Individual disability income insurance (IDII) has reported a substantial loss during the September quarter as the life insurance industry’s performance continues to be challenged, according to Australian Prudential Regulation Authority (APRA) data.
The data found IDII lost another $318.8 million during the quarter, totalling a loss of $1.349 billion for the year to September, 2020. APRA said this was primarily driven by loss recognition as adverse claims experience persisted.
The overall life insurance industry reported a net loss after tax of $1.6 billion over the year to September, 2020 – a reduction from the $220 million profit from the previous year. APRA said the deterioration was caused by poor results during the December and March quarters.
For the 12 months to September, 2020, risk products reported an after-tax loss of $1.5 billion as performance of all risk products deteriorated over the year apart from individual lump sum products.
The second-largest loss after IDII during the quarter was group lump sum at a loss of $95.5 million.
Risk product net profit after tax for the life insurance industry in the year ended 30 September 2020
|
Risk product |
Year to Sep 2019 ($m) |
Year to Sep 2020 ($m) |
Sep 2020 quarter only ($m) |
|
Individual lump sum |
866.0 |
354.8 |
162.8 |
|
Individual disability income insurance |
-1,119.0 |
-1,349.0 |
-318.8 |
|
Group lump sum |
8.1 |
-403.2 |
-95.5 |
|
Group disability income insurance |
-173.1 |
-147.9 |
35.5 |
|
Total |
-418.0 |
-1,545.3 |
-216.0 |
Source: APRA
