Pru Life UK poised to break P3-B level

Pru Life Insurance Corp. of UK (Pru Life UK) is optimistic of breaking its P3-billion level in terms of total premium income this year.

That will allow the United Kingdom-based life insurer to remain within striking distance in joining the top five life insurers of the country.

"We are highly optimistic that we can achieve growth in premium income between 15 to 20 percent of our 2005 performance," Charlie E. Oropeza, president and chief executive officer of the Philippine operations of Pru Life UK, said.

In 2005, its premium income stood at P2.3 billion, ranking it sixth among the country’s 34 life insurance companies.

The elite five life insurers in the country last year based on total premium income were the Philippine American Life and General Insurance Corp. (Philamlife), Sun Life of Canada Philippines Inc., Insular Life Assurance Corp., the Philippine Axa Life Insurance Corp., and the Manufacturers Life Insurance Co. Inc.

Assuming a maximum growth rate of 20 percent last year, the premium income of Pru Life UK in the Philippines would be P2.7 billion.

Thus another 15 to 20 percent annual growth rate in 2007 would give Pru Life UK an estimated premium income of P3.25 billion.

Total premiums rose from P865 million in 2002 to P1.6 billion the following year. In 2004, it threatened to break the P2-billion barrier by recorded total premiums of P1.96 billion.

By 2005, premiums reached P2.3 billion with total assets nearing the P6 billion mark.

But what seems to excite the leadership of the sixth best insurer is the positive nature of its net income since its operations started in the Philippines since 1997.

After logging losses in income in its first few years of operations in the Philippines, Pru Life UK recorded its first positive income growth in 2004 of P105.67 million. In 2005, it vastly improved to P412 million.

Understanding life insurance, gestation period last for some seven or eight years from its start-up operations.

"That is just normal. Positive income growth came in its eight year of operations, and we have not stopped recording positive growth since then," Oropeza explained.

The chief executive expects to report another positive income growth for 2006, and is looking forward to consistent growth figures thereafter. Incidentally, total assets in 2005 was recorded at P5.8 billion.

Pru Life UK (Philippines) remains bullish towards growth in the Philippine market, declaring its preparedness to expand organically or through acquisition.

However, acquiring lock-stock-and-barrel may not be an enticing option. Rather the insurer is more inclined to acquire the portfolio to avoid complications. "There must be a complimenting character in an acquisition, it is not just a matter of numbers. It should enhance our portfolio," officials said.

Since the start of the 21st century, Pru Life has acquired the portfolios of Allstate Insurance and ING Life, two foreign insurers who entered the Philippine market during the liberalization stage. However, both insurers decided to abandon the Philippine market.