PETALING JAYA: LPI Capital Bhd
recorded a decline in net profit to RM66.86mil in the second quarter ended June 30, 2026 (2Q26) as compared to RM83.17mil in the year-ago quarter as the general insurance segment registered net fair value loss in its investments.
The group, in a statement, said quarterly revenue rose to RM545.22mil from RM507.64mil in 2Q25, underpinned by higher insurance revenue in the general insurance segment.
Over the six-month period, LPI’s net profit came to RM166.39mil as compared to RM181.15mil in the first half of financial year 2025, while revenue was higher at RM1.09bil against RM1.02bil in the comparative period.
Lonpac Insurance Bhd, LPI’s wholly- owned insurance subsidiary, posted a pre-tax profit of RM91.2mil in 2Q26, which is 18.1% lower as compared to RM111.4mil achieved in 2Q25.
This was mainly owing to the segment recording a net fair value loss of RM1.8mil as opposed to an RM10.5mil net fair value gain in the previous corresponding quarter.
Gross written premiums (GWP), however, rose 6.9% to RM490.6mil from RM458.8mil in 2Q25.
Lonpac’s insurance service result was also 6.9% lower year-on-year at RM81.2mil.
The lower underwriting result was primarily due to a higher net claims incurred ratio of 46.6% as compared to 43.9% in 2Q25, largely driven by the deteriorating experience of the motor classes of business.
According to LPI, the higher frequency of accidents, higher court awards in third-party bodily injury claims and inadequate pricing for certain segments of motor business have resulted in volatile motor underwriting performance for the group.
“Adopting a prudent underwriting approach and strengthening claims management are the group’s policies to ensure the motor portfolio yields positive underwriting results.
“While the motor insurance portfolio presently contributes less than 25% of its total GWP, the group will work to expand the motor business in the more profitable segments with certain targeted distribution channels,” it said.
In the fire insurance portfolio, the group continues to outperform the industry due to its well-balanced mix of risk across residential, small and medium enterprises, and commercial and industrial properties.
Moving forward, it said it will explore strategic collaboration with new global partners to tap new direct foreign investments and intensify cross-selling efforts with PBB Group to strengthen its market position in the fire business.
The board of directors declared a first interim dividend of 25 sen per share to the shareholders, as well as a special dividend of 65 sen per share representing part of the proceeds from its disposal of 220.29 million Public Bank Bhd shares amounting to RM1.05bil.
