A dramatic fall in net income from NAB-owned MLC and NAB Wealth’s life insurance business has reduced the division’s cash earnings by 12.5% to $533 million for the full year ending September 30.

Net life insurance income for the 2011 year was $360 million compared to $813 million in the previous year.

As a result the bank’s life business reported a $363 million pre-tax profit for the full year, compared to $690 million in 2010.

Premium revenue for the life business was up for the year to $1.3 billion, compared to $1.2 billion in the previous year.

But this was offset by increased claims, up from $695 million in 2010 to $794 million.

The business also saw an 18% fall in new business premiums to $286.1 million, compared to $349 million in 2009/10.

But total annual inforce premiums did rise 4.2% to $1.5 billion.

Total adviser numbers at MLC and NAB Wealth during the year rose from 1555 to 1864, and the bank says sales of life insurance to its customers is now a priority, with 23% of sales now coming from NAB Financial Planning.