Philippine insurers expect rise in sales

Philippine life insurers expect a 60-70 percent rise in first-year premium collections in the first semester from that of the previous year, due to favorable conditions in the industry.

In 2010, premiums for new policies reached P34.28 billion, growing by 59 percent from the 2009 level.

Mayo Jose Ongsingco, president of the Philippine Life Insurance Association Inc. (PLIA), said in an interview that the sector was doing well, tracking a general trend throughout Asia.

Asia now represents more than half of global life insurance premiums, and that share is still growing, Ongsingco said.

“This is partly due to the region’s growing population and a growing middle class,” he said. “Aside from that, bancassurance is gaining ground in Asia, and is about to represent half of premium collections in the region.

Bancassurance, or bank insurance model, refers to the tie-up between insurers and banks, where the latter collect the premiums as opposed to insurance agents.

Ongsingco said life insurance penetration in the Philippines is currently at 0.9 percent of gross domestic product.

“PLIA hopes to catch up with a relatively comparable market such as Malaysia, where penetration is about 3 percent of GDP,” Ongsingco added.

Citing data from the Insurance Commission, PLIA officials said some 15.1 million Filipinos are covered by life insurance, representing 16.08 percent of the total population in 2010, which the National Statistics Office estimates at 94.01 million.

This means an increase of 2.18 percentage points from the 13.9 percent recorded in 2009, when 12.8 million Filipinos were covered.