Tune Protect Group Berhad (“Tune Protect” or “Group”) announced its financial results for the first quarter of the financial year 2024 (1Q24), revealing the impact of its strategic decisions on the Group’s performance.
Financial Performance Highlights:
- Net Written Premiums (NWP): The Group’s NWP rose 18.3% year-on-year (YoY) to RM90.2 million from RM76.3 million in 1Q23, driven by strong growth in the Motor and Travel segments, which recorded 31.6% and 17.5% YoY growth, respectively.
- Insurance Revenue: Insurance revenue decreased by 22.3% YoY to RM94.6 million from RM121.8 million in 1Q23, attributed to the Group’s strategic exit from the low-retention Commercial business.
- Loss After Tax (LAT): Tune Protect reported a LAT of RM3.9 million for 1Q24, compared to a profit of RM3.2 million in 1Q23. This decline was influenced by increased claims and expenses related to the Motor business and exiting the Commercial segment.
- Investment Income: Despite the challenges, the Group’s conservative investment strategy yielded stable returns, with total investment income rising by 0.8% YoY to RM9.4 million.
Strategic Decisions and Future Outlook:
How Kim Lian, Tune Protect Group’s Chief Financial Officer, emphasized that the decision to exit the low-retention Commercial business aligns with the Group’s strategy to focus on more profitable segments. “The move aligns with the Group’s strategy to focus on more profitable segments and enhance overall bottom-line performance,” How stated. “Despite the decline in the Commercial segment, which was the intended outcome of exiting the low-retention businesses, overall Net Written Premiums (NWP) saw encouraging double-digit growth of 18.3% YoY to RM90.2 million from RM76.3 million in 1Q23.”
The Group’s overall retention ratio improved by 2% YoY, despite a significant decline in the Commercial segment’s retention due to a large Fire claim. This strategic shift is expected to enhance the Group’s long-term profitability.
Three-Year Growth Strategy (2024-2026):
Tune Protect’s three-year strategic focus aims to drive growth through:
- Expanding Cross-Country and Regional Businesses: Leveraging the regional presence of its insurance partners, such as AirAsia, VietJet, and AirArabia, Tune Protect aims to capitalize on the growing demand for travel insurance.
- Selective Growth in High-Margin Segments: The Group will prioritize profitable segments, including Travel and Personal Accident insurance, balancing profitability with top-line growth.
- Leveraging the Travel Ecosystem: Tune Protect plans to partner with hotels, concerts, cruises, and car rentals to build a data-driven travel insurance model, establishing itself as a Travel Centre of Excellence (COE).
How concluded, “We remain committed to adapting and refining our approach to ensure sustainable growth and profitability. The Group remains confident that its effective business strategies and strong capital foundation will continue to drive growth over the medium to long term. Our growth strategy, underpinned by digital transformation, product innovation, and strategic partnerships, positions us well for the future.”
