Ladies and gentlemen, welcome to the Swiss Life Presentation on the Q1 Results 2021 Conference Call and Live Webcast. I am Sandra, the Chorus Call operator. I would like to remind you that all participants will be in listen only mode and the conference is being recorded. The presentation will be followed by a Q and A session. Webcast viewers may submit their questions in writing via the relative field.
Kindly note that webcast questions will be answered after the call. At this time, It's my pleasure to hand over to Mr. Matthias Ehlich, Group CFO of Swiss Life. Please go ahead, sir.
Good morning, ladies and gentlemen. Thank you for dialing in and for your interest in Swiss Life. Today, we are reporting selected top line figures For the Q1 of 2021, please note that all figures quoted are in Swiss francs and are unaudited. All growth rates mentioned are in local currency. Let me start with today's key messages.
Afterwards, I will provide more details on our segments. Fee and commission income was up 14% to €527,000,000 all segments contributed positively. Asset Managers grew by 7%, Owned IFAs by 23% and own and third party products and services by 13%. Gross written premiums, fees and deposits received decreased by 14% to CHF 6,800,000,000 mainly due to Switzerland. Insurance reserves, excluding placeholder participation liabilities, grew by 1% to €175,000,000,000 Swiss Life Asset Managers recorded net new assets of €2,900,000,000 In the 3rd party asset management business, CPAM, total assets under management in our CPAM business increased to €296,700,000,000 Direct investment income totaled €0.95,000,000 The non annualized direct yield was 0.6% essentially in line with the prior year period.
The non annualized net investment yield stood at 0.7% compared to 0.4% in Q1 2020. Our SST ratio on the 1st January 2021, as published and filed with FINMA, was 197%. Today, the SSD ratio is at around 200% And thus also slightly above our ambition range. We are well on track with our 3 slides 2021 program And I can confirm all the fiscal year's 2021 financial targets. I will now move on to our segment reporting Starting with Switzerland.
Premiums decreased by 24% to €4,300,000,000 Due to the Group Life business, the overall market was down by 14%. Premiums in individual life were up By 2%, while the market increased by 3%. Periodic premiums grew by 3%, While single premiums were down by 1%. Premiums in group life declined by 25% to EUR 4,000,000,000 While the market decreased by 17%. Periodic premiums were down by 6%, while single premiums decreased by 45%.
About 80% of this decline in single group life premiums can be attributed to new accounts, But the remaining 20% relate to our entries of employees in existing schemes. We continue to focus on disciplined underwriting to protect and improve the quality of our full insurance book. Overall, our full insurance technical reserves have grown by around 1% since year end 2020 based on the mentioned premium development. On the other hand, assets under management in our semi autonomous business, The foundations increased to €5,200,000,000 compared to €4,800,000,000 at year end 2020 were SEK 4,200,000,000 at the end of Q1 2020. Growth in semi autonomous solutions results Lower reported premiums.
Only risk and cost premiums are recorded, but the savings components are reported off balance as asset inflows in the respective foundations. This development It's in line with our full range provider strategy and our established focus on quality before growth. Fee and commission income increased by 12% to €82,000,000 due to a high contribution from Swiss Cliffs Select And our businesses with unit linked solutions and real estate brokerage as well as with investment solutions for private clients. Turning to France. Premiums increased by 17% to €1,800,000,000 The market grew by 10%.
Now life business premiums increased by 22%, Following strong growth in the prior year and continued demand for our new pension products. The market was up by 18%, which compares to a heavily depressed Q1 in 2020. The unit linked shares in our live premiums was 57%. This is at the full year 2020 level And substantially above the market average of 36%. Life net inflows were €500,000,000 Versus overall market net daily flows of €4,400,000,000 Premiums in Health and Protection grew by 5%, where the market was up by 4%.
P and C premiums grew by 13% Driven by motor products based on new partnerships, market growth was 3%. Fee and commission income rose by 17% to €93,000,000 Unit linked fees increased Based on high unit linked reserves primarily due to net inflows and a more favorable financial market environment. We also generated higher revenues from structured products. I will continue with Germany. Premiums increased by 5% to €390,000,000 due to higher premiums with modern, modern traditional and disability products.
