ClearView’s life insurance business made a net profit of $12.5 million in the half-year to December, down 2% due to higher than expected claims.

The group’s overall profit was up 1% to $15.3 million.

Life insurance gross written premium was up 24% to $104.7 million, sales grew 10% to $22.6 million and inforce premium gained 23% to $209.9 million.

There was an adverse claims experience of $3.2 million, compared with $600,000 in the previous corresponding period. Excluding this, ClearView’s life insurance profit would have been up 19% to $15.8 million.

ClearView says the result includes the impact of heightened lapses in the lead-up to January 1 regulatory changes, income protection price increases implemented a year earlier and some drift in the competitive position of LifeSolutions lump sum premium rates.

MD Simon Swanson says ClearView’s integrated financial services model positions it to benefit from the convergence of life insurance and wealth management.

“ClearView remains well positioned to outperform the market, despite the adverse impact of heightened lapses and material claims volatility during the half,” he said.

“The life insurance segment continues to be the key profit driver.”

Earlier this year ClearView stopped selling life insurance products direct and refunded $1.5 million to 16,000 customers after an Australian Securities and Investments Commission investigated identified unfair sales practices.