Singapore’s life insurance industry recorded SG$4.2 billion in weighted new business premiums in 2018, up 3% from the previous year, according to data from the Life Insurance Association (LIA) of Singapore.
The growth has been attributed mainly to the continued uptake and stable performance of annual premium policies, which accounted for total weighted annual premiums of SG$2.78 billion for 2018. This reflects a 6% increase from 2017, the LIA said in a media release.
The industry’s assets under management were worth approximately SG$211.2 billion as of the end of 2018, up 9% from the previous year.
After a good start to the year, the latter stages told a different story, with market volatility and regulatory changes negatively affecting business.
While premium income increased, there was a 3% dip in sales of single premium plans, due to turbulent markets late in the year and a regulatory requirement to reduce the sales charge for purchases of CPF Investment Scheme (CPFIS) products. Weighted single premiums totalled SG$1.42 billion, 74% of which was composed of single premium par and non-par products, while single premium linked products took the remaining 26%.
There was continued demand for protection products and health coverage, with total sum assured for new business growing 7% year-on-year to almost SG$140 billion. Integrated Shield Plans (IPs) and IP riders accounted for 92% (SG$388.3 million) of total new business premiums for individual health insurance, while the remaining 8% came from other medical plans and riders.
As Singapore’s population ages, more individuals are thinking about their retirement, leading to a notable year-on-year increase of 48% in the uptake of retirement policies designed to provide regular payouts to policyholders during their retirement years. A total of 38,120 policies were purchased in 2018 – or 12,345 more policies compared to 2017, which had a total uptake of 25,775 policies.
Singapore’s life insurance industry implemented two remaining initiatives under the Financial Advisory Industry Review (FAIR), which began in 2012 with the aim of increasing consumers’ understanding of life insurance policies.
