Record high payments of more than DKK 40 billion and a return of DKK 31 billion

Despite a historic and challenging year characterised by COVID-19, PFA achieved an operating profit of DKK 1.3 billion in 2020, which is significantly better than anticipated. For the first time, payments have rounded a historic milestone of DKK 40 billion. The total investment return is DKK 31 billion in a turbulent investment year.

In 2020, PFA achieved an operating profit of DKK 1.3 billion as opposed to DKK 340 million in 2019, which has been driven by, among others, a significant improvement in the health and accident insurance results of DKK 1.4 billion. Of the operating result, DKK 1.1 billion is passed on directly to customers via PFA CustomerCapital, which is PFA’s model for sharing profits and risk with its customers. In addition to this, an investment return from PFA CustomerCapital is added so customers receive a transfer totalling DKK 1.4 billion.

Group CEO of PFA, Allan Polack says:

“2020 is a year we will never forget. COVID-19 left a massive mark on the entire year and, at PFA, we had to adapt to a new reality quite quickly. This is why, in many ways, it is extremely satisfying that we are closing out 2020 as a strengthened PFA. We achieved an operating profit that is significantly improved and higher than anticipated. Therefore, we can pass on almost DKK 1.4 billion to our customers, which we, as a customer-owned company, are extremely satisfied with.”

Payments round a milestone of more than DKK 40 billion

Payments have increased to DKK 40.7 billion up from DKK 39.4 billion in 2019, which corresponds to a growth of 3.4 per cent. The regular payments total DKK 24.4 billion as opposed to DKK 23.1 billion in 2019, corresponding to an increase of 5.4 per cent. A development that indicates a continued solid net payment level of DKK 14.5 billion, which is highly satisfactory. The net addition of corporate and organisational customers is 603, while there is growth of more than 8,300 private customers.

At the same time as we have experienced the arrival of new customers throughout the COVID-19 pandemic, PFA has had a strong focus on being there for both new and existing customers by maintaining normal operations.

“It is important that our 1.3 million customers can rely completely on PFA even when the world around them changes. This is why we have placed such significant focus on keeping all parts of PFA up and running, so our customers would not be able to notice any changes. We have quickly adapted to the new reality and maintained a close dialogue with customers in completely new ways, such as via online pension consultations and a wide range of webinars. Payments are at a record high and we have rounded a historic milestone of DKK 40.7 billion. This shows that we are attractive to the market and customers choose us even during extremely difficult circumstances,” explains Allan Polack.

PFA and the 22 financial institutions behind Letpension also renewed their cooperation in 2020 which will continue until the end of 2025. It is an agreement with major strategic perspectives for both parties and more than 1.8 million customers in the respective financial institutions.

“We have been extremely satisfied with our cooperation with Letpension over the past 10 years, and the new agreement extends our strong relationship. The cooperation has major strategic significance to PFA, and the financial institutions behind Letpension are key to our relationship with the private pension market. At the same time, there continues to be significant potential in developing the cooperation on the company pension market,” Allan Polack states.

Health and accident insurance results improved by DKK 1.4 billion

Health and accident insurance results were significantly improved from DKK -2.273 million in 2019, to DKK -841 million in 2020 due to execution of the restoration plan that was initiated. There is a positive development in the number of reactivations, while the results continue to be negatively impacted by more claims than anticipated and the major competition on the pension market.

“The restoration plan is now having a serious breakthrough, which is significantly improving the health and accident insurance results. We have worked in a very targeted manner to help our customers as early in their course of illness as possible and followed up to help them return to work quickly. We have increased manning levels with more health professionals and we have accumulated much more solid data. This allows us to initiate dialogues with our many customers on price and enhanced common initiatives,” says Allan Polack and continues:

“There is still a deficit and we still have quite a way to go, but we are well on our way, which is essential. The ambitious restoration plan will continue, but unfortunately, we are still seeing the number of claims rising and that they are becoming more severe. This is a development we expect to continue, which is an expression of a general challenge in society – a challenge which many players must stand together to solve. This is not a challenge that politicians, organisations, companies and us, as a pension company, can solve individually.”

In 2019, the health and accident insurance results were negatively impacted by the transition to a new volatility adjustment (VA) to the yield curve, which was not the case in 2020.

DKK 31 billion in returns in a very turbulent investment year

During the first six months, COVID-19 had a significant negative impact on the return to the customers, however it further improved during the year. All risk profiles in PFA Plus achieve good returns and, in 2020, PFA created a total return on investment of almost DKK 31 billion.

“On the investment side, 2020 was also impacted by COVID-19. We saw historical movements where things looked very bleak in March and April. This was followed by a fantastic comeback on the financial markets during the rest of the year with substantial share increases in e.g., Denmark and the USA. Few dared to hope for a positive return in the spring, not least massive financial assistance from the central banks and gigantic relief packages for businesses have stimulated the markets, which has strongly contributed to us ending up with an overall return of DKK 31 billion,” says Allan Polack.

Despite COVID-19 shutting most of the world down, during the first half of 2020, PFA developed the climate-friendly pension product PFA Climate Plus. Since its launch in June, PFA Climate Plus has beaten the world equity index by approximately two per cent, and customers have already invested DKK 3 billion in the product.

“PFA Climate Plus is the biggest product launch in 10 years and we are very satisfied for several reasons. Primarily, because customers have welcomed the product with open arms and great interest, while, at the same time, it has generated a decent extra return, which strongly indicates that climate considerations and a good return complement each other well,” explains Allan Polack.

CO2 emissions from PFA Climate Plus are currently at 77 per cent below emissions from the broad equity index MSCI, and the goal is that investments will be climate-neutral in 2025 and have negative CO2 emissions in 2030.

Key figures for 2020

  • Results before tax (excluding minority interests’ share) is DKK 231 million (DKK 49 million)*
  • The result for the year is DKK 180 million after tax (DKK 70 million)*
  • Insurance result of DKK 1,274 million (DKK 340 million)*
  • PFA CustomerCapital’s share of the insurance result is DKK 1,107 million (DKK 289 million)*
  • The total contributions amount to DKK 40.7 billion (DKK 39.4 billion)*
  • Regular payments amount to DKK 24.4 billion (DKK 23.1 billion)*
  • The result of health and accident insurance is DKK -841 million (DKK -2,273 million)*
  • Costs per insured amount to DKK 703 (DKK 699)*
  • The total investment return is DKK 31.0 billion (DKK 57.6 billion)*
  • Return on market rate products before tax of between 1.8 and 6.8 per cent incl. CustomerCapital (6.4 to 19.0 per cent)
  • Return on average interest rate products is 6.6 per cent (11.8 per cent)*
  • Return on average interest rate products including accumulated value adjustments is 3.3 per cent (2.6 per cent)*
  • The total customer funds amount to DKK 601 billion (DKK 560 billion)*

*Figures for 2019

Additional information

Kristian Lund Pedersen, Head of External Communication and Chief Press Officer,, +45 39 17 58 79.