AVIVA NDB records Rs 693 m net profit in 2011
AVIVA NDB Insurance composite financial results recorded a
commendable profit after tax of Rs 693 million, an increase of 15.1%,
despite lower investment income. “It was also very much a year where
risk awareness and management dominated our agenda. We enhanced our
Enterprise Risk Management (ERM) framework to enable us to make better
business decisions and are forging forward.” said Managing Director Shah
Managing Director Shah Rouf
In 2011, AVIVA NDB Insurance continued with the incredible momentum
achieved from the business transformation, although it was more
challenging with the sharp downturn in the stock market and the
replacement of the company’s life product suite by a world-class
The success of the new product range, especially the new flagship
brand AVIVA NDB pensions was evident by the 13.1% growth over the
previous year in life new business. Life gross written premium grew
marginally to Rs 7,865 million in a year that was dominated by challenge
and change. The company declared a life surplus of Rs 355 million which
improved by 8.3% compared to the prior year, through a keen focus on
expense control and optimization of the cost base.
Despite general insurance pricing remaining a challenge in 2011, the
claims ratio improved significantly over the previous year from 79.1% to
64.8% and the combined operating ratio improved from 117.5% to 104.5%.
This was an impressive reflection of the focus on quality underwriting,
pricing and expense control. A post tax profit of Rs 338 million was
reported by general insurance for the financial year ending
Significant improvement in the profitability of the combined
composite business was recorded compared to the corresponding period in
2010, due to prudent investment strategies that helped mitigate the
significant impact of a decrease in investment income from unrealized
equity losses caused by a decline in the capital markets.
A noteworthy improvement in the bottom line performance was a result
of the focus on optimizing the expense base as well as stringent
underwriting and repricing initiatives in general insurance. Embedding
the new product suite with wealth planners, bank assurance partners and
policyholders without detracting from the momentum gained in 2010 was
another challenge faced successfully.
The Company implemented seven risk policies containing 58 risk
standards to improve every aspect of the business.