Performance against key measures:
Cost to income ratio:
The cost to income ratio improved by 0.6 percentage points to 27.8 per cent and controllable costs decreased 6 per cent to $80 million from FY 16. AMP New Zealand continues to focus on cost control, including business reorganisation and product simplification.
Cashflows and assets under management (AUM):
Net cashflows were positive overall, but decreased year-on-year by 44 per cent to $220 million, reflecting seasonal differences in mandate wins. AUM increased 10 per cent to $17.3 billion as a result of positive market performance and net cashflows.
As at 31 December 2017, the AMP KiwiSaver Scheme reached $5.1 billion in AUM, an increase of 16 per cent from 31 December 2016. AMP is one of the largest KiwiSaver providers with 11 per cent of the total KiwiSaver market and 231,000 customers.
Experience gains, lapses and claims:
Experience gains of $11 million reflected overall effective management of claims with a continued focus on helping customers return to work.
Lapse rates remained strong at 11.3 per cent as a result of an ongoing emphasis on lapse management.
Mr Vernon noted: “In 2017, AMP New Zealand supported hundreds of families in their time of need by paying $104 million in life insurance and $24 million in trauma claims. AMP also helped 106 New Zealanders who were unable to return to work because of an illness or injury by paying out $28 million in income protection claims.”
Total annual premium income (API):
API increased by $4 million from FY 16 to $343 million, reflecting higher new premium income particularly from strong growth in group risk new business.
General insurance profit share increased 5 per cent on the previous year to $11 million. In FY 17, AMP New Zealand customers were paid $69 million in general insurance claims.
Other key highlights for AMP New Zealand include:
- AMP launched its new general insurance digital platform and AMP Everyday suite of digital products, enabling access for customers to research, quote and purchase cover online.
- The integration of Spicers into AdviceFirst brought together the strengths of the two complementary businesses to benefit clients and stakeholders, including moving to a single AdviceFirst brand.
- AMP developed AMP KiwiSaver Scheme personalised videos to encourage more members to make active choices about their fund selection.
- AMP launched another tranche of AMP Essentials, New Zealand’s first combined life, trauma and temporary disablement insurance product, linked with the AMP KiwiSaver Scheme, to enable more Kiwis to access insurance.
- AMP announced its partnership with Key To Life and support of Mike King’s I AM HOPE Tour to help reduce the high rates of suicide in New Zealand.
- AMP’s Women in Leadership Pathway programme helped more Kiwi women reach their potential and is encouraging diversity throughout the business world.
- AMP released the results of its research into KiwiSaver non-contributors to encourage more New Zealanders to save for an aspirational retirement. AMP also shared insights from its research into how women access financial products and advice to help more Kiwis make good financial decisions.
- AMP joined forces with Youthtown and The Commission for Financial Capability to help young New Zealanders get to grips with financial capability basics through a series of workshops and initiatives.
- Through its 19th annual AMP Scholarships, AMP awarded 24 recipients a share of $200,000 to help them achieve their dreams in support of communities across New Zealand.
- AMP’s KiwiSaver Scheme received the SuperRatings ‘Gold Rating’ and AMP won 11 awards at the NZ Direct Marketing Awards.