Life industry endures another tough quarter
Australia’s 40 registered life insurers have increased the total assets held collectively by nearly three per cent to $181.5 billion but lost out heavily on new premium inflows and policy payments, according to data released by theAustralian Prudential Regulation Authority(APRA).
APRA data, measuring the life insurance sector to the end of the June quarter, found that premiums inflows for the quarter dropped by 11.3 per cent to $9.2 billion, and over 12 months faced similar falls of 8.6 per cent for a total inflow figure of $37.5 billion.
Life insurers received a double hit with policy payments of $10.1 billion for the quarter climbing more than 26 per cent since the March quarter but were actually down by 0.2 per cent over the last 12 months with $38.1 billion paid out.
In total the net premium flows, that is, premiums less policy payments, for the year ending June 2003 were negative $0.6 billion.
Superannuation continued to account for the lion’s share of premiums with $8.2 billion or 89 per cent of total premium inflows, down 11.7 per cent from the June quarter last year. Across the last 12 months the figures were also moving down with premiums totalling $33.7 billion, down 9.5 per cent.
The remainder of the premium inflows, $1 billion, came via ordinary insurance business but was also depressed by $86 million on the June quarter although stable over 12 months at $3.7 billion.
Total life office assets at the end of June were $181.5 billion, which was still an increase of 2.9 per cent with investment linked statutory fund assets growing to $116.3 billion, and representing 64 per cent of the total assets in life office statutory funds.
The rest of the assets were in non-investment linked statutory fund assets and were steady at $65.3 billion at the end of June 2003.
AUTHOR
Jason Spits
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