Despite the better-than-expected 6.9-percent economic growth in the first quarter, insurance firms were unable to ride on robust consumption as their sales as well as profits dropped from a year ago.
Data released Monday by the Insurance Commission showed that the industry’s total premiums at end-March declined 15.2 percent to P47.7 billion from P56.3 billion a year ago, with the life insurance sector dragging total sales with a faster 19.7-percent year-on-year drop to P38.6 billion.
The non-life sector’s total net premiums written, on the other hand, grew 11.3 percent year-on-year to P9.1 billion.
An industry executive said reasons why sales dipped during the first quarter would vary per company, although he noted that there may have been consumers and investors who opted to take a wait-and-see stance ahead of the elections last May.
Lower sales pulled down profits, bringing the insurance industry’s total net income to just over P5 billion, down 3.7 percent from P5.2 billion in the first three months of last year.
The life sector’s net income increased by 3.1 percent year-on-year to P4.5 billion, while nonlife insurance firms’ combined profit slid 38.8 percent to P518.4 million.
As a whole, the industry’s total assets rose 9.6 percent to P1.2 trillion as of end-March from P1.1 trillion a year ago. A higher asset base means that the insurance industry has more resources and better capability to assume its liabilities.
First-quarter liabilities stood at P949.9 billion, up by a slower 8.3 percent year-on-year.
Insurance firms’ total investments also jumped by 12.1 percent to exceed P1 trillion at the end of the first quarter.
The insurance industry’s total net worth likewise expanded by 15.8 percent to P215.6 billion in the first three months, while total paid-up capital climbed by 4.8 percent to P41.7 billion.
Insurance Commissioner Emmanuel F. Dooc earlier said insurance premium production could hit P300 billion this year, to surpass the record-high of over P230 billion last year.
At end-2015, about 38 million Filipinos were insured, although around 29 million of them were covered by cheap insurance products. The Philippines is widely regarded as a microinsurance model in the region.