Through the first nine months of this year, Allianz Indonesia is strengthening its solid financial position. By end of September 2010, PT Asuransi Allianz Utama Indonesia (Allianz Utama) and PT Asuransi Allianz Life Indonesia (Allianz Life) recorded a combined total local profit (unaudited) of IDR 411.82 billion, a significant increase of 92 percent compared to the third quarter 2010 figure of IDR 214.45 billion.
Both companies reported a combined Gross Written Premium of IDR 3.93 trillion, increased by 48% year on year. Solvency ratios were confirmed at the secure level of 579 percent (Allianz Life) and 157 percent (Allianz Utama), far above the government minimum requirement of 120 percent.
“Both Allianz Life and Allianz Utama Indonesia performed very well in the first nine months of 2010. Supported with our expertise and strong financial status, we are proud to provide the best services and protection to our valued customers for property, life and investments. When the country is hit by natural disasters, it is evident that we are a company that can share our sound position by helping those in need. We held fund raising events for disaster areas, also sent our CSR team to deliver aid for Merapi’s refugees. We also handed over five elementary school that have been rehabilitated for Padang which were damaged by an earthquake a year ago,” said Joachim Wessling, CEO Allianz Life Indonesia.
General Insurance Business
Allianz Utama has improved the quality of its business portfolio and pursues disciplined underwriting practices. With this strategy and supported by a more positive investment condition this year, the company has successfully increased its profit before tax by 86% year on year to IDR 48.92 billion. Prudent underwriting practices also significantly increased the company’s solvency ratio to 157 percent compared to 137 percent for the first nine months last year.
On the other side, stricter underwriting practices reduced its Gross Written Premium income to IDR 545.5 billion from IDR 713.4 billion. Allianz Utama’s GWP performance was mainly driven by property insurance (37 percent) and motor vehicle insurance (24 percent), while the rest of portfolio was generated from engineering insurance (18 percent), casualty insurance (13 percent) and marine insurance (9 percent).
“As an insurance company, we are aiming to build a solid business portfolio to remain a financially stable company. We are pleased that our efforts to implement disciplined underwriting processes provided a very positive outcome to our financial performance. Despite a lower GWP, our profit before tax has grown significantly by 86 percent year on year,” said Don Nguyen, CEO of Allianz Utama Indonesia.
The company reported a strong investment performance with IDR 57.70 billion investment income, an increased of 31 percent compared to last years’ IDR 43.90 billion.
Allianz Utama continues to enlarge its agency contribution within its overall distribution channel portfolio, especially in retail and small and medium enterprise (SME) business. We are serving customers from corporate customers 77 percent, retail 17 percent, and the rest is from SME customers.
“Our most prominent distribution is still the broker channel, which contributed nearly 60 percent. However, we are committed to focus on developing our agency channel to boost our retail business to balance our overall business and customers portfolio,” Don added.
Life, Health and Group Business
In Life, Health, and Group insurance business, Allianz Life Indonesia reported nearly IDR 3.39 trillion of GWP in the third quarter of 2010, grew by almost 75 percent compared to the same period last year of IDR 1.94 trillion.
Individual life insurance business reported a GWP income of IDR 2.13 trillion compared to IDR 1.21 trillion in the same period last year. The recovery of investment and macroeconomic conditions have improved the sales of single premium products from IDR 778.9 billion, to IDR 1.17 trillion or grew by 50 percent. On the other side, premium income from regular premium business rose significantly by 91 percent, to IDR 2.22 trillion, compared to the third quarter 2009 of IDR 1.16 trillion.
Both group and health insurance businesses reported strong GWP income. Group business generated IDR 939.9 billion, compared to IDR 429.2 billion in the last year’s third quarter. Health insurance GWP was reported at IDR 318.3 billion or grew 8.6 percent from last year’s third quarter of IDR 293.1 billion.
Allianz Life Indonesia reported a strong growth of 93 percent of its local profit before tax to IDR 362.9 billion, compared to IDR 188.2 billion in the third quarter of 2010. Its invested assets also grew by 46 percent, reaching IDR 11.06 trillion, while the solvency ratio stood at a significant 579 percent.
“All of our distribution channels this year showed a strong performance, from agency, bancassurance, and other alternative distribution channels,” said Joachim. “Our financial condition which is very strong and excellent service to customers will be a strong foundation to our future performance,” adds Joachim.