SINGAPORE - Singapore's life insurance industry expanded 9 per cent year-on-year in Q4 2015 to S$832.2 million in terms of total weighted new business premiums, which is a metric the industry uses to measure its growth.
This progress was lifted by the sales of non-linked weighted single-premium plans.
In the three months ended December 2015, weighted single-premium sales rose 28 per cent to S$281.9 million, driven by a 37 per cent year-on-year increase for non-linked single-premium plans to S$220.9 million.
Weighted single-premium linked plans grew slightly by 3 per cent to S$61 million.
Weighted annual premium sales for the quarter inched up marginally by one per cent to S$550.3 million.
For the full year, total weighted new business premiums rose 8 per cent year on year to nearly S$3 billion, lifted by the sales of single-premium linked products.
Weighted single-premium sales rose 9 per cent to S$940.8 million in 2015; of this, single-premium linked sales comprised 26 per cent, and CPF-funded policies, 16 per cent.
Weighted single-premium linked plans rose 22 per cent to S$244 million; non-linked sales climbed 6 per cent to S$696.8 million.
In 2015, weighted annual premium sales rose 7 per cent to S$2.06 billion.
Khoo Kah Siang, president of the Life Insurance Association Singapore (LIA), said on Wednesday that the industry recorded healthy growth across all types of businesses and provided new protection cover totalling S$101.2 billion in 2015, representing a 14 per cent rise in new business sum assured from a year ago.
The Direct Purchase Insurance (DPI) scheme, under which regular-premium plans are sold without financial advice, brought in about S$550,000 in weighted new premiums since its launch last April.
The LIA said the total annual premiums in force for group insurance business rose 7 per cent to S$975 million from a year ago.
Tied agents continued to be the main distribution channel, accounting for 40 per cent of new business; banks accounted for 37 per cent and financial advisers, 19 per cent.
Products sold without intermediaries, such as DPI and ElderShield, contributed the remaining 4 per cent.
Participating products accounted for 53 per cent of new sales. Non-participating products accounted for 28 per cent, said the LIA, adding that the remaining 19 per cent was attributable to investment-linked products.
As at end December 2015, the life insurance industry paid out S$5.97 billion to policy holders and beneficiaries, of which S$5.2 billion was for policies that had matured.
The surrender rate in 2015 rose to 2.19 per cent, from 1.82 per cent a year ago, largely due to the closure of Standard Life's Singapore branch.
Dr Khoo said: "The industry will continue to monitor and fine-tune the implementation of Fair (Financial Advisory Industry Review) initiatives, if necessary, to ensure that the objectives and outcomes are aligned".
This article was first published on Feb 11, 2016.
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