ClearView aims for growth after life earnings surge
ClearView Wealth is aiming to grow its share of the life insurance market after group underlying net profit grew a record 41% to $36.5 million for the year to June 30.
Its core life insurance division achieved a 38% rise in underlying net profit to $40.4 million. New life business annualised premium rose 25% to $25.2 million while gross premiums gained 9% to $325.1 million, giving the listed life insurer a 9.2% share of the retail market.
The business is now aiming for a market share of 12-14% and gross premiums of $400 million by FY2025/26.
ClearView says the “successful execution” of its simplification and transformation strategy has seen it emerge as a life insurance business that is “focused on protecting and optimising its position as a dynamic challenger”.
“The group’s refreshed strategy is focused on leveraging our competitive advantage in life insurance to achieve our goal of becoming a top player in the Australian market,” MD Nadine Gooderick said.
“Our decision to re-set and transform the business in early 2020 by simplifying and investing in our systems, processes and technology… is starting to deliver benefits and growth through efficiencies, productivity gains and scale benefits.”
Clearview has focused on its core life operations in the past few years. It exited the financial adviser networks with the sale of the businesses to Centrepoint Alliance in November 2021. The move resulted in a minority holding in a scaled business with more than 500 authorised representatives and support services to a further 190 self-licensed adviser practices.
And a strategic review concluded in November last year that it should exit wealth management given the business’s limited growth options in an industry where scale is vital to succeed.
The wealth management business lost $1 million in the December half and in February this year ClearView announced an agreement to sell its managed investment business to Human Financial, an investment management and technology company.
The sale represents a two-part reorganisation of the wealth management business. Under the sale agreement, ClearView will receive a cash consideration of $1.3 million and will also acquire a strategic 40% interest in Human Financial.
Looking ahead ClearView says plans are underway to increase its exposure to underwriting risk for new business.
“This will reduce reinsurance costs, lift sum insured retained and drive higher new business profit over time.”
The life business’s reinsurance premium expense increased 4% to $123.2 million in the last financial year.