COVID-19 impacts further deteriorate Singapore's non-life insurers' underwriting results

KUALA LUMPUR, April 29 -- For the first time in a decade, the domestic non-life insurance segment in Singapore recorded an underwriting loss in 2019, and with the added economic strain from the COVID-19 pandemic, the lacklustre underwriting performance is expected to persist.

This is according to a new Best’s Commentary titled, ‘Singapore Non-Life Insurance: COVID-19 Impacts Add to Deterioration in Underwriting Results’.

The commentary states that insurers’ poor performance in the motor, health and workers’ compensation lines of business continued, along with a significant surge in marine hull and fire insurance claims.

This surge was mostly due to severe shipping losses during the first quarter of 2019 and a large increase in fire incidents, which especially involved personal mobility devices.

Based on AM Best's statement, the non-life segment’s combined ratio, which hit 101 per cent in 2019, has increased each year since 2014, when the combined ratio was 85 per cent.

AM Best expects medical claims related to the COVID-19 pandemic to rise, albeit on a limited scale given the government’s commitment to bear the costs of disease diagnosis and treatment.

For policies sold in 2019 and 2020, which included the COVID-19 pandemic period within the scope of coverage, AM Best expects the segment’s loss ratio likely to increase significantly over the near term, given the recent spate of cancelled flights and travel interruptions.

More details at www.ambest.com

-- BERNAMA