The prudential regulator’s life insurance statistics for December 2020 revealed that total revenue had declined 68.9 per cent year-on-year across the sector, from $42.7 billion in 2019 to $13.3 billion in 2020.
Net policy revenue had also declined 9.3 per cent year-on-year to $14.4 billion in 2020, while investment revenue had descended from $24.6 billion in 2019 to -$2.3 billion in 2020 as a result of COVID-related volatility.
APRA noted that losses across the life industry had improved from $0.3 billion in 2019 to $0.1 billion in 2020, but said this was due to reserves being released to cover losses and claims payments.
The data revealed that losses across risk products were improving but still substantial, with individual disability income insurance products recording a loss of $739.9 million for 2020, compared with a $1.47 billion loss in 2019.
Losses persisted across the group insurance category with group lump sum and group disability income reporting losses of $173.5 and $122.5 million, respectively. Individual lump sum was still profitable as a product category, reporting a profit of $543.7 million.
The prudential regulator said the industry’s performance “continues to be challenged”.
There has always been to many insurers for such a small market so wonder it’s become unsuitable. When the same client keeps getting moved around from one insurer to the other leaving the substandard lives behind that places more pressure on the insurance pool. It’s a joke but the regulators just keep allowing new players into the market so there is so called greater competition. Well guess what? all that does is allow for more existing policies to be moved under the banner of Best Interest Duty. What once was the best is no longer due to pricing increases, give me a break! There’s a valid reason for increases but it’s easier to move an exiting client rather than finding new ones. ASIC should look at the big writers at PPS & NEOS, new players under Noble Oaks license and see if they are new clients or existing ones and they will find the answer they are looking for.
HAH! And ‘Nah, Nah, Nanah Nah!” We told you this would happen!
I’m not buying that the massive drop was due to Covid and claim stats either…I was flat out last year and actually did okay without bragging but the massive amount of work that I (and every other adviser) had to do for it was just ludicrous – and UNSUSTAINABLE.
But that’s okay ASIC, APRA, FASEA and Governments (both past and current)….you keep pursuing this ridiculous notion of a perfect world where no-one makes a mistake at the expense of an entire industry. There’s more carnage to see play out yet, believe me you ill-informed, ignorant and stubborn idiots.
Exactly
Canberra Bubble Moronic Bureaucrats with ZERO real world understanding.
Every time regulators try to ‘fix’ perceived problems, they make them worse. These numbers will only get worse as advisers flee the risk space.
Insurance why would you bother with insurance with a 2 year clawback and commission structural that is not viable nb we have tried fee for service for insurance not one client has taken up
Another stuff up
This is what happens when you play around with a system and have no idea what you are doing.
If only there was a way to make it viable to provide insurance advice and increase new business.
There is. Problem is, the muppets are more pre-occupied with LIP SERVICE
I know. I was being sarcastic.