At € 1,952 million, the gross written premiums increased by 3.1% (€ 59 million). This increase was driven mainly by a growth in Pension Defined Contribution (DC), which more than compensated for the decrease in the 'service book' portfolio comprising the existing DB Pension portfolio and Individual life. The gross written premiums of Funeral increased slightly.
Recurring premiums of the Pension DC product ‘Werknemers Pensioen’ rose by € 134 million (or 21%) to € 768 million. The number of active participants further increased to over 150,000 (2021: almost 130,000). The DC product ‘Doenpensioen’, especially for small employers and facilitated in an IORP, also contributed to the growth, with the number of active participants increasing to over 160,000 (2021: over 120,000) and AuM increasing to € 2.0 billion (2021: € 1.9 billion).
Growth of the pension business resulted in an increase in AuM to € 5.4 billion (2021: € 5.1 billion). This reflects € 1.2 billion of net inflow, partly offset by lower market valuations (€ -0.9 billion).
The operating result increased by 2% (€ 15 million) to € 768 million, reflecting an improved technical result, including result on costs (€ 23 million), which more than offset the slight decrease in the investment margin (€ 8 million).
Technical result (including result on costs) showed an increase of € 23 million to € 104 million (2021: € 81 million), driven by higher mortality results. Mortality rates in 2022 were above average in the Netherlands, most likely due to COVID-19, delayed care and the influenza wave. The excess mortality was also visible in the diversified portfolio of a.s.r., especially in the Pensions DB and immediate annuities products, resulting in improved mortality results. The disability result in pensions also improved compared to 2021 reflecting a non-recurring favourable assumption change on recovery rates. Due to the decline in equity markets and considerably higher interest rates, provisions for unit-linked liabilities with guarantees were strengthened by € 39 million. The size of these guarantee provisions is highly dependent on the volatile financial markets. Result on costs decreased as a result of lower cost coverage in Individual life and higher operating expenses.
The investment margin decreased by € 8 million to € 665 million. This decrease reflects a negative additional impact from annual inflation update on Funeral provisions (€ 25 million) and lower amortisation of realised capital gains, partly offset by a higher contribution due to the further optimisation of the strategic asset mix and renewable energy investments. The realisation of capital losses due to higher interest rates resulted in a lower amortisation from the capital gains reserve this year. In addition, the required interest on technical provisions decreased to the regular run-off of the Individual life portfolio.
Operating expenses increased by € 8 million to € 182 million, mainly driven by an increase in the cost base following the acquisition of Brand New Day IORP as at 1 April 2021 (renamed ‘Doenpensioen’ in April 2022), extraordinary compensation to employees for higher energy costs and expenses for realising a new IT landscape to administer the pension portfolio.
Life operating expenses, expressed in basis points of the basic life provision, increased slightly to 48 bps (2021: 45 bps), reflecting higher operating expenses and a lower average basic Life provision. This is in line with the target range of 40-50 bps for 2022-2024.
The result before tax increased by € 42 million to € 1.023 million (2021: € 981 million). This increase reflects a rise in the operating result (€ 15 million) and a higher contribution of incidental items (€ 27 million).
Total incidental items went up by € 27 million, primarily driven by a higher contribution from other incidentals relating to a.s.r.’s own pension scheme, which more than offset a lower indirect investment income reflecting the fair value of investments, including derivatives.