The market decreased by 6% driven by single premiums. Fee and commission income rose by 27% to €164,000,000 due to strong contribution from our owned IFAs based on an increased number of financial advisers and productivity gains. This top line development also includes An extraordinary benefit of around €15,000,000 from a successful campaign based on the discontinued solidarity surcharge. The number of financial advisers increased by 13% year on year to 4,846. Moving on to our international unit.
Premiums decreased by 6% to €278,000,000 The business with private clients in Asia increased despite ongoing lockdown measures, thanks to the domestic Singapore business And the successfully launched digital document exchange for some of the business abroad. Premiums with private clients in Europe decreased year on year as the prior year period was less affected by lockdowns. Corporate claims show a positive development. Fee and commission income was up by 5% to €79,000,000 largely driven by high contribution from our owned ISAs, particularly in the UK and in CEE. Assets under control for private clients, one driver of fee income increased by 1% to 20 €900,000,000 compared to year end 2020, mainly as a result of positive financial market movements.
Let's continue with asset managers. Asset managers commission income rose by 7% to $205,000,000 The increase is fully driven by higher recurring commission income. As usual, the update in asset managers in Q1 and Q3 focuses on commission income And does not include other net income from real estate project developments. In our PAM business, Commission of income increased by 3% to €9,000,000 This was due to higher recurring management fees on a growing average asset sales. In our GPAM business, commission income grew by 10% to €115,000,000 Recurring fees were up by 14% based on higher average assets and management.
Non recurring commission income such as transaction and performance fees decreased slightly by €3,000,000 year on year. The share of total nonrecurring income for TTAM, leading commission income as well as other net income such as from project development, was 14% of total TTAM income compared to 12% in the prior year Period. Net new assets in our TPAM business amounted to $2,900,000,000 compared to $13,000,000 in the Q1 of 2020. We achieved strong inflows in real assets of €1,100,000,000 including €1,000,000,000 from real estate And SEK100 1,000,000,000 from infrastructure. This is above the 2020 level When we achieved inflows in real assets of €800,000,000 Inflows in other asset classes amounted to €900,000,000 in money market funds, €700,000,000 in bonds and balance mandates and €200,000,000 in equities.
Excluding money market funds, net new assets amounted to $2,000,000,000 compared to $1,100,000,000 in the prior year Period. Overall, assets under management in our TPAM business were up to 96,700,000,000 compared to €91,600,000,000 at year end 2020. Drivers were strong net new assets supported by market performance and favorable FX effects. Turning to our investment results. Our direct investment income increased by around €60,000,000 to €95,000,000,000 Income on equities was lower due to reduced exposure and due to lower Dividend payments in the COVID-nineteen environment.
Income on bonds was also down due to past bond realizations And lower reinvestment yields. This was partly offset by higher rental income compared to the prior year period. The non annualized direct yield was at 0.6%. Our non annualized Net investment yield was 0.7% compared to 0.4% in the prior year period. The increase is due to higher net capital gains in bonds, loans and alternative investments as well as Those positive effects were partly offset by negative P and L contributions of the hedged equity portfolio, including losses on equity hedging derivatives in the context of a positive market environment.
Unrealized gains within the equity portfolio are recognized as other comprehensive income.
At the
end of March 2021, unrealized net gains on equities amounted to €2,400,000,000 Compared to €1,600,000,000 at year end 2020. Unrealized net gains in bonds amounted to SEK 13,300,000,000 compared to SEK 18,200,000,000 at year end 2020. The asset mix remained in line with year end 2020. Our net equity exposure amounted to 4.4% And the real estate exposure amounted to 22.2%. Let me give some additional color on the real estate portfolio.
We had non annualized real estate revaluation gains of 0.5% in line with the prior year period. Our vacancy rate increased to 4.7% compared to 3.9% at year end 2020. About 2 thirds of this increase relates to Switzerland, primarily due to recent real estate acquisitions with planned reletting towards the end of the year. The remainder pertains to France and Germany. As already mentioned in our full year 2020 speech, we expect slightly higher vacancy rates for the year end 2021 compared to the level of 3.9% in Q4 2020.
