MANILA, Philippines - The country’s insurance industry has reported total premium income of P188 billion in 2014, down slightly from the P198 billion reported in 2013, due mainly to lower sales performance by the life insurance sector.
Total net income of the industry however grew by 11.98 percent, or from P14.6 billion in 2013 to P16.4 billion.
The insurance industry is dominated by the life and non-life sectors, but also includes the reinsurance, pre-need and mutual benefit associations (MBA).
IC Commissioner Emmanuel F. Dooc said that the life insurers experienced a huge drop single pay premium income and slightly anemic first year premiums.
On the other hand, the non-life insurers registered strong gains in the absence of any devastating natural and man-made catastrophes. In 2013, the sector took a beating due mainly to huge losses brought about by Typhoon Yolanda (Haiyan).
Dooc said that the other good news is that the entire industry’s total assets ballooned to a record P1.015 trillion.
Total paid up capital grew 6.94 percent to P39.9 billion last year from P37.3 billion.
But that figure is expected to dramatically expand as the minimum paid-up capital for both life and non-life insurance firms will increase from the present P350 million to P550 million.
“We may see several consolidations, mergers and acquisitions, as the minimum capital is the steepest so far,” Dooc said, adding that the new capital requirement was meant to ensure the financial health and viability of the insurers.
The situation may also see the entry of regional players looking for acquisition and expansion opportunities.
The IC commissioner admitted that several regional and global insurers and financial institutions have been calling on his office making inquiries on the insurance industry.
Meanwhile, total industry investments reached P863.2 billion last year, or 8.64 percent higher than the P794 billion in 2013. And total benefits/losses incurred increased by 10.37 percent to P70.2 billion from P63.6 billion.
The country’s non-life insurance sector reported total net income of P2.3 billion last year, or a whopping 191.52 percent increased from the P822 million in 2013.
Assets expanded to P159.9 billion or 4.53 percent better than the P153.2 billion in 2013.
Meanwhile, gross premiums written hit P63.9 billion last year or 17.13 percent better than the P54.5 billion in 2013.
Thus, total net premiums written increased by 12 percent to P30.1 billion while total premiums earned amounted to P28.8 billion last year from P27 billion in 2013 for a mild 6.71-percent increase.
However, total investments fell slightly to P60.5 billion in 2014 from P61 billion from the year before.
Total paid-up capital grew to P25.5 billion last year from P23.4 billion, while networth expanded nearly nine percent to P64.3 billion from P23.4 billion in 2013.
Total losses incurred were recorded at P12.8 billion or a slight decreased of 6.85 percent from P13.7 billion in 2013. Total liabilities amounted to P95.6 billion up slightly from P93.7 billion in 2013.
Meanwhile, the country’s life insurance sector reported a 7.81-percent drop in premium income, or from P171.2 billion in 2013 to just P157.8 billion last year.
Dooc said that most life insurers reported strong fourth quarter performances.
“That (fourth quarter sales) will serve as a momentum for a stronger 2015,” he said, at the sidelines of the formal induction ceremonies of the Philippine Life Insurance Association (PLIA).
Nevertheless, assets expanded by 15.81 percent to P855.2 billion in 2014 from P734.5 billion in 2013. Networth grew P122 billion or 7.53 percent higher than the P113.5 billion the year before.
Investments jerked somewhat by 9.48 percent to P802.7 billion last year from P733 billion in 2013. Of total investments, government securities reached P369 billion with the balance going to corporate fixed income commercial papers.
Of total premium income, P50.8 billion were traditional or protection insurance while P107.5 billion were variable unit linked or life insurance with an investment component.