AIA Group said that the value of new business (VONB) came down by 37% to $1.41bn in H1 2020 compared to $2.27bn in H1 2019
Headquarters of AIA Group in Hong Kong. (Credit: AIA Group Limited)
AIA Group has reported an increase of 5% in its operating profit after tax (OPAT) for the first six months of 2020 that ended 30 June 2020 (H1 2020) at $2.93bn compared to $2.83bn reported for the same period in last year.
The Hong-Kong based life insurance group said that the result showed the resilience of its large in-force portfolio of long-term business with high-quality, recurring sources of earnings.
The shareholders’ allocated equity in H1 2020 moved up 2% to $43.3bn from $43.27bn reported in H1 2019.
AIA Group’s value of new business (VONB) came down by 37% to $1.41bn in H1 2020 compared to $2.27bn in H1 2019. The group attributed the decrease in VONB on the containment measures it had taken up amid the Covid-19 pandemic which resulted in limited face-to-face sales.
The annualised new premiums (ANP) in H1 2020 came down 24% to $2.56bn compared to $3.44bn reported in H1 2019.
The underlying free surplus generation for the insurer was up by 11% to $3.04bn from the figure of $2.8bn reported in the first six months of the previous year.
The pan-Asia life insurance group announced a dividend of 35 HK cents, which is 5% more compared to 33.3 HK cents for the first half of 2019.
AIA Group chief executive comments on H1 2020 results
AIA Group chief executive and president Lee Yuan Siong said: “We saw very strong signs of recovery in new business sales from our markets as containment measures were eased. The growth in operating profit after tax and underlying free surplus generation demonstrates the resilience of our large and growing in-force portfolio and solvency for AIA Co. remains strong.
“The Board has declared a 5 per cent increase in the interim dividend following our prudent, sustainable and progressive dividend policy allowing for future growth opportunities and the financial flexibility of the Group.”
Earlier this month, the life insurance group entered into an exclusive regional partnership with Holmusk, a data science and healthcare technology company. The partnership has been forged to enable the life insurer to offer a wider variety of health coaching tools and solutions to its customers by leveraging Holmusk’s data-driven approach to health management.