Since 2016, the life insurance industry has continued its strong growth momentum, achieving a total of S$1,682mn (US$1,234mn) in weighted new business premiums for the first half of 2017, the Life Insurance Association of Singapore (LIA) announced yesterday.
This represented a 10 percent increase in weighted new premiums from the S$1,522.6mn posted for the corresponding half of last year. There was an increase in uptake across both single and annual premium products, with a 10 percent increase in weighted single premiums to S$547.3mn and an 11 percent increase in weighted annual premiums to S$1,134.7mn.
Health insurance premiums totalled S$154mn for 1H2017, of which Integrated Shield Plans (IPs) premiums and IP riders accounted for 90 percent (S$139mn). IPs are plans which provide enhanced coverage by private insurers on top of the benefits of the basic government-run MediShield health insurance scheme. The remaining 10 percent (S$15mn) came from other medical plans and riders.
LIA also reported that over 550,000 new policies were signed in 1H2017 (compared to 517,000 in the same period last year), meaning approximately 2.92mn Singaporeans were insured, roughly 50 percent of the population, at 30 June 2017.
Agency forces continued to lead sales, accounting for 55 percent of the number of new policies sold while bancassurance accounted for 13 percent with the financial advisors selling 17 percent of the new policies. On the other hand, bancassurance accounted for 43 percent of weighted new premiums followed by agency forces at 35 percent and financial advisors at 18 percent.
There was an uptake of nearly 11,000 policies designed to provide regular pay-outs to policyholders during retirement years, with approximately S$84mn of weighted new premiums recorded over the half year. Such plans accounted for approximately 5 percent of the total weighted premiums for 1H2017.
Mr Patrick Teow, President of LIA, said: “We are encouraged that the industry continues to grow from strength to strength. While we tirelessly work towards narrowing Singapore’s protection gap, helping Singaporeans to be better prepared for retirement is also a priority. We see a steady take-up of products designed to provide regular payouts from retirement age. This shows that people are appreciating the importance of preparing ahead for their future years.
“Retirement planning is an ongoing concern for both pre-retirees and their children because by 2030, there will only be two working adults supporting one retiree, as compared to about five per retiree last year. The younger generation will be shouldering a greater financial burden of supporting the ageing population and ensuring that they have enough for other milestones, such as marriage and setting up their own families.”
Mr Teow also reported that a new protection gap study is currently underway and is expected to be released before 2018. “The last one we did was five years ago, and we’ll be using that as a reference point, to ensure that we are moving in the right direction and proper growth has been happening in Singapore.”