Insurers insulated from COVID-19 impact — IC

MANILA, Philippines — The spread of the corona-virus disease 2019 (COVID-19) may not have a significant impact on the performance of the local insurance industry this year, according to a top official of the Insurance Commission (IC).

In an interview, Juan Paolo Roxas, head of the IC’s microinsurance division, said the COVID-19 outbreak may not have an adverse impact on the insurance industry given that health insurance is only a small portion of the business.

“I don’t think so, it won’t be affected,” Roxas said when asked if the virus outbreak could potentially cause a decline in the industry’s premium income.

“Human health is just one of the aspects of the business, so you have fire, motor vehicle, life products, and so on and so forth. So I think it’s not that huge,” he said.

Instead, Roxas said developments such as the virus outbreak as well as the eruption of the Taal Volcano last January could instead make Filipinos more aware of the importance of getting an insurance coverage.

“I think more people will be inclined and be aware that insurance is actually there and helping us,” he said.

He said these events could also challenge the industry to come up with new products that would address new and emerging needs.

“With this kind of new disease, the industry will be challenged to formulate new policies, that’s what we want, so they can develop some sort of product that can answer to these kinds of problems,” the IC official said.

Meanwhile, Cebuana Lhuillier president and chief executive officer Jean Henri Lhuillier said the COVID-19 outbreak could serve both as a challenge and an opportunity for insurance businesses.

Cebuana Lhuillier Insurance Brokers Inc. first vice president and group head Jonathan Batangan said this could provide an opportunity for the company to sit down with its insurance partners to create new products that will provide coverage against COVID-19.

In terms of its money transfer business, Lhuillier said the company saw a slowdown in remittances due to the spread of the virus.

“We’ve seen a little slowdown last month, five to 10 percent. The last two weeks have been the start of this global virus taking effect,” he said.

Lhuillier said this may affect the group’s first quarter performance as remittance is its second largest revenue driver.