The Board of Directors of AIA Group has announced the Group's financial results for the year ended 31 December 2020.
Value of New Business
For the full year, the Group reported value of new business (VONB) of US$2,765 million, a 33% decline year-on-year, reflecting operational challenges caused by the COVID-19 pandemic.
This is its first annual fall in VONB, which measures expected profits from new premiums, since its 2010 listing in Hong Kong, Reuters reported.
Sales momentum returned as movement restrictions were eased with VONB up 15% y-o-y in the first two months of 2021.
Increase in operating profit and final dividend
AIA’s large and growing in-force portfolio with recurring, high-quality sources of earnings has supported a 5% growth in operating profit after tax (OPAT) and a 7.5% increase in the final dividend to 100.30 Hong Kong cents per share.
Lee Yuan Siong, AIA’s Group Chief Executive and President, said: “AIA has delivered another very strong performance despite unprecedented macroeconomic conditions and the operational challenges caused by the COVID-19 pandemic. While VONB was affected by social distancing measures, we achieved growth in all of our other key financial metrics. Sales momentum returned as restrictions were eased and we have delivered year-on-year VONB growth in the first two months of 2021. The Group’s financial position remains very strong and we increased the final dividend.”
Supporting customers, agents and partners
“Our first priority is to ensure the safety of our employees and support all of our stakeholders. I would like to thank our employees for their tireless efforts as they provide uninterrupted service to our customers, agents and partners. We always look for every reason to pay a claim and, during the year, paid more than US$16 billion in benefits and claims, providing vital financial support for customers. We extended additional protection cover to our customers and the wider communities where we operate, helping provide peace of mind in uncertain times,” said Mr Lee.
“Following the restrictions on movement and in-person meetings, we accelerated the development and adoption of online and remote capabilities across our markets. We introduced remote sales completion, moved recruitment, onboarding and training online for agents, and launched simpler streamlined services and claim processes for customers. These new capabilities have enabled our businesses to continue operating smoothly in rapidly changing conditions.”
- 100% remote digital sales capabilities across all channels and markets
- 95% digital news business submissions across all markets
- Over 20,000 online recruitment seminars and more than 20% growth in the number of new recruits
- 15 percentage point growth in end-to-end straight-through processing
- Extended free COVID-19 cover to over 25 million policies
- US$1 billion premium support extended grace period in 12 markets
- Paid more than US$16 billion in benefits and claims
Optimistic about the future
Lee Yuan Siong, AIA’s Group Chief Executive and President, said: “While 2020 was an extraordinary and challenging year, it has made me more optimistic about the future for AIA. Now more than ever, Asian consumers are acutely aware of the need for financial security and the need to protect the well-being of their families, making our purpose and propositions even more relevant.
“In 2020, we developed and implemented a new strategy which will transform AIA and position us to harness the powerful structural growth drivers of life insurance across Asia. I am confident that AIA is in the right business, in the right region and at the right time and we will continue to deliver our purpose of helping people live Healthier, Longer, Better Lives.”
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