AIA, Asia's third-largest insurer by market value, reported a 40 per cent increase in the value of new business last year, beating analysts' estimates and driving shares prices up more than 3 per cent to a six-month high.
Value of new business (VONB), a key indicator for insurance companies which measures the present value of future business, rose to US$932 million for the year ended in November. VONB margin climbed 4.6 percentage points to 37.2 per cent, AIA said.
The jump outshone a 41 per cent drop in the insurer's net profit, due to stock investment losses.
'Overall figures were very strong, and VONB results especially beat analyst estimates,' said Stanley Tsai, an analyst at Keefe, Bruyette & Woods.
Margins rose in VONB mainly through the company's repricing strategy, launch of new products and improvement in its agency sale force, said Tsai. He said about 80 per cent of AIA's value of new business was generated through agency channels.
The insurer showed strong growth in its key markets such as Hong Kong, Singapore and the mainland, said Kenneth Yue, an analyst at CCB International.
VONB margin reached 56.1 per cent in Hong Kong, 62.3 per cent in Singapore and 47.2 per cent in the mainland.