lol what potential tunepro has? Covid travel insurance can be a double edged sword, mandatory travel insurance wont be sustainable. Either the Covid situation improves, no more mandatory insurance, or worsen, and loss due to claims. There is like 0 scenario where tunepro can just shake leg and make money.

That cost impact is minimal. Operationally, that will depend on how you want to set the transition CSM (there are multiple approaches). You can set it to super high, normal, or super low. For STMB, since the BEL & CSM both always positive, so doesn't matter how they set CSM, confirm will be a hit to equity. For Allianz, BEL for ILPs almost always negative. Unless the CSM is set to be artificially super high (unlikely), otherwise BEL+CSM will still be a negative for Allianz, and hence higher equity value. Typically, conventional insurers aim to just be balance.

Insurance liability will change to BEL + CSM. For STMB (heavily on single premium), BEL will almost similar with existing, but additional component for CSM (can only be positive), hence downward adjustment for book Value. Basically undo day 1 gain previously, and release it over time in future. For Allianz, heavily on ILP, the contract liability currently (floored at 0) will change to negative BEL + positive CSM. It will be positive adjustment instead (release profit faster).

https://www.asiaone.com/money/integrated-shield-plan-riders-now-require-co-payment-what-you-need-know

Quite poorly written, and she seems just clueless about IFRS17. For the medical inflation and ability to reprice, yes that will be a key concern, but wont be a big issue. Insurers will just exit if not allow to reprice when combine ratio > 100%, and no one will allow this to happen. Recently, Singapore mandatory all insurers abolish cashless medical plan and that's more likely will be the approach BNM is going to take. *Premium for 5% co-pay plan can be 20-30% cheaper vs cashless plan.

EV wont change due to IFRS17. EV is EV, IFRS17 is IFRS17. "20% reduction of EV due to IFRS17" that is a wrong statement.

Where can I get a copy of that affin hwang report?

EV is not just about additional demand, but mainly additional demand during off peak period (most people charge vehicle overnight). Basically no additional cost for TNB.

typically medical repricing will only lead to higher EV, many insurers get away by saying they target a similar level of margin (in %), but withhold the information that they earning higher in absolute amount (hence higher EV).

EV is calculated by Allianz actuaries, not estimated by analysts. All else equal, then yes, Jun 2021 EV = Jun 2020 EV + NBV - profit release, including discounting effect. However, there is medical repricing going on, and will also increase the EV.

Allianz Life EV is now 3.3bil (Jun 2021), vs 2.6bil (Jun 2020) https://www.bursamarketplace.com/mkt/tools/research/ch=research&pg=research&ac=1514989&bb=1538052

tax free EV, 利好TNB

Govt to introduce excise duty on liquid, gel-based vaping e-liquids

budget mentioned vape, but my malay sucks.......

Actuaries will always ensure asset-liability matching, by dollar duration.

People always measure the value per share, with considering of the preferential share. So convert or not, doesn't matter.

EPF can be wrong too

Nope, BNM asked insurers to delay repricing in 2020, but no restriction in 2021.

repricing in 2021, absolute profit still higher no matter what

EV is based on a lot assumptions. The assumptions can be conservative or aggressive. For example, aggressive will be high earning rate with low discount rate. Allianz adopts MCEV, or in layman term, risk free earning rate + risk free discount rate. EV also relies a lot on methodology, for example lapse rate, repricing, bonus etc. Investors typically have lesser faith in China inhouse methodology, and to be fair, they are indeed not as sophisticated as MNC like Allianz, Prudential or AIA. Hence people tends to discount the EV multiple for China insurers. NB multiplier, should correlate with future sales. Typically people will assume NBV margin remains unchanged.

Another thing on VIF (part of EV) calculation, since VIF is basically PV of distributable profit, and since Allianz is heavily selling ILP medical, the VIF amount is actually depending on Allianz calculation methodology. In practice, insurers don't typically assume perpetual medical inflation in the VIF calculation, but in reality the medical inflation will be perpetual. What this means is, the absolute amount of future profit, will only be much higher (assume no interference with the medical repricing).

NB multiplier for well established companies is typically > 10. It can be super high for countries like India and lower in matured market. Even if just assumed 10, and use the YE20 Allianz Life NBV, that is additional 2bil+ on top of current valuation. Some sample number here : https://www.set.or.th/set/pdfnews.do?newsId=15289333958740&sequence=0

12MP : The M40 will be encouraged to subscribe to health and employment insurance to mitigate them from financial vulnerability. In addition, income tax relief on health and life as well as employment insurance for the M40 will be reviewed to reduce healthcare costs. These initiatives will cushion them from unforeseen circumstances due to health and work-related risks.

The Government financial burden will be reduced gradually in providing sustainable quality healthcare services. The Malaysia National Health Accounts report will be strengthened by incorporating a more detailed analysis of public health expenditure as a tool to identify cost drivers within the health system. Current healthcare charges will be reviewed so that higher income patients will be required to pay higher charges. Subsidies for healthcare services will be streamlined based on a means test.

Efforts will be undertaken to encourage the rakyat to have insurance and takaful in financing healthcare expenses.

https://www.theedgemarkets.com/article/south-africas-sanlam-planning-stake-sale-malaysian-insurer-%E2%80%94-sources

Q2 results also so so, mainly due to high claims provision and fair value from Life. https://www.allianz.com.my/documents/144671/1183195/2021_Q2_AMB_Analyst_Briefing.pdf/f1a38b87-091a-473f-82a9-119e526d0552

https://www.theedgemarkets.com/article/syarikat-takaful-ceo-mohamed-hassan-leave-march-2022

Operating profit in the region increased 8 percent to EUR 63 million, mostly in Thailand and Malaysia, driven mainly by our overall technical excellence programs and operations, including an expanded digitalization strategy for our core channels. https://www.allianz-asiapacific.com/news/allianz-asia-pacific-announces-strong-half-year-performance-results-in-2021.html

There is almost 0 additional capital required for GI new business, due to short term nature, hence IRR is almost infinity.

