AXA sales boosted by liquid economy
AXA executives (L-R): BJ Legaspi, Sales Director for Visayas & Mindanao; Daisy Praile, General Santos City Executive Unit Head; Xenas Kintanar, Mindanao Zone Head and Geoffrey Tan, Training & Agency Development Head. FILE PHOTO
MANILA, Philippines—AXA Philippines posted significant growth in premium income and assets under management (AUM) in the first three quarters of the year, being able to corner a chunk of the funds being withdrawn from the central bank’s special deposit accounts.
In a press conference Thursday, the company’s chief reported a 59-percent year-on-year surge in premiums collected from policyholders in January to September to P13.9 billion.
Also, AUM as of the end of September amounted to P51 billion, up by 25 percent from a year ago.
“The numbers have grown partly because of liquidity coming out of SDAs,” said AXA Philippines president and CEO Rien Hermans.
Individual investment funds have been leaving SDAs following a directive issued by the Bangko Sentral ng Pilipinas in May prohibiting retail money from being invested in the facility. Only unit investment trust funds (UITFs) of banks shall have access to the SDA facility, the monetary authority said.
The BSP has given banks until the end of November to take all retail funds out of the SDA facility.
Based on earlier estimates, individual funds in SDAs stood at nearly P1 trillion at one point.
Central bank officials said some of the funds to leave SDAs may be placed in UITFs and, therefore, return to the SDA facility soon, but some could be used to purchase other financial instruments.
Sales of insurance products and government securities, as well as bank deposits rose following the BSP directive.
Hermans said AXA was able to take advantage of the available liquidity in the economy through the introduction of new products and expansion of its sales force.
“We used to have just 300 financial advisors a few years ago. In just a few years, we have grown that number by 600 percent,” Hermans said.
AXA Philippines now has 1,850 exclusive sales agents, he said.
But he said bancassurance was also a significant driver of growth, accounting for 64 percent of sales.
AXA has a bancassurance partnership with Metrobank, which has about 600 branches nationwide.
Mike Bishop, chief executive of AXA Asia, said in the same press briefing that AXA expects the Philippines to be one of its fastest growing markets given the country’s robust economy and still low penetration rate of insurance products.
He said AXA expects its Philippine operations to sustain over the medium to long term the growth rate seen so far in 2013.
“The Philippines is a priority market for us,” Bishop said.
Hermans said the growth potential of an insurance firm in the Philippines was party anchored on the rising number of Filipinos who are becoming more and more financially literate and whose incomes are rising.
He said increasing incomes encourage individuals to allocate a portion of their earnings for investments and insurance.
