General insurance sector posts 10.7% rise in underwriting profit

Singapore's general insurance sector saw a 10.7 per cent rise in underwriting profit to $262.7 million last year, from $237.3 million in 2020, despite more claims being paid out.

Overall gross written premiums rose 8 per cent year on year to $4.4 billion as at end-2021, driven by strong uptake across its top five business segments, the General Insurance Association of Singapore (GIA) said yesterday.

The positive uptake was due to the endemic Covid-19 prompting consumers to safeguard assets against evolving risks, it added.

The sector ended the year with a payout of $84.3 million more in claims compared with the previous pandemic year for three of its largest segments - motor, health and employers' liability - which represent half of the general insurance market. In total for last year, $1.24 billion in claims were paid out across all segments.

Among the biggest segments, motor insurance recorded an underwriting profit of $49.7 million last year, from $104.5 million a year earlier. Although it posted a 2.7 per cent year-on-year increase in gross written premiums to $1.15 billion last year, total claims paid out rose 8.3 per cent as more activities resumed and injuries due to road accidents increased.

It noted that the number of fatal road accidents had risen by 25 per cent, from 80 cases in 2020 to 100 cases last year. Injury-related road accidents also increased.

The health insurance segment recorded an underwriting loss of $5.1 million last year, from a profit of $17.9 million a year ago, due to a 7.5 per cent rise in claims paid out, despite gross written premiums rising 7.8 per cent to $746.5 million.

Meanwhile, the property segment posted an underwriting profit of $41.9 million, from $43.7 million in 2020, due to a 20.9 per cent increase in gross written premiums amid a thriving property market.

The GIA expects a continued upward trend for the property insurance segment as construction activities progressively ramp up.

As for employers' liability insurance, the underwriting profit was down at $29.9 million from $41 million a year ago. Gross written premiums rose 4.7 per cent to $399.3 million last year, but the segment also paid out 13.7 per cent more claims, with the rate of workplace injuries being more comparable with pre-Covid-19 levels as activities resumed.

The travel insurance segment saw underwriting profit rise to $8.3 million from $5.2 million a year ago, although gross written premiums fell 15.7 per cent to $48.5 million amid muted travel activity in the first half of last year.

GIA president Ronak Shah noted that cyber risks and sustainability will become more pertinent issues moving forward. He said: "In 2022, our dialogue and initiatives in place will move talk to action to urgently address these increasingly worrying risks and our policyholders' changing protection needs."

He added: "As we step into 2022 with greater optimism, our efforts will be focused on driving forward-looking developments with purpose, innovation and collaboration at the core."

Among other things, the sector will be focused on monitoring fraudulent activity, said the GIA. It noted that fraudulent activities may continue increasing this year with business and social activities resuming to pre-pandemic levels.

Additionally, the GIA announced the appointment of its new management committee, for 2022 to 2024. It re-elected Mr Shah as president, Mr Christian Sandric as vice-president, Mr Jimmy Tong as honorary secretary and Ms Joanne Huang as honorary treasurer.

THE BUSINESS TIMES