SINGAPORE: The motor insurance business incurred underwriting losses of about S$12.6 million as claims "increased significantly" in the first half of 2018, the General Insurance Association of Singapore (GIA) said on Tuesday (Sep 25).
The claims amount of S$291.3 million represented an 11.8 per cent spike, despite the number of reported motor accidents falling by 4.3 per cent, according to its press release.
AdvertisementGross premiums for the motor insurance segment also fell by 2.4 per cent to S$600.9 million in the first half of the year.
The segment accounts for more than a quarter of the general insurance market.
GIA said it is the third consecutive quarter of losses for the segment and raises several red flags.
The industry body said it will attempt to combat the trend on two fronts; by promoting public awareness and education efforts on the importance of road safety and combating fraudulent claims.
AdvertisementAdvertisement"Our top priorities include working with key stakeholders to reduce the severity and frequency of motor accidents, and leveraging digital technologies to continuously develop and enhance the GIA Fraud Management System, to lower and mitigate claims costs inflation," said GIA President Karl Hamann.
First half underwriting profits for the general insurance sector as a whole declined 94.5 per cent to S$3.14 million on the back of a 1.1 per cent increase in gross premiums to S$2.07 billion.
Aside from motor insurance, there was a 17.4 per cent increase in work injury compensation claims totalling S$88.4 miilion, resulting in an underwriting loss of S$5.99 million, GIA said.
“This weak performance reflects the increased fatal and major injuries reported for the construction sector by the Workplace Safety and Health (WSH) Council,” it added.
The health insurance segment saw an underwriting loss of S$12.7 million, on the back of persistent healthcare inflation in Singapore, GIA said.
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