The Australian Prudential Regulation Authority (APRA) has released its quarterly life insurance performance statistics publication for the June 2023 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 ending 30 June:
Year ending June 2022 ($bn) | Year ending June 2023 ($bn) | Yearly change | |
|---|---|---|---|
| Net policy revenue | 14.7 | 14.7 | 0.0% |
| Investment revenue | -6.3 | 4.8 | – |
Total revenue | 9.5 | 20.5 | 116.9% |
| Net policy expenses | 9.2 | 8.5 | -7.3% |
| Operating expenses | 6.7 | 7.6 | 13.6% |
| Effective movement in net policy liabilities | -6.7 | 2.5 | – |
Total expenses | 9.3 | 18.8 | 103.2% |
Net profit after tax | 0.5 | 1.2 | 136.1% |
Total assets | 121.4 | 124.4 | 2.5% |
Key performance statistics for the life insurance industry, for the quarter ending 30 June:
Mar 2023 Quarter ($bn) | June 2023 Quarter ($bn) | Quarterly change | |
|---|---|---|---|
| Net policy revenue | 3.6 | 3.7 | 2.7% |
| Investment revenue | 3.8 | -0.3 | – |
Total revenue | 7.6 | 3.6 | -52.8% |
| Net policy expenses | 2.2 | 2.1 | -5.1% |
| Operating expenses | 2.1 | 1.8 | -11.8% |
| Effective movement in net policy liabilities | 2.3 | -0.4 | – |
Total expenses | 6.6 | 3.6 | -46.1% |
Net profit after tax | 652.3m | 22.3m | -96.6% |
Total assets | 126.7 | 124.4 | -1.8% |
For the year ending 30 June 2023, the industry reported a net profit after tax of $1.2 billion and a return on net assets of 4.6 per cent.
Risk products returned a net profit after tax of $441 million. Individual Lump Sum and Individual Disability Income Insurance (Individual DII) business reported weaker profits in the year, while Group Lump Sum and Group Disability Income Insurance (Group DII) business reported an improvement in performance in the year.
The aggregate industry prescribed capital amount (PCA) coverage ratio increased to 2.05x over the year ending 30 June 2023.
Net profit after tax by product for the life insurance industry for the period ending 30 June:
| Risk product | Year ending June 2022 ($m) | Year ending June 2023 ($m) | June 2023 quarter only ($m) |
|---|---|---|---|
| Individual lump sum | 88.1 | -367.4 | -659.5 |
| Individual disability income insurance | 1163.7 | 237.9 | 12.6 |
| Group lump sum | -121.3 | 420.6 | 560.7 |
| Group disability income insurance | 76.2 | 150.1 | 40.0 |
| Total | 1206.8 | 441.3 | -26.2 |
Key ratios for the life insurance industry:
| Year ending June 2022 | Year ending June 2023 | Mar 2023 quarter | June 2023 quarter | |
|---|---|---|---|---|
| Return on net assets | 1.9% | 4.6% | 10.0% | 0.3% |
| Prescribed capital amount coverage ratio | 2.03x | 2.05x | 2.09x | 2.05x |
The June 2023 quarterly life insurance performance statistics publication is available on APRA’s website at: .
