The Board of Directors of AIA Insurance Lanka PLC (“AIA Sri Lanka” or the “Company”) is pleased to announce the financial results of the Company and its subsidiary (collectively, the “Group”) for the year ended 31 December 2018.
The main highlights are:
• Consolidated revenue grew by 6 per cent to LKR 18,232 million during the financial year 2018, from the figure reported for financial year 2017, driven by the growth in Gross Written Premium.
• Gross Written Premium (GWP) of the life insurance business, grew by 11 per cent to a record LKR 12,739 million, driven by growth in regular premium business and a favourable shift in persistency. There was continued improvements in customer engagement and premium collection, that resulted in a 22 per cent growth in premium collection from these initiatives.
• Conventional life business GWP grew by 12 per cent, with growth from both the agency and bancassurance channels.
• Investment income dropped by 3 per cent, due to impact on government bond values from the abolishing of national Withholding Tax credits (NTC) effective from 1st April 2018 with the enactment of the Inland Revenue Act 2017.
• Consolidated profit after tax decreased from LKR 13,442 reported in 2017 to LKR 4,111 million in 2018. The profit after tax for 2018 includes the transfer of life business surplus for the year, being LKR 1,157 million and the creation of a deferred tax asset of LKR 2,537 million arising from the tax regime change for life insurers with the enactment of the Inland Revenue Act 2017, which introduced a surplus based tax basis replacing the previous I-E tax basis.
• The consolidated profit after tax for 2017 includes the transfer of life business for the year and the transfer of the Risk Based Capital one-off surplus in line with the Direction #16 issued by the Insurance Regulatory Commission of Sri Lanka.
Pankaj Banerjee, Chief Executive Officer of AIA Sri Lanka, said:
“2018 was characterised by continued transformation at AIA Sri Lanka aimed at laying a strong foundation for sustained growth, driven by our brand promise of helping customers live healthier, longer, better lives. In 2018, AIA Sri Lanka demonstrated great resilience and discipline to deliver a robust performance amidst a challenging external environment marked by slowdown in consumer demand, relatively low economic growth and continued uncertainty in the socio-economic front.
“Against the backdrop of the economic challenges during the year, AIA Sri Lanka remained focused on executing our strategy and launched several key initiatives including the launch of a full-time professional agency outfit of Premier Agency Circle (PAC). We continued to enhance our customer offering with market leading and needs based new pension and health solutions with the introduction of SmartPension and HealthProtector. We also launched a top-tiered customer programme ‘AIA First Class’ for our premier customers. We strengthened our bancassurance platform with continued strong growth through our strategic partnerships with DFCC Bank and NDB Bank, while also commencing development of our digital sales system. Our investments in strengthening our brand visibility also resulted in sizeable enhancement in our brand recognition parameters with Total Brand Awareness growing to 86% by the end of the year. These are all testimony of AIA Group’s firm commitment to the Sri Lankan business where we continue to invest in transformational initiatives, and look forward to achieving further success in the years to come.”
William Lisle, Chairman of AIA Sri Lanka, said:
“I am pleased to see AIA Sri Lanka’s resilience in the face of adversity and appreciate the initiatives launched in 2018 and also the progress made. I remain confident of the long-term growth potential of the Sri Lankan market, and we remain committed to continuously focusing on executing our strategy for making steady progress towards our goal of becoming the pre-eminent life insurer in Sri Lanka and help its people live healthier, longer, better lives.”
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AIA Group Limited and its subsidiaries (collectively “AIA” or the “Group”) comprise the largest independent publicly listed pan-Asian life insurance group. It has a presence in 18 markets in Asia-Pacific – wholly-owned branches and subsidiaries in Hong Kong, Thailand, Singapore, Malaysia, China, Korea, the Philippines, Australia, Indonesia, Taiwan, Vietnam, New Zealand, Macau, Brunei, Cambodia, a 97 per cent subsidiary in Sri Lanka, a 49 per cent joint venture in India and a representative office in Myanmar.
The business that is now AIA was first established in Shanghai almost a century ago in 1919. It is a market leader in the Asia-Pacific region (ex-Japan) based on life insurance premiums and holds leading positions across the majority of its markets. It had total assets of US$221 billion as of 30 June 2018.
AIA meets the long-term savings and protection needs of individuals by offering a range of products and services including life insurance, accident and health insurance and savings plans. The Group also provides employee benefits, credit life and pension services to corporate clients. Through an extensive network of agents, partners and employees across Asia-Pacific, AIA serves the holders of 32 million individual policies and over 16 million participating members of group insurance schemes.
AIA Group Limited is listed on the Main Board of The Stock Exchange of Hong Kong Limited under the stock code “1299” with American Depositary Receipts (Level 1) traded on the over-the-counter market (ticker symbol: “AAGIY”).