monthly report august, 2010

1

MONTHLY REPORTMONTHLY REPORT August, 2010August, 2010

Planning Planning DivisionDivision

David LiuDavid Liu

27 August . 27 August . 20102010

2

Market News

2010/8/17 the new exchange rate officially took effect. The dong/dollar exchange rate is now 18,932 dong per dollar instead of 18,544 dong.

We will trace exchange and interest rate continuously to adjust our pricing strategy immediately.

Exchange rate

16000

17000

18000

19000

20000

2008/6/1 2008/9/1 2008/12/1 2009/3/1 2009/6/1 2009/9/1 2009/12/1 2010/3/1 2010/6/1

↑2.1%

18,932

3

Market News

The statistics of MOF show that, in the first six month of 2010, the structures of life products have been changed significantly.

In Vietnam market, the trend of product change fastly, we should know clearly what product could satisfy our customers.

TypeNumber policies FYP

Trend2009 2010H1 2009 2010H1

Term life 19.5% 31.1% 2% 2% ↗Investment 17.6% 22.1% 27% 36% ↗Endowment 62% 46.1% 62% 55% ↘Annuity & whole life

0.9% 0.7% 1% 1% －

4

Analysis of 2010H1

Market situation

Analysis of persistency

Planning project next

month

Project this Month

5

Analysis of 2010H1 Market situation

Company NB premium Market Share Growth rate with 2009H1

Prudential 489,581 31.70% 26.20%

Bao Viet 380,100 24.60% 21.50%

Manulife 177,229 11.50% 33.80%

ACE Life 152,676 9.90% 22.70%

AIA 136,087 8.80% 16.50%

Dai - chi 131,040 8.50% 49.20%

Korea life 36,734 2.40% 326.60%

Cathay 23,954 1.60% 13.30%

Prevoir 14,463 0.90% -26.70%

Great Eastern 1,662 0.10% -9.00%

VCLI 171 0.00% -

Total 1,543,697(M) 100% 27.20%

Our market share of new business premium is rank 8.

NB Premium

6


Now Cathay’s numbers of agent is rank 8. Compare with 2009H1, the growth rate is 52.8%.

Company 2010Q1 2010Q2 Growth rate with 2009H1

Prudential 67,593 76,195 171.70%

Bao Viet 18,964 19,609 17.00%

Manulife 6,788 8,437 50.90%

ACE Life 6,464 7,323 28.90%

AIA 11,107 11,877 12.40%

Dai - chi 13,158 14,480 39.80%

Korea life 3,196 3,455 117.80%

Cathay 5,195 5,050 52.80%

Prevoir - - -

Great Eastern 602 520 -3.40%

VCLI - - -

Total 133,067 146,946 78.26%

Number of Agent

7


Cathay’s premium per policy is better than average of market, but index of productivity is less than others.

CompanyNumber of

AgentPremium per

policyProductivity

(policy)Productivity (premium)

Prudential 76,195 3.7 1.7 6.4

Bao Viet 19,609 5.9 3.3 19.4

Manulife 8,437 3 6.9 21

ACE Life 7,323 6.7 3.1 20.8

AIA 11,877 5.9 1.9 11.5

Dai - chi 14,480 6.4 1.4 9

Korea life 3,455 7.8 1.4 10.6

Cathay 5,050 5.2 0.9 4.7

Prevoir - 0.7 - -

Great Eastern 520 6.5 0.5 3.2

VCLI - 0.4 - -

Total 146,946 4.4 2.4 10.5

Productivity index

8


Cathay’s NB premium of 「 Whole+Term 」 about equal Korea life’s NB premium of 「 UL」

The main reason that our NB premium is less than Korea lifes’ is because of endowment.

NB policy and premium per policy is both less.

Company Item Endowment Term Whole life UL Rider

Cathay

NB premium 16,938 1,707 4,360 - 949

NB policy 2,946 892 774 - 3,616

Premium per policy

5.7 1.9 5.6 - 0.3

Korea life

NB premium 27,202 - - 7,523 2,009

NB policy 3,361 - - 1,342 3,666

Premium per policy

8.1 - - 5.6 0.5

9


Performance Improvement

Quantity↑Continuously recruit lot IA: IA equal customer

Quality↑Offer sales skill to imporve premium per policyKeep tracing active rate & attain-quota rate

Product StrategyFocus differentiation product: whole lifelaunch Universal life insurance

10

Analysis of 2010H1

Market

situation



month

Project this Month

11

Why Persistency is very important ?

To company:Because of insurance business characteristic, first year

expense is more than first year premium income of a new business policy

◆If there is no renewal premium income, then insurance

company will lose money when they sell a new business

policy

The persistency is related to profit and loss of insurance

company directly

Analysis of Persistency

12

To Individual:(1)Commision

(2)Promotion and Assessment Accumulated persistency of 13th month must be 75%(70%)↑


Policy year 1 2 3 4 5

Commission 40% 7.5% 7.5% 7.5% 5%

RenewalCommission

27.5%

13


month policy Persistency suspension Surrender & othersAccumulatedpersistency

2009/10 148 60.7% 6.2% 33.0% 60.7%

2009/11 264 62.7% 4.2% 33.1% 61.9%

2009/12 374 62.6% 12.4% 25.1% 62.2%

2010/01 497 51.5% 16.9% 31.6% 58.2%

2010/02 563 51.5% 24.1% 24.4% 56.2%

2010/03 836 58.7% 18.3% 23.0% 56.8%

2010/04 528 64.3% 13.4% 22.3% 57.9%

2010/05 748 75.0% 10.3% 14.7% 61.2%

2010/06 943 56.9% 17.8% 25.3% 60.5%

2010/07 1446 53.7% 19.9% 26.4% 59.5%

We have about 40% policies will be lapsed after 13 month from effective date

Persistency of 13th month

14

40%

45%

50%

55%

60%

65%

70%

75%

80%

Month 200910 200911 200912 201001 201002 201003 201004 201005 201006

Persistency

Accumulated persistency


59.5%

53.7%

We have better performance of persistency from December 2009 to April 2010.

15


50%

55%

60%

65%

70%

75%

month 200911 200912 201001 201002 201003 201004 201005 201006

HCMC HN

0%

5%

10%

15%

20%

25%

30%

35%

40%

month 200911 200912 201001 201002 201003 201004 201005 201006

Surrender_HCMC Surrender_HN Suspension_HCMC Suspension_HN

Suspension rate of HCMC is higher.Surrender and Suspension rate of HN is closed.

60.8%

58.4%

29.1%

20.9%

18.3%

12.5%

16


In the future, promotion 、 assessment and incentives will connected with persistency

◆Suspension:

1. Know the reason why customer let his policy be

suspended

2. Persuade customer to reinstate

◆Surrender:

1. Demand analysis of customer

2. Surrender is double lose situation

17

Analysis of 2010H1

Market

situation



month

Project this Month

18

New Product

Hai Phong Branch set up

Review Agent System

2011 Annual Target

2011 New Branch Assessment

Planning Project Next Month

19

Thank you!!

Planning Planning DivisionDivision

David LiuDavid Liu

monthly report august, 2010

Documents