Nov. 15 (Bloomberg) -- Prudential Plc, the U.K.’s biggest insurer by market value, said sales in India are recovering after the regulator forced life insurers to re-register products and offer more protection to savers.
Revenue from India, where the insurer operates a joint venture with ICICI Bank Ltd., declined 56 percent to 73 million pounds ($116 million) in the first nine months of this year, paring the company’s sales growth in Asia to 8 percent, London- based Prudential said last week.
“Everyone’s sales were off by a big number -- 50, 60 percent -- in the first months” after the regulatory change last year, Barry Stowe, Chief Executive Officer of Prudential’s Asian unit, said in a conference call today. “Sales are now recovering and we’re in a much better place than we were on Sept. 1 of last year.” He didn’t give any figures.
Prudential Chief Executive Officer Tidjane Thiam is seeking to double profit from the insurer’s Asian division in the four years to 2013 as the company shifts more capital and manpower to the region from its home U.K. market. The Indian regulator last year required life insurers to provide a greater level of income protection to policyholders.
“While it was quite a disruptive thing to go through for the industry, a bit of a shock if you will, the underlying intent of the regulator was sound and helpful,” Stowe said. The authorities want to “encourage people to save, but provide them with protection while they do so.”
Prudential is still making “good progress” toward its self-imposed 2013 targets, he said. The company last week beat analysts’ sales estimates for the first nine months of the year and posted wider-than-expected margins on new products.
The firm today renamed its Asian asset management division Eastspring Investments, giving the company a single name across the region and avoiding future conflicts with Prudential Financial Inc., an unaffiliated life insurer based in Newark, New Jersey. The Asian funds division, which has 6.5 billion pounds of assets, had 500 million pounds of inflows in the first nine months of this year.
“In order to leverage that performance in other markets, Europe and particularly the Americas, we needed a different brand,” Stowe said. “It’s a very real obstacle that we faced.”
The London-based insurer is holding an analyst and investor conference in Kuala Lumpur this week. The company will give presentations on its Asian, U.S., U.K. and asset management business, it said in a statement today.
Prudential has little interest in developing a general insurance business in Asia, Stowe said, responding to a question about whether the firm may buy HSBC Holdings Plc’s Asian insurance unit.
“It is not part of our strategy at all,” Stowe said.
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