Risk market has worst year in decades

The risk market broke a “decades-long” streak of increases with inflows dropping by more than 4 per cent in 2019, including falls of almost 30 per cent for some life insurers.

New data released by Plan for Life indicated risk market inflows were down 4.5 per cent year-on-year in the 12 months to December 2019, compared to annual growth of 2.5 per cent for the 12 months to December 2018. The research firm said this result “[broke] what was a decades-long history of increases”.

The decline was led by a 29 per cent fall in inflows for AIA, as well as a 7.8 per cent decline for AMP and a 4.3 per cent decrease at MLC.

BT and Zurich also saw inflow declines of 4 per cent and 3.5 per cent respectively during the year.

However, a number of insurers did record positive numbers in 2019, including TAL who saw an 18.8 per cent increase in inflows; ClearView, with an 8.3 per cent increase; and MetLife, which saw a 5.8 per cent rise.

Total new premium sales declined 3.9 per cent across the industry during the year, with the winding up of AMP’s life insurance business seeing a 77.5 per cent decrease in sales for the wealth manager.

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BT also saw a 60.4 per cent decrease in premium sales, while AIA’s sales dropped by 39.2 per cent.

Just two insurers saw sales increases in 2019, with TAL’s premium sales jumping by 202.1 per cent and MLC increasing sales by 7.3 per cent.

TAL became the market leader in the overall risk market in 2019, with 28.6 per cent market share, up from 23 per cent last year. AIA had the second-highest market share at 17.5 per cent, down from 23.6 per cent the previous year.

Risk market has worst year in decades
Risk market has worst year in decades
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