Life insurance industry loses $1.8b
The life insurance industry has lost $1.8 billion after tax for the one year to March 2020, driven by poor performance of risk businesses and a substantial collapse in investment revenue owing to the COVID-19 related volatility in investment markets, according to data.
The Australian Prudential Regulation Authority (APRA) data found the loss was a significant reduction from $759 million profit the previous year.
The data also found that compared to the December 2019 quarter, the March 2020 quarter was down 798.7% in terms of investment revenue. Compared to the March 2019 quarter, investment revenue was down 88.4%.
“All risk products deteriorated with the only exception being the individual lump sum product,” APRA said.
“In particular, individual disability income insurance (also known as income protection insurance) reported a substantial loss, primarily driven by loss recognition as adverse claims experience persists.”
Individual disability income insurance lost $1.4 billion, over the year to 31 March, 2020.
Risk product net profit after tax for the life insurance industry over the year to 31 March 2020
Source: APRA
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