Business overview  Results of operations – Asia 74 China is following global trends in the use of digital channels,  and Chinese government agencies attach great importance to  the e-business industry development. With a ‘netizen’ population  of around 591 million 1 , a growing number of people in  China purchase insurance products online. On November 6, 2013,  Zhong An Online Property and Casualty Insurance Company  began operations in Shanghai to become China’s first online  insurance company. The company’s main focus is corporate and  household insurance for internet transactions. The company’s  key shareholders are Alibaba, Tencent, and China Ping An Group.  From January to December 2013, the total premium collected  by Aegon Religare decreased by 7% to around INR 4.21 billion,  from INR 4.52 billion in 2012. This was due to a drop of nearly  22% in first year premium collection to INR 1.29 billion,  from INR 1.67 billion in 2012. Renewal premium collection  was slightly up at around INR 2.91 billion, compared to  INR 2.85 billion for the same period in 2012. Aegon-CNOOC began e-sales in early 2013. Digital sales and  service platforms allow Aegon-CNOOC to interact with its  customers directly, and offer the convenience of around-the- clock service from any location. As of November 30, 2013, about  35 life insurance companies had launched an e-sales channel.  In addition, large insurance groups such as New China Life are  establishing wholly-owned e-business companies. Insurers  such as Taikang Life and Guohua Life have introduced mobile  platforms for insurance services and product purchasing, such as  WeChat, alongside standard corporate website and third party  website platforms. Estimates suggest e-sales have significant  potential in the China life insurance market. The bancassurance channel is a key growth area in the Japanese  insurance market. The largest share of market growth is from  single premium whole life products. The surrender payment  rate of these is higher than savings account interest, and the  commission rate incentivizes strong sales by bancassurance  representatives.  There is a strong need in Japan for individual annuity products for  self-support after retirement. This is because falling birth rates  and an aging population work against the public pension scheme.  Guaranteed minimum accumulation benefit remains the main  product in the variable annuities market. There are seven active  companies in Japan’s variable annuities market. Aegon Sony Life  had the second largest market share in 2013, up from fifth in  2012, with cumulative annual variable annuities sales of JPY  151.6 billion (JPY 34.3 billion in 2012).  First year premiums, a measure of new business secured by  life insurers, were INR 1,024 billion from January to November  2013, compared to INR 1,029 billion in the same period of 2012.  Of this, 53.6% was underwritten in the individual segment and  46.4% in the group segment, compared to 58.6% and 41.4%  respectively in the same period of 2012 2 .  Economic pressure on traditional distribution channels and  changes in customer purchasing behavior are driving market  recognition that direct marketing is a growing opportunity with  further potential. Multinational insurers are increasing their  capabilities across the region. Linked first year premiums saw a significant drop to  INR 109 billion in 2012-2013, a decrease of 37.4% on  INR 174 billion in 2011-2012, based on the latest information  available on a fiscal year basis from April to March. Non-linked  business collections were INR 965 billion in 2012-2013,  compared to INR 966 billion in 2011-2012. Total premiums  underwritten by the life insurance sector in 2012-2013 were  flat at INR 2,872 billion, against INR 2,870 billion in 2011-2012.  Renewal premiums accounted for 62.6% of this total, compared  to 60.3% in 2011-2012, and first year premiums contributed the  remaining 37.4%, against 39.7% in 2011-2012. Agency sales  forces continue to be an important distribution channel. Life  insurers with banking partners are able to scale up distribution  platforms, which are gradually increasing volumes. In D2C, market participants use their customers’ preferred  channels. For insurers, this primarily involves the tactical  deployment of media such as Direct Response TV, product  microsites, health portals, social media platforms. and mobile  applications. Online sales for non-life products is increasing in  many markets across the region, while life products e-commerce  is emerging.  One of the key challenges affecting Hong Kong and Singapore  is the number of new providers entering the high-net-worth and  affluent market, alongside the well-established players HSBC  Life, AIA, Manulife Bermuda, and Sun Life Bermuda. Production for the year reached USD 54.9 million, which  was 183% of budget and more than double 2012’s figure of  USD 26.1 million. There were 24 licensed life insurers in India at the end of  December 2013. The Life Insurance Corporation of India remains  dominant with a 73% share of new business premiums, with the  balance dispersed among private sector companies.  1 Source: China Internet Network Information Centre as of June 2013. 2 Source: Monthly New Business Report from Insurance Regulatory and Development Authority (IRDA) / IRDA Annual Report 2012-2013. Annual Report 2013 Hong Kong and Singapore - TLB Asia - ADAMS India - Aegon Religare Japan - Aegon Sony Life