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[Updated]  The latest life insurance statistics show that OnePath has done well, Partners is slowing, AMP is having problems and Sovereign still remains number one.

Friday, June 7th 2013, 10:12AM 12 Comments

by Susan Edmunds

Correction

The original story had an error relating to Pinnacle and Kiwi Insurance lapses. Across the 4 categories of Term, Trauma, RI and LSD Pinnacle new business was $195,000 which was 22% higher than lapses of $160,000. Kiwi Insurance lapses of $354,000 were 2.8 times higher than new business.

New annual premium income for all risk products was the highest for any March quarter in the last five years, according to the latest Financial Services Council statistics. March is historically the slowest quarter.

Total new API stood at $46.876 million in the March 2013 quarter, 15% higher than the same period last year.  It follows a December quarter that was 22% up on the year before.

Overall, the volume of annual premiums in force in March 2013 was $2 billion, fractionally up on December 2012 and 6.5% up on the same time last year. Partners Life was not included in the March 2012 return – when it is removed from the 2013 calculation, premiums had increased 3.9% over the year.

Lapses outweighed new business in the quarter but total PI ended up 1.1% higher because of contractual premium increases of 1.6%.

A quirk of reporting meant some unusual results from Fidelity Life.

Fidelity had been reporting the number of people insured in previous periods, rather than the number of contracts in place.

When that was adjusted to fall into line with the other insurers, the number of Fidelity risk term products reported in the March quarter was more than 220,000, compared to the 57,000 reported in December. But the average value of its premiums dropped from more than $900 to $259, the lowest on the table.

Sovereign dominates the insurance market with a 30% market share. It was followed by AMP with 19% and Asteron with 10%.

AMP’s lapses were four times the value of its new business. For trauma products, AMP wrote 6% of new business but accounted for 18% of lapses, and wrote only 5% of new income replacement business but accounted for 18% of lapses.

Despite only having been in business a relatively short time, Partners Life has secured 3% of the market and it increased its new PI by 12% through the March quarter. That is down from the December quarter’s 21% and September’s 31%, which suggests growth may be slowing.

Partners wrote 3829 new risk term contracts in the quarter, down from 5000 in December.  Its share of new term risk business dropped to 11 per cent from 14 per cent in the previous two quarters.

OnePath also had a good quarter in March, with the second-highest dollar value of new business written, behind Sovereign, and the second-highest percentage increase, behind Partners.

Total income replacement business was well down on the previous two quarters, at $9.1 million compared to more than $11 million in December and September. But it grew by 8.6% over the year and lump sum disablement grew by 11.9%, as measured by annual premiums in force.

OnePath wrote the most income replacement business, at just over 22%. It was followed by Sovereign. Its new business was worth more than $2 million.

AMP appears to be slowing markedly – after reporting 83% growth in the year ended March 2012, it reported growth of just 4% to March 2013.

AIA, which reported an extremely high level of lapses in the December 2012 quarter due to a one-off event, is back to more normal levels.

There was $120 million in death benefits paid in the March quarter.

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