Life insurance premium in Australia declined 6% last year, hit by the fallout from the Hayne royal commission, Swiss Re says in its latest Sigma report.

Prevailing low interest rates also affected the industry. Premium growth will probably remain muted as the industry deals with higher regulatory costs and adopts more cautious sales practices in the post-Hayne landscape.

In advanced Asia-Pacific markets including Australia and in Europe, low interest rates will continue to depress profitability.

Swiss Re estimates global life insurance premium increased 0.2% last year to $US2.82 trillion ($4.01 trillion), but it expects 2.9% growth this year and next.

“Most of the improvement will come from emerging markets, in particular China, where we expect a recovery in demand for savings products,” the report says.

“In advanced markets, growth will remain low but positive.”

Combined premium in Australia and other advanced Asia-Pacific markets grew 1.4% last year.