Life Insurers Post Profit Downturn

0

Net profit after tax for the entire life insurance sector fell away by more than $500 million in the year to the end of March 2017, according to data released by the Australian Prudential Regulation Authority (APRA).

In its March report, APRA stated that net profit after tax (NPAT) had declined from $2.9 billion at March 2016 to $2.4 billion a year later, as premium income grew from $16.4 billion to $18.2 billion over the same period. Claims, however, also rose during that time going from $7.7 billion to $9 billion.

In the specific risk product categories, NPAT was $394 million for the March 2017 quarter and $688 million for the year ending 31 March 2017.

Individual Lump Sum Risk products contributed $255 million to the total net profit after tax figure for the March quarter and $771 million for the year, which was still lower than the year ending March 2016, which recorded a NPAT of $1.05 billion.

In the specific risk product categories, total net profit after tax was $394 million for the March 2017 quarter while the net profit after tax for the year ending 31 March 2017 was $688 million.

Individual Lump Sum Risk products contributed $255 million to the total NPAT figure for the March quarter and $771 million for the year, which was still lower than the year ending March 2016, which recorded a NPAT of $1.05 billion for this product category.

Individual Disability Income Insurance products continued a downward run recording a $20 million loss in NPAT for the March 2017 quarter and a $427 million loss for the year, which was a marked decline compared to the $19 million loss recorded for the whole previous year.

Group Lump Sum Risk products contributing $63 million to NPAT for the quarter and $265 million for the year, down $121 million over the year from March 2016.

Group Disability Income Insurance bucked the downward trend and contributed $96 million to total NPAT for the March 2017 quarter and $79 million for the year, up from the $21 million recorded for the previous year.