Insurance industry grows in first half of 2011

The insurance industry is regulated by the Insurance Board of Sri Lanka (IBSL). There are twenty insurers registered with the IBSL. Twelve of them are composite companies (dealing in both General and Long-Term Insurance Businesses), six of them are registered to carry on General Insurance Business and two companies engage only in Long-Term (Life) Insurance Business. However, one company registered to carry on General Insurance Business is prohibited from engaging in insurance business since August 2009.

The overall Gross Written Premium (GWP) Income for General Insurance and Long Term Insurance Businesses was Rs. 38.59b which reflected a growth rate of 23.38 percent compared with the first six months of 2010.

The General Insurance Business has demonstrated a progress of its overall Gross Written Premium (GWP) Income during the 1st half of 2011 when compared to the same period of 2010.

The Long-Term Insurance Business also showed a progress of its overall Gross Written Premium Income during the 1st half of 2011 when compared to the corresponding period in 2010.

The overall GWP Income of General Insurance Business amounted to Rs. 21.56b (1st Half 2010: Rs. 18.18b) while the overall Gross Written Premium Income of Long-Term Insurance Business amounted to Rs. 17.04b (1st Half 2010: Rs. 13.12b) during the first six months of 2011.

The Total Assets of the insurance companies have increased to Rs. 241.86b at the end of the first six months of 2011 when compared to the Total Assets valued at Rs. 222.24b at the end of 2010.

The investment in Government Securities represents 51.86 percent (1st Half 2010: 50.96%) of the total assets of Long-Term Insurance Business and 25.70 percent (1st Half 2010: 24.65 percent) of the total assets of General Insurance Business at the end of 2nd quarter of 2011. This is in excess of the required amount of investment in Government Securities by the Act.

Insurance Broking Companies, as intermediaries, make a significant contribution to the insurance industry. Forty four insurance broking companies, registered with the IBSL currently engage in insurance broking business.

Insurance Broking Companies mainly concentrate on General Insurance Business and their total GWP Income from General Insurance Business and Long-Term Insurance Business amounted to Rs. 4.94b during the first half of 2011.