Home / Financial Services/ AIA delivers strong new business growth for 1Q

AIA delivers strong new business growth for 1Q

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AIA Group Ltd. last week announced 18% growth in value of new business (VONB) on constant exchange rates (CER) for the first quarter ended 31 March 2019.

Growth rates on a constant exchange rate basis were 18% growth in VONB to $1,169 million; 11% increase in annualised new premiums (ANP) to $1,827 million; VONB margin up 4.1 pps to 63.6% and Total weighted premium income (TWPI) up 18% to $8,276 million. 

AIA’s Group Chief Executive and President Ng Keng Hooi said: “AIA has made a good start to the year with an 18% increase in VONB to US$1,169 million for the first quarter of 2019. Our highest ever quarterly VONB result continues our consistent track record of year-on-year growth.

“The strong headline figures reflect our continued focus on executing our strategic priorities as we help to meet the evolving needs of our customers for protection and long-term savings across our markets. AIA’s high-quality financial advice and our transition towards being a lifelong partner to customers are critical success factors in meeting these needs.”

“AIA’s competitive advantages in distribution and product innovation, developed over many years, are aligned with the unprecedented structural drivers of life insurance growth across the Asia-Pacific region. We are exceptionally well-placed to capture these enormous opportunities, deliver long-term, sustainable shareholder value and help our customers live Healthier, Longer, Better Lives,” the AIA CEO and President added.

AIA said VONB increased by 18% to $1,169 million with strong growth from both agency and partnership distribution compared to the first quarter of 2018.

“AIA’s wholly-owned operation in China was our fastest growing reportable market segment and delivered excellent VONB growth in the first quarter of 2019. The consistent execution of our differentiated Premier Agency strategy has delivered a further strong increase in both active agents and productivity as we continue to focus on the financial needs of consumers. We have also begun preparatory work on the new sales and service centres in Tianjin and Shijiazhuang, Hebei.

“Hong Kong generated strong double-digit VONB growth in the first quarter of 2019, driven by both our agency and partnership distribution channels. Agency growth was supported by an increase in the number of active agents. VONB grew for both domestic and Mainland Chinese visitor customer segments.

“VONB growth at AIA Thailand was supported by encouraging progress from our partnership with Bangkok Bank Public Company Limited where we have seen strong momentum from recruitment and enhanced productivity of insurance specialists. Continued progress with our agency transformation delivered a further increase in active agent productivity.”

AIA Singapore reported lower VONB compared to the first quarter of 2018 as higher VONB margin was offset by the reduction in single premium unit-linked business compared to the previous year, following a regulatory change in October 2018.

VONB in Malaysia was flat with market conditions remaining challenging. In agency, targeted recruitment and training delivered growth in active new agents while bancassurance reported VONB growth.

Other Markets reported very strong VONB growth in the first quarter of 2019 led by excellent performances from our businesses in the Philippines, Taiwan, Vietnam and Australia (which includes New Zealand). Australia’s VONB growth was supported by the inclusion of Sovereign in New Zealand and the renewal of a large group scheme in Australia.

Overall, ANP increased by 11% compared with the first quarter of 2018 to US$1,827 million. VONB margin improved to 63.6%, up from 59.7%, mainly driven by positive changes in geographical mix and operating assumption changes reflecting sustained positive experience. Margin reported on a present value of new business premium (PVNBP) basis increased to 11% from 10% in the first quarter of 2018. 

“Long-term economic assumptions remain unchanged from those shown in our Annual Report 2018, following the same approach that we have applied consistently for quarterly new business highlights. TWPI increased by 18% to $8,276 million, compared with the first quarter of 2018, reflecting the continuing effect of adding high-quality new business to our large in-force portfolio.”

In terms of outlook, AIA said Asia’s macroeconomic fundamentals remain resilient and policymakers have taken proactive actions to support their economies in response to challenges in the global environment. “The strong domestic drivers of growth and major demographic trends continue to provide positive structural support for the long-term prospects of AIA’s businesses. We remain confident that consistent focus on executing our strategic priorities will deliver long-term, sustainable value for our shareholders.”

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