LIA released the 3rd quarter 2009 sales results for the life insurance industry. This can be found HERE. It disclosed that the average death benefit per policy is $47,027 for that quarter. But it will be more useful to know what are:

1. The average death benefit claimed per life assured.

2. The average death benefit claimed per life assured but excluding single premiums, endowments and investment values of regular premium ILP.

3. Same as 2 but figures per person died who is (a) a Singapore Resident and (b) below age 60 and (c) inclusive of those who did not buy insurance.

These three statistics are more useful. The often quoted low sum assured is based on per policy. But it is common for a person to buy many policies in their lifetime. Ultimately what is important is the accumulated sum assured per life assured and not per policy.

Secondly, death benefit due to single premiums and endowments are quite meaningless because these are mainly savings with little insurance component. Similarly, cash values due to the NAV of a regular premium ILP should also be excluded from the death benefit calculation since these are investments.

Thirdly, it will be interesting to know what is the average death benefit per each “relevant” death. “Relevant” means Singapore residents who still have dependents. “Relevant” should also means include everybody regardless whether they bought any insurance or not. Only by doing this will we really know whether are Singapore residents underinsured or not.

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