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Insurance industry gets a boost

HIDDEN AGENDA - Mary Ann LL. Reyes (The Philippine Star) - February 28, 2021 - 12:00am

One industry that has received a much-needed boost from the COVID-19 pandemic is private insurance.

According to an article from the Oxford Business Group, while the pandemic has placed an extra strain on the Philippines’ healthcare system, increased awareness of health risks could lead to a spike in private insurance coverage.

Rising concerns that the country’s national health insurance program under the Philippine Health Insurance Corp. or PhilHealth cannot address the citizens’ needs, together with the medical risks of the pandemic, have highlighted the insurance gap in the Philippines, where penetration stands at only 1.69 percent of gross domestic product.

The article revealed that based on recent World Bank figures, out-of-pocket expenditure in the Philippines represented 53 percent of total health spending in 2017, the highest among ASEAN’s major economies. This compared to 37.9 percent in Malaysia, 34.6 percent in Indonesia, 32.1 percent in Singapore, and 11.1 percent in Thailand.

It is estimated that the insurance gap is worth about $4.2 billion, one that presents an opportunity for private insurance players.

The OBG report cited a survey done by Manulife in May last year which showed that 77 percent of the respondents intend to purchase additional insurance within the next 18 months, above the regional average of 62 percent.

It also noted that the development of the microinsurance segment could be key to the sector’s overall growth. The report said that, according to the Department of Finance, the number of people covered by microinsurance increased from less than three million in 2009 to 38.9 million in 2018. By 2022, the microinsurance penetration rate is projected to reach 48.7 percent, up from 25.4 percent in the third quarter of 2016.

In addition, insurers are looking to digitalization to boost revenues during the pandemic and insurance companies are increasingly building partnerships with e-commerce firms to generate online offerings and modernizing their digital platforms to facilitate access to customers, the report revealed.

One company that is speeding up innovation to keep up with the demands of the pandemic is Allianz PNB Life, one of the country’s major life insurance firms.

To respond to the growing need for better safeguards, Allianz PNB Life launched Allianz Shield, a regular pay, unit-linked insurance plan that protects policyholders against unexpected situations, such as the diagnosis of a critical illness or accidental death and dismemberment. It covers at least 10 times the annual premiums depending on the insured’s age upon application for as low as P15,000 annually.

Company chief marketing officer Gino Riola said that the previous year showed that many Filipinos are vulnerable to health and financial crises, and that not everyone has a backup plan in times of need. Unfortunately, many have been challenged economically because of the domino effect of COVID-19, so that the new offering will help them make sure that unexpected expenses are taken care of,

According to Rio, Allianz Shield can help people build a well-rounded protection plan that gives them P1 million coverage upon death, P1 million upon diagnosis of a critical illness, and another P1 million for accidental death and dismemberment. The plan comes with an additional rider coverage that waives succeeding premiums until age 65 of the insured upon diagnosis of a critical illness or upon contracting total and permanent disability. It gives clients the option to withdraw their investment funds, free of charge for up to four times in one year.

It also comes with a loyalty bonus, giving funds a boost every five years as long as the policy remains in force and premiums are paid regularly. It likewise offers a complimentary life event benefit rider which credits back to the policyholder a part of the insurance charges paid in the event of marriage, birth of a child, demise of a family member, involuntary loss of employment, divorce, or separation.

Australia aids Phl pandemic response

Robinson

Australia has recently committed AU$80 million or about $61 million to the Philippines to reinforce the latter’s response to the COVID-19 pandemic.

During a Rotary Club of Makati West (RCMW) membership meeting, Australian Ambassador to the Philippines Steven Robinson said that his country has also committed AU$500 million for COVID-19 response and to provide health security in the Indo Pacific, including the Philippines.

Robinson, also an officer of the Order of Australia (AO), was the special guest at the RCMW’s meeting, which was themed “Mateship and Bayanihan” to celebrate 75 years of friendship between the Philippines and Australia.

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