CHINA TAIPING INSURANCE HOLDINGS COMPANY LIMITEDHOLDINGS COMPANY LIMITED

2012 INTERIM RESULTS2012 INTERIM RESULTSPRESENTATIONPRESENTATION

30 August 2012

Forward-Looking StatementsThis presentation and subsequent discussions may containcertain forward-looking statements with respect to the financial

diti lt f ti d b i f th CTIHcondition, results of operations and businesses of the CTIHGroup. These forward-looking statements represent the CTIHGroup’s expectations or beliefs concerning future events andGroup s expectations or beliefs concerning future events andinvolve known and unknown risks and uncertainties that couldcause actual results, performance or events to differ materiallyfrom those expressed or implied in such statements.

2

Updated as of 30 June, 2012Ownership Structure

100%

China Taiping InsuranceGroup Co.

(“TPG”)

53.27% 46.73%

China Taiping Insurance Group (HK) Company Limited

(“TPG (HK)”) The Public

N t 250 05% 100%Note 1 61 21% 100%

China Taiping Insurance Holdings Company Limited(“CTIH”)

Note 250.05% 100%Taiping

Reinsurance Company Limited

(“TPRe”)

Taiping LifeInsurance

Company Limited(“TPL”)

Taiping GeneralInsurance

Company Limited(“TPI”)

Note 1 61.21%China Taiping

Insurance (HK) Company Limited

(“CTPI (HK)”)

100%

96% 60% 100%100%

Taiping Pension Company Limited

Taiping Asset Management

C Li it d

Taiping AssetsManagement (HK)

TaipingReinsurance

Note 3 Note 4

Note 1: TPG and Ageas own the remaining 25.05% and 24.90% equity interests in TPL, respectively.

Company Limited(“TPP”) Company Limited

(“TPAM”)Company Limited

(“TPA (HK)”)Brokers Limited

(“TPRB”)

3

g g q y p yNote 2: TPG owns the remaining 38.79% equity interest in TPI.Note 3: TPG owns the remaining 4% equity interest in TPP.Note 4: TPG and Ageas own the remaining 20% and 20% equity interests in TPAM, respectively.

Solid Improvement in Market Position

Business Highlights

The market shares of both TPL and TPI have increased

Positive total premium growth for TPL, with growth rates higher than major industry players. TPL was able t th i d li i t b

Solid Improvement in Market Position

to reverse the previous declines in agent numbers

TPI’s premium growth rate is much higher than industry averages

Continued Optimization in Business Development In the life insurance individual channel, premium increased substantially by 25.9% to HK$9,487.43 million.

85.6% of the individual single and first year regular premium have payment terms of 10 years or above

TPI’s combined ratio improved by 1 6 percentage points to 98 0% compared to 1H2011 and has been

Continued Optimization in Business Development

TPI s combined ratio improved by 1.6 percentage points to 98.0% compared to 1H2011 and has been continuously decreasing in recent years

CTPI (HK)’s combined ratio improved significantly by 1.9 percentage points to 93.9% compared to 1H2011

Total invested assets increased by 17 3% to HK$200 97 billion Total invested assets increased by 17.3% to HK$200.97 billion

Group embedded value and total equity increased by 17.2% and 15.5%, respectively, compared to 31 D b 2011

Value Growth

December 2011

TPL’s new business value increased by 2.4% to HK$1,283 million compared to 30 June 2011, representing CAGR of 29.2% since 2008

4 Profit from operations before taxation increased by 6.5% compared with 1H2011 to HK$1,175.08 million

Business Highlights

TPG has provided a loan of HK$600 million for three years at HIBOR plus 2.1%

Important Activities

CTIH has established Taiping E-Commerce Company Limited, which will be providing management services for the e-distribution channels of TPL and TPI

The capital of TPI has been increased by RMB300 million to RMB2,370 million

CTIH ill t i f it t t i bj ti f “B ildi N T i i i Th Y ” th t i “t d bl t t l

Outlook CTIH will strive for its strategic objective of “Building a New Taiping in Three Years”, that is “to double total

premium, total assets and net profit in three years’ time, while maintaining quality, efficiency and risks at an acceptable level”

