Net rises to 3.1b yuan as insurer turns focus on more profitable product mix
Ping An Insurance Group last year sacrificed short-term revenue growth in exchange for a more profitable product mix, operating results show.
The strategy appeared to have paid off with a 34.3 per cent surge in net profit last year to 3.11 billion yuan from a year earlier. Net profit at its life insurance arm rose 38.7 per cent, overcoming a fall in premium revenue and slower investment income growth.
The Shenzhen-based insurer booked revenue of 63.25 billion yuan in the 12 months to December last year, down 5.1 per cent from 2003.
Ping An, the second-largest mainland life insurer behind China Life Insurance, reported gross written premiums, policy fees and premium deposits of 54.72 billion yuan from its life insurance operations, down 7 per cent from 2003.
The decline was triggered by an enhanced focus on more profitable regular-premium individual life insurance policies and reduced sales of low-margin bancassurance and group life products, said Dominic Leung Ka-kui, the chief executive of Ping An Life Insurance.
Premium income and deposits from individual life policies grew 6.9 per cent to 40.16 billion yuan last year, contributing 73.4 per cent of life premium revenue, compared with 63.8 per cent the previous year.