at 105%, in terms of the minimum solvency scenario.

As for the total amount invested in the Savings-Retirement Plans (PPR), it reached 21,000 million euros at the end of last year, which means a drop of 2.7% compared to the previous year.

Premiums and contributions for products financed through life insurance recorded a value of 1,200 million euros, which represents a decrease of around 62.5%, “the lowest value in recent years”.

In a message contained in the report, the president of the ASF reference that 2020 “highlighted the drop already seen in the previous year in the Life branch, justified not only by the continuity of the environment of very low interest rates, which strongly affects the performance of this segment, but also by the effects of the covid-19 pandemic”.

“In the opposite direction, the Non-Life branches maintained the growth trend of recent years, although in a less pronounced way”, notes Margarida Corrêa de Aguiar.

Regarding the coverage of capital requirements, the president of the ASF highlights that, “despite the volatility registered throughout the year, caused by the turmoil in the financial markets”, in 2020 there was a “reinforcement of solvency ratios” in the sector.

“In terms of pension funds, the highlight goes to the growth of total assets under management, which, for the first time, exceeded 23 billion euros”, he points out, he also introduced an improvement in funding levels compared to the end of 2019, “fruit of the strong recovery of the financial markets after the sharp drop in late March”.