Fanhua Inc. (NASDAQ:FANH) Q3 2020 Earnings Conference Call - Final Transcript
Nov 24, 2020 • 08:00 pm ET
Thank you for standing by for Fanhua's Third Quarter 2020 Earnings Conference Call. [Operator Instructions]
For your information, this conference call is now being webcasted live over the Internet. Webcast replay will be available within three hours after the conference is finished. Please visit Fanhua's IR website at ir.fanhuaholdings.com under the Events & Webcasts section. Today's conference is being recorded. If you have any objections, you may disconnect at this time.
I would now like to turn the meeting over to your host for today's conference, Ms. Oasis Qiu, Fanhua's Investor Relations Manager. Please go ahead.
Good morning. Thank you. Good morning. Welcome to our third quarter 2020 earnings conference call. The earnings results were released earlier today and are available on our IR website, as well as on Newswire.
Before we continue, please note that the discussion today will contain forward-looking statements made under the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. The accuracy of the statements may be impacted by a number of business risks and uncertainties that could cause our actual results to differ materially from those projected or anticipated. Such risks and uncertainties, include but not limited to, those outlined in our filings with the SEC, including our registration statement on Form 20-F. We do not undertake any obligation to update this forward-looking information as required under applicable law.
Joining us today are our Chief Executive Officer, Mr. Chunlin Wang; Chief Financial Officer, Mr. Peng Ge. Mr. Wang will provide a review of financial and operating highlights in the third quarter 2020. There will be a Q&A session after the prepared remarks.
Now, I will turn the call over to Mr. Wang.
[Foreign Speech] Thank you for joining us on today's conference call. Here with me, we have our Chief Financial Officer, Mr. Peng Ge. We will begin today's call with an overview of our third quarter 2020 financial and operational results and share with you an update on our recent strategic initiatives. Mr. Ge and I will take your questions after the report.
[Foreign Speech] Part one, financial results in the third quarter of 2020. I would like to start with a brief review of our third quarter financial results.
[Foreign Speech] In the third quarter of 2020, Fanhua's life insurance business grew 15.5% year-on-year in gross written premiums to RMB2.4 billion, outpacing the industry growth rate. Renewal premiums exceeded RMB1.8 billion, while first year premiums reached RMB582.7 million and annualized premiums equivalent reached RMB333.5 million. New business growth was below our previous expectation, mainly due to the following factors.
[Foreign Speech] There -- one, there has been an adverse impact on the -- of the pandemic on customers' purchasing power and consumption sentiment. Second, our agency expansion plan was put on hold due to the pandemic and, as a result, cannot bring incremental growth as previously expected. Third, in recent years, insurance agents' average income has dropped below socio average level in China, and the gap