Tune Protect Group Berhad (Tune Protect) posted a 50.3% year-on-year (YoY) increase in profit after tax (PAT) for the third quarter of 2024 (3Q24), reaching RM7.2 million compared to RM4.8 million in the same period last year.
The company credited the rise to improved underwriting results and better expense and claims management.
The group’s underwriting profit rose 17.3% YoY to RM6.1 million despite a 6.3% decline in insurance revenue, which fell to RM100.2 million in 3Q24 from RM106.9 million in 3Q23.
Newly appointed chief executive officer How Kim Lian (pictured) attributed the drop in revenue to a one-off impact from the Tenang scheme recorded in 3Q23 and the absence of deferred commercial income carried over from 2022.
The group reported a RM3 million improvement in net incurred claims and expenses, largely due to reduced operating costs and favourable claims in the fire and personal accident (PA) portfolios.
How said that the company’s net incurred claims and attributable expenses showed significant improvement – despite the lower revenue than last year – driven by better expense controls and claims outcomes in key segments.
He also noted that the group has reduced its reinsurance premiums as part of a business portfolio review to focus on higher-margin segments.
However, foreign exchange (forex) losses of RM4 million, caused by the Malaysian ringgit’s sharp appreciation against the US dollar, affected profit before tax (PBT).
On a quarter-on-quarter (QoQ) basis, the group’s insurance revenue increased, supported by strong contributions from the travel insurance segment.
Additionally, improved claims experiences in fire, engineering, cargo, and PA lines contributed to enhanced results, reducing the combined ratio by 1.3 percentage points YoY and 11.3 percentage points QoQ.
For the first nine months of 2024 (9M24), Tune Protect recorded a loss before tax (LBT) of RM5 million, impacted by three significant fire-related claims. These claims, while higher than usual, are expected to normalise in the future.
Adjusting for one-off items, the group would have achieved a profit before tax (PBT) of RM11.5 million for 9M24.
The company’s financial performance in 3Q24 and 9M24 highlights:
Tune Protect continues to refine its investment strategy, focusing on conservative approaches to achieve steady returns.
How shared that the group is reallocating investments into low-risk unit trust funds, primarily backed by government securities and bonds.
In operational updates, the group upgraded the online user experience for its airline partner’s direct channel, leading to a 12% QoQ rise in policy sales.
New travel products, such as the Tune Protect Travel Gadget insurance, were introduced in Malaysia to improve uptake.
The group also expanded its business-to-business (B2B) partnerships, collaborating with local travel agencies and a credit card issuer in Thailand.
The Cancel for Any Reason product launched earlier in 2024 has shown significant growth, with gross written premiums (GWP) more than doubling QoQ and policies issued rising by 71%.
How stated that the group remains focused on strengthening profitability in key business segments while maintaining strict cost controls.
In the motor insurance segment, Tune Protect is implementing pricing strategies and claims management initiatives to align its claims ratio with market benchmarks.
How said the company is optimistic about achieving steady growth in the quarters ahead, given its efforts to optimise costs and improve portfolio performance, particularly in travel insurance.
“In line with the review of the group’s business portfolio, we will continue to focus on the more profitable segments of the business while maintaining cost discipline to ensure favourable underwriting results in the coming quarters,” he said.