Intending to have in place mechanisms to improve the capacity for long-term capital raising and funding, with the support of its controlling shareholder, CTIH would consider various options including, increasing its shareholding in its non-wholly owned subsidiaries and/or making other strategic investments, to be funded b th i f it id tiby the issuance of new equity as consideration

5

Key DeliveriesKey DeliveriesHK$ million, unless otherwise specified 5 1H 2011 Change Improved

Group Embedded Value1 33 400 28 503 +17%

1H2012 1H2011 Change Improved

Group Embedded Value 33,400 28,503 +17% Premium Income of the Group 31,411 27,047 +16% New Business Value (Life) 1,283 1,253 +2.4%

ValueCreation

New Business Margin (Life) 13.4% 11.5% +1.9 pts Market Share in Life

1 3.4% 3.3% +0.1 pt Market Share in P&C (PRC)1 1.3% 1.2% +0.1 pt Market Share in P&C (PRC) 1.3% 1.2% 0.1 pt

Persistency ratio-13th mths (Agents) 1 92.7% 92.0% +0.7 pt

Persistency ratio-25th mths (Agents) 1 88.3% 84.5% +3.8 pts

Improvementin Operation

Individual Agents (No. of Persons)1 51,008 46,064 +4,944 Total Equitiy

1 19,663 17,029 +15% Combined Ratio (P&C) 97.7% 99.3% -1.6 pts

Profitabilityin Core p

Return of Total Equity 2 13.6% 1.2% +12.4 pts

Profit from Operations before Tax 1,175 1,104 +6.5% 1 C ti fi f th it h i t f 31 D b 2011

in CoreOperationand Equity

1. Comparative figures for these items are shown against as of 31 December 20112. Total comprehensive income / average total equity 6

Net Profit/(Loss) Before Taxation by Business SegmentNet Profit/(Loss) Before Taxation by Business Segment1H2012 1H2011

(Restated) ChangeHK$ million

Life Insurance 869.67 546.77 +59.1%Property and Casualty Insurance 403.15 373.10 +8.1%

PRC Operations 171.14 133.10 +28.6%Hong Kong Operations 232.01 240.00 -3.3%g g p

Reinsurance (59.89) 227.84 -Pension and Group Life Insurance (44.36) (50.94) -12.9%Asset Management 28.79 13.34 +1.2 timesI I t di 6 62 8 23 19 6% Showing good trendInsurance Intermediary 6.62 8.23 -19.6%Others 1 (28.90) (14.61) +97.8%

Profit from operations before taxation 1,175.08 1,103.73 +6.5%

Showing good trend of major businesses

Due to increase in Income tax (charge)/credit (191.70) 14.59 -

Profit from operations after taxation 983.38 1,118.32 -12.1%Non-controlling interests (446.71) (325.88) +37.1%

taxable income

Non controlling interests (446.71) (325.88) 37.1%

Net profit attributable to the owners 536.67 792.44 -32.3%

1 Others mainly include the results of the holding company and consolidation adjustments

Due to negative result from its wholly owned reinsurance operation

7The figures above are the results of the respective companies from their operations, before intra-group eliminations.

Others mainly include the results of the holding company and consolidation adjustments.

Life Insurance Business Review – TPLLife Insurance Business Review TPL

Note: TPL is 50 05%-owned by CTIH and a consolidated subsidiaryNote: TPL is 50.05% owned by CTIH and a consolidated subsidiary of CTIH.

8The following figures are the results of TPL from its operations, before intra-group eliminations.

Life Insurance Premium and SolvencyLife Insurance – Premium and SolvencyRegulatory Solvency

M i R iGross Premiums Written

HK$ million

Margin RatioGross Premiums Written

21,002.2323,656.93

178% 169%

,

178% 169%

At 31 Dec 2011 At 30 Jun 20121H2011 1H2012

9

Lif I St t f G P iBy Distribution Channels

Life Insurance – Structure of Gross Premiumsy

HK$ million

%

1H2011 1H2012

21,002.23 23,656.93

61.3% 57.6%

1.6%0.4%1.2% 1.9% Other Channels *

Group

253.68 456.69

346.39 87.77

35.9% 40.1%

Bancassurance

Individual

12,864.47 13,625.04

7,537.69 9,487.43

1H2011 1H2012

10

* Other Channels is comprised of mainly telemarketing.

