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Recent insights from Dexx&r, a specialist research organization, depict a significant effect of governmental policies on Australia’s life/risk market, shaking even the traditionally sturdy group insurance subset.
Dexx&r's latest analysis shows a mere 0.4% rise in total risk in-force premiums for the year concluding in December 2023, reaching $16.5 billion.
Interestingly, new individual risk lump sum businesses declined by 5.4%, revealing the broader implications of the prevailing market conditions.
This market turbulence is further highlighted by the increase in individual lump sum discontinues, which escalated to 10.1% by December.
In a stark contrast, new disability income business saw a 7.3% rise during the same year, hitting $451 million, up from $420 million in the prior year.
The attrition rate for Disability Income business is on an upward trajectory, climbing from 9% in December 2020—just before APRA introduced new disability income products—to higher levels following the product releases in 2021.
Significantly, Dexx&r highlighted a 1% decrease in in-force group business for the year ending December 2023. This contraction points to the impact on premium receipts connected to default covers for superannuation funds.
“The introduction of the Protecting Your Super measures led to a reduction in members with default cover; nonetheless, overall premium receipts surged due to re-pricing of existing benefits,” Dexx&r stated.
Total In-force Group Risk Premium witnessed a small dip of 1%, lowering from $7.1 billion in December 2022 to $7.0 billion by December 2023.
TAL maintains its lead with a 32% market share, followed by AIA Australia, Zurich, and MLC Life.
Published:Friday, 17th May 2024
Source: Paige Estritori
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