Allianz Counts on Continued Economic Growth in Asia Next Year
Allianz S.E. [85014] said it is confident its insurance business will see continued growth in Asia through 2010, based on promising economic growth in China and India, along with the insurer’s forecast of 6.7% growth in gross domestic product growth in the emerging Asian region next year.
“Supported by an ongoing stimulus from fiscal and monetary policy and the world trade recovery, GDP growth in China should reach 8.7% and 6.5% in India, while emerging Asia as a whole is likely to grow by 6.7% in 2010,” said the insurer.
According to Michael Heise, chief economist of Allianz, the figures show Asia will “contribute almost 39%” to the expected increase in global economic output of 2.8% next year. Due to the “solid” performance of China and India, regional GDP will show an increase of 4.8% this year, said Heise in a statement. “This is quite impressive, given that at the same time global economic output will contract by over 2%. You can call Asia, and China in particular, a relatively stable ship in stormy seas.”
—Rebecca Ng
ING Closes Sale of Its Australia And New Zealand Businesses
Dutch financial services group ING Groep N.V. [85144] has closed the sales of its life insurance and wealth management venture in Australia and New Zealand to Australia and New Zealand Banking Group Ltd., for E1.1 billion (US$1.66 billion) in cash.
According to ING, the transaction has generated a net profit of E325 million and has freed up E950 million of capital, while the sale will reduce the debt-to-equity ratio for ING Insurance by 365 basis points [3.65%].
ING said the final terms are “slightly better” than those initially estimated in September, when it had said the transaction would generate an estimated net profit of E300 million and free up E900 million of capital, while reducing the ING Insurance’s debt-to-equity ratio by 345 basis points.
After the sale, ING will maintain a “strong” footprint in Asia in life insurance and retirement services as the third-largest international insurance company in the region, the company said.
In September, ING announced it would sell its 51% equity stake in ING Australia and ING New Zealand to ANZ, its joint venture partner, who now will become the sole owner of these businesses.
—Rebecca Ng
Hong Kong’s Nine-Month Underwriting Results Improve
Hong Kong’s insurance regulator said that during the first nine months of 2009, the overall underwriting market has improved to HK$2 billion (US$258 million), from HK$814 million in the correspondent period of 2008, mainly due to favorable claims experience and less severe losses caused by tropical storms.
Gross and net premiums for the domestic general insurance market recorded growth of 2.9% to HK$21.5 billion and 4.3% to HK$15.6 billion, respectively, according to the Hong Kong Office of the Commissioner of Insurance.
For direct business, the regulator noted gross and net premiums rose by 2.8% to HK$17.4 billion and 4.6% to HK$13.1 billion, respectively, driven by accident and health comprising medical business, which had gross and net premiums of HK$6 billion and HK$5.2 billion, respectively.
The construction-related employees’ compensation business with first-three-quarter gross and net premiums of HK$851 million and HK$711 million, respectively, also have contributed to the direct business growth. But the respective drop of HK$638 million and HK$411 million in gross and net premiums of goods in transit business offset part of the overall growth, said the regulator.
During the period, the underwriting profit of direct business rose to HK$1.2 billion, from HK$130 million in 2008.
The regulator said that growth came as property damage business noted a profit of HK$401 million as compared with HK$24 million for the same period in 2008, when severe losses were inflicted by tropical storms. Employees’ compensation business turned from a loss of HK$375 million to a profit of HK$21 million.
Improvement in claims experience also contributed to a “significant” reduction in the underwriting loss for motor vehicle business, said the regulator.
Gross and net premiums of reinsurance inward business rose 3.2% to HK$4.1 billion and 3.1% to HK$2.5 billion, respectively, in the first three quarters; while improvement in claims experience pushed up the underwriting profit of this business to HK$793 million from HK$684 million.
Total premiums of long-term in-force business fell 11.1% to HK$117.1 billion in the first three quarters.
—Rebecca Ng

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