The pension and retirement savings was once again the growth leader in the life and health insurance industry in 2017, according to the Canadian Life and Health Insurance Association’s annual fact book.
Of the $651 billion held in employer-sponsored pension plans last year, the industry was responsible for managing $152 billion, which is up from $142 billion in 2016. Some $45.3 billion was paid out in retirement benefits by life insurance companies in 2017, compared to $43.5 billion 2016 and $40.9 billion in 2015.
The trend towards de-risking pension plans is expected to continue unabated, the CLHIA noted, as employers reduce risk and focus on their business. To this end, employers that offer defined benefit pensions transferred $3.7 billion in pension risk to life insurers in 2017, up from $2.6 billion in 2016.
Read: Retirement plans boost growth in life, health insurance industry
The fact book also showed 79 per cent of Canadian employees and their families are covered by private health insurance plans, an increase from the 71 per cent covered 10 years ago. As well, premiums were up more than $110 billion in 2017, led by life insurance, which rose 5.5 per cent, while health insurance saw a 5.2 per cent bump and annuities increased 3.5 per cent.
The industry paid out $34 billion in health benefits, up $1.5 billion from 2016. Holding steady with the 2016 numbers, 75 per cent of health benefits paid out in 2017 were for extended health benefits, 21 per cent for disability and four per cent for other coverage. Looking more closely at extended health benefits, $11.3 billion was paid out for drugs, a slight increase over the $11 billion seen in 2016. Slight increases were also seen in dental, travel, paramedical and vision. Hospital costs held steady at $1.8 billion.
