ClearView Wealth says its life insurance arm “performed solidly” in the last financial year, pushing overall operating earnings after-tax 83% higher to $23.9 million for the 12 months to June.

Underlying net profit after-tax increased 54% to $22.7 million from a year earlier.

The business says the life segment remains the “key profit driver” with its 2020/21 performance as operating earnings more than doubled to $23.5 million, accounting for 98% of overall earnings.

The life business reported a $4.2 million claims experience profit, compared to assumptions, reflecting improved claims management outcomes and limited COVID-19 claims impacts.

Gross life insurance premiums increased 7% to $278.2 million.

ClearView Wealth is confident the life business will continue to perform well going forward, citing the Australian market’s demographics.

“Demand for life insurance products remains, due to Australia’s large financially active population,” ClearView Wealth said.

It says the market is made up of relatively affluent but highly leveraged households and there is heightened awareness of the need for protection and professional advice throughout life.

ClearView Wealth’s other businesses, financial advice and wealth management, did not fare as well in the last financial year.

The wealth management business suffered an 80% decline in earnings to $600,000 and financial advice reported a 58% drop to $900,000.

ClearView says the sale of the financial advice business to Centrepoint Alliance followed the completion of a strategic review to seek out and pursue inorganic opportunities to obtain scale in the market.

The sale agreement will see ClearView taking a 25% stake in Centrepoint Alliance.

“The Centrepoint Alliance deal allows ClearView to indirectly participate in the financial advice industry consolidation (given structural market changes) and at the same time separate its product manufacturer and financial advice arms,” the business said.

Fitch Ratings says the sale of the financial advice business will allow ClearView to focus on its core business of developing life insurance products.

“ClearView, along with other Australian life insurers, is reviewing its income protection portfolio to address the [prudential] regulator’s recommendations, which aim to ensure the sector’s sustainability,” the rating agency said.