Amid the expected effects of the global economic downturn, the Singapore life insurance sector has recorded $1.05 billion in weighted new business premiums in the first quarter of 2023. This figure represents a 13.6% drop from the same period last year.
Single-premium products, in particular, took a nosedive, recording 46.3% lower sales on a quarter-on-quarter basis, resulting in weighted premiums amounting to $355.7 million.
According to a news release from the Life Insurance Association (LIA) of Singapore, the fall in demand for single-premium products can also be attributed to a volatile macroeconomic environment, in addition to rising interest rates in an increasingly competitive sector.
Despite the downturn, there is a notable increase in the uptake of annual premium products as it rose by 24.7% quarter-on-quarter equivalent to $692 million in total weighted premiums.
The industry recorded $30.5 billion in total sum assured during this period, with tied representatives accounting for $12.3 billion (40.3%) and financial advisory (FA) representatives securing $10.4 billion (34.1%). LIA Singapore president Dennis Tan assured the country’s policyholders that its commitment to the sector remains despite the results.
“On this end, the Life Insurance Association, Singapore, will be launching findings of our nationwide protection gap study, looking at the mortality and critical illness protection gaps that exist. We remain committed to driving efforts to get the community better protected,” Tan said.
The sector’s non-life sibling, on the other hand, recorded a thriving year-on-year growth as the general insurance sector reported a 15% uptick for both offshore and domestic segments.
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