China Taiping Insurance Holdings Company Limited (“China Taiping” or “the Company”, and together with its subsidiaries, “the Group”, stock code: 966.HK) announced its unaudited interim financial results for the six months ended 30 June 2020 (the “Period”) at 25 August 2020.
In the first half of 2020, China Taiping thoroughly implemented the new development concept, guided by the development strategy of the new era, adhered to the operational strategy of “Surpassing the Market, Competing at an Advanced Level, Growing on Steady Basis, and Enhancing Value”, insisted on strictly implementing epidemic prevention control and business development at the same time, and withstood the epidemic impact and market test. The insurance business was gradually stable and improving, investment performance made steady progress, collaborative business promoted solidly, overall operations achieved steady growth. TPG, with CTIH as a core subsidiary, the ranking on the “Fortune Global 500” in 2020 was 392nd, significantly improved by 59 place, being one of the fastest improving global enterprises in the list. At the same time, China Taiping highlighted the effects of innovation, reform and technology empowerment, actively enhanced technological operation capabilities, accelerated the pace of online transformation and technological construction; continuously improved the construction of systems and mechanisms, and holding fast to the bottom line of risks.
Equity Attributable to Owners and Embedded Value Appreciated Steadily
In the first half of 2020, China Taiping’s total premiums written and policy fees was HK$137.1 billion, slightly decreased by 1.3% over the Last Period, profit attributable to owners was HK$2.877 billion, decreased by 57.3% over the Last Period, owners’ equity was HK$78.487 billion, increased by 2.9% over the 2019 year-end, total assets were HK$998.3 billion, increased by 8.6% over the 2019 year-end, group embedded value per share attributable to owners was HK$45.910, increased by 3.0% over the 2019 year-end figure of HK$44.564, while TPL’s embedded value increased by 2.7% over the 2019 year-end.
PRC Insurance Businesses Made Steady Progress
In the first half of 2020, China Taiping’s direct premium of the life insurance increased by 0.7% over the Last Period; first year regular premium from bancassurance increased by 81.7% over the Last Period, outperforming major peers; TPL’s four persistency ratios of the individual agency and bancassurance channels were industry-leading; renewal premium increased by 6.3% over the Last Period; TPP’s short term employee benefit of group business increased by 30.7%, quality of business improved over the Last Period; New payment from annuity increased by 26.2% over the Last Period, continued maintaining rapid growth; pension assets under management was over RMB450.0 billion, with occupational annuity assets under management reached hundred billion level; PRC property and casualty insurance combined ratio was 99.6%, optimised by 0.2 percentage point over the Last Period, achieving continual underwriting profit; with the combined ratio for motor insurance was 96.3%, optimised by 2.3 percentage point over the Last Period. Sales team remained stable, TPL’s number of individual agents reached 407K, around 20K more than the 2019 year-end end of last year.
Overseas Insurance Businesses Grew Rapidly
In the first half of 2020, TPL (HK)’s premium income increased by 157.3% over the Last Period, with market influence continued increasing; CTPI (HK) achieved a fast development of local business, with premium income increased by 13.0% over the Last Period, with optimised underwriting profitability over the Last Period; TP Macau's premium income sustained its market leadership, with a combined ratio of 72.6% and maintained outstanding underwriting result; TP Singapore’s premium income increased by 65.5% over the Last Period, with property and casualty business maintaining underwriting profit, premium from life insurance business increased by 126.8% over the Last Period; TP Indonesia’s premium income increased by 43.1% over the Last Period, with both local business and Chinese enterprises business grew rapidly, combined ratio at 43.2%, underwriting profitability maintained at an excellent level; TPRe’s Macau representative office officially opened, the leading position in the Hong Kong and Macau market further enhanced, achieving continual underwriting profit.
Investment Income Increased Steadily
The investment asset scale maintained rapid growth, investment income increased steadily. In the first half of 2020, the total investment assets of the Group was HK$831.9 billion, increased by 11.8% over the 2019 year-end, higher than industry average, investment income for the first half of 2020 was HK$21.075 billion, representing an increase of 34.7% over the Last Period.
Pursue the concept of long-term investment with continual improvement in the quality of income. In the first half of 2020, the Group adhered to long term investment and value investment to increase the allocation of high-dividend stocks while the stock market is low, dividend income and fund dividends was HK$2.291 billion, increased by 47.7% over the Last Period.
Achieve initial results in institutional transformation with continuously improvement in the allocation mechanism. In the first half of 2020, the Group achieved initial results in institutional transformation with professional and market-oriented operation policy in place and the allocation mechanism reform was further improved with more scientific appraisal management approaches and significantly enhancement in investment management capabilities.
Enhance the centralised control of investment to accelerate the response to market risk. In the first half of 2020, the Group continuously optimised the investment management mechanism, strengthened the centralised control of investment, accelerated the response to the dramatic changes in capital market, so as to ensure high-quality development of the investment business.
Strategic Clients Cooperation and Cross-selling Business Progressed Steadily
As at the end of June 2020, China Taiping had established strategic cooperation relationships with 99 large clients and these clients has contributed total premium of HK$28.973 billion and pension under management of HK$8.080 billion.
In the first half of 2020, our cross-selling initiatives achieved HK$5.212 billion insurance sales, including HK$4.163 billion of property insurance sales through TPL, HK$806 million of pension sales through TPL, HK$108 million of life insurance sales through TPI, HK$103 million of property insurance sales through TPP and HK$31 million of pension sales through TPI.
The Development Concept of “Taiping for Your Peaceful Life” Received Increasing Recognition
TPG, with CTIH as a core subsidiary, the ranking on the “Fortune Global 500” in 2020 was 392nd, significantly improved by 59 place, being one of the fastest improving global enterprises in the list. China Taiping has been selected as the top 100 world’s most-valuable insurance brands for the 7th consecutive year; the Group and its 11 institutions were rated “A” by international leading rating agencies; China Taiping’s VI recognition system was continually improved and received increasing brand reputation.
Mr. Wang Sidong, General Manager of China Taiping commented, In the face of the sudden outbreak of COVID-19 pandemic in the first half of the year, China Taiping took swift action and followed the trend. It insisted on "two-pronged approach" emphasizing both pandemic prevention and control and business operation. A series of special policies were put forward in time to effectively prevent and control the pandemic, enhance precision service and stabilize business growth, which ensured undisrupted online customer service operation and full resumption of normal business operation. In the second half of the year, China Taiping will maintain its strategic determination, face up to problems and not be afraid of challenges, continue to adhere to the general work theme of seeking progress in stability, insist on the pursuit of scale with value and growth with high quality, unswervingly innovate and reform, stimulate endogenous development momentum, find ways to make up for the weaknesses and solidify advantages, cultivate new opportunities in the crisis, open a new landscape in the changing situation, and continue to create greater value for investors, customers and the society.