Falcon Insurance expects flat profit growth for 3-5 years
Falcon Insurance does not expect any growth in net profit for the next three to five years despite its aggressive premium-growth target of 15 per cent a year. It says that because if is now focusing more on personal rather than commercial lines, it needs
Chief executive officer Sopa Kanjanarintr said the company expected net profit this year to be about the same as last year’s Bt100 million even though premium income is targeted to grow by 13 per cent to Bt1.76 billion, compared with Bt1.55 billion in 2014.
Commercial lines this year are expected to contribute premiums of Bt1.12 billion, while Bt640 million is from personal lines.
The personal-line contribution this year will be 35 per cent, up from 30 per cent, she said, adding that within three years, personal lines will account for half of total premiums.
“Premiums from personal lines three years from now should reach Bt1 billion, compared with the Bt640 million expected of this year,” Sopa said.
Margins from personal insurance lines are better than from commercial lines, but the company has to invest a lot on developing insurance policies, so annual net profit over the next three to five years could stay around Bt100 million.
Falcon yesterday introduced a health-insurance plan for individuals called iHealth Plus, combining health check-ups and medical treatments in one membership package. The package offers guarantee renewals up to 80 years of age without additional conditions.
Annual premiums start at Bt20,000.
Falcon targets premium income from iHealth Plus at Bt250 million over the next three years.
The company reported premium income of Bt1.55 billion last year, up 5 per cent from 2013. Property insurance accounted for Bt731 million, Bt298 million was from motor insurance, Bt219 million from miscellaneous insurance, Bt115 million from engineering insurance, Bt158 million from personal accident policies and Bt35 million from marine insurance.
