Singapore’s life insurance industry recorded a total of S$4.38 billion in weighted new business premiums in 2020, up three per cent from a year earlier, according to the Life Insurance Association, Singapore (LIA Singapore).
Data showed that the industry posted a rebound in the second half of 2020 after the initial fallout from COVID-19, which affected policy uptake most significantly in the second quarter of the year.
“The foremost priority for life insurers this year is to ensure that individuals, families and companies continue to have their healthcare, financial, and service needs met as we continue to experience fallout from the global pandemic. We are working closely with the relevant government agencies to constantly review the situation and support national initiatives,” said LIA Singapore president Khor Hock Seng.
The uptake of new policies purchased online saw a significant increase to 206,679 in 2020 compared to 9,971 in 2019. Most of the policies purchased online were single premium products such as short-term non-par endowment plans, par whole life plans, and universal life plans.
Contributing factors leading to increased uptake of such policies online include:
- Simple online purchasing process
- Simple and easy to understand features
- Short-term commitment period, especially appealing to consumers amid uncertain financial security, and
- Reasonable returns, which are attractive to consumers seeking safe assets amid a low interest rate environment and uncertain economy.
Sales of single premium products recorded a 47 per cent year-on-year increase in weighted premiums amounting to S$1.84 billion in total for YTD 4Q2020.
Strong uptake of single premium products cushioned the decreased uptake of annual premium policies for the year.
Sales of annual premium products recorded a 15 per cent drop from the same period last year, amounting to S$2.55 billion in total weighted annual premiums.
Employment in the life industry rose by four per cent, compared to the corresponding period in 2019, with 320 net new hires. This brings Singapore’s life insurance industry’s workforce to 8,768 employees as at 31 December 2020. New hires have primarily been attributed to insurers expanding their IT and operations teams as well as steady hiring in project and product management roles.
The demand for digital specialists is expected to continue unabated in the foreseeable future as the industry presses on with digital transformation efforts.
In the same period, 15,201 representatives held exclusive contracts with companies that operate a tied-agency force. – BusinessNews.ph