KUALA LUMPUR: LPI Capital Bhd’s (LPI) pre-tax profit for the third quarter of 2017 (3Q17) grew by 18.1 per cent year-on-year (yoy) to RM115 million from RM97.4 million previously.
Revenue for 3Q17 also rose to RM406.78 million from RM363.52 million in 3Q16, it said in a filing to Bursa Malaysia yesterday.
The insurance company attributed the vast improvement in profit during the quarter ended Sept 30, 2017 to the profit growth in the general insurance segment.
“The profit from the general insurance segment rose by 20.4 per cent yoy to RM102.8 million from RM85.4 million previously,” it said.
Meanwhile, its underwriting segment’s profit for 3Q17 rose by 19.9 per cent yoy to RM83.6 million from RM69.7 million previously, mainly driven by growth in net earned premium income and higher release of unearned premium reserves (UPR) during the quarter.
It said this was due to the revised accounting estimate in the calculation of UPR as well as lower combined ratio of 63.9 per cent.
LPI’s nine-month revenue rose to RM1.1 billion from RM1.02 billion in the corresponding period last year, but pre-tax profit fell 28.9 per cent yoy to RM293 million from RM412.1 million previously.
The company attributed the decrease to the lower pre-tax profit recorded by its investment holding segment, which fell to RM29.1 million from RM178.6 million, mainly due to the non-recurring gains of RM150.4 million from the sale of its equity investment in the same period last year.
“Going forward, we foresee technology as a major factor which will dramatically affect the insurance industry, with the emergence of disruptive insurtech and a shift in customer expectations,” it said.
As such, LPI’s unit, Lonpac Insuran Bhd, had established a digital strategy department to leverage on technology to distribute its products and to further enhance its services to its customers.
“We believe that investment in technology will enable us to further expand our business segment and strengthen our market position. With the improving Malaysian economy and the continuing infrastructure development by the government, we are confident that the group will be able to report an improved performance during the last quarter of the year,” it said. — Bernama