Life Insurance – Individual Gross PremiumHK$ million

Life Insurance – Individual Gross Premium

21.78 Single Premium9,487.43

7,537.69

2,243.88

2,120.11 49.39 Regular Premium - First Year

Regular Premium - Renewal Year

,

5,244.42 7,345.54

1H2011 1H2012

11

Life InsuranceLife Insurance– Individual Single and First Year Regular Premium

6.3% 4.9%

By Product FeatureBy Payment Term

10 0% 10 1%

45.5% 51.4%

6.3%

22.5% 22.7%

10.0% 10.1%

32.9% 29 3%

39.3%56.4%

2.2% 1.0%13.1% 13.4%

29.3%

28.2%10.8%

1H2011 1H2012

Single 2-9 Years 10-19 Years

20-29 Years More than 30 Years

1H2011 1H2012

Short Term Savings Long Term Savings Long Term Protection Others

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Life Insurance Bancassurance Gross PremiumHK$ million

Life Insurance – Bancassurance Gross Premium

12,864.47 13,625.04

6,413.93 5,943.43

Single Premium

Regular Premium – First Year

4 897 99 6,406.58

1,552.55 1,275.03

Regular Premium – Renewal Year

1H2011 1H2012

4,897.99

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Life Insurance – Bancassurance First Year Regular PremiumLife Insurance Bancassurance First Year Regular Premium

By Payment Term

0.4% 0.5%Other

75.3% 84.9%10 Years

5 Years

24.3% 14.6%

1H2011 1H2012

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Life Insurance – Key Operational Data (1/2)Number of BranchesMarket Share

Life Insurance – Key Operational Data (1/2)

Number of provincial branches

3.3% 3.4%

Number of provincial branchesNumber of sub-branches and marketing centers

At 31 Dec 2011

At 30 Jun 2012

Based on premiums published by the CIRC

34 34

798 815

At 31 Dec 2011 At 30 Jun 2012At 31 Dec 2011 At 30 Jun 2012

Distribution Network

Based on premiums published by the CIRC

Agent ProductivityNumber of bancassurance outletsNumber of individual agents

Number of new policies per agent and per monthFirst year premium per agent and per month

HK$

Number of new policies per agent and per monthFirst year premium per agent and per month

18,938 15,556

46,064 51,008

At 31 Dec 2011 At 30 Jun 20122.00 1.77

7,897.34 7,473.02HK$

At 31 Dec 2011 At 30 Jun 201215At 31 Dec 2011 At 30 Jun 2012

Life Insurance – Key Operational Data (2/2)Compounded Persistency Ratios

of Regular Premiums

Life Insurance – Key Operational Data (2/2)

C t I di id l 92 7%

Persistency ratio - 13th monthPersistency ratio - 25th month

Number of CustomersIndividual

5 995 262 6,252,885

Corporate Individual88.2% 92.0% 92.7%

81.0% 84.5% 88.3%

5,995,262 6,252,885At 31 Dec 2010 At 31 Dec 2011 At 30 Jun 2012

Bancassurance

6,502 4,044

At 31 Dec 2011 At 30 Jun 201294.0% 93.2% 92.9%

Persistency ratio - 13th monthPersistency ratio - 25th month

At 31 Dec 2011 At 30 Jun 201289.6% 91.5% 90.4%

At 31 Dec 2010 At 31 Dec 2011 At 30 Jun 2012

16Based on the amount of premiums

Embedded Value of TPLEmbedded Value of TPL

17

Change of Risk Discount Rate and Investment Return

In order to improve the competitiveness of TPL’s products and to bring the embedded value and new business value more in line with the market for comparison purposes, the Company has decided to adjust the following actuarial assumptions:assumptions:

The risk discount rate to 11.0% (previously 11.5%)

The actuarial assumptions on investment return to 4.6% increasing to 5.0% in 2020 and thereafter (previously 4.1% increasing to 4.5% in 2020 and thereafter)

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Embedded Value Key ComponentsAt 30 June, 2012HK$ million

Embedded Value – Key Components

HK$ million

24,08825 815

(3,079)25,815

4,806

AdjustedNet Worth *

Value ofIn Force Business

Cost of Capital Embedded Value

4,806

Net Worth * In-Force BusinessBefore Cost of Capital

* Adjusted Net Worth is the shareholders’ net assets of TPL as measured on a PRC statutory basis, with fair value 19

j y ,adjustments to certain assets.

