AIA third-quarter new business value rises 25%, beats estimates

[HONG KONG] AIA Group Ltd, the third-largest Asia-based insurer, said new business value increased by a higher-than-estimated 25 per cent in the third quarter.

The measure of the projected future profitability of new policies surged to US$689 million in the three months ended Aug 31, from US$552 million a year earlier, the Hong Kong-based company said in a statement to the city's stock exchange Friday. It beat the median estimate of six analysts of 21 per cent growth. AIA chief executive officer Mark Tucker has used new business value as the key gauge of management performance.

Analysts including Goldman Sachs Group Inc's Mancy Sun and BNP Paribas SA's Dominic Chan have expected AIA to benefit from a rush of mainland Chinese visitors buying insurance in Hong Kong, undeterred by government curbs introduced to stem capital outflows.

AIA, which collects premium income mostly in local currencies and reports financial figures in US dollars, has also benefited from stabilising Asian currencies and rebounding stock markets.

New business value would have grown 27 per cent without considering currency fluctuations, said the insurer. Annualised new premiums, a gauge of new business sales, rose 42 per cent to US$1.3 billion in the third quarter, AIA said.

New business margin, the value of new business as a percentage of annualised new premiums, narrowed by 6.9 percentage points to 50.7 per cent. The company didn't give a geographical breakdown for business growth.

BLOOMBERG