Rent collections amounted to around 96% of rental income due. The majority is due to rent deferrals as rent losses amounted to less than €10,000,000 Moving to solvency cash and payout. Our SSC ratio was 197% on the 1st January 2021. As of today, the SSC ratio is at around 200% and therefore slightly above our ambition range of 140% to 190%. Cash at holding amounts to somewhat below €1,000,000,000 today compared to a figure of slightly more than €1,000,000,000 at year end.
Both our solvency and cash position remained strong. Our €400,000,000 share buyback, which was resumed on the 4th January 2021, is on track And will be completed by the end of May the latest. Let me sum up. I'm very pleased With the strong performance of Swiss Life in 2020 so far, especially with the development of the fee business, We have thus further improved the quality of our earnings and demonstrated the resilience and strength of our business model In an environment that remains challenging, we are very well on track with our Swiss Life 2021 program And I can therefore confirm all the Swiss Life's 2021 financial targets. Thank you for listening.
I'm now ready to take your questions.
We will now begin the question and answer eventually turn off the volume of the webcast. Webcast viewers may submit their questions in writing via the relative The first question comes from Peter Eliot from Kepler Cheuvreux. Please go ahead.
Thank you very much, and congratulations on the great results as always. I had three questions, please. First one on The fee income result, I mean, I know you don't disclose the fee results for Q1, but I was just wondering if you could give us any pointers Whether we should expect this to move in line with the strong fee income you've disclosed or whether any of it is lower margin. And I guess in particular, you've previously said that recent asset management inflows have been at higher margin. And I'm just wondering if that's still the case in Q1.
Second question would be on cash. Quite positively surprised actually at the cash at holding just below €1,000,000,000 Because given that you've, I think, just about finished, if you haven't already finished the share buyback, Yes, it's higher than I would expect it. I'm just wondering if there's any sort of thing particular That you're able to comment on there in terms of the drivers. And then the third question is on the FIST premiums. Just wondering if you can sort of help us on how you see the outlook for that business.
I mean should we The trends that we saw in Q1, are they something that you expect to continue? Or Might we see a sort of partial recovery in full Insurance Solutions in future quarters? Any insights you could give there would be very helpful. Thank you very much.
Okay. Thanks, Peter, for the question, let me start with the first one on the fee income. By and large, clearly, we see this Going through into the fee results as well. There is certainly some differentiation to be made across, let's say, the Various businesses, Germany, we had an exceptionally strong Q1 for the recent mentions. Today, we really expect to see some operational leverage.
In asset managers, If we look at the total asset composition, we have seen a good share of, Let's say real assets in the inflow. If we look at the overall book, we have around 40%, 42% real estate in the assets It's under management in TPM, which is essentially at prior year level. It's also important to see that we have Substantial strong growth in TPM compared to the PAM business. And in the PAM business, costincome So it's clearly below or is better than the one in Ete Chem. So that's a couple of things to keep in mind when thinking about the fee development, but let me also here confirm obviously the targets for the fee results for 20 2021.
On the level of the cash, yes, the share buyback is Ongoing. We have not fully completed it. We are maybe at €375,000,000 as of today. What is important to keep in mind in terms of the cash level of holdings that we have paid out the dividends to the shareholder, But we have paid it out net of the withholding tax of around ZAR 230 1,000,000 and this withholding tax will be paid from the holding in May Versus the end of May. So this is an outflow that is not yet reflected in the numbers mentioned.
In terms of the group life business, there are a couple of things. First of all, to keep in mind for the year 2021, there is a strong seasonality. In the group life This business we have typically most of the signal premiums coming in at the beginning of the year. So if we look now at the premium, within the year, we expect this Decline of minus 24% on a relative basis to It comes more, but overall, but also for the full year, we expect a premium reduction In the Swiss Group Life Business. Now a bit more longer term, what can you say there?
We have this Full range provides strategy. And this is nothing new. I mean, we have mentioned, for example, so at the Investor Day Today that we strive for a good mix between full insurance and semi autonomous solutions. Clearly, there is now compared, for example, to the year 2019 when we had The high shareable insurance in the new business now focus more on the semi autonomous business. The interest rates have come down substantially and therefore we have an actual, let's say, preference in the low in this very low rate environment The semi autonomous solutions, but as rates move up, this can also lead to some obvious Mix this between the full insurance and semi autonomous business.
