HONG KONG GENERAL INSURANCE PREMIUMS UP 14.5% IN FIRST HALF

Hong Kong’s Office of the Commissioner of Insurance (OCI) released Tuesday provisional statistics of the Hong Kong insurance industry for the first half of 2010.

In the first half of 2010, gross and net premiums of general insurance business recorded a double-digit growth of 14.5 per cent to HK$16.6 billion (US$ 2.13 billion) and 11.8 per cent to HK$11.7 billion respectively compared with the corresponding period in 2009, the OCI said in a statement. Overall underwriting profit was at HK$1.3 billion, on a par with that of 2009.

On direct business, the OCI said gross and net premiums gained 9.4 per cent to HK$12.8 billion and 8.2 per cent to HK$9.5 billion respectively in the first half of 2010 compared with the corresponding period in 2009, propelled again by Accident and Health business (comprising Medical business), gross and net premiums of which were HK$4.4 billion and HK$3.7 billion respectively. Other major classes of business, including Employees Compensation, Motor Vehicle, Pecuniary Loss and Property Damage businesses, also contributed to the premium growth. Their gross and net premiums were HK$2.0 billion and HK$1.7 billion, HK$1.4 billion and HK$1.2 billion, HK$818 million and HK$525 million, and HK$1.8 billion and HK$1.0 billion respectively.

The underwriting profit of direct business increased from HK$925 million to HK$962 million. The profit of Pecuniary Loss business significantly rose from HK$56 million to HK$288 million, driven by the strong premium growth in mortgage guarantee business and lower claims for credit business. Motor Vehicle business also showed a material improvement in its underwriting result essentially attributable to premium rates increase as well as better claims experience with the claims incurred figures of an insurer placed in liquidation excluded. Reduction in profit was however recorded in Property Damage business as a result of poor claims experience, and the profit fell from HK$318 million to HK$132 million.

On reinsurance inward business, gross and net premiums boosted from HK$2.8 billion to HK$3.8 billion and from HK$1.7 billion to HK$2.2 billion respectively in the first half of 2010 compared with the corresponding period in 2009. Nevertheless, the underwriting profit dropped from HK$368 million to HK$311 million due to adverse claims experience.

Total revenue premiums of long term in-force business was HK$84.0 billion in the first half of 2010, increasing by 12.3 per cent over the same period of 2009, the OCI said.

Revenue premiums of Individual Life and Annuity (Non-Linked) business and Individual Life and Annuity (Linked) business increased by 20.9 per cent to HK$51.6 billion and by 17.4 per cent to HK$20.4 billion respectively. Contributions of Retirement Scheme business plunged by 18.4 per cent to HK$10.8 billion. Total insurance benefits paid to individuals increased by 26.7 per cent to HK$35.7 billion.

New office premiums (excluding Retirement Scheme business) of long term business for the first half of 2010 increased significantly by 46.0 per cent to HK$28.5 billion compared with the same period in 2009. Both Individual Life and Annuity (Non-Linked) and Individual Life and Annuity (Linked) business recorded significant premium growth, with the former increasing by 49.3 per cent to HK$19.8 billion and the latter increasing by 41.4 per cent to HK$8.5 billion.

In respect of new policies issued to Mainland visitors, office premiums amounted to HK$2.1 billion, representing 7.3 per cent of the total new office premiums (HK$28.4 billion) for individual business in the first half of 2010, the OCI said.