The life Insurance Association, Singapore (LIA Singapore) released a set of industry results for the period January to September 2019 (YTD 3Q2019).
The results show a steady growth of 4% for annual premium products for the same period last year, amounting to S$2.1 billion in total weighted annual premiums – mainly attributed to the increase in uptake of participating plans, meeting the protection and saving needs of consumers.
Despite the 4% increase on annual premium products, single premium products recorded a 20% dip. For YTD 3Q2019, weighted single premiums amounted to S$889.2 million, of which:
- Single premium par and non-par products comprised 81 per cent; Single premium linked products took the remaining 19 per cent
- CPFIS-included products comprised 10 per cent; Cash-funded products took the remaining 90 per cent
Increased uptake of retirement policies
The insurance industry in Singapore recorded a 57 per cent increase in the uptake of retirement policies 5 in YTD 3Q2019 compared to a year ago. A total of 38,622 policies were purchased as at 30 September 2019, a significant 14,012 more policies compared to the same period in 2018.
Making up about 12 per cent of total weighted premiums for YTD 3Q2019, retirement policies totalled S$356 million in weighted premiums for the first nine months of 2019.
Integrated Shield Plans (IPs) remain a significant component of health insurance
53,000 more Singaporeans and Permanent Residents were covered by IPs and riders as at 30 September 2019. 2.77 million lives – approximately 69 per cent of Singapore residents – are protected by IPs and riders, which provide coverage on top of MediShield Life.
Total new business premium 6 for individual health insurance for YTD 3Q2019 amounted to S$342.3 million. Overall, IPs and IP rider premiums accounted for 90 per cent (S$307.5 million) and the remaining 10 per cent (S$34.8 million) comprised other medical plans and riders.
Life insurance industry continues to expand its workforce
Employment in the life industry rose by 3.6 per cent as a result of 296 new hires, compared to the corresponding period in 2018, to reach a workforce of 8,444 employees, as of 30 September 2019. Recruitment is focused on data analytics, cyber security, and various insurance business functions as life insurers pursue digital innovation.
14,892 representatives held exclusive contracts with companies that operate a tied agency force as at 30 September 2019, a slight one per cent decrease compared to the corresponding period in 2018. The role of financial advisory representatives in Singapore remains essential in giving personalised advisory based on each individual’s circumstances and protection needs.
The contribution of new business by the different channels is as follows:
||By Weighted Premium (%)
||By Number of Policies (%)
|Financial Adviser representatives 7
|Online Direct Channel 8
|Others ( products sold without intermediaries,e.g. DPI, Eldershield)
The life insurance industry will continue to focus efforts on helping consumers narrow their protection gaps, despite the uncertain global economic environment.
On top of ongoing education efforts, consumers can look forward to the upcoming official launch of the life insurance calculator, which will be hosted on the LIA Singapore website. The digital calculator aims to help consumers gain a better understanding of their financial protection needs.
Other recent initiatives aimed at enhancing policyholders’ claims experience include:
- Updates to Critical Illnesses (CI) definitions to clearly reflect intent of coverage, as a result of medical advancements and health trends in the past five years. 10
- Launch of the standard Pre-Authorisation Form to simplify the application process for doctors and bring about consistency of practice among all IP insurers. 11
5 These policies are designed to provide regular payouts during policyholders’ retirement years.
6 With effect from 1 January 2016, the MediShield Life premiums have been excluded from LIA statistics. New Business premiums refer to the premium due to the new business sold in the year, as well as incremental premiums from any repricing of plans, and change in age-band of the insureds.
7 Financial Adviser (FA) Representatives include representatives of “related FA firms”. A related FA firm is a wholly-owned subsidiary of an insurance company.
8 Online Direct Channel is a new data point from January 2019, and it refers to “any web portal or application in the internet created, developed and maintained or operated by a life insurer, on which a client may purchase a life policy”.