That's great. Thanks very much. Could I just follow-up very quickly on the last point? Because I guess, I mean, I was trying to look through the seasonality A little bit, so I was sort of thinking more about longer term, so what you're commenting on towards the end. But I mean, I guess, when we come to do our forecast for Q1 2022, for example, if the environment is the same as today in terms of interest rate level, etcetera, should we be using The Q1 2021 as a sort of baseline starting point?
Or do you think it was sort of Still low still lower than one might use for a base. I don't know if that's a bit clearer.
Yes, we have had if you look back into the past, We have seen different levels, let's say, of production of premium in the first half of the year. Certainly, the Q1 2021 is probably at the lower end. But that said, There are various things that enter the picture. There are lag effects From prior year period, we have tariffs that we establish you. Then it takes a while before this is seen in the premium.
So I wouldn't, Let's say, put now 2 more chances on this Q1 result because We also have seen, that's what I've mentioned, seen substantially lower amounts of new entries into existing schemes. This may or may not have to be seen in the context of the COVID environment with Less people and changing jobs. So I think this the Q1 has been a very particular Q1 and I think we now have to see how this develops further.
That's great. Thank you very much, Mathesus. Thank you.
The next question comes from Andrew Sinclair from Bank of America. Please go ahead. Mr. Sinclair, your line is open. You may proceed with your question.
We will take the next question comes from Colmatelli from UBS. Please go ahead.
Yes. Thanks very much. Question on the fee income. Obviously, strong growth coming via the adviser, the IFA channel. You talked a little bit around that being driven by some adviser growth, but also productivity Increases.
Can you just put some numbers around both of those drivers so we can get more clarity on exactly What is driving that 23% year on year growth? And related to that, is there anything you would comment for This Q1, that is exceptional within any of those numbers. And then lastly, just in terms of residual COVID impact, You mentioned it in your last answer to an extent, but to what extent do you feel COVID Has maybe in the Q1 held back any of these growth numbers that you have delivered, Particularly when we look at kind of international or some of the non domestic business, to what extent is that still being impacted by COVID? If you're able to put Either qualitative or quantitative answers to that, please. Thank you.
Thank you. Let me start First with the question on Advices and the productivity gains. And let me focus here On Germany, where we had this 27% growth in fee income, even though also in other areas, let's say, in UK and CE, we have seen a good development of the numbers. So in Germany, we have seen year on year An increase of 13% in terms of adviser numbers and maybe 5% since the end of 2020. Now on the other hand, we have reported for German this 27 1% growth in fee income.
And as mentioned, there was a particular benefit in it. The German government has abolished this tax surcharge, the solidarity tax surcharge for many people, which are typical in our client segments. And this has Generated additional opportunities for our financial advisers and we have said this is maybe around €50,000,000 So if you strip that top line, this particular top line effect out of this German growth, You end up with a, let's say, adjusted growth number, which is slightly above the 13% in terms of advisers. So there is A productivity gain of maybe 3 to 4 percentage points that we have observed in Q 1, 2021. Now how will this move forward?
We reported about The fact that in the lockdown situations, our advisers and their clients We like more on virtual communication. And therefore, we have seen clearly that there is Some productivity gains, I advise traveling less around. And we Hope that at least some of those productivity gains can be continued into the future even If the lockdown situation eases in Germany. So that's to give some flavor, let's say, on the advisory In Germany, in terms of how the COVID situation has Influence the growth numbers. You mentioned international.
Clearly, The situation in Asia is still for the Singapore carrier that there is Clearly, a lockdown in place in history. Medical underwriting, there are, as mentioned, some Great in terms of document, electronic document exchange, but clearly there these measures are in place. In The European business of international and the Private Wealth business, we clearly See restrictions that have held back the premium numbers and also in the area of ask Managed the lockdown situation leads to situation where we have less client activity, less marketing, Less fares, which continue to be an important, let's say, channel to acquire new clients. And as a result, we're extremely focused in all the businesses on existing client relationships.
Okay. Thanks very much.
