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Financial advisory channel drives growth in Aviva Singapore's H1 2017 sales
COMPOSITE insurer Aviva Singapore on Thursday posted a 57 per cent year-on-year rise in annual premium equivalent (APE) - a measure of sales for its life business - to S$90.5 million in the first six months of 2017, driven by Aviva Financial Advisers and the Affinity channel.
Value of new business (VNB) - a measure of the expected profits from new premiums written - grew 14 per cent to S$77.1 million for the six months ended June 30.
In the past six months, the British insurer said, it had invested heavily in simplifying and digitalising the sales process for financial advisers, including maximising the benefits of technology to provide instantaneous underwriting at point of sale. These are expected to significantly reduce the average turnaround time for new applications.
"Aviva has also been investing in the ownership of financial advisory (FA) firms, as they believe FAs are best placed to offer customers choice and integrated financial planning. In most developed markets like the United Kingdom, the United States and Australia, the FA channel is the dominant channel; and Aviva is of the view that the Singapore market will follow suit," the insurer said.
It has been the majority stakeholder of PIAS, one of Singapore's largest FA firms, since 2013. In August 2016, Aviva opened its own FA arm; and the initial 280-strong firm has since expanded to over 500 advisers within a year.
The insurer's group life business APE also grew close to 10 per cent from the year before.
Aviva is one of the largest providers of group insurance in Singapore, covering more than 3,000 companies, including the Ministry of Defence and Ministry of Home Affairs.
At the regional level, VNB jumped 49 per cent to £71 million (S$127.8 million), led mainly by strong performances in China and Singapore.
China's VNB soared 119 per cent to £31 million, driven by an improvement in product mix towards higher margin protection business, and growth in its agency and broker channels.
Operating profit in H1 2017 from the life, general insurance and health businesses was £115 million, comparable to the year-ago's £112 million.
Said Chris Wei, executive chairman of Aviva Asia and Friends Provident International and global chairman of Aviva Digital: "We teamed up with Hillhouse and Tencent to form a digital insurance business in Hong Kong, which will be instrumental to our efforts in driving digital transformation in the region. We have also introduced our venture capital fund, Aviva Ventures, in Asia with the objective of supporting startups that are at the forefront of innovation, and we are seeing good progress here."
He also said that the group wants to capitalise on the expanding middle classes and rising number of high net worth individuals in markets such as China, Indonesia and Vietnam.