Insurers Outsource Fund Management

Insurance asset managers in Singapore are increasingly planning to outsource fund management to external experts, showed a study by Clearwater Analytics. The move comes amid growing demand for greater portfolio control and transparency, as insurers navigate more complex investment environments.

Among the 50 Singapore insurance asset managers surveyed, 63 per cent or nearly two-thirds said that they expect to shift more assets to external managers, while 26 per cent foresee a greater share being managed in-house. Only 11 per cent believe that the balance between internally and externally managed assets will remain unchanged.

All respondents surveyed have delegated some portion of their funds to external managers, with the percentage of externally managed funds ranging from 24 to 45 per cent. On average, Singapore insurance asset managers have 34 per cent of their funds managed externally.

Notably, the need for greater control over investment portfolios was the top reason cited by insurance asset managers in the Republic for the shift towards outsourcing fund management, said the study.

This was followed by the need for transparency and reporting. Other factors, such as increased visibility of investment portfolios, and the improved reputation and increased acceptance of using external managers, followed closely as reasons for this shift.
ith data-management challenges set to intensify, 84 per cent of the Singapore respondents plan to increase the diversification of their investments across a wider range of asset classes over the next three years, noted the study. In line with this, average private-market allocations are expected to grow from 20 per cent to 36 per cent of holdings in five years.

As firms seek managers with the required expertise to manage the asset classes they invest in, this should lead to an increase in the outsourcing of portfolio management. It will also result in more data in varied formats and an increasing difficulty in accessing information.

As these trends heighten operational pressures and reshape talent strategies, here were “significant skills and capability gaps” within investment management functions.

The study noted that the top strategies to combat these issues included recruiting people from a broader range of sectors or with a greater diversity of perspectives, hiring more specialists in risk-management roles and adding new tools or platforms to compensate for system deficiencies.

Transferring more risk-management analysis away from spreadsheets and other manual processes, as well as outsourcing more to third parties, were also among the top strategies for addressing these problems.

AIA Share Buyback

Hong Kong-based insurer AIA Group on Thursday (Mar 19) announced a new share buyback program of US$1.7 billion and achieved a record value of new business (VONB) in 2025, propelled by the resilient performance of all of its segments.

The firm reported a 15 per cent rise in VONB, which gauges expected profits from new premiums and is a key barometer for future growth, to US$5.52 billion on a constant currency basis for the year ended Dec 31, compared to US$4.71 billion in the year-ago period.

Hong Kong, one of AIA’s largest contributors in terms of profit, logged a 28 per cent increase in VONB for the year on the back of strong demand from both domestic customers and mainland Chinese visitors.

The firm also bore fruit from commencing operations in additional provinces of mainland China as it recorded double-digit VONB growth in the majority of the markets.

Mainland China, AIA’s second-largest market in terms of new sales, reported a 2 per cent hike in VONB. Besides those, AIA’s 18 markets in Asia include Thailand, Singapore, Malaysia, Indonesia, the Philippines and South Korea.

AIA Thailand logged a 13 per cent rise in VONB to US$993 million for 2025, riding on strong distribution and continued investment in digital tools. The segment also reported an operating profit before tax of US$1.21 billion, placing it as the third-most profitable region behind Hong Kong and mainland China.

AIA - 2025 Record Results

The largest pan-Asian life and health insurer, AIA Group, has reported record results in 2025 with double-digit growth across key financial metrics for new business value, earnings and cash generation.

The details are as follows (with growth rates shown on a constant exchange rate basis unless otherwise indicated):

New business performance and embedded value

• Value of new business (VONB) increased by 15% to $5,516m

• Operating ROEV of 15.8%, up by 90 basis points

• EV Equity of $79.7bn, up by 14% per share on an actual exchange rate basis

IFRS earnings

• Operating profit after tax (OPAT) of $7,136m, up 12% per share

• Confident in meeting or exceeding OPAT per share CAGR target of 9 to 11 % from 2023 to 2026

• Operating ROE of 15.5%, up 70 basis points

Free surplus generation and capital

• Underlying free surplus generation (UFSG) of $6,765m, up by 11% per share

• Net free surplus generation (net FSG) up by 14% per share to $4,451m after new business investment

• Shareholder capital ratio of 221% at 31 December 2025

Dividends and share buy-backs

• Final dividend increased by 10% to 144.08 Hong Kong cents (18.40 US cents) per share

• Total dividend of 193.08 Hong Kong cents per share, up 10 %

• New $1.7bn share buy-back.

The group has a presence in 18 markets – wholly-owned branches and subsidiaries in Mainland China, Hong Kong, Thailand, Singapore, Malaysia, Australia, Cambodia, Indonesia, Myanmar, New Zealand, the Philippines, South Korea, Sri Lanka, Taiwan (China), Vietnam, Brunei and Macau, and a 49% joint venture in India. In addition, AIA has a 24.99% shareholding in China Post Life Insurance.