PH insurance industry’s net income grew by 4.2% in H1
MANILA -The insurance industry in the Philippines continued to be profitable as a decline in benefit payments outpaced that of premiums while intake from new business surged.
Data from 126 out of 138 firms registered with the Insurance Commission (IC) show that industrywide net income for the first semester grew by 4.2 percent to P22.39 billion this year from P21.48 billion in the same period last year.
At the same time, total benefits payments or losses incurred decreased by 5 percent to P61.77 billion from P65 billion.
Meanwhile, total premiums eased by 0.5 percent to P187.76 billion from P188.69 billion.
Further, industrywide net worth jumped by 18.8 percent to P452.05 billion from P380.42 billion.
In a statement, the IC noted that in the second quarter alone, life insurance firms collected a total of P29.5 billion in new business annual premium equivalent (NBAPE) — which tallies first year premiums and 10 percent of single premiums.
This represented a 9.6-percent rise from the P26.9 billion premiums collected from new business during the April-June period in 2022.
The regulator said the increase in premiums collected from new business could be attributed to the increase in premium collection from traditional life insurance products. This surged by 31 percent to P50.83 billion from P38.77 billion.
Last August, Insurance Commissioner Reynaldo A. Regalado called on insurers to continue supporting financial literacy programs that provide awareness of the benefits of financial products and services, particularly insurance policies that guard against risks that can result in financial ruin.
Regalado expressed optimism that through financial literacy programs and digitalization, more Filipinos would be encouraged to be insured so that the protection gap in the economy can be reduced.
To further promote financial inclusion, the IC introduced digitalization programs such as the online submission and approval of new insurance products, and is set to release the regulatory guidelines on Islamic insurance within the year.
“Financial inclusion is not only about increasing the percentage of the population who have access to financial products and services,” Regalado said. “It is more about reducing the demographic disparities between that portion of the population who are unable to participate in the formal financial sector and those who are unable.”