+
20
Gross premiums of general business maintained a healthy growth of 16 per cent to $19.7 billion. Direct business and reinsurance inward business grew to $14.8 billion and $4.9 billion respectively.
Except motor vehicle business, all classes of business experienced growth in gross premiums, with general liability business achieving the highest growth of 46 per
cent.
"Property damage business remained the largest class of business, accounting for 27 per cent of total gross premiums.
"Motor vehicle business still maintained its position as the second largest class although its share declined from 25 per cent in 1993 to 21 per cent in 1994," Mr Lam stated.
Net premiums, that is gross premiums less premiums for reinsurance, rose by 17 per cent to $12.4 billion. Retention ratio of the industry increased slightly from 62 per cent in 1993 to 63 per cent in 1994. Motor vehicle business continued to be the largest contributor, with a share of 25 per cent of net premiums in 1994.
This was followed by property damage and general liability business with a share of 23 per cent and 20 per cent respectively.
Total claims paid of general business fell by three per cent to $7.2 billion. After deducting reinsurance recoveries of $3 billion, total net claims paid amounted to $4.2 billion.
"The claims experience of general business continued to show improvement in 1994," Mr Lam said.
The overall net claims incurred ratio, that is net claims incurred to net earned premiums. improved slightly from 53 per cent in 1993 to 52 per cent in 1994.
As regards the underwriting performance of the general insurance industry, Mr Lam remarked that this continued to enjoy a profit for the second consecutive year in 1994. An overall underwriting profit of $1.2 billion was made, which represents 10 per cent of net earned premiums.
Turning to the long term insurance business, Mr Lam said it achieved a faster growth with office premiums increased by 26 per cent to $19.5 billion in 1994, compared with 19 per cent in 1993.
"In 1994, a total of 569,578 new individual life policies were sold, generating office premiums of $4.4 billion, an increase of 12 per cent over the prior year," he added.