Super dominates life industry

Superannuation has once again been revealed as the dominant element in the Australian Prudential Regulation Authority’s (APRA) quarterly Life Insurance Trends data.

The data, released last week, reveals that total life office statutory fund assets backing Australian policyholder liabilities stood at $202.1 billion at the end of March this year, representing a 7.7 per cent rise over the same period last year.

Significantly, superannuation assets in life office statutory funds stood at $176.8 billion for the quarter, representing an increase of 8.9 per cent over the same period last year.

The APRA data said these assets had continued to trend upwards to represent 87.5 per cent of total assets in life office statutory funds.

“However, with total superannuation assets over the year to March 31, 2005 increasing by 181 per cent, life office superannuation assets as a percentage of total superannuation assets continued to decline, falling from 27 per cent to 24.9 per cent the APRA data said.

Looking at premiums and policy payments, APRA noted that superannuation business accounted for $6.4 billion in premiums for the quarter - a decrease of 15 per cent on the December 2004 quarter and a decrease of 14.1 per cent on the same period last year.

It said that for the year to March 31, superannuation premiums amounted to $30.7 billion, up 3.3 per cent on the 12 months to March 31, last year.

“Superannuation business in life offices remained strong and, as a percentage of life office premiums relating to Australian policyholders, accounted for 87 per cent during the March quarter and represented 86.7 per cent for the year ended March 31,” the APRA data said.

It said that superannuation business accounted for 89.2 per cent of policy payments relating to Australian policyholders made during the quarter and 89.9 per cent for the year to March 31.