But GI market in Malaysia is already saturated, there are just that many car or fire insurance that you can sell. For growth, GI typically aim to sell additional coverage for car insurance, or standalone health/CI insurance. But then, consumers in Malaysia typically prefer investment linked policies vs standalone health/CI.

For Allianz, its GI business is roughly there and the valuation wont change much. Life is the only possible catalyst to bump up its share price. Phase 2 reopen soon, and dine in allowed, more opportunities for Life side face-to-face sales.

Not to mention, Prudential recently announced Covid medical coverage (on reimbursement basis) for its policyholders, very likely all other big players will follow, and potentially can see a high sales in H2.

Allianz APE:
2019H1 : 285mil
2019H2 : 309mil
2020H1 : 213mil
2020H2 : 318mil
2021H1 : 335mil

Allianz is narrowing its gap with HLA (4th), based on NB APE.

the world now started to focus on value/energy stock, to prepare for inflation. https://www.stashaway.my/r/economy-inflationary-disinflationary-growth

They both already exist in Malaysia market for years, not new entrance. Currently we have 21 conventional P&C insurers, after 1 year, will consolidate to 19.

AmGeneral sold @ 1.4x book value, while AXA sold @ ~1x book value, and give away life business for free

https://www.theedgemarkets.com/article/ammbs-51owned-unit-sells-amgeneral-insurance-rm229b-cash-and-shares-deal-liberty-mutual?fbclid=IwAR13Qll8w0ha9SM8_PKXTFKFh6-IpDd3FfmIRzfQ0qFJe3AcI-_2gmZSdOU#.YPVcR9gWL6s.facebook

https://www.sinchew.com.my/content/content_2513273.html

First year premium < units allocation/creation + first year expenses + first year commission, thus will sell at a paper loss, in first year.

Branches don't have to open to sell new insurance policies. In fact, even to settle claims, branches dont have to open as well. I did visit insurance company branch a few times before, but mainly just to switch funds, change payment method etc.

whole market is down, just collect if got free cash

1 month or even one full year of bad sales will not change anything. There is almost zero capital required to write a new business and no cost of inventory etc. The sales in fact are mostly campaign driven, and not surprised to see one month of sales can be 3x of another month.

Q1 2019 117.5
Q2 2019 167.8
Q3 2019 132.8
Q4 2019 176.7
Q1 2020 122.6
Q2 2020 90.8
Q3 2020 150.7
Q4 2020 167.7
Q1 2021 171.3

Later new PM (whoever he is), mandatory waive all interest on late payment

https://paultan.org/2021/07/05/motor-insurance-claims-fraud-cost-rm1-billion-a-year-in-malaysia-fighting-corruption-is-a-lonely-road-allianz/

There are many secret undertable arrangement for AIA and Prudential.

AIA
https://www.insurancebusinessmag.com/asia/news/breaking-news/foreign-insurers-want-review-of-malaysias-ownership-rules-96114.aspx
http://lib.perdana.org.my/PLF/Digital_Content/Prominent_Leaders/Mahathir/News_1968-2004/1996-1998/1998aj/equity%20ear%20grace.pdf

Prudential
https://www.theedgemarkets.com/article/high-court-rules-favour-prudential-over-stake-malaysian-licensee

The foreign ownership thing being brought up again in 2017, so far only one company "negotiated" and "donated" to the government to get exemption. Many others did scramble up to find a local partner, as there are only a few with big enough size and good quality local partner. https://www.nst.com.my/business/2017/11/299822/epf-kwap-eye-foreign-insurers

Supposed someone upper level eventually stop the government to proceed with this, and now is silence again. The only victim so far, is that one company.

Recently, China, India and Indonesia all slowly open up to allow higher foreign ownership. It seems unlikely government will proceed with this anymore. There is this unique position for life insurance, which it is actually much better to allow for big MNC insurance, with good governance, to come in. Local insurance typically restricted with capability and with poorer governance, and hardly survive for a long time. Back then we did have a lot more local insurers (MAA, Uniasia, MCIS, Tahan), but now only HLA and Etiqa managed to sustain.
https://www.theedgemarkets.com/article/takeover-tahan-no-surprise-industry

Allianz is now number 1 in GI, number 4 in Life (conventional). There are only 2 local conventional life insurers, HLA and Etiqa, both with foreign minority shareholder. The only unfavorable law, at least recently, is the 70% cap on foreign ownership, but seems like is being postponed again indefinitely.

Last time work in office, 100 people 10 AC, now work from home, 100 people 50 AC. Then residential rates, they will pay the higher tariff >rm0.50 per kWh.

https://www.linkedin.com/posts/tonyfernandesairasia_ridehailing-activity-6815143075829157889-Iij9/

https://www.nst.com.my/news/nation/2021/06/703091/6-month-bank-loan-moratorium-individuals-micro-entrepreneurs

BAT now import and distribute only

https://www.kwongwah.com.my/?p=1014203

1h20m : Yes we are selling a lot of protection business which is actually very good under the 17 basis, the profit will emerge quite well.

AXA sold for 140mil euro (~690mil MYR) for 49% Life + GI, valuing AXA at ~1400mil MYR, vs Allianz MV of ~5000mil MYR (adjusted for ICPS)

https://www.channelnewsasia.com/news/business/france-s-axa-to-sell-malaysia-insurance-businesses-to-generali-15066432