Sales of in-force group risk insurance rose by 13 per cent over the year ending March 2016 despite life insurance sales remaining relatively flat, according to research house DEXX&R.
The firm's Life Analysis Report shows total lump sum sales for the full year reached $1.3 billion in new annual premiums. Three of the top five life companies recorded a rise in lump sum new business, with TAL recording a 3.9 per cent increase and OnePath a 2.4 per cent increase.
"The December and March quarters are traditionally the slowest quarters," the report said.
"With lower sales recorded for the March 2016 [quarter] than the March 2015, there are signs that calendar 2016 may prove to be a tough year for sales in the individual lump sum market."
Total in-force group risk business increased to $6.1 billion over the 12 months to March 2016, up from $5.4 billion at March 2015.
The top five companies in in-force group premiums all recorded increases, with TAL and AIA both recording the largest increases at around 27 per cent.
The report noted there were $489 million in new disability income premiums over the year to March 2016, an increase of 5 per cent from the $467 million recorded in the 12 months to March 2015.
Seven of the top 10 companies recorded an increase in disability new business, with AIA and OnePath recording the largest increases, at 19 and 16 per cent respectively.
The report also noted that the attrition rate for disability income business decreased from 14.4 per cent at March 2015 to 13.9 per cent at March 2016.
"As with lump sum business there is now a clear trend of lower levels of discontinuances in the disability income market," the report said.
"The continued fall in lump sum and disability discontinuance rates during a period of flat or falling sales indicates that the industry is improving retention with a commensurate improvement in profitability."
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