Allianz’s gross written premiums likely to grow by 3.8%

TA Research, in its report, said moving into 2022, it expects the insurer’s gross written premiums to grow by 3.8% on the back of higher car sales.

PETALING JAYA: Insurer Allianz (M) Bhd is cautiously optimistic about its prospects this year, as the broader economy regains its strength.

Citing the briefing session the management had with analysts, RHB Research said the group’s life insurance segment remained soft in Q1’22.

“Despite that, management remains hopeful for a double-digit growth in this year’s new business value, or NBV, through new and repriced product offerings to support both volume and margin expansion,” it told clients in a report.

JPN or Registration Department of Malaysia claims are expected to moderate in 2022, while provisions for Covid-19 mortality are likely to decline, in our view, on lower death rates associated with Omicron, it said.

Allianz’s general insurance business, on the other hand, started the year on a stronger footing as compared to Q4’21, with FY22 growth expected to be driven by machinery and assets-related products, RHB said.

It noted that the general insurance business remained resilient despite headwinds as it managed to grow its FY21 pre-tax profit by 1.2% on the back of resilience of its underwriting results, despite having undertaken three major floods and multiple large losses in FY21.

“This was also helped by better loss experience on motor insurance, due to lockdown restrictions,” it added.

Allianz recorded a net profit of RM478.50mil for its FY21, an 8% decline from the RM520.33mil achieved in the preceding financial year.

Its revenue, however, increased to RM6.43bil from RM5.95bil previously.

TA Research, in its report, said moving into 2022, it expects the insurer’s gross written premiums to grow by 3.8% on the back of higher car sales.

“However, we anticipate a higher combined ratio to 91.5% (closer to pre-pandemic levels of about 92%) on the back of higher motor claims due to more traffic flows following the full reopening of economic activities.

“Going forward, the group will remain focused on sales of investment-linked products with protection riders but also cater to the demand for saving products,” TA Research said adding that Allianz’s market share ranking improved to fourth place from fifth, last year.