AIA Group has announced its results for the first half of 2020, bannered by 5% profit growth, despite the negative economic effects of the COVID-19 outbreak worldwide.
The company’s operating profit after tax was at US$2.933 billion, up 5% year on year. Underlying free surplus generation improved by 11% to US$3.05 billion.
AIA’s value of new business (VONB) decreased by 37% to US$1.41 billion for the first half, but it has shown signs of recovery, with strong month-on-month VONB growth in markets as they emerged from COVID-19 containment measures.
Annualised new premiums also went down by 24% to US$2.58 billion. Sales were especially affected in AIA’s home market of Hong Kong, which reported a 68% decrease in VONB. This was mostly driven by the mandatory quarantine requirements for all arrivals from Mainland China since early February.
Outside of the Hong Kong and mainland China markets, AIA’s businesses grew by double digits in the first quarter, but restrictions that took effect in the second quarter caused a huge impact on new insurance sales.
“I am extremely proud of the way AIA’s businesses have responded with speed and compassion to the challenges brought by the COVID-19 pandemic, and provided uninterrupted support to our customers and communities. I am grateful for their dedication, collaboration and contributions in these unprecedented times,” said Lee Yuan Siong, AIA Group CEO and President.
“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.”
