Life insurance sales strong
Life insurance business continues to show strong growth in the current challenging market conditions, according to statistics released by the Investment Savings and Insurance Association (ISI).
Thursday, February 26th 2009, 11:50AM
“Total premiums payable for all categories of life insurance increased 9.4% to $1.544 billion in the 12 months to 31 December 2008. In the same period premiums for the popular risk products sector have grown a strong 11.9%,” says Vance Arkinstall, ISI chief executive.
He believes continued growth reflects peoples’ need to seek peace of mind in difficult economic times by “ensuring they have important protection for their families through life insurance and income protection insurance.”
However, despite continued growth, underinsurance remains a major issue in New Zealand, creating a potential burden for both taxpayers and the welfare system.
“Clearly there are many New Zealanders who do not have life insurance or have inadequate protection. In these cases if the worst should happen the cost of supporting the family and dependents falls upon the welfare system,” Arkinstall says. “In a business environment ensuring adequate cover for key staff and business partners is essential, particularly in a challenging environment when access to credit funding is not easy.”
The life insurance industry also is encouraging the government to defer the introduction of a new taxation regime for life insurance.
“With the current global economic problems now is not the time to raise taxation which will inevitably increase the cost of an essential financial service,” Arkinstall says.
The leading top 10 life insurers based on total inforce premiums as at 31 December 2008 were:
|
Company |
Total inforce premiums |
Market share |
|
Sovereign |
455,981 |
29.5 |
|
AXA |
214,024 |
13.9 |
|
AMP |
211,710 |
13.7 |
|
Asteron Life |
126,210 |
8.2 |
|
AIG Life |
90,808 |
5.9 |
|
Tower NZ |
79,617 |
5.2 |
|
Westpac Life |
74,144 |
4.8 |
|
Fidelity Life |
70,507 |
4.6 |
|
CIGNA Life |
59,339 |
3.8 |
|
ING |
52,215 |
3.4 |
For the year ended 31 December 2008, life insurers paid $460 million in death claims, $201 million in maturities and $227 million in other benefits including income protection claims and surrender values. The total sum paid of $888 million in 2008 is 8% higher than was paid in 2007.
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