Insurance sector GWP up 11 % to Rs 105,310 M
The insurance industry was able to achieve a growth of 10.67% in terms of overall Gross Written Premium (GWP), during the 1st half of 2021, recording an increase of Rs 10,152 million when compared to the same period in the year 2020, according to the Insurance Regulatory Commission of Sri Lanka (IRCSL). According to IRCSL, the GWP for Long-Term Insurance and General Insurance Businesses was Rs 105,310 million compared to the 1st half of 2020 amounting to Rs 95,158 million.
The GWP of Long-Term Insurance Business amounted to Rs 56,159 million (1st half 2020: Rs 43,270 million) recording a growth of 29.79%. The GWP of General Insurance Business amounted to Rs 49,154 million (1st half 2020: Rs 51,889 million) recording a decline of 5.27% Total asset value of insurance companies increases to Rs 814,589 million at 1H 2021 The value of total assets of insurance companies has increased to Rs 814,589 million as at end of 1st half of 2021, when compared to Rs 755,229 million recorded as at end of 1st half of 2020, reflecting a growth of 7.86%.
The assets of LongTerm Insurance Business amounted to Rs 600,751 million (1st half 2020: Rs 540,126 million) depicting a growth rate of 11.22%, mainly due to increase in business volume which is represented by investments in government debt securities and corporate debts. The assets of General Insurance Business amounted to Rs 213,838 million (1st half 2020: Rs 215,103 million) indicating a slight decline of 0.59%.
Investment in Government Securities
Investments in Government Debt Securities amounted to Rs 241,254 million representing 45.33% (1st half 2020: Rs 224,179 million) of the total investments of Long-Term Insurance Business and increased by 7.62%, while such investment of the total investment of General Insurance Business amounted to Rs 50,631 million representing 37.14% (1st half 2020: Rs 57,286 million) and decreased by 11.62%. Accordingly, the total investment in Government Securities in the two businesses amounted to Rs 291,885 million (1st half 2020: Rs 281,465 million), showing an overall increase of 3.70% respectively.
Claims incurred by Insurance Companies
Claims incurred by insurance companies in both Long-Term Insurance Business and General Insurance Business were Rs 41,030 million (1st half 2020: Rs 36,625 million) showing an increase in total claims amount by 12.03% yearon-year. The Long-Term Insurance claims, including maturity and death benefits, amounted to Rs 20,755 million (1st half 2020: Rs 16,707 million). The claims incurred in General Insurance Business, including Motor, Fire, Marine and other categories, amounted to Rs 20,275 million (1st half 2020: Rs 19,918 million). Hence, during the 1st half of 2021, there is an increase in claims by 24.23% and 1.80% for Long-Term Insurance and General Insurance Businesses respectively, when compared to the corresponding period in 2020.
Profit (Before Tax) of Insurance Companies
The profit (before tax) of insurance companies as at end of 1st half of 2021 in both Long-Term Insurance Business and General Insurance Business amounted to Rs 14,458 million (1st half, 2020: Rs 18,158 million) showing a significant decrease in total profit amount by 20.38%. The profit (before tax) of Long-Term Insurance Business amounted to Rs 7,862 million (1st half 2020: Rs 6,647 million), while the profit (before tax) of General Insurance Business amounted to Rs 6,596 million (1st half, 2020: Rs 11,511 million). Thus, profit (before tax) of Long-Term Insurance Business has increased by 18.28% and General Insurance Business has decreased by 42.70%.
Out of twenty-five (27) Insurance Companies (Insurers) in operation as at 30th June 2021, thirteen (13) are engaged in Long-Term (Life) Insurance Business, twelve (12) companies engaged in General Insurance Business and two (02) are composite companies (dealing in both Long-Term and General Insurance Businesses).
Sixty-eight (68) insurance brokering companies, registered with the Commission as at 30th June 2021. Total Assets of insurance brokering companies have increased to Rs 7,189 million as at the end of 1st half of 2021 when compared to Rs 6,154 million recorded as at 1st half of 2020, indicating a growth of 16.82%.