In 2019, Singapore’s general insurance industry slid into red as it suffered S$28 million underwriting loss in comparison to the S$36.3 million profit in 2018.
According to the results released by General Insurance Association of Singapore (GIA) on Tuesday (24 March), the loss was mainly caused by the S$159 million or 12.2 per cent increase in total insurance claims doled out in 2019.
The combined underwriting loss of the five biggest segments, which are employer’s liability and travel, motor, property, and health was S$43.4 million last year. These five segments form 70 per cent of the general insurance market.
There was a partial offset to this loss by the personal accident segment as it recorded underwriting profit of S$17.2 million.
As at 31 December last year, the gross written premiums for the entire sector rose 7.6 per cent on the year to reach S$4.1 billion.
Segment-wise, the biggest contributor to gross written premiums was motor insurance as it brought in some S$1.12 billion in 2019, which was a 1 per cent increase from 2018. Even so, the sector’s overall underwriting performance was dragged down due to the S$41.3 million or 7.6 per cent increase in total claims doled out. There was an underwriting loss of S$17.4 million in the motor insurance segment, compared to a profit of S$9.2 million in 2018.
Last year, vehicle ownership in the country saw a shift as evidenced by the highest vehicle population since 2013. The main driver of this was the increase in private-hire cars, GIA pointed out.
GIA added that “this meant that the sector was insuring a vehicle population with higher risk profiles as private-hire cars are driven more frequently on the road,” as shown by the higher total number of reported accidents in 2019, which rose by 1.4 per cent from 2018.
The second-biggest general insurance sector in the country, health insurance saw a smaller underwriting loss to S$11.2 million in 2019, compared to 2018’s S$44.2 million loss.
The health insurance claims continued to increase by S$22.6 million or 8.1 per cent in payouts to insurance holders needing medical treatments in 2019. There was an increase in gross written premiums around S$666.8 million or 14.3 per cent in 2019 from S$583.3 million in 2018.
In the employers’ liability insurance segment, the sustained growth in employment in the construction sector in 2019 helped support the segment as it saw a rise in gross written premiums by 8.9 per cent. GIA reported that in the midst of 5 per cent increase in the number of non-fatal injuries, the sector doled out S$8.29 million more in work injury compensation, although the number of workplace fatalities dropped to a record low in 2019.
GIA appointed a new management committee on Tuesday (24 March) at its annual general meeting. Craig Ellis was elected as president whereas Christian Sandric was elected as vice-president.
The Singapore’s general insurance sector is “determined to overcome” the current challenges posed by COVID-19 together and it will double its efforts to back all stakeholders, community, partners and GIA members, Mr Ellis reassured.
He added, “We will ensure that general insurance protection remains accessible for everyone.”
Aside from the efforts towards combating COVID-19, GIA is also focused on establishing a new centralised investigation bureau whose aim to is to take the torch from GIA in its insurance fraud-prevention initiatives. Through the recently established market development committee, the bureau will also promote innovative changes for the insurance sector.