Life insurance companies posted a higher net income last year due to rising demand for financial services, but non-life insurance firms suffered a steep decline in profit due to a surge in claims following the natural calamity that hit the country last November.
The Insurance Commission reported that life insurance companies posted a collective net income of P13.83 billion last year—up by about 32 percent from the P10.51 billion of the previous year.
But non-life insurance firms registered a combined net income of P822 million—down year-on-year by nearly 69 percent from P2.62 billion.
There are 25 life and 69 non-life insurance firms in the country.
The commission said it had anticipated the 2013 performance of the two subsectors of the insurance industry.
Insurance Commissioner Emmanuel Dooc earlier said that the increasing awareness of Filipinos of the value of insurance helped pushed up sales of insurance products.
From only about 14 percent in 2009, the estimated proportion of Filipinos with life insurance had increased to at least 25 percent last year, he said.
Dooc said non-life insurance companies also benefited from rising demand for their products as more people saw the need to insure their properties.
However, he said, non-life insurance firms had to meet a substantial rise in claims late last year due to the devastation wreaked by Super Typhoon “Yolanda.”
The powerful storm cut a swath of destruction across central Philippines, killing thousands of people and ruining billions of pesos worth of property.
Dooc said microinsurance companies bore the brunt of the financial impact of the calamity. The microinsurance firms cater to the low-income market, which includes farmers.
But the official was quick to point out that the non-life insurance subsector remained healthy.
Dooc said it expected the subsector to post a profit rebound this year.
The rise in demand for insurance products was reflected in the increase in premiums collected both by life and non-life insurance firms last year.
Data from the Insurance Commission showed that premiums collected by life insurance companies reached P171.21 billion last year—up by nearly 43 percent from P120.33 billion in 2012.
Premiums collected by non-life insurance firms hit P54.57 billion, up by 4.4 percent from P52.26 billion.
The government continues to encourage the insurance industry to expand its reach. In particular, Dooc said, it supports the industry effort to offer more microinsurance products so that more low-income earners may avail of insurance coverage. Michelle V. Remo