by Rob Hosking
These will include definition enhancements, revised pricing, and commission options “designed to encourage distributors to create more sustainable businesses by reducing up-front commissions in favour of increased rewards for renewals.
AXA, in its annual results announcement last week, said earnings of $47.1 million were up 29% on the previous, fuelled by “acquisitions and organic growth”.
The company’s funds under management and administration grew 42% to $11.2 billion – up from $7.9 billion the previous.
Only one part of the annual result strayed into the negatives – new business from insurance was down 17%. This looks less bad if adjusted for the currency (it is a fall of 10% in New Zealand dollars), but it was also expected following changes made in the group insurance area, says chief executive Ralph Stewart.
“With group insurance you strike a relationship, and then two or three years down the track you review that and renegotiate premiums on the basis of that experience. We did that in 2005 and we expected something like this. To give you an idea, we’d had $41 million in claims.”
The company is currently New Zealand’s third largest insurer, with in-force annual premiums of $164 million.
Rob Hosking is a Wellington-based freelance writer specialising in political, economic and IT related issues.
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