S'pore life insurers have healthy buffers to withstand shocks

Most hit a capital adequacy ratio of at least 150% - more than the normal level of 100%

- Claire Huang

The nine key life insurers in Singapore have healthy capital buffers to withstand sudden shocks and observers expect them to remain well capitalised in the months ahead.

Based on publicly available data, almost all nine hit a capital adequacy ratio (CAR) of at least 150 per cent, higher than the typical level of 100 per cent.

The nine insurers are AIA Singapore, Etiqa Insurance, Great Eastern Life, HSBC Life Singapore, Manulife Singapore, Income Insurance, Prudential Singapore, Singlife and Tokio Marine Life Insurance Singapore.

The stipulated minimum CAR requirement of 100 per cent is a way to ensure an insurer has enough capital buffer to withstand shocks.

Mr Danny Fischer, who is head of solutions for the Asia-Pacific at Mitsubishi UFJ Financial Group, said the CAR of Singapore life insurers remains strong and that it continues to be the case on a forward-looking basis.

"The sector is well capitalised and boards and management will continue to focus on strong capital solvency levels," he said.

A look at the insurers' returns showed that Tokio Marine Life's CAR fell from 244 per cent in 2019 to 102 per cent in 2023.