The next question comes from Michael Huttner from Berenberg. Please go ahead, sir.
Good morning. Thank you very much. Thanks for these Matthew, what's up?
I just wondered whether you can explain the solidity damage to tax a little bit more.
It sounds intriguing. Was I suppose with the message to clients What you're no longer paying in tax, you pay it in insurance. Just wanted to understand what it is. And then the on the group life premiums, You did a really full answer. And I suppose what I'm wondering is Why now?
So or maybe I was maybe a little bit of sleep, but it seems Quite a big change. And it seems I know in line with your strategy, but in the past there's always been growth in this area, Adjusting for the action effect. And now that it seems to be kind of almost as this is slammed on the brakes. And I just wondered What is the reason now? You mentioned tariffs.
And I just wondered if it's linked to the decision you announced earlier this year that The pensions you pay would be I can't I think they were below the relative to a minimum, but I couldn't quite understand And then my third question is on
the real estate. Well, it can give us a
little bit of comfort that the rise in vacancy rate that you have signaled before, but It's anything to add. Thank you.
Okay. Thanks, Michael. On the solidarity tax, let me give some background on that. The The German government has introduced that in 1990s or something like that to finance The integration of the former DDR that is the Democratic Republic of Germany in the context of the reunification. This was a surcharge of at the end 5.5% on the tax.
And this has been in place for Essentia now 30 years. And effective 2020 1, a large part of the population gets rid of this Surcharge in the tax bill. So maybe up to a taxable income of €60,000 They will be relieved from paying this cost. So meaning they have more disposable income And this was taken up or recognized by our financial advisory business As an opportunity and they started to advise their clients to invest That additional taxable or that additional disposable income into the old age pension And this was clearly seen last year as an opportunity. Last year, people have had time to think about that.
And because this tax relief enters into force this year, We have now seen these contracts start and we now have also recognized this benefit, This additional income in fee income this year. So that's a bit of the background To that, for a direct surcharge tax, the business is now rectally efficient. This is kind of a one off That we have seen as an additional top line. Now in terms of the group life Business, maybe I'm not sure whether I have understood all the questions, but let me go back a bit. As we said, in 2019, we have written a substantial Block of business as a competitor pulled out.
This money came in at the beginning of 2019. We have increased back then both the single premiums and also the periodic premiums. And we have Had this now really on the books. We invested that money at the beginning of 2019 when interest rates were Substantially higher than there we are today. Now as also mentioned, we have This full range strategy, which is a mixture of full insurance business and Semi autonomous business and we now have focused in the past year And that's the business that now has ended in Q1 on the balance sheet, more on the semi autonomous business.
Rates have come down substantially and we put clearly profitability And that's the reason why we have maintained and even also taken under Our underwriting in the full insurance base, because at the end of the day, we want to protect the quality of the full insurance Back book. Now what also happens is we move into the semi autonomous space, We just have due to the accounting a lower recognition of premium. What does it mean? We record only the cost and the risk premium in our P and L And both and all the savings components be it the regular savings contribution semi autonomous business Or the initial payment when somebody ends semi autonomous business is not recorded in the premium, But that flows directly to the semi autonomous foundation without being recorded as Premium and Bill, we have, as mentioned, grown the AUMs to now EUR 5 point €2,000,000,000 comparing to €4,200,000,000 1 year ago. So that's a bit on the Group Life premium dynamics now on the vacancy rate, we have At recent acquisitions, which we have acquired at some vacancies, Killeen, that was Essentially, the driver for this uptick from the 3.9% at year end 2020 To the SEK 4.7 billion that we now report for Q1, the reletting activities are underway.
And also based on that, we can confirm what we already stated at the full year disclosure call that for the end of 2021, we see vacancy rates slightly above the 2020 level.
That's really helpful. Just one very quick follow-up on the
solidarity. The EUR 15,000,000, EUR 15,000,000 ex Q1, Will there be
some announced in the next few quarters or is it all done now?
No, that's now all done. These Contracts now have entered into force. We have received from our product partners. The commission, the tuition, this is To that end, an extraordinary item that we have recorded. Now there is something else in Germany that you may have heard of.
