AMP profits to be hit by life insurance woes

Company News

by Jessica Ellerm


AMP Limited (ASX:AMP) has indicated structural issues in the life insurance sector will impact its underlying profit in the order of $565 million for FY16 and FY17.

The company has indicated the changes will reduce the Australian wealth protection embedded value for FY16 by approximately $1 billion.

Goodwill attributable to the wealth protection business is expected to be fully impaired by $668 million.

AMP has taken action to re-set the wealth protection business and free capital by implementing a $750 million reinsurance arrangement with Munich Re.

AMP Limited posted a net profit of $1.05 billion at 30 June 2016.  

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