FINANCIAL SERVICES BOARD INSURANCE DIVISION

Transcription

1 FINANCIAL SERVICES BOARD INSURANCE DIVISION SPECIAL REPORT ON THE RESULTS OF THE LONG-TERM INSURANCE INDUSTRY FOR THE PERIOD ENDED SEPTEMBER

2 1 SPECIAL REPORT ON THE RESULTS OF THE LONG-TERM INSURANCE INDUSTRY Industry results - Typical insurers (typical insurers, for the purpose of this report, are those insurers who offer most of the six classes of business as defined in the act, in the primary market). The table below sets out combined unaudited statistics (net after reinsurance) for typical insurers for the years to and for the first of as well as comparative figures for the first of. a (3) % of net Investment yield %* 11 (1) Individual lapse %** Individual Individual expiry %** cover ratio (median) cover ratios - Typical insurers Covered 0-1 times Covered 1-2 times Covered 2-5 times Covered 5-10 times Covered 10+ times a During, there was reclassification of companies. As a result one typical insurer was reclassified as niche. * Return on investment is calculated according to the formula R=2i/A+B-i where i is all investment income plus realised and

3 2 Industry results - Niche insurers (niche insurers, for the purpose of this report, are those insurers who conduct business in a specific target market). The table below sets out combined unaudited statistics (net after reinsurance) for typical insurers for the years to and for the first of as well as comparative figures for the first of. b Net premiums- Non-recurring (15) 21 (2) % of net Investment yield %* 12 (4) (2) (21) 19 (23) (25) (20) 25 Individual lapse %** Individual (4) Individual expiry %** cover ratio (median) cover ratios - Niche insurers Covered 0-1 times Covered 1-2 times Covered 2-5 times Covered 5-10 times Covered 10+ times b During, there was reclassification of companies. As a result one typical insurer was reclassified as niche. 1 The substantial increase in non-recurring premium was due to one insurer starting doing business this year after being in run-off.

4 3 Industry results - Linked investment insurers (linked investment insurers, for the purpose of this report, are those insurers who underwrite policies whereby the value of the policy is directly linked to the value of the assets invested in, and no guarantees are offered). The table below sets out combined unaudited statistics (net after reinsurance) for typical insurers for the years to and for the first of as well as comparative figures for the first of. c Net premiums- Non-recurring (21) % of net Investment yield %* 13 (4) Individual lapse %** Individual Individual expiry %** cover ratio (median) cover ratios - Linked investment insurers Covered 0-1 times Covered 1-2 times Covered 2-5 times Covered 5-10 times Covered 10+ times

5 4 Industry results - Cell captive insurers (cell captive insurers, for the purpose of this report, are those insurers who conduct business on a cell captive basis only). The table below sets out combined unaudited statistics (net after reinsurance) for typical insurers for the years to and for the first of as well as comparative figures for the first of. 9 Months Net premium increase (year 50 (17) (2) Management Expenses (as % of net Investment yield %* Number of policies increase - (3) (40) (4) cover ratio (median) cover ratios - Cell captive insurers Covered 0-1 times Covered 1-2 times Covered 2-5 times Covered 5-10 times Covered 10+ times d

6 5 Industry results Reinsurers (reinsurers, for the purpose of this report, are those insurers who conduct only professional reinsurance and are not involved in marketing to the public). The table below sets out combined unaudited statistics (net after reinsurance) for typical insurers for the years to and for the first of as well as comparative figures for the first of. 9 Months % of net Investment yield %* cover ratio (median) cover ratios - Reinsurers Covered 0-1 times Covered 1-2 times Covered 2-5 times Covered 5-10 times Covered 10+ times e

7 6 Industry results - Assistance insurers (assistance insurers, for the purpose of this report, are those insurers who offer life policies where the sum assured does not exceed R18 000). The table below sets out combined unaudited statistics (net after reinsurance) for typical insurers for the years to and for the first of as well as comparative figures for the first of (23) % of net Investment yield %* (2) Individual lapse %** Individual Individual expiry %** cover ratio (median) cover ratios - Assistance insurers f Covered 0-1 times Covered 1-2 times Covered 2-5 times Covered 5-10 times Covered 10+ times