Singapore life insurance industry to hit $77b
Singapore’s life insurance industry is forecast to reach SGD100.4 billion ($77 billion) by 2027, growing at a compound annual growth rate (CAGR) of 9.8%, from SGD 62.9 billion ($47.2 billion) in 2022, according to GlobalData.
The data showed that the industry grew at 13.3% in 2022 however it was predicted to grow at 10.9% in 2023, with the growth driven primarily by increased awareness of financial planning after the pandemic which led a push towards protection products such as term and whole life insurance.
Shabbir Ansari, senior insurance analyst at GlobalData, said that Singapore’s life insurance industry was resilient and recorded its fastest growth in recent years despite the pandemic.
“After witnessing high growth of 18.0% and 21.6% in 2020 and 2021 respectively, the industry growth is expected to slowdown from 2022 onward due to slowing economic growth, rising inflation, and global geopolitical uncertainties,” he added.
The demand for whole life insurance, which is the largest segment within the Singapore life insurance market and accounted for a 50.3% share of the GWP last year, was led by the pandemic-induced awareness of the need for financial protection from life-threatening events and diseases.
Following this, endowment insurance accounted for a 33.1% share of the overall life GWP in 2022 while non-linked endowment policies were preferred insurance products in Singapore as they provided guaranteed returns along with life insurance cover.
Non-linked endowment insurance accounted for more than 80% of the total endowment GWP in 2022.
Personal Accident and Health (PA&H) accounted for an 8.6% share of the overall life GWP in 2022 as the rise in healthcare costs, which were expected to increase by 9% in 2023, and increasing health awareness pushed the demand for private health insurance in Singapore.
According to Global Data, PA&H insurance was expected to grow at a CAGR of 5.3% during 2022-2027.
Term life as well as other life and annuity insurance accounted for the remaining 8.0% share of the life insurance GWP in 2022.
According to Ansari, the increasing awareness for financial protection, product innovations, and a growing affluent population in the country would see the Singaporean life insurance industry witness strong growth over the next five years.
So Singapore has a growing and thriving insurance industry, in contrast, the Australian market is on life support and close to death. Perhaps ASIC, APRA, the Government and advisor associations take a look at what is happening over there.
I’m willing to bet the Singapore regulator, insurance industry and Governments would be looking at us in utter disbelief!