The Science ministry in Germany plans to reduce the maximum technical interest rate for insurance Product for life insurance products from currently 0.9% 2.25% starting in 2022. And Experience has shown and it has been the last time in 2017 that such a reduction has taken place, but also in prior years Before such a lowering of the rates, typically people By life insurance at the somewhat higher technical rates and this typically also leads to A pickup of financial advisory activity in such a year end. We see this come For 2021, let's say, a market wide effect.
Thank you very much. Thank you.
The next question comes from Liane Fulin from Morgan Stanley. Please go ahead.
Hello. Thank you. I have three questions, please. So the first one is, so you just mentioned that in Germany, apparently, the increasing fee income is mainly driven by the Higher number of devices. Just wonder is that actually because or partially benefiting from the fact That the more people are looking for jobs during COVID-nineteen.
And then with the economy actually recovers, then You have potentially going to lose people to the other industries or is it because there You have like a school or something, which is just pumping out the qualified advisers quicker than before. So that's the first one. And then secondly is a very quick one. I just want to make sure that The cash number, if I slightly below RMB1 1,000,000,000, if I remember correctly, you used to the remittance from your subsidiaries Usually happens actually later in the year. So this number has not included the cash you are going to receive from your subsidiaries, right?
My last question is also very quick one. Just want to confirm the solidarity tax point. You just said that it sounds like to me, you mean that's one off effect In Q1, is that right? Because if I understand correctly, the disposable income of those low income like populations will increase actually going forward as well. So why do you think it's just one off impact to 1Q results?
Thank you.
Okay. Let me start with the first question. Conceptually, you are right. You're right. The main driver of the growth of fee income is the growth of the number of advisers.
That's the 13 We've mentioned there is a bit of additional productivity gains. Indeed, The fact that in the lockdown situation, people see the job of financial base as an opportunity Personally, growth that you have something to do may have supported the growth, especially in one of The channels we have and the techs brand. On the other hand, one of our key attraction points to financial advices It's our platform in Germany, which helps which offers them a very efficient way that makes Successful in advising people, in meeting people and also in making money for themselves. I mean this platform and Let's say the features of this, the way we manage to say that the advisory force is really an attraction point, Which is here to say and irrespective of, let's say, this COVID-nineteen situation. In terms of The cash number, the main remittance from Twist Life AG has been included In the numbers, in the cash numbers reported.
And as said, there is this outflow of the withholding tax on the dividend Of around €230,000,000 that will take place. On the other hand, we will have some debits, some remittances from small units To come in at during the Q2, we can we'll report for the Happy numbers to start this. On the Solidarity's tax surcharge, Indeed, this surcharge has been abolished effective now for the future. And as a result, our clients have to pay lower amounts of taxes and they will have In the future, higher income. And this higher income, for example, is now invested into a periodic premium Contract?
So they have essentially committed, if you wish, all their increase In the future disposable income into a contract and this contract has now been essentially advised And this is commissioned for us upfront and this commission has now come in In the Q1 of 2021, as we have done Quite some of the advisory in 2020 and contracts have now started in the beginning 2021.
Okay. Thank you very much.
The next question comes from Azik Musaddi from JPMorgan. Please go ahead.
Yes. Thank you and good morning. I just have a couple of questions and most of the questions have already been answered. So First of all, like if I look at your 3rd party asset management move in terms of total assets, around DKK 2,900,000,000 is Because of net inflows and around SEK 3,500,000,000 is because of mark to market. So can you just give us some clarity on what this mark to market is?
Because I mean interest rates have gone up, so you should have a bit negative mark to market on the bond side. How you are doing on Real estate side, any additional clarity on this would be very helpful. And secondly, if I look at the fee premium growth, fee Fee revenue growth, it was 8%, whereas if I look at the total AUM growth in third party, it's been You say 20% over past 1 year versus fee income growth of only 8%. Now I remember like in your opening remarks, you mentioned that it's because of the mix of PAM and PAM and it's because of So can you just give additional thoughts on that like how do you think about the growth in 3rd party AUM Versus the growth in fee revenue at the group level sorry, in the asset management business? Thank you.
