Fiji’s insurance sector has reached a remarkable achievement, with gross premium income hitting an all-time high of $476 million in 2024, according to the Reserve Bank of Fiji (RBF) in its 2024 Insurance Annual Report. This significant milestone was presented in Parliament by Deputy Prime Minister and Finance Minister Professor Biman Prasad.
However, alongside this robust growth in premium income, the industry encountered a decline in overall profitability, down by $30 million. This downturn is linked to increases in overall expenditures and net claims paid, which totaled $254.2 million. The life insurance segment accounted for $139.3 million in net policy payouts, primarily related to matured policies, while the general insurance sector contributed $114.9 million largely due to claims associated with medical and motor vehicle incidents.
In his foreword to the report, RBF Governor Ariff Ali praised the resilience of Fiji’s insurance industry, citing strong economic growth throughout 2024. He also reported a 7.5% increase in total industry assets, which now stand at $2.9 billion, as well as a substantial 22.6% rise in the combined solvency surplus, reaching $688.5 million.
The notable performance of the sector has been supported by the absence of serious catastrophic events during the year, even though licensed insurers reported a rise in claims. The RBF is proactively working to modernize the regulatory framework, including updates to the Insurance Act of 1998, as part of the transition to International Financial Reporting Standard 17 (IFRS 17). This change aims to enhance transparency in insurance contract reporting, with implementation scheduled for January 2025.
In addition, the Reserve Bank is collaborating with development partners to develop a parametric micro-insurance sector in Fiji. This initiative focuses on offering climate-risk insurance products to households vulnerable to environmental challenges. A grant agreement established in August 2024 with the InsuResilience Solutions Fund further enhances the capacity for climate risk insurance in the nation.
While the insurance sector is projected to maintain its positive trajectory into 2025, the governor urged caution. He highlighted the increasing risks posed by the growing volume and cost of claims linked to climate-related events and global economic uncertainties, both of which will significantly influence insurers’ pricing and risk management frameworks.
The outlook for Fiji’s insurance industry remains promising, highlighting its crucial role in supporting economic stability. The ongoing efforts by the government and the RBF to foster growth and protect consumers underscore a strong commitment to sustaining the financial ecosystem in Fiji.