Risk industry records 11.9 per cent growth
Inflows into Australia’s life insurance companies fell by 1.6 per cent last year from $34 billion to $33.4 billion, reversing a 0.6 per cent growth in inflows recorded in 2004, according to the latest Plan for Life data.
The one bright spot for Australia’s chronic underinsurance outlook is that the risk insurance market continued to record strong premium growth during the 12 months to September 2005, climbing 11.9 per cent to $4.87 billion.
It follows an 11.7 per cent growth in premiums in the risk market — mainly comprising individual term life, term and permanent disability (TPD), and trauma — to $4.4 billion in 2004
Inflows into the group superannuation market, which comprises a large amount of old (pre-1970) products, also grew in 2005 by 3.3 per cent to $13.9 billion.
Individual investment business, both super and ordinary (non-super), continued to decline during 2005, falling by 6.4 per cent and 5.9 per cent respectively.
The individual super investment sub-market is comprised of mainly single premium bonds and, more recently, master funds, together with some old products created in the 1960s.
Retirement income business fell by 14.5 per cent during the year, although this was primarily due to the previous year’s sales being affected by a one-off legislative surge in business.
On a company basis, the highest percentage of overall growth in premium inflows during 2005 were posted by AIG Life (52.4 per cent), PrefSure (36.1 per cent), MBF (29.6 per cent), St George (27.7 per cent) and Suncorp-Metway (24.4 per cent).
Among the larger companies, ING (8.7 per cent) and National Australia/MLC (6.4 per cent) posted the best results. On the other hand, inflows fell for Challenger (-33.0 per cent), MetLife (-29.0 per cent) and Tower (-17.1 per cent).
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