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Insurance service expenses and other expenditure (Tables)

12 Months Ended

Dec. 31, 2024

Insurance service expenses and other expenditure

Schedule of analysis of expenses


		2024 $m		2023 $m		2022 $m
Expenses attributed to insurance acquisition cash flows^{note (i)}		4,987		4,833		3,232
Other directly attributable expenses^{note (ii)}		1,328		1,258		1,221
Other expenditure ^{note (iii)}		1,003		990		1,019
Total expenses		7,318		7,081		5,472

Notes

(i)

Expenses attributed to insurance acquisition cash flows represent insurance acquisition expenses incurred in the year, which are implicitly deferred within the CSM and amortised as part of the CSM amortisation. Ceding commissions received from outward reinsurance agreements are not included in the analysis above.

(ii)

Other directly attributable expenses are those incurred in the year when providing insurance services to the policyholders, excluding the cost of claims and benefit payments. The expected other directly attributable expenses are explicitly included within the BEL and form part of the BEL release to the insurance revenue. The actual other directly attributable expenses incurred in the year form part of insurance service expenses.

(iii)

Other expenditure includes interest expense other than interest on core structural borrowings that is presented separately on the income statement as Finance costs. Total segment interest expense is $62 million (2023: $58 million; 2022: $23 million), of which $23 million arises in the Hong Kong segment (2023: $31 million; 2022: $11 million) and $35 million (2023: $23 million; 2022: $9 million) arises in central operations with the remainder spread broadly across the other markets. Included within interest expense is $10 million (2023: $7 million;2022: $8 million) of interest on lease liabilities. Core structural borrowings and operational borrowings (other than lease liabilities) represent financial liabilities that are not classified at FVTPL.

Total depreciation and amortisation expenses relate primarily to amortisation of distribution rights intangibles as shown in note C4.2. The segmental analysis of total depreciation and amortisation is shown below.

Schedule of segmental analysis of depreciation and amortisation


		2024 $m		2023 $m		2022 $m
Hong Kong		51		42		43
Indonesia		12		11		12
Malaysia		22		21		21
Singapore		36		36		40
Growth markets and other		372		369		339
Eastspring		13		12		13
Total segment		506		491		468
Unallocated to a segment (central operations)		17		33		26
Total depreciation and amortisation		523		524		494

Schedule of costs of employment


		2024 $m		2023 $m		2022 $m
Wages and salaries		1,119		1,079		1,018
Social security costs		37		37		41
Defined contribution pension schemes		54		46		40
Total Group		1,210		1,162		1,099

Schedule of average number of staff employed


		2024		2023		2022 $m
Asia and Africa operations ^note		14,851		14,479		13,685
Head office function		561		551		511
Total Group		15,412		15,030		14,196

Note

The Asia and Africa operations staff numbers above exclude 702 (2023: 621; 2022: 744) commission-based sales staff who have an employment contract with the Group.

Schedule of movement in outstanding options and awards


														Awards outstanding under
		Options outstanding under Sharesave and ISSOSNE schemes												incentive plans
		2024				2023				2022				2024		2023		2022
				Weighted				Weighted				Weighted
				average				average				average
		Number		exercise		Number		exercise		Number		exercise
		of options		price		of options		price		of options		price		Number of awards
		millions		£		millions		£		millions		£		millions
Balance at beginning of year		1.7		9.5		1.9		10.4		2.0		11.6		14.3		21.0		24.6
Granted		0.6		5.3		0.4		7.8		0.5		7.4		10.9		6.3		6.5
Exercised		(0.1)		7.4		(0.3)		11.6		(0.3)		11.2		(6.6)		(10.1)		(7.2)
Forfeited		–		7.6		–		7.8		–		10.8		(0.5)		(1.7)		(1.1)
Cancelled		(0.5)		10.2		(0.3)		12.0		(0.3)		12.7		–		(0.1)		(0.1)
Lapsed/expired		–		9.4		–		10.4		–		13.0		(0.6)		(1.1)		(1.7)
Balance at end of year		1.7		7.8		1.7		9.5		1.9		10.4		17.5		14.3		21.0
Options immediately exercisable at end of year		0.2		11.6		0.2		10.8		0.3		12.5

