HK Insurance Authority publishes results for first three quarters of 2023

Which sectors recorded the biggest drops?

HK Insurance Authority publishes results for first three quarters of 2023

Insurance News

By Kenneth Araullo

The Insurance Authority (IA) of Hong Kong has disclosed provisional statistics for the local insurance industry for the first nine months of 2023. These figures indicate a slight decline in total gross premiums, which fell by 1% to HK$428.6 billion, compared to the same period in 2022.

In the long-term business sector, total revenue premiums for in-force policies amounted to HK$374.8 billion, marking a 1.7% decrease. This total includes HK$329.2 billion from individual life and annuity (non-linked) business, showing a 2.8% increase.

However, there was a 17% decrease in individual life and annuity (linked) business to HK$18.2 billion, and a significant 35% drop in retirement scheme business to HK$22.4 billion. This decline was attributed to specific transactions related to retirement scheme business during the same period in 2022. Total claims and benefits paid to policyholders rose to HK$239.7 billion, a 7.4% increase.

New office premiums for long-term business, excluding retirement scheme business, witnessed a substantial rise of 30.6% to HK$146.5 billion. This was primarily due to a 37.4% increase in Individual life and annuity (non-linked) business, amounting to HK$137.3 billion, despite a 24.4% decline in Linked business to HK$9 billion. Around 24,300 qualifying deferred annuity policies were issued, contributing HK$1.6 billion in premiums, equating to 1.1% of the total for individual businesses.

Premiums from Mainland visitors decreased by 32.9% quarterly to HK$15 billion, but still reached HK$46.8 billion or 32% of the total for individual businesses over the first three quarters. About 97% of these policies were non-single premium, with whole life, critical illness, and medical insurance constituting 54%, 35%, and 4% of the policies respectively.

In general business, gross and net premiums for the first three quarters of 2023 were HK$53.8 billion (up 4.7%) and HK$34.7 billion (up 3%) respectively, with gross claims of HK$22.8 billion (a 5.6% increase). The overall underwriting profit fell significantly from HK$3.4 billion to HK$1.5 billion.

Direct business saw gross and net premiums of HK$39.6 billion (up 5.4%) and HK$27.9 billion (up 5%) respectively. Accident and health business gross premiums were HK$15.4 billion, increasing by 13%, driven by recovery in travel and new coverages in medical insurance. motor vehicles and property damage businesses reported increases of 6.9% and 7.4% respectively, while pecuniary loss business saw a 12.3% reduction to HK$2.8 billion. The overall underwriting profit for direct business dropped by 68.3% to HK$649 million, with net claims incurred ratio rising from 57.2% to 62.2%.

Reinsurance inward business recorded gross and net premiums of HK$14.2 billion (up 2.9%) and HK$6.8 billion (down 4.7%) respectively. The overall underwriting profit in this segment declined by 35.7% to HK$870 million. The net claims incurred ratio increased slightly from 47.3% to 48.6%.

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