TAIPEI: Mercuries Life Insurance Co said its embedded value (EV) reached NT$91.04 billion (US$2.98 billion) as of the end of last year, up 24.8 percent from NT$72.92 billion a year earlier.
The updated figures translated into an industry-leading EV per share of NT$67.3 — based on the number of common shares in circulation — which translates to a 13.3 percent rise from NT$59.4 a year earlier, chief financial officer Winston Yang said.
Embedded value represents the value of a life insurance company’s future profitability plus its adjusted net asset value.
LONG-TERM CONTRACTS
Since insurance policies are long-term contracts in which policyholders pay a premium to be covered against a possible future event, such as death, embedded value is an important indicator of a life insurer’s future profitability and financial standing.
The company’s increase in embedded value last year was mainly due to first-year premiums, which grew 24.8 percent from a year earlier, senior executives said.
The updated embedded value included NT$4.67 billion in unrealized property gains, the company said.
Mercuries Life said its total assets would grow to more than NT$1 trillion by the end of 2017, after it saw assets grow at a faster-than-expected pace last year.
Mercuries CEO Roy Meng (孟嘉仁) said Mercuries Life recorded a net profit for the 10th consecutive year last year and the company’s board agreed to pay a cash dividend of NT$0.3 per share and a stock dividend of 10 percent.
The company reported a net profit of NT$2.41 billion last year, or NT$1.81 per share, with total premiums of NT$132.59 billion.
FIRST-QUARTER PROFITS
In the first quarter, the company posted NT$730 million in net income, or earnings per share of NT$0.54, a significant improvement from a net loss of NT$630 million recorded in the same period last year, Mercuries Life said in a statement.
Gross premiums totaled NT$42.95 billion in the first three months of the year, an increase of 14.4 percent from a year earlier, with first-year premiums rising 13.6 percent year-on-year to NT$13.67 billion, the statement’s data showed.
Mercuries Life is Taiwan’s sixth-largest life insurer in terms of market share and one of only a few insurers that are not affiliated with financial conglomerates.
The company currently has a total of 15,000 insurance representatives, which ranks the fifth-highest in the domestic life insurance industry.
