Singapore’s life insurance industry saw “strong growth” in the final quarter of 2016 and in the 12 months to the end of December, in spite of a “challenging” macro-economic environment, the industry’s trade association has reported.
Data released on Tuesday showed total weighted new business sales grew by 15% in the last three months of 2016, compared to the same period a year earlier, to S$955.3m (US$673.42m, £537.32m), due largely to the rise in sales of annual premium products, the Life Insurance Association Singapore (LIAS) said in a statement.
Weighted new sales of annual premium products, including whole life policies, rose 20% a year on year to S$661.1m, the data revealed.
Compared to the rate at which Singapore’s gross domestic product grew in 2016 – 1.8% – “the industry’s growth of 10% is more than five times the rate at which the economy expanded,” LIAS said.
Tied agency representatives “continued to play a major role” in the distribution of the industry’s products in the fourth quarter, accounting for 57% of policies sold, LIAS added, while banks were responsible for some 12% of sales, and financial advisers sold 15%. Products sold without intermediaries, via such channels as direct purchase insurance and ElderShield, made up the remaining 16%, the LIAS said.
As measured by weighted premium, though, banks continued to be the main channel of distribution, accounting for 38%, tied reps for 37%, financial advisers for 21% and non-intermediated sales, 4%.
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In the statement announcing the 2016 results for Singapore’s life industry, LIAS president Khoo Kah Siang said the “good progress quarter on quarter” reflected the fact that more Singapore residents were taking a long-term perspective to their financial planning, and in doing so were acting to protect themselves through the purchase of the savings products the life insurance industry specialises in.
Separately, the LIAS called attention to certain actions it had taken during the course of the year just ended, which included a new “LIA Register of Unclaimed Life Insurance Proceeds”, which was set up to reach out to claimants or beneficiaries of unclaimed policy assets.
It also launched what it calls the Health Insurance Task Force, or HITF, to help address “Singaporeans’ concern with escalating healthcare costs”.
Established in 1962, the Life Insurance Association of Singapore is the not-for-profit trade body of life insurance product providers and life reinsurance providers based in Singapore, and is licensed by the Monetary Authority of Singapore.