LIFE assurers' increasing ability to create products that are appropriate for lowincome customers helped to drive up recurring premium inflows in the first half of this year, the latest figures from the Life Offices Association (LOA) show.

In its half-yearly figures, the association said total single and recurring premiums for individual life business -- which include life policies, endowments and retirement annuities -- increased 9% from last year's R40,4bn to R44,2bn.

The association's CEO, Gerhard Joubert, said: "Large life companies were responsible mainly for single-premium growth and the medium to smaller companies for recurring-premium growth.

"Much of the increase in recurring-premium inflow emanates from the low-income market. This ... shows us that life insurance products are increasingly becoming relevant to that market."

Large companies reported a 7% decrease in new-premium income, while small and medium companies experienced an increase of almost 50%. New individual single premiums soared 11%, from last year's R17,3bn to R19,2bn.

Premium and investment income increased 13% to R99,8bn compared with last year. Total premium income was R78,5bn and claims settled amounted to R70,9bn, translating to a net premium inflow of R7,6bn.

He said the percentage of individual surrenders of policies increased 2%; the industry was concerned about the surrenders but was encouraged that there had not been a substantial increase.

Total lapsed premiums for large offices decreased 3% compared with last year. Total lapses for medium and small life offices increased 51%. The association has attributed the increase to "a dramatic" increase in credit life policies being written under life insurance licences.

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