MANILA, Philippines - The Insular Life Assurance Corp. (Insular Life), the third largest life insurance company in terms of total premiums, is poised to expand its business by 20 percent in 2010.
In fact, first year premiums or new business in the first four months of the year already grew by 20 percent to P700 million.
First year premiums or FYP are new policies written with premiums collected, while renewal premiums are premiums paid by existing policyholders (payments either in quarterly, semestral or annual basis).
Insular Life, the only local life insurer ranked among the top five players in the industry, wants total premiums to grow to P7.5 billion by the end of the year or some 20 percent higher than the P6.3 billion registered in 2009.
That would keep Insular Life well in pace with second running Sun Life of Canada which registered a strong P9.5 billion in total premiums last year. The Philippine American Life and General Insurance Co. (Philamlife) managed to cling on to the top spot in terms of total premiums with P10.8 billion.
Insular Life president and chief operating officer Mayo Jose B. Ongsingco said that they launched a US-dollar denominated structured insurance recently that was based on the Greater China (Taiwan, Hong Kong and mainland China) index.
It is an investment-linked life product, which has a guaranteed principal feature and a maturity period of just five-years.
“The product was so popular that it accounted for half (P350-million worth) of the new business premiums after April this year,” Ongsingco told The STAR.
Aside from the dollar-denominated fixed income product, the insurer has other investment-laced life insurance products in the equity, peso-denominated fixed income, and the balance fund market. It still peddles the traditional life products such as the whole life and term.
Last year, Insular Life also lent out P2.8 billion in term loans to major players in the property development, power generation and distribution, and telecommunications.
In the same period, it registered a consolidated net income of P2.12 billion and consolidated revenues of P12.6 billion. Investment income and other recurring income streams reached P5.2 billion.
Insular Life has over 2,000 agents, spread out in 20 regional centers and 60 branches nationwide.
Ongsingco said that a large, well-trained and highly motivated agency force is their “secret.”
“The Filipino market still wants the face-to-face meeting which allows the agent to explain the importance of insurance, and the kind of insurance products,” the Insular chief operating officer said, adding that it is a bigger edge if it has a nationwide coverage.
Insular Life is optimistic that its countrywide agency coverage can take advantage of the strong economic growth of the country.
In the first three months of the year, gross domestic product (GDP) expanded by 7.3 percent. The full year forecast trend is moving upwards between 4.5 to 5.5 percent.
Key contributors to the exceptional growth in the first quarter were high remittances from overseas Filipinos and continued expansion of the business process outsourcing (BPO).
Ongsingco said that that is the same market Insular Life is looking to exploit.
“The young BPO employee getting at least P15,000 a month is swallowed by the three Gs of gimmick, gadgets, and garments. The families of overseas Filipinos are more consumption-oriented versus savings-investments-protection,” he lamented.