The Company has recorded a Consolidated Revenue of Rs. 7, 265 million with an impressive growth rate of 23.7% over the previous year. The Revenue reported for the current year includes Rs. 171.2 million being the gross-up of tax withheld at source on Government Securities. Excluding this, the growth for 2008 stands at 20.8%.
Gross Written Premium (GWP) for the year Rs. 6,387 million has recorded a growth of 13% over 2007. The GWP earned by the Life and General businesses are Rs.4, 342 million and Rs.2, 045 million respectively. Life insurance business continues to account for a significant proportion of the top-line performance.
Consolidated Profit After Tax of the Group was Rs. 463.7 million in 2008, 12% lower than the profit reported for 2007. Low profitability is mainly attributable to higher lapses in the Life business, selective underwriting strategy adopted by the general insurance business leading to a relatively lower GWP growth, higher claims experienced by the General Insurance business and a significant amount of unrealised losses from equity investments.
The Company’s Net Assets stood at Rs. 2,224 million, recording a growth of 9.8% over the previous year. The Company’s Life Policyholders’ fund stood at Rs.14, 484 million as at 31.12.2008 with a growth rate of 18%in 2008. The Company declared a first and final dividend of Rs.7 per share for 2008 which was paid in April 2009. The Company has also declared a gross dividend of 10% for the Life Policyholders.
Global Financial Crisis and it’s impact on Aviva
The global financial crisis has had a minimal impact on AVIVA, and the Group has publicly stated that it expects its ultimate exposure to the failed financial institutions to be around 1% of net assets. The financial strength of the Group is extremely strong as indicated by the Standard & Poor rating of A+. The Group’s financial strength is further reflected by its commitment to double its Earnings Per Share by 2012 despite the crisis. Further, the Group has made public its continued commitment to grow and invest into its businesses in the Asia Pacific region.
Solvency Margins
The Company has maintained a strong financial position and the technical provisions and reserves for both Life business and General insurance business well above the adequate level to operate the business.
Eagle Insurance maintains a solvency ratio of 1.32 times the required solvency margin for Life business as at end 2008 where the required solvency margin was Rs.663 million and the Company maintained an excess in admissible assets of Rs.209 million. The solvency ratio for the General insurance business as at end 2008 was 3.19 times the required solvency margin where the required solvency margin was Rs.240 million and the Company maintained an available solvency margin of Rs.765 million.
