UNITED Overseas Insurance, the insurance arm of UOB, posted a net profit of S$27 million for the second half of its 2024 fiscal year ended Dec 31, a 10 per cent increase from S$24.5 million in the same period in the previous year, said the company via a bourse filing on Friday (Feb 14).
Insurance service revenue increased by 30 per cent to S$62.5 million from S$48 million over the same period, as a result of optimisation of current business, transformative initiatives and higher releases of contractual service margin for services provided.
However, insurance service expenses soared to S$32.9 million – a 204 per cent increase from S$10.8 million – largely attributed to higher incurred claims.
Net expenses from reinsurance contracts fell by S$4 million due to higher claims recovery. Hence, the net insurance service and financial result decreased by 24 per cent to S$11.1 million.
Non-underwriting income was recorded at S$6.6 million, a 50 per cent increase from S$4.4 million due to an increase in interest earned from fixed deposits and higher dividend income from investments.
Other comprehensive income recorded an unrealised profit of S$11.4 million. This was largely attributed to resilient financial markets and interest-rate reductions which occurred in the latter half of 2024.
For the full 2024 fiscal year, net profit came in at S$39.1 million, a 4 per cent increase from S$37.5 million in the previous fiscal year.
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Insurance revenue increased by 20 per cent to S$113.5 million for the year.
The company recommended the payment of a final dividend of 8.5 Singapore cents per share and a special dividend of six cents per share for H2 FY2024. Together with the interim dividend of 8.5 cents per share paid on Aug 15 last year, the total dividend for FY2024 would be 23 cents per share, compared with 21 cents per share in the previous fiscal year.
UOI said that the local insurance market remains highly competitive, yet growth prospects and opportunities continue to exist for companies that excel in technology adoption and customer value propositions.
“The company is confident that its strategic initiatives, which include leveraging cross-selling synergies with its parent bank, expanding its insurance intermediary business, enhancing technological capabilities and cultivating a customer centric approach, will continue to drive sustainable growth. The investment climate is expected to be challenging due to geopolitical uncertainties and market volatility,” read its financial statement.
Shares of UOI rose 0.7 per cent or S$0.05 to close at S$7.15 on Friday.
