China Reinsurance (Group) Corporation has announced a 24% dip in net profit for the first-half of 2020 while gross written premiums (GWP) jumped by almost 21% in the period.
Overall, the reinsurer’s GWP reached RMB102.1 billion in H1 2020, with growth of 17.6% in P&C reinsurance, 31.4% in L&H reinsurance, and growth of 5.7% in primary P&C insurance.
The reinsurer notes that premiums of domestic P&C reinsurance hit a new high of RMB18.0 billion, which represents growth of almost 21%, meaning that it’s growing faster than the primary insurance industry. This segment recorded a combined ratio of 99.8% for the period, with China Re noting continued improvement in overall business quality.
Turning to the firm’s overseas P&C reinsurance operations, and GWP reached RMB9.7 billion, representing year-on-year growth of 14.9%. Excluding the impact of the COVID-19 pandemic in the period, and the company’s combined ratio was 92.08%, which is a significant improvement on the previous year.
In L&H reinsurance, China Re notes that premiums of domestic protection-type business hiked by nearly 25% in the period to RMB11.6 billion. At the same time, China Re states that the combined ratio of short-term protection type business was 97.26% in H1 2020, which actually represents a year-on-year decline of 30 basis points.
In its primary P&C business, China Re’s motor insurance premiums jumped by 2.3% to RMB14.2 billion, while non-motor premiums increased by 9.7% to RMB11.2 billion.
China Re has also revealed that during H1 2020, its asset management business secured excess investment returns. Overall, net investment income in the first-half of 2020 climbed by 22.8% to RMB7.6 billion, while the annualised total investment yield reached 5.48%, which represents a year-on-year increase of 29 basis points.
“Going forward in the post-COVID-19 era, the insurance market will face various changes including sharp increase in demand, technological disruptions and business transformation. Meanwhile, the reinsurance market is full of opportunities as insurers seek to cede risks, barriers to entry into the reinsurance industry become higher as market leaders strengthened their positions,” said the reinsurer.
Adding: “In the second half of 2020, China Re Group will adhere to its operational goals of “stabilising growth, adjusting structure, controlling risks and increasing profitability”, striving to achieve its annual business targets and attain a new level of high-quality development.”