Prudential the ‘best in class’ in the US and Asia as sales increase
INSURANCE GIANT Prudential has seen new business profits jump by nearly a fifth as higher interest rates bolstered sales across the US and Asia.
The firm said “higher sales and more favourable economics” gave life insurance new business profit a 17 per cent lift to £2.47bn for the first nine months of the year.
Asia churned out the largest slice of the growth, with new business profit in the region rising 15 per cent to £1.62bn, as the firm saw double-digit growth in seven countries, including China, Hong Kong and Singapore.
Jackson, Prudential’s US insurance arm, also hiked new business profits by 17 per cent to £619m during the three quarters, but said regulatory reforms in America had cast an uncertain outlook over variable annuity sales.
Group chief executive Mike Wells said: “In Asia, we are meeting the health, protection and savings needs of a rapidly growing middle class.
“In the US, we are addressing the savings and retirement income requirements of the baby-boom generation, and in the UK and Europe we are focused on the opportunity presented by the converging life assurance and savings markets.”
Focusing on the UK, asset manager M&G Prudential saw total assets under management rise to £336.5bn, up from £310.8bn at the end of December last year.
The operation, which was forged following the merger of Prudential and M&G asset management, recorded external asset management net inflows of £9.9bn for the period.
UK insurance new business profits rose 31 per cent to £234m.
Under Solvency II – which requires insurance companies to prove they can withstand a major financial shock – Prudential’s surplus was £12.8bn, an equivalent cover ratio of 201 per cent.
Shore Capital analyst Eamonn Flanagan said: “The strength of the group’s business model across the globe is unparalleled... with a powerful balance sheet to match.
“The operations in Asia and the US are ‘best in class’ in our view in their respective territories, with M&G Prudential in the UK clearly determined to deliver likewise on these shores.”