MAPFRE MSV Life p.l.c. registered a profit before tax of €13.7 million for the year ended 31 December 2018, up 11.4% on the previous year where a €12.3 million profit before tax was generated. Profit after tax is recorded at €10.9 million, up 9.0% on the €10.0 million in the previous year.
Operating results were supported by strong inflows of premium revenue across the Company’s range of insurance and investment products resulting from stronger customer demand.
Gross premiums written for financial year 2018 increased by 10.7% from €289.2 million to €320.0 million. This was mainly due to ongoing demand across all core products, particularly savings contracts and life protection business.
Net claims incurred increased to €145.7 million through the year compared to a prior year €137.4 million largely because of an increase in maturing medium-term single premium contracts. A large proportion of maturing contracts were subsequently re-invested in new medium-term savings contracts.
In aggregate, the balance on the long-term business technical account increased to €13.4 million from a prior year €11.8 million as a result of a technical result improvement well supported by strong business growth and underwriting performance.
Total assets increased by 4.6% from €2,116.8 million at the end of 2017 to €2,213.4 million at the end of 2018, whilst net technical provisions (including investment contracts without DPF) increased by 5.0% from €1,918.8 million in 2017 to €2,013.9 million in 2018.
The value of in-force business, which projects future transfers to shareholders arising from policies in force at the end of the year, increased by 0.3% from €62.4 million in 2017 to €62.6 million in 2018. This is attributable to the impact of new business inflows and updated mortality assumptions offset by weaker investment conditions brought about by lower yields.
Total shareholders’ funds at the close of 2018 amounted to €160.0 million (2017: €161.2 million), a decrease of 0.7% over the previous year yet well ahead of minimum solvency guidelines.
The directors recommended the payment of a final net dividend of €10.94 million (2017: €12.30 million) and an interim special net dividend for 2019 of €16.35 million which is being appropriated out of retained profits generated prior to financial year 2018.
The MAPFRE MSV With-Profits Fund stood at €1.89 billion at 31 December 2018 (2017: €1.79 billion). The total investment return of the Fund amounted to a negative €43.1 million down from a positive €63.9 million in 2017 whilst the net investment return after fees was a negative 2.15% compared with a positive 3.85% in 2017.
The Chairman of MAPFRE MSV Life p.l.c., John Cassar White, stated, “in 2018, the life insurance market in Malta retained strong demand patterns. We continue to see good momentum in all our product groupings as customers continue to choose MAPFRE MSV Life, reflecting trust in our brand and in the quality of our service proposition. These satisfactory results were achieved despite the difficult investment conditions that marked 2018.”
Mr. Cassar White added, “the changing customer behaviours, the dramatic technological developments, the product innovation and the disruption that is taking place in the insurance industry will require insurance companies to adapt to these challenges to be in a position to exploit the many opportunities that will certainly arise. MAPFRE MSV Life is well-positioned to benefit from these business opportunities.”
The Chief Executive Officer of MAPFRE MSV Life p.l.c., David G. Curmi, stated, “going forward we will continue to maintain strong focus on our customers by continuously assessing our business processes and operations in order to provide good value and excellent service. To this end, we have very ambitious plans to invest and innovate in information technology. In tandem, we have a number of initiatives lined up to strengthen further our digital platform and widen our digital marketing strategy. During 2018 we launched SavviSave, an innovative simplified digital savings product that uses mobile technology and which we have developed jointly with Munich RE and MAPFRE Group.”
Mr. Curmi added, “the Maltese life insurance market has, for a number of years, registered growth that is significantly above the average in Europe but remains an underinsured market. Although life insurance companies are playing an increasingly important role in Maltese household savings, comparative studies with other European life insurance markets show that whilst the Maltese life insurance market has grown significantly between 1996 and 2018, the life insurance density and life insurance penetration still trail well behind the European average. We therefore see attractive potential for an uplift in life protection, long term and retirement savings in the local life insurance market and during 2019 we plan to launch our first Voluntary Occupational Pension Schemes (VOPS) following Government’s introduction of a number of fiscal incentives to encourage employers to set up VOPS for their employees.”
MAPFRE MSV Life p.l.c. is authorised under the Insurance Business Act, Cap 403 of the Laws of Malta and regulated by the Malta Financial Services Authority.
Investment returns can go down as well as up and the past is not necessarily a guide to future performance. Changes in the rate of exchange of currencies may also affect the value of investments.
MAPFRE MSV Life p.l.c.
T: 2590 9000