Andrew Sinclair

Andrew Sinclair from Bank of America asked for the timescale to bring the capital ratio back within the 175-200% target range, given it is expected to be well above. He also inquired about regional drivers for new business margin changes and details on the Mainland China participating (par) business back book, including yields and guarantees.

Answer

CFO Ben Bulmer explained that the company may operate slightly above the 200% range due to remittance timing, and the Board will regularly review excess capital. He noted that a seasonal shift to the agency channel in H2 would benefit margins. For China, he stated that current returns are sufficient to cover liabilities on the par book and that the business has gained approval to issue perpetual debt locally to bolster its balance sheet.

Questioned the ambition of the new business profit growth target, the strategy for penetrating India's health insurance market, and the required evolution of the health product offering.

Answer

Management defended the 15-20% CAGR target as thoughtful, balancing opportunities and challenges, while emphasizing the focus on quality growth and free surplus generation. For India, they are exploring all options, including organic and inorganic routes, particularly looking at stand-alone health insurers (SAHIs). The broader health strategy involves deepening payer capabilities (pricing, claims management) and expanding into adjacent services like preventative care and rehabilitation, which will require new capabilities and investment.