SINGAPORE - Pandemic lockdown measures helped motor insurers return to profitability last year, as traffic accident numbers fell.
In a statement on Thursday (March 18), the General Insurance Association of Singapore (GIA) said the motor insurance segment posted a 0.7 per cent increase in gross written premiums to $1.13 billion, and an underwriting profit of $104.5 million for 2020.
This compared with 2019's $1.12 billion gross written premiums and an overall underwriting loss of $17.4 million.
But the association warned that accident numbers are on the rise again as economic activity returns with the easing of Covid-19 measures.
"Based on latest statistics, the number of accident reports made monthly are back to more than 80 per cent of December 2019 levels," it noted.
If this prevails, motor insurers could return to the state of being in the red this year if premiums remain unchanged, and efforts to curtail excessive and fraudulent claims are not stepped up.
"GIA will continue to support efforts to promote road safety and facilitate a more seamless accident reporting process to protect motorists," the association added.
Motor insurance remained the largest segment in the industry with around 28 per cent of total gross premiums, followed by health with 17 per cent, property with 15 per cent, employers' liability with 9 per cent and marine with 5 per cent.
On the whole, the general insurance industry recorded flat growth for 2020, with a marginal 0.2 per cent decrease in gross written premiums to $4.09 billion. But the sector recorded an underwriting profit of $237.3 million, from a loss of $28 million in 2019.
This indicates that claims have decreased. For instance, travel insurance saw gross premiums plunge by 72.8 per cent, but the sector recorded an underwriting profit of $5.2 million.
And while personal accident insurance posted a 5 per cent decrease in premiums, it recorded an underwriting profit of $28.1 million.
The suspension of various workplace activities in the first half of 2020 also saw a decline in workplace injuries, resulting in fewer claims.
However, with workers returning to work sites, injuries are on the rise again.