AIA Sri Lanka posts strong full-year results

Friday, 7 March 2014 04:27 - - {{hitsCtrl.values.hits}}

AIA Insurance Lanka PLC yesterday announced solid performance for the year ended 2013 with the combined composite Gross Written Premium (GWP) amounting to Rs. 9,536 million, up 7% from the previous year. Investment income increased to Rs. 4,408 million, up from Rs. 4,028 in 2012. Consolidated profit after tax excluding re-branding spend was Rs. 673 million. Consolidated profit after tax net of re-branding was Rs. 499 million. The Board of the company has also recommended a first and final dividend of Rs. 2 per share, in line with the payout ratio of 2012. “We are extremely buoyant about the future prospects and opportunities in the market and intend to retain earnings to continue to invest in a number of growth initiatives,” explained Shah Rouf, Chief Executive Officer of AIA Sri Lanka.

Life Insurance, the largest contributor to the company’s top line, recorded a new business premium of Rs. 2,057 million and GWP of Rs. 6,863 million during the year ended 2013. Benefiting from professional long-term investment strategy and continued focus on expense control, AIA Sri Lanka successfully created value for its Life fund and declared a life surplus distribution of Rs. 200 million for 2013. General Insurance achieved profit after tax of Rs. 316 million in 2013. Sri Lanka is a soft, highly price-sensitive market for General Insurance and it is indeed commendable that the Company reports 11% growth in gross premiums written during 2013 notwithstanding the focus on maintaining quality. General Insurance claims ratio has seen a marginal increase from 52% to 58% and the net combined ratio (NCR) went up to 103% from 97%. The Company’s focus over the last couple of years has been on quality underwriting and right pricing which now yielded the desired outcome. Rouf continued: “Whilst in general the global economy is still showing mixed signs of recovery, Sri Lanka is showing a relatively healthy economic growth. Our prudent execution of strategic priorities which involved driving sustainable and profitable business growth through

geographic expansion, strategic partnerships, product differentiation and leveraging our strong brand promise has been very successful.” He added that the company will continue to invest in developing its sales force, Wealth Planners. “In 2013 we had the most successful recruitment drive for Wealth Planners. The Wealth Planners expansion has positively impacted top-line growth. Sustainable growth is expected as our new recruits continue to grow and develop. Our Bancassurance channel also delivered a steady, solid performance with our refined operating model now embedded within the existing and new partner banks.” Gordon Watson, Chairman of AIA Sri Lanka, said: “2013 was my first year as Chairman. I am delighted to see that AIA Sri Lanka has delivered a strong performance, during what has been a relatively challenging macro environment. Our success is a testament to the dedication and hard work of our talented people, and leaves us well placed for continued growth in 2014. AIA is exceptionally well-positioned to capture the upside growth opportunities in Sri Lanka and across the region given the quality and scale of our distribution platforms, our depth of experience derived from the Group’s long history in Asia Pacific, our unrivalled financial strength and our terrific people.”