Let me start with the NNA figures of €2,900,000 and the additional Contribution of FX movements and the performance. So, we report our figures In Swiss francs, we're as quite a substantial part of PPAM assets are denominated in euros. And as a result of that, we have had an FX translation effect of around CHF1.3 billion, Which has to be added to the €2,900,000,000 net new assets. And then we have had a performance €900,000,000 And this performance clearly has various contributions, as you say. Rates were having a negative impact.
On the other hand, we have had some spread tightening, Which held on the call, but bond mandates we have had substantial appreciation of the equities. We have also seen appreciation of the real estate, which by the way in the TPAM assets account 40% of the phone class on the management. On the balance sheet, we have 20% of real estate. And in the fee plan, it's About 40% and there continued appreciation has helped. So net net with different contributions Also in terms of size, we have had €900,000,000 of performance.
Now in terms of the A and M as management fee income, I think It's important to keep in mind that the fee income does not fully develop in line with assets under management. Why is that? We have clearly some contributions which are nonrecurring in nature. This is essentially the real estate project development. Those are transaction fees.
Those are sometimes performance fees. These are fees for refurbishing real estate and the like. We have also some fees, For example, in Facility Management, in the Property Management that relate to The management of the tenant relationships. So there is Quite a substantial part of the fee income, which is not developing in line with AUMs, asset, other components. Now in terms and we give you The order of magnitude, we have had in Q1 nonrecurring components Of the total income, meaning fee and of the net income of 14% compared to 12% at the prior Year Q1, for a full year, to take the last full year 2020, we have It'd be at 27%, because within the year this non recurring income is Back end loaded.
So that's a bit about the fee dynamics and asset management.
Thank you. Thanks a lot. That's great to hear.
The next question comes from Farooq Hanif from Credit Suisse. Please go ahead.
Hi, everybody. Thanks so much. Just going back to solvency tests And the 200%. I mean given what you said about FX and given the equity market, I'm just a little bit surprised it's not a little bit higher. I'm kind of wondering, you're giving a very, very approximate number, but or is there a big negative that I'm Not taking into account in that statement.
And secondly, going back to Group Life. You've had a very, very strong increase, it seems, in semi autonomous AUM. So going forward, are we going to see is the potential for that AUM I mean, I guess, what I'm really trying to find out, what is the net in net inflow or the inflow that we can that's going into that Business and do you expect that to grow? And then tied to that, when you talk about tariffs wanting Get adequate compensation for writing the traditional full group life. What metrics are we using?
Is it return on allocated, to form the capital? Is it new business margin? Can you give us a little bit more of an idea about Kind of what the hurdle rate is? Thank you.
Thanks. Coming first So the SST, when you do the math with the sensitivities we provide, You may end up with a somewhat high number. Rates have improved, Corporate spreads have improved and equity markets have improved and real estate markets have improved. And This roughly speaking has contributed maybe each 1, 1.5, 2 percentage points to SSD. What may be a bit of a surprise is the interest rate movement and there You have to acknowledge that on the U.
S. Dollar rate increase, We have no corresponding liabilities against that, and that's the reason why rate increase in the U. S. Dollar has a Negative impact on the SSP. However, We have had the benefit of that in 2020 as a positive contribution to SSD And now it has reversed.
And this may be the reason that if you do just the back of the envelope calculations in 2021, That the increase may be a bit lower than what you have expected. So there's nothing particular to those So, cost of thought other than the increase in the U. S. Dollar rates. Now in terms of the group wide business, Semi autonomous business, we have clearly the ambition to grow that business.
As said, we have had the EUR 1,000,000,000 since Q1 2020 and for us this is something we want to follow that business. This is An attractive offer for clients. For some clients that's really a good thing. And at the other hand, we also Clearly maintain the full insurance business there. We, as I said, look in terms of the underwriting Specific operating looks like average age, how much Extra man, the 30 basis points we have in the contract and the like and how it compares To the average book that we have.
So those are more the operational considerations we follow. In terms of evaluation of strategy, how do we think about finding the balance between full insurance And the semi autonomous business, how do we see that? We have disclosed that at the Investor Day 2018, You know where we have evaluated various strategies and there we have come to the conclusion that a mix Sure. Of both, full insurance and semi autonomous is most attractive. There we look at Stuff like the incremental net profit, how much value of new business we generate and also what is the capital efficiency in terms of do we meet The capital efficiency criteria we have developed.
