Allianz Life’s Q1 earnings dip 38%

Allianz Life Insurance Company of North America posted an operating profit in the first quarter, but earnings were down 38 percent from the year-ago period, the company disclosed in financial results released on Wednesday.

The Minneapolis-based life insurer's first quarter operating profit totaled $134 million, a 38 percent decline from the $217 million recorded in the first quarter of 2012.

The first quarter 2013 earnings compare favorably, however, with the company’s fourth quarter 2012 profit of just $27 million.

“The decrease in year-over-year quarterly profit and the increase in quarter-over-quarter profit reflect normal profit fluctuations and positive one-offs in the first quarter of last year,” the company indicates in a press statement. “In addition, total assets under management reached $104.5 billion, compared to $98.5 billion at March 31, 2012, representing growth of approximately 6 percent.

“In the quarter, more than $2 billion of benefits were paid to policyholders in the form of claims disbursements, annuity payments and withdrawals,” the company adds.

Allianz Life also improved its capital position, reporting a 21 percentage point increase in regulatory risk-based capital (RBC) ratio from 373 percent on Dec. 31, 2012 to 394 percent on March 31, 2013.

“Despite a very low interest rate environment that negatively affects all life insurers, our business continues to have strong performance,” said Allianz Life Chief Financial Officer Giulio Terzariol. “Though it is common to see fluctuations in quarterly profit, Allianz Life’s profit trends remain strong and in line with our expectations."

Sales volume in the first quarter of 2013 was up 3 percent compared to the fourth quarter of 2012. Allianz Life reported premium of $2.1 billion for the quarter, compared to $2.0 billion in the fourth quarter of 2012 and $2.7 billion in first quarter of 2012.

Fixed annuity premium of $1.2 billion was down 7 percent compared to the fourth quarter 2012, but variable annuity sales of $742 million were up 21 percent compared to the fourth quarter of 2012. A slight drop in life insurance sales for the first quarter 2013 reflects sales of $16 million, a 5 percent decrease from sales of $17 million in the fourth quarter of 2012. 

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