Tune Protect reports Q3 2023 financials

Notable increase in NWP recorded

Tune Protect reports Q3 2023 financials

Insurance News

By Kenneth Araullo

Tune Protect Group Berhad has reported notable growth in its financial performance for the third quarter of the financial year 2023.

The group witnessed a 22% year-on-year increase in net written premiums (NWP) and saw a profitable bottom line, influenced by improvements in underwriting performance and investments.

Key growth drivers for the group’s topline were its travel, motor, and health segments. The overall retention ratio in both 3Q23 and the first nine months of 2023 (9M23) surpassed the group’s target of 70%, reaching 74% and 76%, respectively.

Rohit Nambiar, Tune Protect Group’s chief executive officer, commented on the growth, noting a 22% YoY increase in NWP across the main pillars in 3Q23. This rise compensated for the discontinuation of the Perlindungan Tenang (Tenang) scheme in FY23.

The health pillar, led by the foreign worker segment, and the lifestyle pillar, driven by the motor segment (up 41.1% YoY) and travel segment (up 25.5% YoY), were key contributors. The SME segment saw a slight decline of 7.6% due to slower growth in the engineering segment, offset by a surge in the SME fire segment (up over 100% YoY).

Digital partnerships driving growth for Tune Protect

The group’s digital partnerships and eCommerce achieved 7.5% YoY growth in 3Q23 NWP. While the 9M23 NWP showed a 17.6% decline if Tenang was included, the growth excluding Tenang was 38.8%, indicating reduced dependency on Tenang. The number of digital partners increased from 65 in 3Q22 to 79 in 3Q23.

Despite a 15.3% drop in insurance revenue YoY to RM106.9 million in 3Q23, the group’s profitability was supported by the growth of the insurance service result and improved investment performance. The insurance service result grew over 100% YoY to RM6.7 million in 3Q23, and a lower combined ratio of 95.2% was achieved during the period.

Tune Protect also continues to focus on digital partnerships, both domestically and regionally. It has become the first insurer to collaborate with the Credit Guarantee Corporation (CGC) to offer digital insurance solutions for micro, small and medium enterprises (MSMEs). The group is expanding in Southeast Asia, with Vietnam emerging as a key market. Partnerships with Baoviet Insurance and Vietjet Air contributed 15% to the total gross written premium (GWP) from Vietnam in 3Q23.

The group is also advancing its core system HYDRO and Tune Integrated Producer System (TiPS) implementation. This involves immediate policy processing, centralised customer records, and automated workflow.

With an investment portfolio totalling RM714.5 million as of September 30, 2023, Tune Protect remains optimistic about its investment returns.

“Close to 80% of our portfolio is invested in money market funds and term deposits,” Nambiar said. “Bank Negara Malaysia (BNM) has again maintained the current Overnight Policy Rate (OPR) at 3.0% for the third successive meeting, reiterating its stance that the monetary policy remains supportive of the economy and is consistent with the current assessment of inflation and growth prospects. Our conservative asset allocation continues to shield us from recent market volatility. We will remain vigilant on developments in both global and local capital markets.”

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