APRA releases life insurance statistics for September 2022
The Australian Prudential Regulation Authority (APRA) has released its Quarterly Life Insurance Performance Statistics publication for the September 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 September:
| Year ended Sep-21 ($bn) | Year ended Sep-22 ($bn) | Yearly Change |
Net policy revenue | 14.6 | 14.8 | 1.5% |
Investment revenue | 5.4 | -7.5 | - |
Total revenue | 20.9 | 8.3 | -60.1% |
Net policy expenses | 9.2 | 9.2 | 0.2% |
Operating expenses | 7.0 | 6.5 | -6.4% |
Effective movement in net policy liabilities | 2.2 | -7.2 | - |
Total expenses | 18.6 | 8.7 | -53.2% |
Net profit after tax | 1.4 | 0.2 | -87.0% |
Total assets | 134.2 | 122.4 | -8.8% |
Key performance statistics for the life insurance industry for the quarter ended 30 September:
| Jun 2022 Quarter ($bn) | Sep 2022 Quarter ($bn) | Quarterly change |
Net policy revenue | 3.7 | 3.9 | 4.9% |
Investment revenue | -3.9 | -0.5 | - |
Total revenue | 0.05 | 3.7 | - |
Net policy expenses | 2.4 | 2.3 | -2.2% |
Operating expenses | 1.5 | 1.7 | 15.8% |
Effective movement in net policy liabilities | -3.3 | -0.3 | - |
Total expenses | 0.5 | 3.8 | 669.8% |
Net profit after tax | -157m | 65m | - |
Total assets | 121.4 | 122.4 | 0.8% |
For the year ended 30 September 2022, the industry reported a net profit after tax of $0.2 billion and a return on net assets of 0.7 per cent, a decrease in comparison to the results from the prior year. The driver behind the decrease in performance was an investment loss of $7.5 billion due to unrealised losses on interest bearing investments.
Collectively, risk products returned an improved result for the year ended 30 September 2022, recording a profit of $977 million compared to prior year’s profit of $435.7 million. This was predominantly driven by a $1.1 billion profit recorded by Individual Disability Income Insurance. The increase in Individual Disability Income Insurance can be attributed to repricing activities as well as reserve releases as a result of increases in bond yields over the past 12 months. Individual Lump Sum reported a loss of $207.0 million, a decline in performance compared to the prior year. Group products both returned improved results with Group Lump Sum recording a profit of $7.6 million and Group Disability Income Insurance recording a profit of $96.8 million.
Net profit after tax by product for the life insurance industry for the year ended 30 September:
Risk product | Year ended Sep 2021 ($m) | Year ended Sep 2022 ($m) | Sep 2022 quarter only ($m) |
Individual lump sum | 430.1 | -207.0 | -105.4 |
Individual disability income insurance | 117.6 | 1079.6 | 69.5 |
Group lump sum | -97.5 | 7.6 | 6.2 |
Group disability income insurance | -14.4 | 96.8 | 47.2 |
Total | 435.7 | 977.0 | 17.5 |
Key ratios for the life insurance industry for the year ended 30 September:
| Year ended Sep 2021 | Year ended Sep 2022 | Jun 2022 Quarter | Sep 2022 Quarter |
Return on net assets | 5.2% | 0.7% | -2.4% | 1.0% |
Prescribed capital amount coverage ratio | 1.95x | 2.06x | 2.03x | 2.06x |
The September 2022 Quarterly Life Insurance Performance Statistics publication is available on APRA’s website at: 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, mutuals, general insurance and reinsurance companies, life insurance, private health insurers, friendly societies, and most members of the superannuation industry. APRA currently supervises institutions holding around $9 trillion in assets for Australian depositors, policyholders and superannuation fund members.