AXA Insurance plans Bt1.5 bn capital increase
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Group's holding in Thai unit to reach 86%; seeks foreign business licence
AXA Insurance is raising its registered capital in the wake of Thailand’s devastating floods last year, so as to ensure the company has sufficient capital for future expansion.
The insurer plans to increase its registered capital by about Bt1.5 billion, from Bt352.64 million to Bt1.85 billion.
After the capital increase, the Paris-based AXA Group will hold an 86-per-cent stake in the com-pany, Kheedhej Anansiriprapha, chief executive officer of Bangkok-based AXA Insurance, said yesterday.
AXA Group currently has a 25-per-cent holding in the business.
The Thai unit is in the final phase of the capital-increase process, awaiting approval from the Finance Ministry. The recapitalisation is expected to be completed next month.
“Once we complete the capital increase, we, as a multinational, will also have to request a for-
eign business licence from the Commerce Ministry to be able to operate insurance business in Thailand [without disruption],” Kheedhej said.
Meanwhile, AXA Insurance plans to launch new products this year, including property policies covering catastrophe and general natural perils, and to open seven more branches to reach customers in upcountry provinces.
Two of the seven branches, in Rayong and Udon Thani, have already commenced operations.
Claim settlements
After last year’s floods, which devastated many of its clients’ facilities and eroded its 2011 profit, AXA Insurance has continued making settling claims from flood-affected customers.
Of the more than Bt91 million in claims settlements to flood-hit motor customers, the company
paid out 70 per cent, or Bt77.35 million, during the first four months of the year and expects
to complete the remainder this month.
“For our non-motor clients, we expect to complete claims payments within the third quarter,” Kheedhej said.
AXA Insurance has recorded claims of Bt6.54 billion for non-motor clients, some Bt1.41 billion of which have already been paid.
This year, the company expects to record growth of 20-25 per cent for its gross written pre-
miums (GWP) on the back of the country’s better-than-expected economic recovery after the flood disaster.
The insurer targets full-year GWP growth to Bt2.4 billion, after registering a 14.2-per-cent rise for the first quarter.
Of total GWP, about 58 per cent is expected to come from retail business, 37 per cent from commercial business and about 5 per cent from health.
AXA Insurance expects to expand its largest segment, retail business, by 16 per cent this year, driven mainly by likely robust growth in auto sales after the floods. Motor insurance accounts for 88 per cent of the company’s retail business.
The insurer estimates its commercial business will expand 28 per cent and its health business will rise 45 per cent this year.
