Citi invites clients to protect financial future by closing insurance gap

MANILA, Philippines - Citi Philippines is concerned about Filipino families. While economic growth has been steadily growing, albeit slowly, the protection gap is getting wider.

Bea Tan, Consumer Banking head for Citi Philippines, explains, “Protection gap is the difference between the resources needed and the resources already available for dependents to maintain their living standards in the unfortunate event that the breadwinner is no longer able to provide.”

Put another way: What happens to your family when your father or mother, husband or wife, or the main breadwinner, passes away? Will you still be able to continue the children’s education? Pay for the house mortgage and the bills? Or will you be so financially devastated that the life you’ve known will be reduced to ashes?

For many Filipino families, this is unfortunately the case.

Mainly it’s because they’re not insured or protected. Insurance has always been a low priority for Filipinos and Citi hopes to change that with a new educational campaign in the Philippines, as well as throughout its 500 branches and digital network in Asian markets like Hong Kong, Singapore, China, Indonesia and India.

Called “Have You Done Enough?” the campaign’s goal is to make people understand the risk of under-insurance (or none at all, in many cases) and to encourage its clients to assess their insurance needs — because a family of three’s needs are different from a family of five’s. Or a family with still 15 years of mortgage on their home is different from one that fully owns their house but still has three university-age children.

What brought about this sense of urgency to make people understand the importance of insurance? It was the publication of findings of a recent study by the Zurich-based global reinsurer Swiss Re.  The report estimated that the mortality protection gap in 13 Asia-Pacific markets went up from $42 trillion in 2010 to $58 trillion in 2014.

Called “Have You Done Enough?” Citi’s campaign is to help people understand the risk of under-insurance (or none at all, in many cases) and to encourage its clients to assess their insurance needs.

Bea explains that the shortfall “refers to the mortality protection gap and this underscores the need for greater insurance planning. By 2020, the Philippines is facing a shortfall of $528 billion in resources needed to sustain households in case the breadwinner in the family is unable to function, based on estimates by regional insurance giant AIA.”

Gordon Watson, regional chief executive of AIA Group, said, “Asia is increasingly underinsured with a widening protection gap. As the leading life insurance group in the region, AIA is committed to and focused on helping our customers meet their protection needs. We are dedicated to address this by investing more in consumer education and provide protections that best suit people’s evolving needs, through our partnership with Citi.”

Culturally and traditionally, Filipinos like to leave everything in the hands of a greater power. Our attitude toward death or planning for it has not been the most practical.

But Bea thinks this attitude has been changing in the past years but not fast enough or nearly enough for families affected now or in the near future. “No one wants to think of death in the family or even plan what happens to those we leave behind, but it’s a reality all of us face, some of us sooner or later than others. We have seen generations of families who have lost  — not even great fortunes — but simply a comfortable life when the breadwinner dies. Our clients are beginning to understand the importance of having protection products in their portfolio,” she says. “The challenge here is not just having protection, but the right amount of protection to ensure a secure financial future. We will continue to leverage on our long relationships with our clients so they can close the protection gap in their financial planning.”

Anand Selvakesari, Citi head of consumer banking at Asia Pacific, said in a statement, “Taking insurance to protect future earnings and lifestyle should be a higher priority for consumers in the region. More needs to be done to further increase the awareness of the benefits of insurance protection to the general public. This is a priority for Citi in Asia, and in partnership with AIA we are confident that we can offer our clients the solutions they increasingly need to protect themselves for the future.”

Today, when you visit Citi’s retail bank branches in Metro Manila and Metro Cebu, you will see the consumer education campaign they have built around three key topics: challenging clients to see if they have done enough to protect their health, if they have taken steps to secure their wealth and lifestyle, and lastly, have they laid the right groundwork for a comfortable retirement,

Citi is also leveraging its website to drive the conversation on the protection gap.  Visit www.citibank.com.ph today and click on the insurance section.  There you will find a user-friendly calculator that will help you determine how much insurance you need, and what gap you need to address.

Citi’s campaign comes at the right time as the Philippine economy becomes more stable and young people are joining the workforce with enough disposable income to put into insurance and start early rather than later or squandering away their extra money.

Like they say, it’s never too late to save money. In the same vein, it’s never too early for people to ask themselves, “Am I doing enough for my and my family’s future?”