Insurance premiums to hit P115 B

Ted P. Torres - The Philippine Star

MANILA, Philippines - The Insurance Commission (IC) is highly optimistic that the country’s life insurance industry can hit the P115-billion mark in terms of premium income this year.

Along with the Philippine Life Insurance Association (PLIA), the IC has earlier forecast that total premium income will breach the P100-billion level.

After nine months into 2012, the industry recorded total premium income amounting to P82.6 billion, just P3-billion short of equaling the entire 2011 premium income of P85.6 billion.

“I am optimistic that the life industry’s premiums will reach P115 billion this year,” Emmanuel Dooc, IC commissioner, said.

PLIA president George D. Mercado said that the P100-billion premium target was now attainable with the results of the first nine months practically equaling the entire 2011 premium income. Mercado is also the president and chief executive officer of the Philippine Prudential Life Insurance Co. (Philippine Prudential).

Sun Life of Canada (Philippines) Inc. (SLOCPI) president and chief executive officer Riza Mantaring believes it will be “well past P100 billion in premium income.” SLOCPI is the life insurance arm of Sun Life Financial Philippine Inc. of which Mantaring is likewise the chief executive.

SLOCPI topped all life insurers last year with total premium income worth over P13.8 billion.

“The industry has been experiencing unusually strong growth in the fourth quarter, driven by the robust economy. Variables or unit linked (VULs) are selling extremely well, which is to be expected given both the strong market and the low interest rates which make traditional products less attractive,” Mantaring said.

VULs are life insurance products laced with investment instruments.

AXA Philippine president and chief executive officer Rien Hermans agrees with the forecast but expressed concern that single premium products will not dominate the sales.

“I hope is that this growth is not coming from the increase in single premium sales in the bank channel alone. Life insurance offers great value to people who want to take their financial future in their own hands, to protect their loved ones, ensure money is available when they need it at times of high expenses (education) or retirement or to shield them for high medical expenses,” Hermans added. AXA Philippines was third best performer in terms of premium income in 2011.

Single premiums offer limited protection features from traditional ones that offer a variety of protection features.

Manulife Financial Philippines president and chief executive officer Indren Naidoo readily agreed with the bullish forecast for this year.

“With a growing financial awareness among the middle class and overseas Filipinos that has led to the demand for financial protection and savings products in recent years, I believe that the life insurance industry can surpass the P100- billion mark this year,” Indren said. Manulife Philippines ranked seventh overall among the 34-life insurers last year.

Since 2009, total premium income has grown by over 20 percent.

However, Dooc hopes that the lower half of the industry can contribute significantly in the coming years in terms of premium income. “I would like to see the lower half of the players account for a more significant share.”

In the past years, the top five players already accounted for over 50 percent of total premiums. Add the next top five, and that accounts for more than 80 percent of the total.

The top 10 players in the life industry in 2011 are: Sun Life; Philippine American Life and General Insurance Co. (Philam Life); AXA Philippines; Prulife of the UK (Philippines) Inc. (Pru Life); Insular Life Assurance Corp. (Insular Life); BPI-Philam ( the bancassurance joint venture between Philam Life and the Bank of the Philippine Islands); Manulife Philippines; Sunlife Grepa (the bancassurance joint venture between Sun Life and the Rizal Commercial Banking Corp.); United Cocolife; and Generali Pilipinas (the joint venture between BDO Unibank Inc. and Generali Spa).













  • Latest
Are you sure you want to log out?

Philstar.com is one of the most vibrant, opinionated, discerning communities of readers on cyberspace. With your meaningful insights, help shape the stories that can shape the country. Sign up now!

or sign in with