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APRA releases life insurance statistics for June 2022

Thursday 25 August 2022

The Australian Prudential Regulation Authority (APRA) today released its Quarterly Life Insurance Performance Statistics publication for the June 2022 quarter.

The Quarterly Life Insurance Performance Statistics publication provides industry aggregate summaries of financial performance, financial position, capital adequacy and key ratios.

Key performance statistics for the life insurance industry for the year ended 30 June:

 

Year ended Jun-21 ($bn)

Year ended Jun-22 ($bn)

Yearly Change

   Net policy revenue

14.6

14.7

0.8%

   Investment revenue

6.3

-6.3

-

Total revenue

21.7

9.5

-56.4%

   Net policy expenses

9.4

9.2

-1.7%

   Operating expenses

7.0

6.7

-4.4%

   Effective movement in net policy liabilities

3.3

-6.7

-

Total expenses

19.9

9.3

-53.3%

Net profit after tax

1.0

0.5

-51.6%

Total assets

132.7

121.4

-8.5%

Key performance statistics for the life insurance industry for the quarter ended 30 June:

 

Mar 2022 Quarter ($bn)

Jun 2022 Quarter ($bn)

Quarterly change

   Net policy revenue

3.4

3.7

9.5%

   Investment revenue

-3.9

-3.9

-

Total revenue

-225m

43m

-

   Net policy expenses

2.1

2.4

10.7%

   Operating expenses

1.4

1.5

1.4%

   Effective movement in net policy liabilities

-3.5

-3.3

-

Total expenses

0.02

0.5

-

Net profit after tax

47m

-156m

-

Total assets

126.6

121.4

-4.1%

For the year ended 30 June 2022, the industry reported a net profit after tax of $0.5 billion and a return on net assets of 1.9 per cent, a decrease in comparison to the results from the prior year. Net policy revenue remained stable, however the industry reported a large investment loss of $6.3 billion as a result of unrealised losses on interest bearing investments.

Collectively, risk products returned an improved result for the year ended 30 June 2022, recording a profit of $1.2 billion compared to prior year’s loss of $18 million. This was driven by a 1.1 billion profit recorded by Individual Disability Income Insurance, a $1.5 billion increase from the previous year. Individual Lump Sum returned a fall in profit from $403.3 million to $89.5 million. Group products returned mixed results relative to the prior year, with continued losses in Group Lump Sum amounting to $121.5 million but Group DII returning a profit of $76 million.

Net profit after tax by product for the life insurance industry for the year ended 30 June:

Risk product

Year ended Jun 2021 ($m)

Year ended Jun 2022 ($m)

Jun 2022 quarter only ($m)

Individual lump sum

403.3

89.5

-62.7

Individual disability income insurance

-345.3

1148.8

282.3

Group lump sum

-70.5

-121.5

101.8

Group disability income insurance

-5.6

76.0

75.1

Total

-18.0

1192.8

396.6

 Key ratios for the life insurance industry for the year ended 30 June:

 

Year ended Jun 2021

Year ended Jun 2022

Mar 2022 Quarter

Jun 2022 Quarter

Return on net assets

3.8%

1.9%

0.7%

-2.4%

Prescribed capital amount coverage ratio

1.94x

2.03x

1.99x

2.03x

The June 2022 Quarterly Life Insurance Performance Statistics publication is available on APRA’s website at: Quarterly life insurance performance statistics.

Media enquiries

Contact APRA Media Unit, on +61 2 9210 3636

All other enquiries

For more information contact APRA on 1300 558 849.

The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, private health insurers, friendly societies, and most members of the superannuation industry. APRA currently supervises institutions holding $7.9 trillion in assets for Australian depositors, policyholders and superannuation fund members.