The strength of the Canadian life and health insurance industry was evident as it faced the economic challenges of 2012 (i.e., slow growth, prolonged low interest rates, and global uncertainty) as well as domestic and global regulatory changes. However, the industry built on its past solid performance with continued asset growth and sustained record high premiums during 2012.
Industry assets in Canada rose 7.7 per cent during 2012 to $614.8 billion, as equity markets performed better than expected. Accounting for almost two-thirds of the total, general fund assets increased 6.6 per cent to more than $400.4 billion. Meanwhile, segregated fund assets rose 9.8 per cent to almost $214.4 billion.
At the same time, total premiums and premium equivalents (all lines of business) rose 2.8 per cent to a record high of $83.3 billion as Canadians continue to accumulate assets for retirement and also focus on health care and life insurance products. Annuity premiums experienced only minimal growth (up 0.6 per cent to over $36 billion), as contributions to segregated fund or market-value-based investment products surpassed the record high levels of the previous year to marginally offset the doubledigit drop in premiums for fixed-return general fund products. Meanwhile, premiums for supplementary health and disability insurance products rose 4.6 per cent to $30.9 billion and life insurance increased 4.4 per cent to exceed $16.3 billion.