Okay, thanks. It sounds like it's very bespoke on a case by case basis, but I can follow-up later. Thank you very much. Welcome.
The next question comes from Thomas Fossard from HSBC. Please go ahead.
Yes, good morning, everyone. Two questions. The first one would be related to the Swiss market. Actually, there has been a lot of swing in terms of businesses In Q1, any indication you may share with us regarding The evolution of your new business margins. Just for us to better understand What was driven by, I would say, more cautious assumption in terms of margin and how you're shifting And moving your business around margin, that will be very helpful.
And the second question will be relating to the Department of Justice. Any update on the issue and any comments you would like to make at this stage regarding the EUR 70,000,000 charges you've taken at the full year? Thank you.
Okay. I'll start with the second question on the DOJ. There's nothing new to report on that since There's a full year release. Now in terms of the margin development, how we think about As you know, we have seen in the last year in 2020, a clear increase Of new business margin in Switzerland from 1.6% to 2.5%. And as mentioned, This has been seen in the context of a lower share of full insurance Business that we have waited in 2020.
We also have had in 2020 An improvement of the business mix, not only within the group life business, but also within the individual life business with an increased Share of capitalized products and with that we could also more than offset The negative interest rate development we have had during the full year 20 2020. So that gives a bit of a flavor of what The dynamics were so all in all we can say the full insurance business has a low with an average margin even though as we also continue to say It meets the hurdle rate of 1.0 percent, but it has been our average margin and that's what we could already observe in 20
Swamy, an indication of good trends In Q1 compared to last year?
Well, we disclosed the value New business, the margin update at the half year. It is now updated Q1. But if you look a bit back, You know that we still have some interest rate sensitivity and particularly for the Swiss business they may be This contribution. But at the end of the day, what matters is the rate level at the half year. When we disclose the numbers and I think
The last question for today's call comes from Peter Eliot from Kepler Cheuvreux. Please go ahead.
Thank you very much for allowing me a follow-up. And sorry to come back on the group life, But I'm just thinking, one thing that might really help us sort of understand the dynamics is I don't know if you're able to give us a hint on the business that went into Semi autonomous. If that had instead gone into Foot Insurance Solutions, are you able to sort of give us an indication of what the premium uplift might have been, maybe just so that we can sort of fully understand the quantum of that effect. And if I could just add one more. Solvency level, I mean, I think I or maybe somebody else asked this So, yeah, but obviously, you're above the sort of your target range at the moment.
Are you able to give us any thoughts on What that means for you at the moment? How you think about that? Maybe pushing my luck a bit. Any comments you'd give would be very helpful. Thank you.
Maybe starting with the second question first. Yes, we have Situation, not the first time that we explained about the ambition range. I think what it means, we have talked about that on all the calls. I think we have Just about the criteria that we consider and I think there's nothing more to add to that than what we said on the previous Now in terms of the question about The semi autonomous and what might have been, I think that is kind of speculation because I mean it It needs to fit 1st of all the client situation. This is not that we can say, well, Go there or here.
It needs to fit the client situation. And we Cannot say that otherwise they might have gone somewhere else. These those are clients that come in. What is Maybe to be said that the rule of thumb is that when new clients enter The scheme, be it full insurance or semi autonomous, they bring in their part of money they have accumulated in the old scheme at another insurance company or in another place and they deposit that. In the full insurance, this is a single premium.
And in the semi autonomous space, it was kind of a deposit into the AUM. And this AUM, as mentioned, Have increased by around €400,000,000 since year end 2020. That's probably the best I can say. Clearly, these numbers also include other effects, That's probably something that we can say. And other than that, also in the semi autonomous space, What is key to remember is that all the recurring payments, savings components, they do not show off in the P and L as a premium that directly go into the foundation without touching our P and L.
No, that's great. Thanks very much. I was aware I was probably pushing my luck anyway. Thank you.
Sir, so far, there are no more questions from the phone.
Thank you for your interest in Swiss Life and for your questions. I wish you a nice day.
Participating in the conference. You may now disconnect your lines. Goodbye.