AIA Group Reports Growth and Increased Shareholder Returns in 2024
AIA Group Limited has unveiled its financial results for the year ending December 31, 2024, showcasing growth across major financial and operational metrics alongside elevated capital distributions to shareholders.
Value of New Business and Premiums: The insurer recorded an 18% surge in the value of new business (VONB), amounting to US$4.71 billion. Annualised new premiums (ANP) also saw an uptick, climbing to US$8.61 billion, marking a 14% increase. All of AIA’s business segments experienced double-digit growth in VONB, with the company’s VONB margin expanding by 1.9 percentage points to 54.5%.
Embedded Value and Operating Profit: AIA’s embedded value (EV) equity reached US$71.6 billion post shareholder capital returns, reflecting a 9% per-share increase. The embedded value operating profit was reported at US$10.03 billion, a 19% rise per share. The operating return on EV (ROEV) saw a boost of 200 basis points, reaching 14.9%.
Operating Profit and Surplus Generation: The company’s operating profit after tax (OPAT) grew by 12% per share, totaling US$6.61 billion. AIA remains on track to achieve its projected compound annual growth rate (CAGR) for OPAT per share of 9% to 11% from 2023 to 2026. The operating return on equity (ROE) also improved by 130 basis points, climbing to 14.8%. AIA generated US$6.33 billion in underlying free surplus, reflecting a 10% increase per share. After reinvesting in organic new business, the net free surplus generation was reported at US$4.02 billion, with the shareholder capital ratio standing at 236% as of the end of 2024.
Capital Returns and Shareholder Initiatives: AIA’s board has approved a 10% increase in the final dividend, bringing it to 130.98 Hong Kong cents per share. Furthermore, a new US$1.6 billion share buyback initiative has been announced, with the total capital returned to shareholders through dividends and buybacks in 2024 reaching US$6.5 billion.
Leadership Insight: AIA Group’s chief executive and president, Lee Yuan Siong, highlighted the company’s financial growth and its commitment to returning capital to investors. He stated, “AIA is uniquely well-positioned to capitalise on the long-term structural growth potential in the world’s most attractive market for life and health insurance through the consistent execution of our clear and ambitious strategy. I am confident that AIA’s long-term business prospects remain exceptional. We will continue to strengthen our substantial competitive advantages to capture the opportunities ahead of us and create sustainable value for all our stakeholders.”
AIA Singapore’s Performance: AIA Singapore reported a 15% increase in VONB, driven by expansion in both agency and partnership distribution channels. ANP grew significantly, by 52% to US$897 million, although the VONB margin reduced by 16.8 percentage points to 50.5%, attributed to a strategic shift towards long-term savings products. Total Weighted Premium Income (TWPI) recorded a 13% rise, showcasing overall business growth. The operating profit after tax exhibited a 1% increase, with lower investment income and increased remittances to support AIA Group’s share buyback program being key factors impacting profitability.
CEO Commentary: AIA Singapore’s chief executive, Wong Sze Keed, remarked on the company’s robust momentum across its distribution channels and high-net-worth (HNW) business segment. She noted, “Our business in Singapore is well-positioned to capture long-term growth opportunities across the mass affluent and HNW segments. Leveraging our unique ‘Wealthbeing by AIA’ proposition, we provide holistic wealth solutions which seamlessly meld wealth creation and well-being.”
Wong added that the company introduced new mental health coverage options, expanding benefits to over 1.3 million insured employees. AIA Singapore continued to enhance its wealth management offerings, launching AIA Wealth Centre and AIA International Wealth to cater to affluent clients. The introduction of the AIA Platinum Wealth Venture, an investment-linked plan, supported growth in long-term savings products.
Wong also emphasized AIA Singapore’s advancements in digital engagement, particularly through the AIA+ mobile app, which consolidates policy management, payments, and claims processing into a single platform.
