AIA’s new business up 22 percent in third quarter | Sunday Observer

AIA’s new business up 22 percent in third quarter

15 November, 2020

HONG KONG, November 9  – AIA Group Limited has recorded  key new business indicators for the third quarter ended 30 September 2020.  

In the third quarter of 2020, the Group delivered strong momentum in new business sales. VONB  increased by 22 per cent compared to the second quarter of 2020, driven by sequential quarter on-quarter growth from almost all of our markets. VONB margin was consistent with the second  quarter as the reduction from economic assumption changes and geographical mix shifts was  offset by reduced acquisition expense overruns as quarterly sales momentum improved. Across  our agency businesses, we have continued to build future capacity with new recruits up more  than 20 per cent compared to the third quarter of 2019.

While sales volumes during the first nine months of 2020 were lower than for the same period  last year, the overall scale of our in-force business has continued to increase. TWPI of  US$8,797 million increased 7 per cent compared with the third quarter of 2019. The third quarter of 2020 marked a historic change for AIA China, beginning with the incorporation  of our new subsidiary in Mainland China on 9 July. Our people worked tirelessly on the conversion  process, which included coordination with more than 2,000 counterparties and 150 government  departments across the country. 

In  the third quarter, VONB from AIA China was broadly similar to the second quarter before allowing  for 5 per cent withholding tax, which has been applied since 9 July.

AIA China remained the  largest contributor to the Group’s VONB. In the first nine months of 2020, we have continued to  grow our high-quality Premier Agency force and our disciplined execution has achieved a  double-digit increase in new recruits, total agents and also agency leaders.  

AIA Thailand achieved strong quarter-on-quarter growth in the third quarter as sales momentum  returned to both agency and bancassurance channels. Our businesses in Singapore and  Malaysia delivered excellent quarter-on-quarter growth with VONB more than double the second  quarter and also significantly above the third quarter of 2019. 

The easing of movement restrictions across many markets supported excellent quarter-on quarter growth in VONB for our Other Markets segment. Tata AIA Life achieved excellent year on-year growth on a like-for-like basis despite the ongoing disruption to the Indian economy from  the pandemic and has now become the market leader in retail protection business. All of our  other individual markets in this segment delivered quarter-on-quarter growth in VONB. 

After the sharp contraction in the global economy in the first half of 2020, some countries have  returned to growth in the third quarter, including Mainland China. Economic recovery has  diverged significantly at the country level, driven by the effectiveness of pandemic containment  measures and government policies as well as the importance and competitiveness of  manufacturing industries.The medium-term outlook remains highly uncertain given COVID-19  infections have been rising in many countries and political and trade tensions remain elevated.  However, the demand for AIA’s products and services will continue to grow over the long term,  powered by the structural drivers of rising wealth, low insurance penetration levels and limited  social welfare across Asia.