AIA first-half profit up 11%, driven by strong growth in Hong Kong and Asia sales

AIA Group, the leading independent life insurance company in Asia, announced an 11% rise in its first-half operating profit, driven by robust sales in Hong Kong, mainland China, and Southeast Asia. The company's operating profit after tax, adjusted for currency fluctuations, reached $4.16 billion, with earnings per share increasing to 39.95 US cents.

This surpassed the analyst's consensus estimate of $3.94 billion. The value of new business, a critical measure of sales momentum and future profitability, grew by 10% year-on-year to a record high of $3.21 billion. Out of the 18 markets AIA operates in across Asia-Pacific, 17 experienced growth, with only Thailand recording a decline in new business.

Key executive Lee Yuan Siong highlighted continued demand in the Chinese mainland visitor segment, with VONB remaining relatively stable against a high comparison from 2025 and growing quarter-on-quarter in the first half. He emphasized that Asia remains the most promising growth opportunity for life and health insurance. The company declared an interim dividend of 53.9 HK cents per share, a 10% increase from the previous year.

Analysts anticipate that AIA's second-half earnings may face challenges due to a new 20% levy on offshore investment gains of wealthy individuals by Beijing. This tax is expected to dampen demand for overseas insurance products by mainland visitors in Hong Kong, a significant growth driver in the past. Hong Kong and the mainland contributed 62% of AIA's new business in the first half, both showing strong sales growth.

VONB in Hong Kong surged by 10% to $1.17 billion, largely fueled by mainland customers seeking superior returns and health protection. Around 26.71 million people visited Hong Kong from January to June, a 13% increase year-on-year, with 77% of them originating from the mainland. AIA's expansion continued on the mainland, with VONB increasing by 20% to $937 million.

Among AIA's top three markets in Southeast Asia, Singapore and Malaysia both witnessed VONB growth of 10%, while Thailand saw a 6% drop. Overall, other Asian markets expanded by 7%.