Hong Kong general insurers post 7.8% gain in 2020 gross premiums

But net premiums fell 8.7% in the same year.

Hong Kong’s general insurers posted an 8.3% increase in their gross premiums to $7.8b (HK$60.3b) in 2020 but saw their net premiums fall 8.7% to $5.3b (HK$40.9b), according to the Insurance Authority (IA).

Overall underwriting profit surged to $283.4m (HK$2.2b), supported by direct business. Direct business’ gross and net premiums were $5.7b (HK$$44.4b) and $4b (HK$31.3b), respectively.

Accident and health business slipped 5.8%, within which the medical subclass registered a modest gain of 2.4%, and the non-medical subclass dropped 43.3% as outbound travel remained hampered.

Gross premiums of pecuniary loss business surged 88.4% due to upward adjustment of maximum property values under the mortgage insurance programme. General liability grew 7.9%, whilst the motor vehicle business inched up 4%.

Direct business generated a 95.5 % surge in underwriting profit to $219m (HK$1.7b). Accident and health contributed $125m (HK$973m) whilst employees’ compensation rebounded to a profit of $50.4m (HK$391m), even though the favourable performance is heavily influenced by suppression of claims amidst COVID-19. Underwriting loss for the motor vehicle business narrowed to $31m (HK$241m).

On the reinsurance inward business, gross and net premiums grew $2.05b (HK$15.9b) and $1.2b (HK$9.6b), respectively, driven by the property damage business due to hardening rates and new coverages. Underwriting profit rose to $74.9m (HK$582m), largely arising from general liability, ships and goods in Transit businesses which was partly offset by reduced profit derived from property damage lines.