SOUTH CHINA INSURANCE - Operation Reports

Operation Reports

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Operation Reports

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Separating the Wheat from the Chaff · Tempered with Hard Work and Numerous Revisions

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In 2023, the global economy was affected by sluggish end market demand and industrial inventory adjustments, resulting in a slow growth. While domestic private consumption was stable, Taiwan’s economic growth seemed lower than expected due to the downturn of commodity exports and corporate investment intentions. According to the statistical data released by Ministry of Finance, the values of both import and export trades of 2023 decreased from the last year. Nevertheless, with the rebound in the momentum of world merchandise trade volume and the continuous expansion of business opportunities in emerging applications such as automotive electronics, the overall economic momentum is expected to go towards an uptrend.

As for Non-Life insurance in domestic market during 2023, total written premium reached NTD 243,740 million, a growth of 10.63% compared to NTD 220,316 million in 2022. In general, the performances of auto, fire, marine, casualty, and personal accident & health insurances had all improved compared with 2022, and especially fire insurance registered the best growth rate of 23.65%. The overall industry development in the future is expected to maintain the tendency of growth.

Operation Report of 2023

Performance

Profitability

Research & Development

During 2023, the Company posted a total written premium of NTD 13,246 million, representing a growth of 8.86% compared to last year.Among them, auto premium increased by 10.09%, a total of NTD 7,863 million; fire premium grew by 22.28%, posting a total of NTD 2,032 million; marine premium grew by 4.97%, a total of NTD 737 million; casualty premium grew by 0.4%, standing at NTD 1,266 million; personal accident & health declined by 3.80%, reaching total of NTD 1,347 million; and inward reinsurance increased by 13.14%, a total of NTD 846 million. Our company ranks 6th in the overall written premium market.

In addition, gross claims during the period totaled NTD 9,324 million, accounting for 70.39% of total premium written. Among them, auto claims amount comes to a total of NTD 4,459 million, equivalent to 54.75% of total auto premium income; fire claims totaled NTD 1,185 million, or 56.55% of fire premium; marine claims totaled NTD 2,023 million, or 275.07% of marine premium; casualty claims totaled NTD 504 million, or 46.70% of its premium; and personal accident & health claims totaled NTD 1,152 million, accounting for 96.86% of its premium income.

During the year under review, the Company’s operation development continued to make adjustments and control business quality so as to improve underwriting profits; provided consumers with a better service experience, strengthened talent training, and provided multiple learning channels to enhance the professionalism of employees; and actively completed the construction and integration of the IFRS17- and ICS-related systems and operating procedures in order to be smoothly in line with international standard and improve competitiveness.

With the emphasis on the implementation of legal compliance and risk management, prudent employment of digital technology, and intensification of the sustainable quality of enterprises, we will stride towards a high-quality financial institution with sustainable operations.

During 2023, the Company’s operating revenue totaled NTD 10,592 million, producing a profit of NTD 916 million, or NTD 4.58 per share, after tax. Returns on assets and shareholders’ equity are 3.59% and 13.73 respectively.

Unit：NTD$1,000

Financial Highlights	2021	2022	2023
Premium Written	11,871,405	12,916,863	14,093,228
Reserves	14,580,613	16,634,678	16,173,244
Investments Income	676,193	438,564	651,315
Total Assets	23,551,014	24,378,325	27,016,630
Profit (Loss) before Tax	1,046,025	539,577	1,013,834
Earnings per Share (NTD)	4.50	2.29	4.58

The global economy’s strong recovery from the epidemic has resulted in the inflation maintaining a high level. Many other factors, moreover, such as the stabilization of energy prices in response to the expected economic recession, the unclearness of the economic prospects of the United States and China, the geopolitical risks in various places, global monetary policies and climate change all made some contribution to the continuous slowness of economic growth momentum. Nevertheless, the Company continued to cautiously respond to environmental changes, actively made adjustment in accordance with market changes, and committed itself to the research and development of new products and innovative combination of promoting projects. During 2023, the Company had developed total 72 new products and already marketed 130 packaged products to meet the needs for business development and provide complete professional services to the customers.

With the rapid changes in the environment and the increasing prosperity of financial technology, while fighting for business, we will also focus on the issues regarding the optimization of various measures on the principle of fairly treating customers so as to improve the overall service quality. In the fiercely competitive market, we will continue to enhance mobile insurance services, develop and promote package products such as Travel Comprehensive Insurance, seize market opportunities, and provide customers with more diverse and convenient insurance channels to meet customer needs.

In recent years, the inflationary blow caused by excessive global economic recovery, together with the impact of global geopolitical risks, have jointly led to the slowdown of the recovery speed in global economy. In addition, the awareness of environmental sustainability continues to rise. In the face of so many aspects of diverse issues, the Company will continue to develop green financial products, and provide various products and services in a timely manner to meet diverse needs. Also, following the trend of digital transformation, we will make efforts to optimize electronic platform services and provide more complete protection in response to the society’s expectations for enterprises.

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