Life insurers are still struggling to build profits, recording a combined 16% decline to $2.2 billon after tax in the year to September 30, according to the latest Australian Prudential Regulation Authority data.

Net policy revenue fell 1.6% to $16 billion compared with the previous year.

The problem for life insurers was an 11.2% rise in net expenses to $9.4 billion. Drilling down into these expenses, claims grew to $9.3 billion from $8.2 billion, while policies maturing totalled $429 million, a slight increase from $427 million the previous year.

Surrenders and terminations fell to $420 million from $459 million. Upfront commissions were static at $1.4 billion, and trails declined to $2.3 billion from $2.7 billion.

Net policy revenue for individual lump sum business was static at $7.1 billion, while net policy expenses grew slightly to $2.8 billion from $2.6 billion. After-tax profit for this sector fell to $782 million from $1 billion.

Insurers are still losing money on income protection insurance: after-tax losses were $285 million, compared with $292 million the previous year. Net policy revenue fell to $1.9 billion from $2.3 billion. Net policy expenses grew to $888 million from $855 million.

Group life also suffered a decline in after-tax profits, to $252 million from $401 million.

Net policy revenue was static at $4.5 billion, while net expenses grew to $3.3 billion from $3 billion.