The life/risk market may be further on the mend, according to the latest data released by Dexx&r.
The specialist firm has pointed to a continued fall in lump sum and disability discontinuance rates over recent months as an indicator of the improving fortunes of the sector.
It said the attrition rate for disability income business decreased from 14.4 per cent at June 2015 to 13.8 per cent at June 2016 and that, as with lump sum business there was now a clear trend of lower levels of discontinuances in the disability income market.
“The continued fall in lump sum and disability discontinuance rates during both periods of growth and flat or falling sales indicates that the industry is improving retention with a commensurate improvement in profitability,” the Dexx&r analysis said.
The Dexx&r analysis found that after two quarters of falling sales, lump sum risk product new business increased in the June quarter when compared to March 2016 with new business in the June 2016 quarter up 13 per cent to a total of $308 million.
However the analysis noted that new business in the June 2016 quarter was four per cent down on the $321 million recorded in the June quarter, last year.
It said the industry had written $1.26 billion of lump sum new business in the 12 months ending June 2016, marginally down on the $1.29 billion recorded last year and that amongst the top 10 life companies, AMP, MLC, TAL, AIA Australia, and ClearView had recorded an increase in lump sum new business for the year ending June 2016.
The Dexx&r data revealed disability income new business increased by eight per cent to $498 million over the year to June 2016, up from $464 million recorded in the 12 months to June 2015 with eight of the top 10 companies recording an increase in disability income new business.
It said ClearView recorded an increase of 64 per cent to $15 million, AIA Australia recorded an increase of 20 per cent to $28 million, MLC an increase of 14 per cent to $89 million, Westpac an increase of 14 per cent to $64 million, Zurich an increase of 13 per cent to $25 million, TAL an increase of 12 per cent to $75 million, OnePath an increase of nine per cent to $89 million and CommInsure an increase of two percent to $27 million.
