MOTOR LINES DENT SINGAPORE GENERAL INSURANCE FIGURES

A poor performance in motor lines has tarnished what were otherwise strong first-quarter results for Singapore's general insurance industry. Figures from the country's General Insurance Association (GIA) showed that, despite premiums rising by 9% in the first quarter on the back of continuing strength in the country's domestic economy, ongoing losses on motor lines severely dented underwriting profit. Singapore, widely regarded as the hub of the Asian insurance market due to its prime location, busy transport ports and the city-state's use of English as its administrative language, clocked up net earned premiums in the first quarter of $443.2m - up from $407.1m in the same period last year - and gross premiums of $760.3m. Yet with the motor account, the largest business class in the country, performing so poorly, underwriting profit for the sector as a whole was down some 38% to $33.8m, compared with $54.5m for the first three months of 2007. According to the GIA the underwriting loss on the motor account, standing at a whopping $35.3m, was "one of the worst ever losses suffered by the class in any one quarter". Last year the same account saw a loss of $13m, a figure more than $22m less than this year's loss. Adding insult to injury, net earned premiums in motor lines actually grew by 9.7% over the quarter to $187m against $170.5m in 2007 but net incurred claims shot up 26% to $163.7m from $129.7m the previous year. The line's incurred loss ratio correspondingly rose to 87.5% in the first quarter against a general industry loss ratio. Other lines had a better start to the year, however, with fire in particular improving on last year. Although net earned premiums from fire were flat at $27m net incurred claims fell in the period, creating a 37% leap in underwriting profit to $13.5m for the three months.