THE Financial Services Commision (FSC) indicates in its latest insurance industry update (to December 2021) that the island’s six life insurance companies continued their dominance within the insurance sector, accounting for 79 per cent of the sector’s total assets, while the eleven general insurance companies accounted for 21 per cent.

According to FSC data, both total assets and investment assets for the life insurance companies rose by 8.2 per cent and 8 per cent to $397.6 billion and to $354 billion, respectively, as at December 31, 2021.

Combined total liabilities grew by 7.3 per cent to $264.5 billion from the $247.2 billion as at end of December 2020. Cumulated capital climbed by 10.8 per cent to $133.1 billion, from $120.2 billion at December 2020.

For the life sector, for the twelve-month period ended December 2021 net premiums earned (NPE) for the industry amounted to $76.5 billion, reflecting a 13.4 per cent expansion when compared to the NPE of $67.5 billion for the similar period in 2020.

The FSC noted that the growth in NPE was due to an uptick in business, especially the annuity class of business. Other income jumped by 47.8 per cent, over the comparative period in 2020, to reach $7.4 billion at December 2021. This was mainly due to an extraordinary item of recognition of income to the general fund, the FSC outlined.

Investment leap

Net investment income, meanwhile, leaped to $27.1 billion from the $8.6 billion over the reporting period. This was triggered by higher yields and fair value gains from investment assets. Consequently, total combined revenue grew by 36.8 per cent to $111.0 billion (December 2020: $81.1 billion).

The FSC outlined that aggregate total expenses, excluding taxes for life insurers, rose by 70.4 per cent to $82.2 billion (December 2020: $48.4 billion).

According to the regulator, the hike in expenses was due to a substantial expansion in operating, as well as claims and related expenses in the reporting period.

The FSC stated, “With aggregate expenses growing faster than combined total revenue, cumulated net income before tax fell 13.0 per cent to $28.5 billion at December 2021, (December 2020: $32.7 billion).”