The life insurance market in Singapore reported S$2.68bn ($1.97bn) in weighted new business premiums for the first half of this year, a strong 61% growth compared to 1H2020, according to the Life Insurance Association, Singapore (LIA Singapore), in a statement released yesterday.
LIA Singapore said consumers are adapting to the COVID-19 environment. As a recap, during the same period last year, sales were at depressed levels due to the COVID-19 lockdown measures, which included the prohibition of face-to-face physical meetings.
LIA Singapore president Khor Hock Seng said, “The strong showing of business results seen in the life insurance industry in the first half of this year reflects a level of stabilisation of Singapore’s economy from the immediate impact of COVID-19 in 1H2020. The growth in uptake of life insurance also seems to show that more people are placing greater importance on providing for their long-term financial and healthcare needs in the midst of an evolving pandemic environment.”
Single-premium products
Single-premium products recorded a 106% year-on-year increase in weighted premiums amounting to S$1.28bn for 1H2021.
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Single-premium par and non-par products comprised 84% of all single-premium purchases; single-premium linked products made up the remaining 16%.
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Cash-funded products accounted for 92% while Central-Provident Fund-included products comprised the remaining 8%.
Annual-premium products
Annual-premium products recorded an increased uptake of 35% from the same half last year, amounting to S$1.40bn in weighted annual premiums.
Significant growth in number of policies purchased online
The number of new policies purchased online continues to increase to 203,351 in 1H2021 compared to 32,952 in 1H2020. These are purchases transacted online by customers without the help of financial advisors.
Health insurance
Integrated Shield Plans (IPs) remain a significant component of health insurance. These plans are health insurance policies sold by private insurers that supplement the government-run national basic health insurance scheme, MediShield Life. As of 30 June 2021, 2.85m lives – approximately 70% of Singapore residents – are protected by IPs and riders.
Total new business premiums for individual health insurance for 1H2021 amounted to S$176.8m. Overall, IPs and IP rider premiums accounted for 82% (S$144.7m) and the remaining 18% (S$32.1m) comprised other medical plans and riders.
Recovery in uptake of retirement policies
In terms of policy count, there was a 34% increase in the uptake of retirement policies in 1H2021 compared to the same period last year. A total of 22,137 retirement policies were purchased as at 30 June 2021. Accounting for approximately 7% of total weighted premiums for 1H2021, retirement policies totalled S$198.2m in weighted premiums for the first six months of 2021.
Total group insurance premiums in-force
Total in-force annual premiums for group insurance business rose by 20% to S$1.75bn in 1H2021 compared to the same period a year ago.
Looking forward
Mr Khor said, “The life insurance industry will continue to focus on meeting our sustainability (ESG) commitments and workforce transformation goals for the year ahead.
“The LIA, as a strategic partner of the Green Finance Industry Taskforce, is working together with the general insurance and reinsurance sectors to build the industry’s capacity for the progressive adoption of local best practices and international standards. We are also working on industry initiatives to future-proof our workforce as technology and digital tools impact the way we do our jobs.”