KUALA LUMPUR (Aug 22): Allianz Malaysia Bhd’s net profit for the second financial quarter ended June 30, 2019, grew 31% to RM117.67 million from RM89.87 million a year earlier, contributed by higher gross earned premiums and investment income.

However, revenue for the quarter grew only 5% to RM1.37 billion from RM1.31 billion in the previous year’s corresponding quarter.

In a filing with the bourse, the insurer said its gross earned premiums increased by RM47.6 million, while investment income increased RM11.6 million during the quarter.

This was largely due to its life insurance segment which saw an 8.5% growth in operating revenue to RM780.7 million, as gross earned premiums and investment income grew by RM51 million and RM10 million respectively.

“The increase in gross earned premiums of the life insurance segment was mainly contributed by higher premiums from agency and employee benefits channels,” said Allianz.

This was partly offset by lower performance from its general insurance segment, which saw operating revenue drop 0.3% to RM582.1 million, as gross earned premiums fell due to lower premiums from the fire business.

For the first half of its financial year, net profit stood at RM216.58 million, up 22% from RM177.1 million a year earlier, while revenue increased 5% to RM2.71 billion from RM2.58 billion.

“Amidst a challenging economic environment, Allianz Malaysia has relied on its strong pillar of business to deliver RM2.38 billion in gross written premiums in the first six months of 2019. The results we achieved were driven by the positive performance of our life insurance business and satisfactory numbers from the general insurance business.

“Our focus now is on the second half of 2019 and controlling our expense ratio while continuing to deliver on our promise to offer customers protection that really matters, when it is needed the most,” said Allianz CEO Zakri Khir in a statement.

The group acknowledges the challenging domestic environment, noting the 1.7% decline in gross written premium for general insurance industry for the first half of 2019, mainly from the decline in non-motor business.

Looking ahead, the group said it remains focused on optimising business margins for its general insurance segment by shifting into profitable business segments, executing technical excellence in claims management, enhancing operational efficiency and prioritising customer needs.

For its life insurance segment, Allianz expects a softer second half of the year, given the ongoing liberalisation of the industry, but the group will continue to enhance its distribution capabilities and product portfolio.

Allianz fell 16 sen or 1.15% to RM13.80, giving it a market capitalisation of RM2.44 billion.