Life insurers are still shedding money on income protection business, with the industry reporting a $381 million loss for the year to June 30.

The Australian Prudential Regulation Authority’s industry figures show the after-tax loss has blown out from a $351 million deficit the previous year.

Gross policy revenue for income protection grew to $2.7 billion last financial year from $2.6 billion.

This was offset by a rise in total expenses to $3.2 billion from $2.9 billion.

There is a slightly better picture in the group disability income sector, with after-tax losses shrinking to $24 million from $55 million.

Group disability gross policy revenue was up to $2.2 billion from $2 billion, offset by a rise in total expenses to $1.5 billion from $1.3 billon.

Group lump sum business was more profitable, with after-tax profits rising to $468 million in the year to June 30 from $280 million the previous year.

Gross policy revenue was flat at $65 million, while total expenses fell by $100 million to $4.1 billion.

In the individual lump sum sector, gross policy revenue was up to $8.8 billion from $8.1 billion.

Total expenses grew slightly to $5.2 billion, delivering an after-tax profit of $1.3 billion, up from $1.1 billion.

Overall, life insurance industry profitability improved to $2.8 billion last financial year, up from $2.5 billion.

Death and disability claims grew to $8 billon from $7.3 billion.

Upfront commissions fell to $1.4 billon from $1.5 billion, offset by trails rising to $2.7 billion from $2.4 billion.