The total sum assured of new insurance sales exceeded $100 billion last year, a record for the industry, said the Life Insurance Association Singapore (LIA) yesterday.
LIA president Khoo Kah Siang attributed this to "healthy growth" across all types of life and health coverage. He told the LIA's quarterly briefing that the new protection cover totalling $101.2 billion represented a 14 per cent increase in new business sum assured from $88.67 billion in 2014.
Dr Khoo said 2015 was a constructive year for life insurers.
Over the past 12 months, the LIA has focused on implementing the key Financial Advisory Industry Review (Fair) initiatives, which include aggregator website compareFirst, Direct Purchase Insurance (DPI) products and the Balanced Scorecard framework for financial adviser representatives.
DPI products are basic life plans sold without financial advice and bought directly from insurers' customer service centres or websites.
From April 7 to Dec 31, 646 of these policies were sold, drawing $550,000 in weighted new premiums, of which 89 per cent were term-life policies. These plans provide affordable protection and are suitable for people looking for basic family cover.
The Fair initiatives mean policyholders can look forward to enhancements on disclosure of insurance policy details relating to illustrated investment returns, bonuses as well as less jargon in policy documents by the end of the year. A key reform will involve including the projected yields to maturity or net returns in the benefit illustration of the participating life or "par" plans.
New protection cover last year.
New health insurance premiums as at Dec 31.
New health insurance premiums totalled $231 million as at Dec 31, of which 88 per cent went to Integrated Shield Plans (IP) and IP riders.
There was a 13 per cent dip compared with the same period a year earlier as the 2014 performance, specifically the first quarter's results, had carried the impact of pricing revisions in March 2013.
MediShield Life was implemented in November and the five IP providers have agreed to maintain their premiums for a year from Nov 1.
Details of the standard B1 IP are expected to be announced in the next few months.
Dr Khoo added that while the five IP providers will offer the same standard B1 plan, the premiums will vary, depending on each insurer's claims experience and marketing efforts. "The standard B1 Integrated Shield plan will offer better coverage compared with the standard MediShield plan. It also offers more choice to consumers who are currently on a private IP and wish to downgrade because of affordability issues," said Dr Khoo.
Total weighted new business premiums rose 8 per cent to almost $3 billion in the 12 months to Dec 31. This included single-premium products, which were up 9 per cent to $940.8 million, of which 26 per cent were single-premium linked plans, while CPF-funded policies made up 16 per cent.
During the same period, weighted annual premium sales rose 7 per cent to $2.06 billion.