Number of insurance agents barely grows over 5-yr span

MANILA, Philippines - The number of life insurance agents, insurance brokers, and re-insurers in the Philippines has not increased in a span of five years, or from 2007 to 2011. 

In contrast, total premium income and licensed variable life agents have grown by leaps and bounds in the same period. 

The country’s licensed insurance agents remained in the vicinity of 36,600 on the average. 

Licensed insurance brokers shrunk from 93 in 2007 to just 63 in 2011 based on available data coming from the Insurance Commission (IC). Licensed re-insurance brokers were recorded at 23 in 2011 from 32 in 2007.

 Meanwhile, total premium income of the life insurance industry is expected to breach the P100-billion level after growing an average 20 percent in the past few years. 

Licensed variable life agents ballooned from 4,834 in 2007 to a record 8,314 in 2011. 

In terms of premiums sold, variable life or investment-link life insurance products accounted for a third of total premiums in 2011, from accounting for just a fourth in 2009. 

Meanwhile, Asia Pacific Life Insurance Congress (APLIC) chairperson Nenette Aseniero explained that the stiffer regulatory environment and the low level of financial literacy, might have contributed to the poor growth of the insurance industry.

 â€œThe increasing regulatory environment required a higher level of financial literacy from the existing agency force, and those eyeing the profession,” Aseniero said.  “Insurance today is not just selling, but also selling based on the needs of the prospective client.” 

A good example of the higher level of financial literacy required on the present crop of agents, is that some insurers tapped the expertise of such prestigious institutions as the Asian Instituted of Management (AIM) to raise the level of financial literacy and skill of its agents. 

But it was likewise agreed by insurers that there was a real demand for investment-linked insurance product over pure protection products. 

Sun Life Financial Philippines chief agency distribution officer Alexander Narciso admitted that the insuring public had a clear appetite for life insurance products laced with investments. 

“It is something dictated by the market, especially with the anticipated credit rating upgrade to investment grade by the international rating agencies,” Narciso said. 

He added that the insuring public is concerned over higher returns for their money, in the light of the low interest rate environment and the strong performance of the country’s equity market. 

“Thus the industry responded with the changes by introducing products that meet these needs,” the Sun Life executive explained. 

The APLIC will be holding its 14th conference at the Philippine International Convention Center (PICC) on Feb. 20-22, with an expected 5,000 delegates from all over the region.