Insurance premium sales remain subdued

Inflows into the life insurance risk market grew 12.5 per cent in 2010, although new premium sales continued a pattern of marginal growth, according to Plan for Life research.

All companies surveyed experienced inflows increases in 2010 from $8.3 billion to $9.4 billion, with Tower (31.5 per cent), AMP (26.4 per cent), AIA Australia (19.1 per cent), BT/Westpac (9.7 per cent), OnePath Australia (9.4 per cent) and National Australia Bank/MLC (8.8 per cent) achieving the highest growth rates. However, new premium sales were up just 0.4 per cent over the period, although Tower’s sales were up 30.5 per cent, followed by AMP (13.8 per cent) and AXA Australia (7.7 per cent).

The individual risk lump sum market continued to experience steady and solid growth due to unabated growth in the housing market, Plan for Life stated. This sector saw premiums increase by 10.2 per cent year on year, with AIA experiencing growth of 19.9 per cent, followed by Zurich (13.1 per cent), Tower (11.1 per cent) and OnePath (11.0 per cent). However, sales increased by only 3.2 per cent over 2010, with AIA (22.9 per cent), AMP (16.6 per cent), OnePath (11.2 per cent), Suncorp (9.6 per cent) and AXA (8.6 per cent) reporting the highest growth.

Inflows for the individual risk income market grew 10 per cent over the year, with BT/Westpac (21.3 per cent), AIA (19.2 per cent), OnePath (15.3 per cent), Zurich (11.5 per cent) and CommInsure (10.6 per cent) the best performers. New risk income premium sales were up slightly by 2.2 per cent year on year. AIA (39.5 per cent), Macquarie Life (26.7 per cent), OnePath (13.6 per cent) and AXA (13.0 per cent) reported significant increases, Plan for Life stated. However, it noted that AMP and National Australia Bank/MLC saw a decline in sales of 14.1 per cent and 11.5 per cent respectively.

Inflows into the group risk market jumped 17.6 per cent over 2010, with AMP (386.5 per cent), Tower (63.0 per cent), AIA (18.9 per cent), National Australia Bank/MLC (11.9 per cent) and CommInsure (11.5 per cent) reporting the highest growth. AMP’s figures were artificially boosted by a reclassification of its business from single to annual premium, Plan for Life noted. Overall, actual new group sales in 2010 were down 4.6 per cent on the 2009 result due to a lag effect following strong growth in 2009. Tower (59.6 per cent), AMP (35.3 per cent) and CommInsure (19.4 per cent) recorded the best comparative group risk sales performances year on year.