| Imagery Source: AIA Group Limited |
| Information Source: AIA Group Limited |
| AIA Group Limited (the Company) announces 13 per cent growth in value of new business (VONB) on constant exchange rates (CER) for the first quarter ended 31 March 2025. |
| Growth rates are shown on a constant exchange rate basis. |
- VONB up 13 per cent to US$1,497 million
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- Annualised new premiums (ANP) increased by 7 per cent to US$2,617 million
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- VONB margin up 3.0 pps to 57.5 per cent
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- New business contractual service margin (NB CSM) up 16 per cent
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- Shareholder capital ratio remained strong and comfortably above 200 per cent
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| Lee Yuan Siong, AIA’s Group Chief Executive and President, said: |
| “AIA has continued to build on our excellent results and momentum in 2024 with VONB of US$1.5 billion in the first quarter of 2025, up 13 per cent compared with last year’s record quarterly result. Our ability to capture profitable new business opportunities sustainably at scale is the direct result of our highly diversified and resilient business model and growing demand for AIA’s products and services. |
| “Our Premier Agency is a key pillar of our growth strategy, delivering over 75 per cent of the Group’s total VONB in the first quarter of 2025. We continue to grow our reach with strong, high-quality recruitment, supporting an overall 8 per cent increase in active agent numbers. Our differentiated agency model, focused on long-term customer relationships and powered by leading digital platforms, has driven further increases in agent activity and productivity while maintaining a diversified and resilient product mix. |
| “Our proven management team’s commitment to building a high-quality, sustainable business for the long term, and continued focus on executing our strategic priorities help us successfully deliver against a global backdrop of volatile capital markets and capture the strong fundamental growth drivers in Asia, which is the most attractive region in the world for life and health insurance. I have full confidence that our substantial competitive advantages will continue to deliver long-term sustainable value for all of our stakeholders.” |
| SUMMARY FOR THE FIRST QUARTER |
| AIA delivered a 13 per cent increase in VONB to US$1,497 million in the first quarter of 2025, with growth from both our agency and partnership distribution channels. |
| Our unrivalled, proprietary Premier Agency grew VONB by 21 per cent to US$1,218 million with very strong growth from both traditional protection and participating products. The focused execution of our strategy drove higher agent productivity, an 8 per cent increase in the number of active agents and a 9 per cent increase in the number of recruits. The agency channel accounted for over 75 per cent of the Group’s total VONB in the first quarter of 2025. |
| VONB from our partnership distribution was up 2 per cent to US$397 million, as we remain financially disciplined in AIA Hong Kong’s independent financial adviser (IFA) and broker channel as well as AIA China’s bancassurance channel. Outside Mainland China, our bancassurance businesses delivered VONB growth of 21 per cent. |
| Our largest business, AIA Hong Kong, delivered another very strong quarter with VONB up 16 per cent, supported by balanced growth across both the domestic and Mainland Chinese visitor (MCV) customer segments. We achieved excellent performances in both our Premier Agency and bancassurance channels. Our Premier Agency is the market leader in Hong Kong and Macau, and our strategy continues to drive increased agent activity and productivity, as well as very strong recruitment. |
| AIA China’s VONB was up by 8 per cent, before the effects of economic assumption changes, compared with the very strong result we reported in the first quarter of 2024. VONB included in the Group’s reported results for the first quarter of 2025 reflects Chinese government bond spot yields as at 31 December 2024, as well as the reduction of 80 basis points in our long-term investment return assumption made at the end of 2024. On this prudent basis, VONB reduced by 7 per cent compared with the first quarter of 2024, while the VONB margin was above 50 per cent, as previously indicated. |
| Our Premier Agency model is unique in Mainland China, combining high-quality professional advice with a focus on long-term relationships with middle-class and affluent customers, our economically robust target segment. The proactive training and professionalism of our agents have been critical enablers of our product strategy, with a successful shift towards participating products, and our product mix overall remained balanced. Recruitment continued to be strong with the number of active new agents increasing by 15 per cent, supporting an overall increase of 6 per cent in active agent numbers, further building sales momentum. |
| Agency VONB in our new geographies established between 2019 and 2023 grew by more than 20 per cent. In March and April, we successfully launched new operations in another four new geographies, namely Anhui, Shandong, Chongqing and Zhejiang, providing access to 100 million potential new customers in our target segment. |
| AIA Thailand delivered exceptional VONB growth as webenefited from one-off sales through the agency channel ahead of regulatory changes relating to individual medical insurance products introduced from March 2025. We also saw very strong VONB growth through the bancassurance channel, driven by our strategic partnership with Bangkok Bank. |
| In Singapore, we achieved excellent growth in VONB and continued to see strong sales from our unit-linked long-term savings products that provide access to leading global fund managers through the AIA Regional Funds Platform. The strong performance of our market-leading Premier Agency was supported by very strong growth in agent productivity. |
| AIA Malaysia reported higher VONB as excellent growth through our strategic partnership with Public Bank was partially offset by a decline in the agency channel, where we continue to focus on quality recruitment. |
| Other Markets delivered very strong VONB growth, driven by increases from most of the markets in the segment. Our joint venture in India, Tata AIA Life, achieved excellent VONB growth with strong performances across its multi-channel distribution platform, and maintained its number one industry ranking in retail protection by sum assured in the first quarter of 2025. |
| Overall, VONB for the Group was up by 13 per cent to US$1,497 million. ANP grew by 7 per cent to US$2,617 million, while VONB margin increased to 57.5 per cent, benefitting from the favourable shift in product mix, partially offset by the change in economic assumptions. Margin reported on a present value of new business premium (PVNBP) basis remained stable while total weighted premium income (TWPI) increased by 14 per cent to US$12,680 million. |
| NB CSM for the first quarter of 2025 increased by 16 per cent, faster than VONB growth of 13 per cent. Successive layers of profitable new business add to our substantial, recurring earnings from in-force business, providing us with confidence in delivering our operating profit after tax (OPAT) per share CAGR target of 9 to 11 per cent from 2023 to 2026. |
| Whilst the global macro environment and capital markets remain volatile, AIA’s financial strength and flexibility are key differentiators for the Group. The shareholder capital ratio, our principal measure of the overall capital and free surplus position for shareholders, remained strong and comfortably above 200 per cent at 31 March 2025. Our recently announced US$1.6 billion share buy-back programme commenced on 14 April 2025 and is expected to complete over three months. |
| The number of outstanding shares as at 31 March 2025 was 5 per cent lower compared with 31 March 2024. |
| OUTLOOK |
| Despite capital market volatility and geopolitical tensions, high levels of private savings, growing yet ageing populations, low insurance penetration and limited welfare coverage continue to be powerful structural growth drivers in Asia, and create substantial demand for insurance products. AIA’s strong momentum in the first quarter of 2025 reflects our substantial competitive advantages, the breadth and diversity of our markets, our financial strength and the quality of our people, which are critical success factors for AIA’s exceptional long-term business prospects. Our strategic priorities leverage the significant opportunities ahead to drive profitable new business growth that delivers increased future earnings, free surplus generation and greater shareholder value. |
| For the full document, click the link below |
| AIA Group Limited |
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