Life insurer net premiums fell to $42.3 billion in the year ending March 31, Australian Prudential Regulation Authority (APRA) figures show.

This compares to net premiums of $43.1 billion reported in March last year.

Net policy payments fell from $41 billion in March 2011 to $40.9 billion this year.

Revenue for life companies was $19.8 billion, a significant drop from $25.6 billion the year before.

Expenses also fell from $21.4 billion to $16.2 billion this year.

Despite the overall fall in expenses, death and disability claims rose from $4.4 billion to $5 billon. Policy terminations dropped from $626 million to $590 million.

The cost of acquiring new life insurance business also rose, from $1.3 billion to $1.4 billion.

Commissions paid for ongoing policies rose from $1.8 billion to $2 billion.

Although some expenses were up, net profit stayed almost flat at $2.57 billion compared to $2.69 billion a year earlier.

Life insurers increased their assets from $237 billion to $239 billion.