MANILA, Philippines — The insurance industry’s bottom line declined 9.85 percent year-on-year to P28.62 billion during the first nine months of 2020, no thanks to weaker sales in the midst of a pandemic-induced recession.
The latest Insurance Commission (IC) data showed the total net income of 128 life and non-life insurers as well as mutual benefit associations (MBAs) from January to September last year dropped by almost a tenth from P31.74 billion a year ago.
Total end-September premiums across the three sectors declined 3.76 percent to P216.51 billion from a year ago’s P224.97 billion.
Benefit payments disbursed by insurers also dropped by 10.7 percent to P69.77 billion from P78.13 billion in the previous year.
On a per sector basis, IC data showed that 31 life insurance companies’ combined net income fell 11.5 percent year-on-year to P21.44 billion, as total premiums shrank by 0.95 percent to P173.69 billion.
While sales of variable life products inched up by 2.48 percent year-on-year, those of traditional life as well as new business annual premium equivalent went down by 3.01 percent and 19.52 percent, respectively.
On the other hand, 62 non-life firms saw their net income climb by 60.09 percent year-on-year to P4.84 billion even as total net premiums written, premiums earned, as well as gross premiums written all declined by 19.45 percent, 4.17 percent and 11.31 percent, respectively.
Thirty-five MBAs’ net surplus fell by a faster 47.94 percent as total contributions and premiums declined by 17.35 percent.
At the end of the first nine months of 2020, life players’ benefit payments went down 4.94 percent year-on-year; non-life insurers’ losses incurred, down 25.79 percent; and MBAs’ benefit expenses, down 11.38 percent.
Across the three sectors, total assets as of end-September inched up by 2.83 percent year-on-year to P1.79 trillion—this meant the country’s insurers had bigger resources and better capability to assume their liabilities, which also increased by 7.44 percent to P1.43 trillion.
Industrywide paid-up capital and guarantee funds also climbed 13.62 percent year-on-year to P63.44 billion, even as total investments contracted by 1.31 percent to P1.56 trillion.
The industry’s total net worth was lower by 12.12 percent year-on-year to P360.72 billion last year as at least two previously licensed companies stopped operations due to non-compliance to the higher end-2019 capitalization requirement of P900 million.