Non-life insurers remain optimistic amid the crisis

Though indirectly affected by the global credit crisis that resulted to the collapse of giant financial companies abroad, Cebu’s non-life insurance industry is still optimistic to manage this year’s operation.

Andy Manatad, president of the Cebu Insurers Club, gave assurances that their member companies do not have placements in the bankrupt Lehman Brothers as most of their placements are with re-insurers based in London, Hong Kong, Germany, Singapore, Australia, Switzerland and New Zealand.

He said that the only link they have with the woes regarding the financial collapse in the US is that most of their members have deposits in some banks which have declared placements or investments in the Lehman Brothers.

“It is quite possible that our deposits could be affected but we are still continually monitoring the situation to safeguard our investments in these banks. If ever we see a greater threat, we may transfer our deposits to other unaffected banks,” he said.

Manatad urged the banking institutions and financing firms affected by the financial collapse to expose their losses so that their sector can make necessary steps to ensure their investments.

“We are asking the affected banks and financing firms to give the business sector the complete details of their investments in the Lehman Brothers so that we can also make our own initiative to recoup possible losses” he said.

Manatad added that right now, their deposits still remained intact with these banks as they believe those who have been affected are big companies and there is a possibility that only a small percentage of their liquid assets have been invested in Lehman Brothers.

However, despite the crises, Manatad reported that from the first quarter until the third quarter of this year, there have been monthly increases in their sector in terms of premium collections.

“There are several sectors which have helped the industry achieve increasing collections. The banking industry requires insurance for loans, government projects also required insurance, loans also from financing institutions need insurance,” he explained.

Manatad said that for the third quarter, their sector is continually improving to increase their production further to reach their quotas.

He said that unlike the life insurance industry which offers continuing coverage, their sector offers insurance coverage which automatically expires over a period of time because it does not have loan value. —Rhia de Pablo