Australian Prudential Regulation Authority Releases Life Insurance Statistics for March 2020

SYDNEY, Australia, May 29 --The Australian Prudential Regulation Authority issued the following news release:

The Australian Prudential Regulation Authority (APRA) has released its Quarterly Life Insurance Performance Statistics publication for the March 2020 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 in the year ended 31 March:

See table here (https://www.apra.gov.au/news-and-publications/apra-releases-life-insurance-statistics-for-march-2020).

Key performance statistics for the life insurance industry in the quarter ended 31 March:

See table here (https://www.apra.gov.au/news-and-publications/apra-releases-life-insurance-statistics-for-march-2020).

The life insurance industry's performance continues to worsen. Net loss after tax was $1.8 billion for the year to March 2020, a significant reduction from $759 million profit in the previous year. This deterioration was caused by poor results in both the December and March quarters, driven by the poor performance of risk business (see below) and a substantial collapse in investment revenue owing to the COVID-19 related volatility in investment markets. This was somewhat offset by the release of reserves, which fell by 78.1% in the 12 months to March 2020.

For the 12 months to March 2020, risk products reported a combined after-tax loss of $1.6 billion. All risk products deteriorated with the only exception being the Individual Lump Sum product. In particular, Individual Disability Income Insurance (also known as Income Protection Insurance) reported a substantial loss, primarily driven by loss recognition as adverse claims experience persists.

Risk product net profit after tax for the life insurance industry in the year ended 31 March:

See table here (https://www.apra.gov.au/news-and-publications/apra-releases-life-insurance-statistics-for-march-2020).

Key ratios for the life insurance industry in the year ended 31 March:

See table here (https://www.apra.gov.au/news-and-publications/apra-releases-life-insurance-statistics-for-march-2020).

The March 2020 Quarterly Life Insurance Performance Statistics publication is available on APRA's website at: Quarterly life insurance performance statistics (https://www.apra.gov.au/quarterly-life-insurance-performance-statistics).

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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 $6.5 trillion in assets for Australian depositors, policyholders and superannuation fund members.