Insurance Commission forecasts record P250-B premium income for insurers

MANILA, Philippines - The Insurance Commission (IC) expects the industry’s total premium income this year to surpass the record P198 billion in 2013 to hit a new all-time high of P250 billion.

IC commissioner Emmanuel F. Dooc said premiums are estimated to grow roughly 30 percent this year from the P188 billion premium income last year.

Total premium income reached P56 billion in the first three months and initial reports for the next quarter places the figure at roughly the same amount.

Dooc said traditionally, the second semester outperforms the first six months of the year.

Likewise, bancassurance partnerships, which generates the largest chunk of single premiums for life insurance, all reported huge gains in the past three years. Single premiums also dominate total annual sales for the life sector, and majority of single premiums are investment-laced variable unit-linked (VUL) insurance, Dooc noted.

He said he is also bullish on the contribution of the non-life sector, which has been reporting strong sales due to the heightened awareness for protection from natural catastrophes.

Dooc said if the country’s gross domestic product continues to register nearly seven percent annual growth rates, the country’s per capital GDP income could rise to nearly $3,000.

“It would result in greater excess revenues for individuals and higher insurance sales or a penetration rate of three percent,” he said.

With that scenario, the IC forecasts total premium income to breach the strategic barrier of P500 billion by 2019.

2013 was a banner year for the Philippine insurance industry, raking in total premium income worth P198 billion. Last year, it slipped to P188 billion due to a weaker sale of single-pay premiums by life insurers.