Trend of Embedded ValueHK$ million

Trend of Embedded Value

21,574

25,815

13,626

17,511

8,548

3,6 6

At 31 Dec 2008 At 31 Dec 2009 At 31 Dec 2010 At 31 Dec 2011 At 30 Jun 2012

20

Trend of New Business ValueHK$ million

Trend1H2012 vs 1H2011

2,2742,025

1,253 1,283

1H20121H2011

1 6102,025

2,274

772 9912H20112H2010 815

1,220 1,610

12 Months to30 June 2011

12 Months to30 June 2012

12 Months to30 June 2008

12 Months to30 June 2009

12 Months to30 June 2010

12 Months to30 June 2011

12 Months to30 June 2012

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Analysis of New Business ValueAnalysis of New Business ValueBefore and After Change of

Risk Discount Rate and Investment Return Before and After Cost of Capital

HK$ million HK$ million

1,549218 1,283

(266)1,2831,065

1H2012New

Business Value

1H2012New

Business Value

Risk Discount

Rate Changed

New Business

ValueBefore

New Business

ValueAfter

Cost of Capital

Value(Risk

Discount Rate 11.5%; Investment

Return 4 1% 4 5%)

Value(Risk

Discount Rate 11.0%; Investment

Return 4 6% 5 0%)

Changed from 11.5% to 11.0%;

Investment Return

Changed from

BeforeCost ofCapital

AfterCost ofCapital

224.1%~4.5%) 4.6%~5.0%)from

4.1%~4.5% to

4.6%~5.0%

Property and Casualty InsuranceProperty and Casualty Insurance Business Review

PRC Operations – TPI

Hong Kong Operations – CTPI (HK)

The following figures are the results of TPI and CTPI (HK) from their respective operations, 23before intra-group eliminations.

PRC Operations TPIPRC Operations – TPINote: TPI is 61 21%-owned by CTIH and is a consolidatedNote: TPI is 61.21% owned by CTIH and is a consolidated

subsidiary of CTIH. With effect from July 2011, the equity interests of TPI held by CTIH increased from 50.05% to 51 77% d f th i d t 61 21% ith ff t f51.77% and further increased to 61.21% with effect from November 2011.

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P&C Insurance TPI Premium and SolvencyP&C Insurance – TPI Premium and SolvencyRegulatory SolvencyGross Premiums Written

HK$ million

g y yMargin RatioGross Premiums Written

3 455 754,507.51 152% 168%

1H2011 1H2012

3,455.75

At 31 D 2011 At 30 J 20121H2011 1H2012 At 31 Dec 2011 At 30 Jun 2012

25

P&C Insurance TPI Gross Premiums

B P d t Li

P&C Insurance – TPI Gross Premiums

By Product Lines

1H20121H20121H20111H2011Total: HK$3,455.75 million Total: HK$4,507.51 million

Motor

Non-Marine$700 60

Non-Marine$891.0619 7%$2,657.64

76.9%

Marine$97.51

$700.6020.3% Motor

$3,488.0777.4%

Marine$128.38

2.9%

19.7%

2.8%

26

P&C Insurance TPI Combined RatioP&C Insurance – TPI Combined Ratio

Trend1H2012 vs 1H2011

Loss ratio Expense ratio

99.6% 98.0%

116.9%

108.2%

44.8% 49.1%

200 2009 2010 2011 1H2012

102.1% 99.9% 98.0%

FY2008 FY2009 FY2010 1H2012FY2011

54.8% 48.9%

200 2009 2010 2011 1H2012FY2008 FY2009 FY2010 1H2012FY20111H2011 1H2012

27

Hong Kong Operations CTPI (HK)Hong Kong Operations – CTPI (HK)

28

P&C Insurance CTPI (HK) Premium GrowthHK$ million

P&C Insurance – CTPI (HK) Premium Growth

511.11 565.82

1H2011 1H2012

29

P&C Insurance CTPI (HK) Gross Premium

By Product Lines

P&C Insurance – CTPI (HK) Gross Premium

By Product Lines

1H20121H20121H20111H2011Total: HK$565.82 millionTotal: HK$511.11 million

M t MotorMotor$87.8117.2%

Marine

Motor$109.5819.4%

$103.0520.2%Non-

Marine$320.25

Marine$127.5022.5%

Non-Marine$328.7458 1%62.6% 58.1%

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P&C Insurance CTPI (HK) Combined RatioP&C Insurance – CTPI (HK) Combined Ratio

