In 2018 the total assets of the Fijian insurance industry grew by 9.2 per cent or $95.5 million to $2.8 billion.
This was supported by the life insurance sector as revealed by the Reserve Bank of Fiji governor, Ariff Ali during the submission to the Standing Committee on Economic Affairs on the Reserve Bank of Fiji Insurance Annual Report 2018 yesterday.
“The industry made up around 8 per cent of the total assets of the financial system,” he said.
“While the number of life policies enforced increased by 2977 in 2018, there was a significant 62.5 per cent decline in general (non-life) insurance policies compared to 2017, that is a reduction of 124,465 policies arising from the transfer of the compulsory third party (CTP) class to the Accident Compensation Commission Fiji (ACCF).
“However the general insurance industry benefited from an increase in group covers by 1069 policies in 2018.”
According to Mr Ali, the insurance industry’s combined gross premiums had grown by 7.5 per cent to $347.9m in 2018 which was supported by growth in both the life and general insurance sectors.
“A marginal pick-up in the contribution of the industry to GDP was noted, with gross premiums as a percentage of GDP registering at 3.4 per cent in 2018, compared to 3 per cent in 2017.
“The gross premiums of the general insurance sector grew by 8.4 per cent to $205.7m, despite the transfer of the CTP insurance class to the ACCF, underpinned by renewals and new policies issued for the motor vehicle class, and the continued uptake of the micro insurance bundled product.
“The life insurance sector recorded a turnaround with a 6.2 per cent increase in gross premiums to $142.2 million from a decline in 2017 and it’s attributed to the continued uptake of investment-linked endowment products.”
Mr Ali said the risk transfer role which the insurance industry provided was vital to the sustainability of the economy.
He added the insurance provided the necessary safeguard for the financial health of individuals, families, communities, businesses financial institutions and the economy as a whole.
“A key safeguard therefore is in the form of claim payments, and total net claims and policy payments increased by 6.0 per cent to $223.3 million in 2018.
“The general insurance sector’s net claims paid increased by 7.8 per cent to $104.5 million, due to the settlement of major fire claims.
“Similarly, the life insurance sector recorded an increase of 4.5 per cent to $118.8 million in 2018, as mature policies accounted for majority of the payout to policyholders,” he said.