Tower Australia (Tower) managing director Jim Minto warned about the potential impact of increasing market consolidation at the company's annual general meeting in Sydney yesterday.

Minto's comments follow the ACCC's decision to review the bids by AMP and the National Australia Bank to purchase Axa Asia Pacific.

"The transformation of the market to fewer, larger players creates a concern that Australians will lose choice among life insurance providers as well as see a loss of independent companies and innovative solutions," Minto said.

"We will potentially see Australians being offered higher-margin products as a result ... large players with power can create reduced choice and higher prices."

Minto called on the government and the Australian Competition and Consumer Commission to investigate the rising consolidation in the life market.

"We do not believe that this is in the best interests of Australians as consumers," he said.

Meanwhile, Tower's results for 2009 pointed to further growth.

The company reported a 10 per cent increase in underlying profit for the year to $74.5 million and a growth in embedded value of 30 per cent to $1.2 billion.

The board was also able to lift its dividend by 17 per cent.

"Tower continued to perform strongly in 2009 and maintained a strong capital position with low levels of debt," Tower company chairman Rob Thomas said.

"This was an outstanding achievement in a challenging environment."

Rice Warner actuaries' latest risk projections report supported further growth in the insurance sector.

Over the 15 years to 30 June 2024, the total risk insurance market in annual premium income terms is projected to reach $33,283 million per year, compared with $8,187 million at 30 June 2009.

Minto said it was Tower's broad distribution footprint that helped the insurer grow at or in excess of market rates.