AVIVA NDB gains momentum amidst challenges in 2011
In 2011, AVIVA NDB Insurance continued with the momentum achieved
from the business transformation, although it was more challenging with
the sharp downturn in the stock market and the replacement of the
Company’s Life product suite by a world-class contemporary range. The
success of the new product range, especially the new flagship brand
AVIVA NDB Pensions was evident by the 13.1 percent growth over the
previous year in Life new business. Life Gross Written Premium grew
marginally to Rs 7,865 m in a year that was dominated by challenge and
change. The Company declared a Life surplus of Rs 355 m which improved
by 8.3 percent compared to the prior year, through a keen focus on
expense control and optimisation of the cost base.
Despite General Insurance pricing remaining a challenge in 2011, the
claims ratio improved significantly over the previous year from 79.1
percent to 64.8 percent and the combined operating ratio improved from
117.5 percent to 104.5 percent. This was an impressive reflection of the
focus on quality underwriting, pricing and expense control. A post tax
profit of Rs 338 million was reported by General insurance for the
financial year ending December 31, 2011.
Significant improvement in the profitability of the combined
composite business was recorded compared to the corresponding period in
2010, due to prudent investment strategies that helped mitigate the
significant impact of a decrease in investment income from unrealised
equity losses caused by a decline in the capital markets.
A noteworthy improvement in the bottom
line performance was a result of the focus on optimising the expense
base as well as stringent underwriting and repricing initiatives in
General Insurance. Embedding the new product suite with Wealth Planners,
bancassurance partners and policyholders without detracting from the
momentum gained in 2010 was another challenge faced successfully.
Composite financial results recorded a profit after tax of Rs 693
million, an increase of 15.1%, despite lower investment income.
“It was also very much a year where risk awareness and management
dominated our agenda” said Managing Director, Shah Rouf. “We enhanced
our Enterprise Risk Management (ERM) framework to enable us to make
better business decisions now and going forward.”
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