MANILA, Philippines — One of the largest life insurers in the country will spend P3 billion over the next three years to boost its sales network in an effort to capture a bigger slice of the local market which, company executives said, continues to be severely underinsured.
In a press briefing, Philippine American Life and General Insurance Co. CEO Kelvin Ang said the new investment will result in the hiring of as many as 5,000 “full-time and highly professional leaders” who, in turn, are expected to have an average of five agents under them, resulting to a 25,000 bump in the insurer’s sales force.
Ang, an executive of Hong Kong-based parent firm AIA who took the Philam helm earlier this year, has a mandate to grow the local business which had slipped in the wake of the global financial crisis a decade ago. That crisis severely affected Philam’s former majority shareholder AIG which has since divested from what used to be the country’s largest underwriter of life insurance policies.
“We see tremendous upside for the local market, especially since we can see a ‘protection gap’ of P1.5 trillion at present,” Ang said, noted the difference Filipinos’ “insurable” out of pocket expenses last year and the actual value that insurance policies covered.
This protection gap, he said, is expected to rise further to P2.7 trillion by 2020.
He noted that the insurance penetration rate in the country remains in the single digit at less than 2 percent, representing a substantial upside potential for the industry.
“This, combined with its relatively steady GDP growth and growing middle class, tells us that all indicators point to a resilient Philippine economy with a lot of potential,” Ang said.
The Philam chief explained that accelerating the growth of the firm’s agency force to reach more Filipinos and developing products that address our customers’ needs will be prioritized.
“The unique development program targeting 5,000 elite leaders is a long-term strategy that will contribute to sustainable growth in the business,” he said. “At the same time, our thrust to help close the protection gap of the country will ensure that we stay true to our brand promise.
Established in 1947, Philam Life had P251.4 billion at the end of 2017, serving almost 600,000 individual policyholders and over 2,200,000 insured group members.