CBA's insurance up and down

An improvement in retention of premium paying customers across CommInsure helped lift Commonwealth Bank's insurance income for the six months to December 2014 to A$416 million, up eight per cent on the same half a year ago.

An increase in average in-force premiums of six per cent to $3.2 billion, thanks to new business sales, also helped lift earnings.

CBA pointed to a "non-recurrence of reserve strengthening" and improved pricing in CommInsure Wholesale Life as favourable factors, partly offset by the impact of the Brisbane hail storm and higher working claims made on CommInsure general insurance, as well as deterioration in claims experience in retail life and wholesale life.

But, compared to the June 2014 half-year results, CBA's insurance income decreased by four per cent.

Retail life insurance income decreased by five per cent, thanks to a high level of claims and lower sales, partially offset by the benefit from lower lapse rates following "the implementation of retention initiatives."

CBA said wholesale life income benefited from improved pricing and the non-recurrence of significant reserve strengthening in the prior comparative period, while also offset by deteriorating claims experience - that is, an increase in the number of customers claiming benefits.