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Perapol: Good customer credit risk management essential to success |
Krungthai AXA Life Insurance, the Thai-French joint venture, is increasingly upbeat about its bottom line after posting a net profit of 262 million baht in the first half.
The first-half net profit was equivalent to the amount the company earned for all of 2007.
CEO Michael Plaxton attributed the improved performance to underwriting profit and lower expenses.
New business income for the first six months grew by 151% to 1.62 billion baht, contributed by agent sales and bancassurance through Krung Thai Bank, with total premiums of 4.2 billion baht.
Agents generated new business income of 879 million baht, up 123% over the same period last year, while the bank channel delivered 688 million baht (excluding mortgages), a rise of 253%.
Bancassurance contributes 41% of the company's premiums, with the figure expected to reach 45% by 2012.
''Agencies are the most productive independent sales team in Thailand (and for AXA Asia). At the half-year they produced new business income of 879 million or 53% of the total production,'' said Mr Plaxton. ''Alternative distribution is showing excellent results. We are now successfully opening up connections in the brokerage market and we are building a competent worksite team.''
According to executives, a healthy contribution from underwriting profit was expected to help offset otherwise bearish returns from investments.
Krungthai AXA now manages an investment portfolio of about 12 billion baht, most of which is in bonds and only 10% in equity. ''While the market is predicting a slow year with a single-digit growth, we believe our business outlook for the year is good because of the solid fundamentals demonstrated year-to-date,'' said Mr Plaxton. ''With good support from the bank and the continued strong performance from agencies we are predicting sales will exceed the plan this year.''
Krungthai AXA Life reported last year that new business income rose 172% to 2.7 billion baht on total written premiums of 5.81 billion.
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