In its most recent Life Analysis Report, the market research firm found that total risk in-force premiums fell 1.7 per cent for the year to 31 December 2024, down from $16.5 billion to $16.2 billion.
Total new individual risk premiums saw a drop of 18.5 per cent for the year, down to $1.11 billion, while lump-sum new business premiums were down 11.2 per cent from $910 million the year before to $809 million at the end of December 2024.
Interestingly, there was small growth in new lump-sum sales for the December quarter, which was up to $203 million – 1.3 per cent higher than the $200 million in the September quarter.
However, this is still 5.3 per cent lower than the December 2023 quarter and continues an up and down trend for the category, which had seen 5.7 per cent growth in the June 2024 quarter.
The lump-sum attrition rate continued its steady climb, rising to 10.5 per cent for the 12 months to December 2024, compared with 10.1 per cent in the previous year.
The attrition rate for disability income has likewise continued to rise, sitting at 11.4 per cent for the period, up from 10.9 per cent in the previous period and its 2020 low of 9.1 per cent.
DEXX&R noted that the continued rise in discontinuances coincides with the release of a new range of disability income products following the APRA intervention and release of conforming products in 2021.
New disability income business also continued to plummet, falling to $301 million from $451 million in December 2023.
It is also down considerably from the previous quarter’s reporting, with the year to September 2024 hitting $343 million.
Data for the December quarter showed some improvement compared with September 2024, with new disability business up 16.9 per cent from $61 million, though still 37.2 per cent down on the $113 million recorded in December 2023.
The year to December also saw small growth in group risk premiums, up 0.3 per cent to $7 billion, which the research firm said was due in part to repricing of existing benefits, despite the Protecting Your Super legislation leading to fewer super fund members with default cover.
Meanwhile, TAL continues to hold the largest market share among Australian insurers, currently sitting at 31.3 per cent valued at $5.06 billion, followed by AIA with 21.3 per cent, and Zurich with 14.9 per cent.
Rounding out the top five is MLC Life Insurance with 11.3 per cent and Resolution Life with 7.8 per cent market share.
Certain super fund just increasing TPD premiums by 92%
Stop offering default insurance – quarantine those that already have cover. Anyone new , they need to apply and be underwritten
Increase new business pricing by 25% across the board. Quarantine those that already have cover.
Two things this would do
1) Force a mad rush of people getting insurances before the industry ” resets” therefore giving the insurers a much needed cash injection.
2) Stop all these claims from non underwritten insurance destroying the industry
3) Reset the whole market.
If these steps aren’t taken, the market is dead.
It won’t change, it WILL be dead by end of ’26 sadly. Never even got a real chance to be proven a profession.
LIF is going well. Premiums up, less people insured, industry in turmoil. What a beautiful case study regarding the perils of government interference in financial services.
attrition rate due to people retiring and cancelling insurances plus companies are pricing themselves out of the market.
Just at the time life companies need skilled experienced advisers to retain business on the books, the life companies have done and are still doing everything to drive those advisers from the industry they loved. No rewards for effort, ridiculous motivation killing 2-year claw-back period and they’re in cahoots with government not only on the massive commissions reduction but every bit of unnecessary over-the-top compliance and red tape they can dream up. Don’t even start me on the unnecessary AFQ8 educational requirements for specialist risk advisers that prematurely pushed the very best from the industry – and THEN shelved the idea after they’d mostly gone and sold their businesses. Idiot politicians and short-sighted greedy life company execs, what a team! . . . DON’T start me . . . .