That is the forecast of several players in the country’s struggling non-life insurance industry which includes auto, fire, marine, personal accident, and property insurance.
As a measure to increase the level of protection of the public, the Insurance Commission (IC) has ordered non-life insurance companies to raise their increase in paid-up capital from the present minimum of P50 million to P300 million by 2007.
The IC has been pushing for better protection for the public, higher professionalism, and increased competitiveness of the country’s insurance industry in lieu of the anticipated onslaught of regional players.
Member firms of the Philippine Insurers and Reinsurers Association (PIRA) in general agree that the industry needs to consolidate, and that mergers and acquisitions will remain the order of the day.
"What has been experienced by the banking industry, would also happen to the insurance industry," Jose
Zuniga, PIRA trustee and president of PNB General Insurance said.
Zuniga said it is necessary to strengthening the non-life industry, "In the face of the expected entry of foreign players as the region breaks down trade and business barriers forces the industry to consolidate and increase capital to stay competitive," he added.
Fortune General Insurance president Michael F. Rellosa said mergers and aqcuisitions are inevitable when the IC imposes the higher capital base requirements