Trend1H2012 vs 1H2011

Loss ratio Expense ratio

95 8% 93 9%

43.8% 38.1% 102.8% 100.0% 97.4% 98.9%93 9%

95.8% 93.9%

52.0% 55.8%

% 93.9%

1H2011 1H2012 2008 2009 2010 2011 1H2012FY2008 FY2009 FY2010 1H2012FY2011

31

Reinsurance Business Review – TPReReinsurance Business Review TPReNote: TPRe has changed the accounting policy for the measurement of unearned premium

provisions for the reinsurance segment in preparing its consolidated financial statementsprovisions for the reinsurance segment in preparing its consolidated financial statements for the period ended 30 June 2012.

The above changes in accounting policy have been applied retrospectively and the comparative figures for 2011 have been restated accordingly.

32The following figures are the results of TPRe from its operations, before intra-group eliminations.

Reinsurance Geographical Distribution of Gross Premium

HK$ million

Reinsurance – Geographical Distribution of Gross Premium

7.5% 7.4%

Others

Europe

1,861.87 2,127.63

5.8% 6.7%20.1% 19.4%

16.0% 14.2%Rest of Asia

Japan

12 8% 12 1%

37.8% 40.2% Mainland China (& Taiwan)

Hong Kong & Macau

1H2011 1H201212.8% 12.1%

33

Reinsurance Combined RatioReinsurance – Combined Ratio

Net claims from the 2011 Thai Floods amounted to HK$640 million in 1H2012

Loss ratio Expense ratio

HK$215 million in net redundant loss reserve provisions were released during 1H201232 7%

96.6%110.6%

Expense ratio decreased due to premium growth, stricter terms and conditions as well as the77 9%

34.3%32.7%

and conditions as well as the change in calculating UPR

No major losses reported during 1H2012

62.3% 77.9%

1H20121H2011 1H2012

(Restated)

34

Pension and Group Life Insurance pBusinesses Review – TPP

The following figures are the results of TPP from its operations, before intra-group 35eliminations.

Pension and Group Life BusinessesPension and Group Life BusinessesGross Premium Pension Administration

Fee IncomeHK$ illi HK$ illiHK$ million HK$ million

1H2011 1H2012

216.30

597.54

1H2011 1H2012

44.30 49.43

Annuity and Investments Funds Number of Enterprisesin Funds and Schemes

HK$ million

2011 1H2012

48,737 55,757

2011 1H2012

6,703 6,764

362011 1H2012 2011 1H2012

Investments

37

Consolidated Investment AssetsConsolidated Investment Assets

% of Investment AssetsHeld by Each Business SegmentGrowth of Investment Assets

HK$ million

7 2% 7 1%3.6% 3.4%1.9% 1.5% Others

200 967 10

HK$ million

7.2% 7.1%Reinsurance

P&C

Life

171,263.51200,967.10

87.3% 88.0%

At 31 Dec 2011 At 30 Jun 2012 At 31 Dec 2011 At 30 Jun 2012

38

Consolidated Investment Income and Yield

1H20121H2012 1H20111H2011 ChangeChangeHK$ million

Consolidated Investment Income and Yield

Income Recognized in the Consolidated

Net investment income 3,652.76 2,709.27 +34.8%

1H20121H2012 1H20111H2011 ChangeChangeIncome Recognized in the ConsolidatedIncome Statement

Net realized investment gains/(losses) (342.22) 466.16 -Net unrealized investment gains/(losses) 145.38 56.87 +1.6 timesNet impairment gains/(losses) on securities (883.74) (95.64) +8.2 timesNet impairment gains/(losses) on securities (883.74) (95.64) 8.2 times

Total investment income 2,572.18 3,136.66 -18.0%

N t i t t i ld ( li d) 4 4% 3 9% 0 5 tNet investment yield (annualized) 4.4% 3.9% +0.5 ptTotal investment yield (annualized) 3.8% 4.2% -0.4 pt

Unrealized gains/(losses) recognizedin the fair value reserve 1,932.38 (1,546.44) -

39* The above-mentioned investment income and investment yield figures do not include investment income from unit-linked products.