Summary of the range of exercise prices for options outstanding

Outstanding

Exercisable

Weighted average

remaining

Weighted average

Weighted average

Number outstanding

contractual life

exercise prices

Number exercisable

exercise prices

millions

years

£

millions

£

2024

2023

2022

2024

2023

2022

2024

2023

2022

2024

2023

2022

2024

2023

2022

Between £5 and £6

0.5

–

–

4.3

–

–

5.24

–

–

–

–

–

–

–

–

Between £7 and £8

0.7

0.7

0.5

2.7

3.7

4.1

7.55

7.55

7.37

–

–

–

–

–

–

Between £9 and £10

0.1

0.3

0.4

1.4

1.4

2.2

9.64

9.64

9.64

–

0.1

–

–

9.64

–

Between £11 and £12

0.4

0.6

0.8

1.3

2.0

2.4

11.70

11.59

11.48

0.2

–

0.2

11.57

–

11.12

Between £12 and £13

–

–

–

0.6

–

–

12.02

–

–

–

–

–

–

–

–

Between £13 and £14

–

0.1

0.1

–

0.4

1.4

–

13.94

13.94

–

0.1

–

–

13.94

–

Between £14 and £15

–

–

0.1

–

–

0.4

–

–

14.55

–

–

0.1

–

–

14.55

Total

1.7

1.7

1.9

2.8

2.6

2.6

7.84

9.50

10.43

0.2

0.2

0.3

11.57

10.82

12.48

The years shown above for weighted average remaining contractual life include the time period from end of vesting period to expiration of contract.

Schedule of assumptions used to estimate fair value amounts on date of grant relating to all options and awards

2024

2023

2022

Sharesave

Sharesave

Sharesave

and

and

and

ISSOSNE

Prudential

Other

ISSOSNE

Prudential

Other

ISSOSNE

Prudential

Other

options

LTIP (TSR)

awards

options

LTIP (TSR)

awards

options

LTIP (TSR)

awards

Dividend yield (%)

2.08

–

–

1.38

–

–

1.11

—

–

Expected volatility (%)

28.17

28.45

–

30.02

31.50

–

25.68

33.64

–

Risk-free interest rate (%)

3.57

4.39

–

4.55

4.34

–

3.97

2.79

–

Expected option life (years)

4.03

–

–

3.95

—

–

4.52

—

–

Weighted average exercise price (£)

£

5.24

–

–

£

7.75

—

–

£

7.37

—

–

Weighted average share price at grant date (£/HKD)

£

7.16

HKD

75.10

–

£

8.89

HKD

112.76

–

£

9.54

HKD

113.83

–

Weighted average fair value at grant date (£/HKD)

£

2.50

HKD

29.29

HKD

72.58

£

2.85

HKD

49.60

HKD

111.97

£

3.45

HKD

21.32

HKD

113.81

Schedule of key management remuneration


		2024 $m		2023 $m		2022 $m
Salaries and short-term benefits (including fees paid to non-executive directors)		24.6		27.0		22.5
Post-employment benefits		1.3		1.0		1.0
Share-based payments^note		23.6		22.2		15.4
Payments on separation		–		–		1.0
Total key management remuneration		49.5		50.2		39.9

Schedule of fees payable to the auditor


		2024 $m		2023 $m		2022 $m
Audit of the Company’s annual accounts		5.3		5.8		2.3
Audit of subsidiaries pursuant to legislation		6.0		8.1		4.4
Audit fees payable to the auditor		11.3		13.9		6.7
Audit-related assurance services ^{note (i)}		5.2		4.0		3.5
Other assurance services ^{note (ii)}		1.2		0.9		0.7
Non-audit fees payable to the auditor		6.4		4.9		4.2
Total fees payable to the auditor		17.7		18.8		10.9

Notes

(i)	EY became the Group’s statutory auditor in 2023 replacing KPMG who was the statutory auditor during 2022. The 2024 and 2023 fees shown above are wholly in respect of fees payable to EY while the 2022 fees were the fees paid to KPMG.

(ii)	Of the audit-related assurance service fees of $5.2 million (2023: $4.0 million; 2022: $3.5 million), $1.2 million (2023: $1.1 million; 2022: $0.9 million) relates to services that are required by law and regulation as defined by the FRC.