(Yicai Global) July 6 -- ZhongAn Online P&C Insurance’s shares surged to the highest in more than two years after China’s first internet-based insurer said it expected first-half net profit to have at least doubled from a year earlier mainly due to a fall in its underwriting loss.

ZhongAn’s stock price [HKG: 6060] gained 16.9 percent today to close at HKD55.10 (USD7.11), the most since April 2018. The benchmark Hang Seng Index rose 3.8 percent.

Investors have driven the stock about 85 percent higher since mid-June, anticipating a solid performance by the Shanghai-based company, which was jointly set up by internet giants Ant Financial Services Group and Tencent Holdings with Ping An Insurance Group, one of the world’s biggest insurers.

“As the company continued to pursue the growth with quality, the combined ratio further improved accompanied by the steady increase in the gross written premiums,” ZhongAn said in a filing to the Hong Kong Stock Exchange today, without specifying the combined ratio.

The ratio was 108.3 percent in first half of last year, down 15.7 percentage points from the same period in 2018. Widespread use of fintech is gradually improving the operational efficiency of the insurance business.

Despite a net profit of CNY94.5 million (USD13.4 million) in the first half of last year, ZhongAn still posted a loss for the whole of 2019.

ZhongAn said in a statement in mid-June that its premium income totaled CNY5.3 billion (USD760.7 million) in the first five months of the year, an annual increase of about 16.6 percent.

Approved to start business in September 2013, ZhongAn went public in Hong Kong at the end of September 2017. As of the end of last year, it had served 486 customers, issuing eight billion insurance policies.

The firm didn’t provide any additional earnings forecasts. ZhongAn plans to unveil its interim first-half results in August.

Editor: Peter Thomas