Consolidated Investment AssetsAt 30 Jun 2012At 30 Jun 2012At 31 Dec 2011At 31 Dec 2011

Consolidated Investment Assets

Total Investment:HK$171,263.51 million

Total Investment:HK$200,967.10 million

Investment properties$2,915.58

1.6% Cash and

Investment properties$3,521.50

1.8%

Debt securities

$116,230.21 67 9%Investment

Cash and bank

deposits$37,776.40

22.1% Investment

bank deposits

$57,442.1828.6%

67.9%

Equity

Investment funds

$5,672.44 3.3% Debt

securities$125 078 13Equity

funds$6,878.89

3.4%

Equity securities$8,668.88

5.1%

$125,078.13 62.2%

ysecurities$8,046.40

4.0%

40* Cash and bank deposits includes HK$32,065.83 million in cash funded from securities sold under repurchase agreements (31 Dec 2011: HK$19,618.86 million).

OutlookOut oo

41

OutlookCTIHOutlook

With macroeconomic and financial conditions globally and in China/Hong Kong likely to continue to be challenging and g g y g gdifficult, CTIH believes that it is of utmost importance for the Company to follow its philosophy of pursuing sustainable value creation and perfecting its integrated business model of “One Customer, One Taiping”

CTIH will continue to focus on enhancing its capabilities in professional management operations profitability andprofessional management, operations, profitability and sustainable development

42

OutlookCTIHOutlook

CTIH will strive for its strategic objective of “Building a New Taiping in Three Years”, that is “to double total premium, total assets and net profit in three years’ time, while maintaining quality, efficiency and risks at an acceptable level”

Intending to have in place mechanisms to improve the capacity for long-term capital raising and funding, with the support of its controlling shareholder, CTIH would consider various options including, increasing its shareholding in its non-wholly owned subsidiaries and/or making other strategic investments to besubsidiaries and/or making other strategic investments, to be funded by the issuance of new equity as consideration

43

OutlookLife Insurance

OutlookLife Insurance

For the remainder of 2012, TPL will continue to focus on building its agency force, simultaneously focusing on recruiting new agents and maintaining the high productivity

f it i ti tof its existing agents

In the bancassurance channel TPL will continue to work In the bancassurance channel, TPL will continue to work with its banking partners, and will strive for breakthroughs and improvementsand improvements

44

OutlookLife InsuranceOutlook

TPL is confident that an improvement of the operating environment, generally expected to be at the latter part of theenvironment, generally expected to be at the latter part of the year, will gradually improve its sales in the second half of 2012 and beyond

TPL has entered into a financial reinsurance contract with a leading reinsurer in early of July 2012 whereby the admittedleading reinsurer in early of July 2012 whereby the admitted assets of TPL (applied in calculation of statutory solvency ) would be increased gradually in next four quarters from July 2012. It is estimated that the statutory solvency of TPL in the second quarter of 2013 would be increased by approximately RMB 4 billion

45RMB 4 billion

OutlookProperty and CasualtyOutlook

TPI Although pricing and general market conditions in the PRC property and

lt i t d TPI i ti i ti th t iticasualty insurance sector are under pressure, TPI is optimistic that positive and satisfactory operating and earning results will be achieved for the entire year

TPI will continue to apply proactive underwriting selection and will strive to lower its combined ratio during the remaining part of the year

CTPI (HK)CTPI (HK) While macroeconomic and financial conditions in Hong Kong are unclear and

challenging, CTPI (HK) is confident that it will continue to grow in line with the g g, ( ) gmarket

Despite high levels of competition, CTPI (HK) expects premium growth to be stable and normal, and believes that satisfactory underwriting and operating

46

stable and normal, and believes that satisfactory underwriting and operating results are achievable for the full year

O tl k

R i

Outlook

Reinsurance

Barring any unforeseen or significant adverse events in the Barring any unforeseen or significant adverse events in the coming months, TPRe expects to achieve overall positive operating results for the full year of 2012, albeit in the midst of very challenging global and regional economic and financial conditions

47

AppendixI. Consolidated and Segmental Income StatementII. Consolidated and Segmental Statement ofII. Consolidated and Segmental Statement of

Financial Position

48

Q tiQuestions&&

AnswersAnswers49