AIA delivers strong 1H results; value of new business up 22%

AIA Group has announced strong results in the first half of FY21 with 22% growth in value of new business (VONB) to $1,814 million.

It said VONB exceeded pre-pandemic levels in all reportable segments except Hong Kong.

EV Equity of $ 70.1 billion, was up 5% from 31 December 2020 whilst Operating profit after tax (OPAT) increased by 5% to $ 3,182 million. AIA also reported a free surplus of $ 17.9 billion, up $ 4.4 billion from 31 December 2020. The Group Local Capital Summation Method (LCSM) cover ratio was 412%. The interim dividend declared increased by 8.6% to 38 Hong Kong cents per share  

AIA’s Group Chief Executive and President Lee Yuan Siong said:  “AIA has delivered very strong VONB growth of 22% and an increase in all of our key financial metrics. I am very pleased that VONB exceeded the pre-pandemic levels of the first half of 2019 for each of our reportable segments except Hong Kong, where travel restrictions continue to affect sales to Mainland Chinese visitors.  

“Our growing high-quality in-force portfolio supported growth in both OPAT and UFSG. EV Equity and shareholders’ allocated equity reached record highs and our very strong financial position is reflected in a significant increase in free surplus and a Group LCSM cover ratio of 412%.  

“The Board has declared an 8.6% increase in interim dividend to 38.00 Hong Kong cents per share. This follows AIA’s established prudent, sustainable, and progressive dividend policy, allowing for future growth opportunities and the financial flexibility of the Group. 

“Our focus on further enabling our business with technology has significantly improved resilience in the face of ongoing pandemic containment measures. Compared to the first half of 2020, our Premier Agency has increased both agent productivity and our number of active agents. We have delivered a 25% increase in our registered Million Dollar Round Table (MDRT) members to more than 16,000. This is our seventh consecutive year of achieving the largest number of registered MDRT members globally. 

“AIA’s Purpose of helping people live Healthier, Longer, Better Lives comes to life through our compelling propositions which integrate our Health and Wellness Ecosystem and long-term savings solutions. We continue to focus on advancing the key components of our ecosystem to deliver improved health outcomes for our customers.” 

He said AIA believed that creating distinctive, personalised and meaningful experiences for customers would generate a range of business benefits. “Transforming AIA into a simpler, faster, more connected organisation will support the delivery of our strategic ambitions for the next era of growth, building on the powerful demographic trends and immense opportunities in the life insurance market in Asia. I am confident that the continued execution of our strategic priorities will enable us to generate long-term sustainable value for our shareholders.” 

AIA has continued to make excellent progress with strategic priorities as it embraces the transformation that will further extend its competitive advantages and enable AIA to capture the significant growth opportunities available across Asia. “The upgrading of our technology to world-class modern architecture and systems has gathered pace as we make targeted investments in digital tools and embed data analytics at scale into our businesses. This transformation is enabling us to significantly enhance the experience of our customers, distributors, partners, and employees while achieving greater growth and efficiency,” Siong added.