The life insurance industry has continued its strong growth momentum since 2016, achieving a total of S$1,682 million (US$1,234 million) in weighted new business premiums for the first half of 2017, the Life Insurance Association of Singapore (LIA) announced yesterday.
This represented a 10% increase in weighted new premiums from the S$1,522.6 million posted for the corresponding half of last year. There was an increase in uptake across both single and annual premium products, with a 10% increase in weighted single premiums to S$547.3 million and an 11% increase in weighted annual premiums to S$1,134.7 million.
Health insurance premiums totalled S$154 million for 1H2017, of which Integrated Shield Plans (IPs) premiums and IP riders accounted for 90% (S$139 million). The remaining 10% (S$15 million) came from other medical plans and riders. IPs are plans which provide enhanced coverage by private insurers on top of the benefits of the basic government-run MediShield health insurance scheme.
1 in 2 Singaporeans are insured
LIA also reported that over 550,000 new policies were signed in 1H2017 (compared to 517,000 in the same period last year), which meant that approximately 2.92 million Singaporeans were insured, roughly 50% of the population, at 30 June 2017.
Agency forces continued to lead sales, accounting for 55% of the number of new policies sold while bancassurance accounted for 13%, and financial advisors sold 17% of the new policies. However, bancassurance accounted for 43% of weighted new premiums followed by agency forces at 35% and financial advisors at 18%.
There was an uptake of nearly 11,000 policies designed to provide regular payouts to policyholders during retirement years, with approximately S$84 million of weighted new premiums recorded over the half year. Such plans accounted for approximately 5% 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.”
New protection gap survey underway
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.”