Great Eastern Holdings reports 23% higher total weighted new sales in FY2020, boosted by strong sales growth from agency channel

| 24 Feb 2021

Great Eastern Holdings' total weighted new sales (TWNS) rose 23% y-o-y to S$1,545.3 million (US$1,172.2 million), according to its financial results for year ended 31 December 2020.

New business embedded value reported an increase of 10% to S$670 million and operating profit from insurance business rose 11% to $732.2 million.

However, profit attributable to shareholders fell 4% to $960.6 million, amid a less favourable financial market condition for the year, particularly in Q12020. Q42020 saw a 19% y-o-y increase due to a one-off positive tax impact arising from the finalisation of prior years’ tax assessment.

Credit: Great Eastern

Growth in Total Weighted New Sales led by agency channel

The Group registered strong TWNS growth for FY2020 and Q42020 despite the adverse economic environment amid social distancing and movement control restrictions.

FY2020 and Q42020 TWNS reported an increase of 23% to $1,545.3 million and 34% to 4527.6 million, respectively, driven by strong momentum from the Singapore and Malaysia business.

Group Chief Executive Officer Khor Hock Seng said: “The Group’s solid distribution capabilities and innovative product strategy, supported by the focused execution of our digital and technology infrastructure initiatives, have put us in a position of growth this year. Our timely implementation of such initiatives has helped us overcome the business challenges brought by the COVID-19 pandemic, changed the way we operate for the better and built greater resilience.”

“Key to this resiliency is the transformation of our agency force, which has become more agile, efficient and effective,” he said.

In Singapore, the TWNS growth of 35% was led by the agency channel as it posted an increase of 75.5% from $378 million to $663.6 million. Bancassurance saw a decline of 3.6% from $382.2 million to $368.1 million.

Agency in 2020 accounted for 63% of the channel mix in Singapore, up from 48% in 2019.

Credit: Great Eastern

In Malaysia, TWNS remained resilient amid challenges from restricted sales activities (+4%). Growth in Q42020 was driven by the agency channel as it registered a 47.9% grow in TWNS over Q3 to $149.9 million.

Agency continues to be the dominant channel in Malaysia, accounting for 82.4% of its channel mix.

Credit: Great Eastern

Reflections and looking ahead

Social distancing measures impacted new business volume in the initial phase of implementation, with sales from the bancassurance channel experiencing a more significant impact as sales activity was largely at the bank branches. However, sales regained momentum in 2H2020 after a relaxation of social distancing measures.

The Group views the COVID-19 pandemic as an evolving situation with continued uncertainties that could impact the performance of the Group. There are still many unknowns surrounding the pandemic and the timing of its eradication remains uncertain. The impact to its business operations would hinge on each government’s response to manage the health and economic effects of the pandemic.

“We have delivered a healthy set of results in a year marked by disruptions triggered by the COVID-19 pandemic,” said Mr Khor. “In the near future, while uncertainties are likely to persist, we remain positive on the long-term growth potential of the markets we operate in.”  

About Great Eastern

Founded in 1908, is well-established in Singapore and Malaysia. With over S$90 billion in assets and more than 10 million policyholders, including 6 million from government schemes, it provides insurance solutions to customers through three successful distribution channels – a tied agency force, bancassurance, and financial advisory firm Great Eastern Financial Advisers. The Group also operates in Indonesia and Brunei and has a presence in China as well as a representative office in Myanmar.

Great Eastern is a subsidiary of OCBC Bank, the longest established Singapore bank, formed in 1932.

*Total Weighted New Sales = (Single Premium x 10%) + New Regular Premium


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