Singapore life insurance new business premiums surge 7.7% to nearly S$3 billion in H1 2025 while claims payouts fall 42%
This growth was driven largely by annual premium policies, which saw a 22 per cent year-on-year increase in weighted new business premiums, said the Life Insurance Association (LIA) Singapore on Wednesday (Aug 13).
However, single premium policies recorded a 21.3 per cent decline in weighted new business premiums over the same period.
Weighted new business premiums measure the premiums collected on new policies. This includes considering 10 per cent of the value of single premium products, the full premiums for annual premium products, and an adjusted value for products with premium payment durations of less than 10 years.
Other figures reported by LIA suggest that consumers may be purchasing fewer, but more comprehensive policies, potentially opting for coverage that offers greater protection or investment potential per policy.
While the total sum assured rose by 1.7 per cent year on year, the total number of policies declined by 18.6 per cent, from 711,922 policies to 579,343 policies.
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Claims payouts also fell significantly by 42.1 per cent between Jan 1 and Jun 30, 2025, with the life insurance industry paying out S$6.35 billion to policyholders and beneficiaries. Of this, S$5.32 billion was for matured policies, while the remaining S$1.03 billion was for death, critical illness, or disability claims covering more than 10,900 policies.
In contrast, data from LIA for 2024 reflected a significant increase in payouts, with a total of S$18.12 billion disbursed to policyholders and beneficiaries.
The life insurance sector recorded a total sum assured of S$71.4 billion during the first half of 2025.
It saw significant contributions from financial adviser (FA) representatives who achieved a sum assured of S$30.4 billion, accounting for 42.6 per cent of the total. Tied representatives, meanwhile, secured an additional S$21.4 billion, representing 29.9 per cent.
LIA Singapore president Wong Sze Keed believes the resilient Singapore economy provides a 'more encouraging backdrop' for consumers to review their financial plans and re-engage with their FA representatives to optimise their portfolios and address long-term protection needs, amid geopolitical concerns.
'As our nation celebrates 60 years of independence, the life insurance industry is focused on what it can do to truly help people 'go' further in life – by enhancing financial literacy to bridge protection gaps, supporting families through legacy planning and simplifying claims processes, as well as strengthening trust through elevating industry culture and conduct,' she added.
Focus on long-term security
Industry growth continued to be driven by investment-linked policies (ILPs), which allow customers to select professionally managed investment-linked funds.
In H1 2025, the weighted new business premiums for ILPs rose by 31.3 per cent year on year, from S$975 million in H1 2024 to S$1.28 billion. As a result, ILPs accounted for 43 per cent of total new business in the first half of 2025.
'The continued growth in annual premium policies and ILPs demonstrates Singaporeans' focus on long-term financial planning and security,' said Wong.
She added that this trend is supported by renewed optimism, as Singapore's economy posted a robust 4.3 per cent year-on-year growth in Q2 2025, outpacing Q1 figures.
'The sustained demand for ILPs reflects a prudent yet ambitious mindset – one focused on safeguarding against global current unpredictability while capturing growth opportunities in an evolving financial landscape,' said Wong, who is also chief executive officer at AIA Singapore .
In line with this, a spokesperson from Tokio Marine Life Insurance Singapore told The Business Times that there has been a growing preference for ILPs among those 'seeking a balance between wealth accumulation and security'.
Similarly, a spokesperson from Manulife Singapore highlighted a growing demand for hybrid solutions that combine both protection and wealth accumulation alongside the rising focus on critical illness and long-term care coverage, as key trends in the life insurance sector.
Reflecting this, recent data from LIA showed that integrated shield plans (IPs) remain a critical component of health insurance coverage as about 69,000 Singaporeans and permanent residents took up new IPs in H1 2025.
In total, about three million lives, roughly 72 per cent of Singapore residents, are covered by IPs, which provide additional coverage on top of national health insurance scheme MediShield Life.
Total new business premiums for individual health insurance in H1 2025 amounted to S$373.7 million, marking a significant 69.3 per cent increase compared with the same period last year. Of this, premiums for IPs and IP riders accounted for 89.9 per cent (S$336.1 million), while the remaining 10.1 per cent (S$37.6 million) were made up of other medical plans and riders.
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