Phil Prudential sells record microinsurance premiums in 2011

MANILA, Philippines - Philippine Prudential Life Insurance Co. Inc. (Philippine Prudential) has recorded a total of P26.730 million in microinsurance premiums in 2011, an increase of 186.16 percent against the P9.34 million in 2010. 

It likewise paid out P22 million worth of microinsurance claims in 2011 numbering over 600, or a whopping 817.26 percent increase from the P2.49 million the year before. 

Philippine Prudential president and chief executive officer Gregorio D. Mercado said that the life insurer was expanding its services beyond the traditional life insurance policies. 

“We’ve had success in going beyond the standard insurance plans and creating products that cater specifically to the needs of customers who may not be able to afford the standard insurance plans,” Mercado said. 

Microinsurance refers to insurance products characterized by low premiums and low coverage limits. 

It is specifically designed to service those belonging to the lower income segment of society as these would not ordinarily be able to avail of more conventional insurance programs. 

In the Philippines, microinsurance products involve premium payments of as low as one peso to P19 per day with benefits as high as P190,000 per policy. 

Its microinsurance claims make up 16.84 percent of the total amount of claims paid out in 2011 which amounted to P135.80 million. 

As one of the country’s major microinsurance providers, Philippine Prudential caters to the group life insurance needs of such microfinancing institutions (MFIs) as non-government organizations (NGOs), cooperatives and rural banks that provide small loans to developing communities.   

It is currently one of the microinsurance partners under the Rural Bankers’ Association of the Philippines – Microenterprise Access to Banking Services (RBAP-MABS) program.

In 2011, a total of 3.5 million microinsurance policies were sold after the government and the private sector began promoting the financial protection products for the poor.

 The National Credit Council (NCC) clarified however that the 3.5 million policies sold does not indicate how many people were covered, since some policies were group insurance policies. They could be covering 100 or 200 people,” he added. 

The NCC is a line agency of the Finance department involved in microinsurance along with the Insurance Commission. 

The NCC said that at least five million microinsurance products could be attained by end 2012. 

There are currently eight microinsurance providers from the non-life insurance sector, seven from the life industry and 15 from mutual benefit associations (MBAs).