BMI - Combined ratio increases YoY due to surge in claim expenses

BMI released its business results for H1 2023 with gross written premium of VND3.0tn (USD134mn; +8.4% YoY) and PBT of VND187bn (USD8.0mn; +9.1% YoY), achieving 45% and 48% of our FY2023 forecasts, respectively. The bottom-line YoY growth was mainly contributed by a 30.8% YoY increase in net financial income, which outweighed a 7.3% YoY decrease in underwriting profit.

- H1 2023 net written premium (NWP) was VND2.1tn (USD47mn; +2.7% YoY), implying a retention ratio of 70.3% vs 75.7% in 2022 and fulfilling 42% of our full-year forecast.

- The combined ratio in H1 2023 was 99.3% (+5.9 ppts YoY), with the loss and expense ratios at 36.1% (+6.1 ppts YoY) and 63.2% (-0.2 ppts YoY), respectively. The strong YoY increase in the combined ratio dragged underwriting profit down YoY.