MetLife will again battle to maintain its share of the margin-challenged group insurance market, as a client worth $40 million of annual premiums puts its contract out to tender.
MTAA Super is understood to be seeking higher default levels of cover for its death and disablement group policies, and wants to make its opt-in salary continuance insurance more accessible, particularly for younger members.
These upgrades could see the new contract’s annual premiums in force exceed $40 million. IFS Insurance Broking is assisting MTAA Super with the tender, and a result is expected by the end of March. Challengers to the incumbent are understood to include CommInsure, ING and MLC.
If MetLife fails to win this contract, it will be the insurer’s second big setback recently. In November last year, MetLife lost a group insurance contract worth $65-70 million annually with First State Super, to Tower Australia.
MTAA Super’s contract has been with MetLife directly since 2006, and previously with Citi Insurance before the MetLife buyout of Citi in 2005. Citi won the business from Hanover in 2002. At the start of 2010, MetLife was earning $188.8 million in annual premium income from the group risk market, over $176 million of that from industry funds, for a total 8 per cent of the market. However the loss of the First State Super contract woul have since eroded that position.