AACP claims the figure is the highest return on investment in the life insurance industry. The marked decline in its accumulated loss in the first quarter is part of a trend at the company, which had earlier managed to decrease its running loss from Bt1.59-billion in 2004 to Bt330 million at the end of 2005.

Of its Bt55-billion investment portfolio, 90 per cent is placed in fixed-income instruments, including government and corporate bonds, 8 per cent is invested in equities and the remaining 2 per cent is in bank deposits.

In addition to its high return on investment, the insurer's general expenses fell to 6.9 per cent last year from 7.2 per cent of premiums in 2004.

"Due to better financial management, the investment return and physical cost-cutting like office-space renovation, the company was able to leap up to a higher net profit," said Wilf Blackburn, AACP's president.

AACP returned to profitability last year when it posted a net income Bt900 million, compared to a net loss of Bt528 million in 2004.

After 2005, the company injected Bt1.64 billion into its reserve account, the funds of which are used to pay current and anticipated claims. It now has Bt3 billion in reserves.

Despite writing only Bt440 million in first-year premiums in the first two months of the, the life insurer expects to write Bt8 billion in first-year premiums this year. Its first-year premium growth rate ranked second in the industry last year, behind Bangkok Life Assurance.

According to the Thai Life Assurance Association, AACP took Bt19.7 billion worth of premiums last year. It gained an 11.8-per-cent market share and maintain its position as the country's third-largest life insurer.

Piyarat Setthasiriphaiboon

The Nation