The general insurance industry sank into the red last year with an underwriting loss of $28 million, compared with a profit of $36.3 million in 2018.
The loss was largely due to a 12.2 per cent or $159 million rise in total insurance claims paid out last year, the General Insurance Association of Singapore (GIA) said yesterday.
The five largest segments - motor, health, property, employer's liability and travel, which make up 70 per cent of the general insurance market - had total underwriting losses of $43.4 million last year.
An underwriting profit of $17.2 million from the personal accident segment partially offset this loss.
Gross written premiums for the overall sector grew 7.6 per cent on the year to $4.1 billion as of Dec 31 last year.
Motor insurance was the largest contributor to gross written premiums, raking in $1.12 billion, up 1 per cent from 2018. But it also weighed down the sector's overall underwriting performance by incurring a 7.6 per cent or $41.3 million rise in total claims paid out. The segment posted an underwriting loss of $17.4 million versus a profit of $9.2 million in 2018.
There was a shift in vehicle ownership here last year, with vehicle numbers at their highest since 2013, fuelled mainly by a spike in private-hire cars, said GIA.
"This meant that the sector was insuring a vehicle population with higher risk profiles, as private-hire cars are driven more frequently on the road," it noted. This was reflected in the total number of accident reports last year, which increased by 1.4 per cent from 2018.
The underwriting loss for health insurance, the second-largest general insurance segment, narrowed to $11.2 million last year compared with a $44.2 million loss in 2018.
The upward trend in health insurance claims continued, with an 8.1 per cent or $22.6 million rise in payouts to policy holders requiring medical treatment last year. Gross written premiums for the segment rose about 14.3 per cent to $666.8 million, from $583.3 million a year before.
The employers' liability insurance segment was buoyed by a sustained growth in employment for the construction sector last year, which led to an 8.9 per cent increase in gross written premiums.
The sector paid $8.29 million more in work injury compensation amid a 5 per cent rise in the number of non-fatal injuries, though the number of workplace fatalities fell to a record low last year, said GIA.
The association appointed a new management committee at its annual general meeting yesterday, with Mr Craig Ellis named as president and Mr Christian Sandric as vice-president.
Mr Ellis said Singapore's general insurance sector is "determined to overcome" the unprecedented challenge of the coronavirus outbreak together, and will double its efforts to support the community, GIA members, partners and all stakeholders.
"We will ensure that general insurance protection remains accessible for everyone," he added.
Notwithstanding the Covid-19 pandemic, one of GIA's focus areas this year is to form a new centralised investigation bureau, which will build on the association's insurance fraud-prevention initiatives.
THE BUSINESS TIMES
