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In Singapore, the COVID-19 period saw flat sales and in Malaysia, which is under-insured, sales were up 20% pre-Covid and 10% in the rest of the year. It has 38 million insurance policies in force -- 16 million of which are group policies.

The insurance business is resilient and surprisingly insensitive to interest rate changes, moving no more than 1.7% up or down because yields are up or down. Asia is under-insured, with newly comfortable customers seeking private policies. AIA attracts me also because it is good at selling insurance during a pandemic, thanks to a long history of remote digital policy sales. Despite this, some 57% of policies in force are traditional, with 91% requiring regular premium payments.

Not all markets are as profitable as China (14%) or Hong Kong (10%), and currently the group lost 7% on policies written in Thailand, 2% in Malaysia, and 11% in other markets. However, its coverage ratio rose to 374% last year vs. 366% in 2019. Last year borrowings were a modest 8.6% and leverage was 11.9%. Gains before investment returns and dividends rose 19%, and investment results nipped that to 16.5%. It upped its dividend by 2% last year to 7.57% in Hong Kong bucks.

Here are some examples of how it meets insurance hunger. In Thailand, medical claims are paid out cashlessly to the provider without the insured person having to do anything except report, saving immense hours of work. In China, 30% of new agents are recruited and trained electronically. Malaysian marketing is 100% digital in marketing. In India, Tata Bank uses personalized policy proposals to sign people up for life insurance and then digitally collects their payments each month from their bank accounts.

Tata accounts for 60% of new Indian policies. In South Korea, Galaxy, a watch-maker, provides customer lists for selling health insurance, allowing it to reward long-term savers for healthier living. AIA also gave COVID-19 coverage to 25 million policies without charge.

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Mike Sharon 1 month ago Member's comment

Good article, thanks.