Life insurer ClearView has taken aim at its rivals for cutting premiums to unprofitable rates in the race to maintain customer numbers.

The ASX-listed company voiced the criticisms as it revealed that life insurance new business premiums fell 35% to $14.2 million in the most recent half-year, and said ClearView will no longer sell agreed value income protection after March as it reprices its products and reviews claim assumptions.

“Some insurers appear to be engaging in ‘honeymoon’ discounting to maintain market share rather than focusing on delivering long-term sustainable products and transparent pricing to customers,” the company says in a business update to the ASX today.

“ClearView is not participating in this approach, which is impacting current new business volumes.”

The retail life insurance industry lost $1.1 billion on income protection in the year to September 30, extending five-year losses to over $3 billion.

The Australian Prudential Regulation Authority (APRA) introduced its new measures in December, imposing a “Pillar 2” capital charge. Insurers must take necessary action to satisfy the requirements of all stakeholders by mid 2021 or risk further action.

“It is disappointing that the leading industry players were unable to support sustainable business models without APRA’s intervention and appear to continue engaging in poor pricing practices,” ClearView’s business update says.

Sydney-based ClearView says it is “very supportive” of APRA’s new Individual Disability Income Insurance Sustainability Measures.

“Given APRA’s recent policy measures and the continued underperformance of the income protection portfolio, ClearView has already commenced a comprehensive review of its LifeSolutions IP product series with a focus on reviewing product pricing and design,” it says.

The insurer will launch a new indemnity-type income protection product in the second half of the year. It says this will offer a lower maximum monthly benefit at a competitive premium rate, and the company expects further price changes will be made in the coming months to reflect increased claim rates.

Significant adverse deterioration in claims, in particular in December, and higher than expected lapses amid challenging market conditions will lower its life insurance underlying net profit for the half-year to December 31 to $8.7 million, ClearView says.