MANILA, Philippines–Generali Philippines, a bancassurance venture between global insurer Generali Group and local banking giant BDO Unibank, has decided to phase out non-life operations and concentrate solely on the life insurance business by 2013.
“After three years, our board is fully convinced that any further effort to operate our non-life business has become far less attractive due to an overly competitive market and to the significant increase in catastrophe reinsurance costs, a consequence of a series of natural events that recently occurred in Asia. The above reasons, all of which are not expected to improve in the near future, led the board to this unanimous decision,” Generali Pilipinas president Renato Vergel de Dios said in a press statement on Wednesday.
By shifting its focus towards its core life business and harnessing the partnership with banking leader BDO, Vergel de Dios said Generali Philippines chief was poised to achieve its ambitious growth targets that would push up its industry rankings.
“With our strong foundation and right fundamentals now in place, we are extremely excited at the prospect of taking Generali Philippines to the next level,” Vergel de Dios said.
The strategic move to focus on life insurance marketed through its bancassurance channel has created a steady stream of recurring premium income and a more profitable in-force individual life portfolio for the company, Vergel de Dios said.
Generali Pilipinas reported a 38 percent year-on-year increase in premiums from January to September. New individual insurance sales, arising solely from regular premium products, were up 30 percent for the same period, while individual renewal premiums grew at 59 percent. Group Life and health premiums were likewise up by 25 percent.
A key driver to such growth was the company’s sustained efforts to beef up its primary bancassurance distribution channel, Vergel de Dios said, noting that Generali Pilipinas was now employing over 500 bancassurance sales people who operate in more than 750 branches nationwide of BDO.
Beyond the sheer growth in sales manpower is a nearly threefold improvement in regular sales productivity since 2009, he added. This was attributed to the company’s investment in sales training and supervision, improved field management systems and concentration on its broad-based target markets.
“Our efforts in developing a professional bancassurance sales force by building strong fundamentals have started to bear fruit,” he said. “This move has brought us closer to our ultimate objective of helping bank clients buy the right insurance products for their expressed needs. In the process, we enable our financial advisers to achieve their own financial aspirations via a rewarding sales career in Generali.”