Thai Life Insurance reported a net profit of 3,129 Million Baht for the first quarter result of 2023, with Value of New Business (VONB) increase of 8.7% and an Annual Premium Equivalent (APE) of 3,028 Million Baht due to the growth of all distribution channels and the effective execution of our product strategy
Mr. Chai Chaiyawan, Director and Chief Executive Officer of Thai Life Insurance Public Company Limited, or TLI, disclosed the company's operating performance in the first quarter of 2023, stating that Thai Life Insurance continues to have strong operating results with a net profit of 3,129 Million Baht and the Annual Premium Equivalent (APE) of 3,028 Million Baht.
The total expected profit generated by the new business or the Value of New Business (VONB) was 1,701 Million Baht, an increase of 8.7%. At the same time, the VONB margin was 56.2%, an increase of 9.1 percentage compared to the same quarter of the previous year, as a result of VONB growing across all distribution channels. The agency channel grew through due to improved quality of sales and shifting toward products that generate more sustainable profits, as reflected in a higher VONB margin of 56.7%.
Our partnership channel’s VONB continues to generate double-digit growth due to the success of the company's product strategy with key bank partners that can offer high-profit product bundles with other product offerings.
Although the net profit in the first quarter of 2023 decreased compared to the same period last year, the company achieved an insurance profit of 2,020 Million Baht, an increase of 10.3%. The decrease in net profit was negatively impacted by lower investment profit due to lower gains on investments and fair value. This is in line with the market performance and outlook for equity markets in the first quarter of 2022. The company released most of its investment surplus ahead of the bear market, resulting in a particularly high profit from investment gains for the year-on-year comparison.
The company has developed a product strategy focused on creating long-term profitable products that are less sensitive to the interest rate movement such as participating products, investment-linked products and riders. This product strategy would generate sustainable profitability in the midst of uncertain economic conditions." said Mr. Chai.
As of March 2023, the company's capital adequacy ratio, or CAR ratio was 449.6% higher than the regulation requirement of 140% set by the Office of Insurance Commission (OIC). The company prioritizes its robust capital position as the cornerstone of sustainability.
"Thai Life Insurance places great importance on sustainable business operations with the vision "To be an insurance company of sustainability" as well as integrating ESG principles into business strategies by initiating several ESG-related projects during the first quarter of 2023 such as the preparation and promulgation of the Supplier Code of Conduct and the launch of ESG products for community enterprises "Thai Life Insurance Suk Yang Yuen Refund" to create opportunities to access life insurance and health insurance for Thai people. Or published the first sustainability report of 2022 based on Global Reporting Initiative Standards (GRI Standards)." said Mr. Chai.