Tuesday, August 21, 2012
Thursday, August 2, 2012
Life insurance premiums hit P50 B in six months
Philippine Star
Banking
By Ted Torres (The Philippine Star) Updated July 31, 2012 12:00 AM
MANILA, Philippines - The country’s life insurance industry has reported total premium income of P50 billion in the first six months of 2012.
That strengthened the forecast of the Insurance Commission (IC) that the industry is on track to hit the P100-billion mark this year.
In 2011, life insurers posted a record P85.6 billion in total premium income.
On the sidelines of the formal launching of the mobile microinsurance partnership between Smart Communications (Smart) and Beneficial Life Insurance (BenLife) last week, IC Commissioner Emmanuel L. Dooc said that the full year target was achievable with traditional life insurance products being complemented with stronger sales of microinsurance products.
The introduction of new protection products, variable or investment-laced life products, and the double-digit growth of policies sold through bancassurance are still the leading drivers for the strong growth of the industry.
The IC said that the aggressive behavior of the industry is spurred by the strong economic growth, as well as the increased competition between the top life insurance players, mostly foreign dominated.
Aside from the contribution of the premium income coming from traditional protection products and the investment-laced variable or unit-linked products, the IC is looking at the microinsurance sector as increasing its share of the premium income pie.
Microinsurance products have been predominantly sold through mutual benefit associations (MBAs).
But in the past few years, life and non-life insurance companies have joined the bandwagon.
There are now over four million individuals in the Philippines covered by microinsurance, or protection that offers affordable premium rates focused on the previously un-served segment of the country’s population.
From 2007 to 2010, 10 life insurers alone generated total premiums of P1.9-billion while paying claims for death benefits recorded P920 million and P1 million in medical/health benefits.
General or non-life insurers in the same period collected P102 million in premiums while paying P12 million for fire losses, P38 million for death benefits, and P153,322 for medical/health.
But the bulk of the microinsurance premiums was earned by 14 MBA amounting to P4.2 million while death claims recorded P706 million and P5.2 million in medical/health.
The Asia Pacific region is the acknowledged leader in the development of the microinsurance industry.
Of the 500-million protected by the uncomplicated and inexpensive form of institutional protection end 2011, 400 million are domiciled in Asia.
According to a study by the International Labor Organization (ILO) and the Munich Re Foundation, the “microinsured” global population stood at 78 million in 2006 to the present 500 million.
“Asia is spearheading microinsurance development, in part because of large and dense populations, interest from public and private insurers, willing aggregators or distribution channels, and, perhaps most importantly, active government involvement, for example through subsidies,” the study added.
There are 50 million individuals covered by microinsurance in Latin America and another 24 million in Africa.
Friday, July 27, 2012
Micro-insurance program tailored to needs of the poor - DOF director
BAGUIO CITY, July 27 (PIA) - - The Department of Finance and its partners are into massive advocacy campaign on micro-insurance program which gives access and assurance to the poor sector of society.
Finance Director Joselito Almario, who was one of the lecturers on the Advocacy Seminar on Micro-insurance held in this city last week, said that government together with private sector insurance providers and micro-finance institutions had come up with a micro-insurance program tailored-fit to the needs of the poor and those not formally enrolled in mandated insurance systems.
Almario, who is also deputy director of the National Credit Council, explained that micro-insurance are insurance, insurance-like, and other similar business activity which provide specific products and services that meet the needs of the poor for risk protection and relief against distress, disaster, or any untoward incidents.
The amount of premium or contribution per micro-insurance policy ranges from P1 to P20 per day.
The Asian Development Bank and the German International Cooperation provide technical assistance to the micro-insurance program.
Almario assured that micro-insurance packages are supervised by the Insurance Commission and covered by stringent rules and regulations to be adhered by providers which guarantee benefits to be availed by the poor in the event something happens to them.
He recounted how through the years, micro-finance originally dubbed as micro-credit has evolved and now covers the micro-insurance program with government giving recognition on the need to uplift the standard of living of the poor through insurance access.
There is also a wrong notion that the poor cannot pay. Past experiences prove that they can pay in informal credit institutions, according to Almario.
Insurance, unlike credit, savings, payment transfers, and remittances was the only major financial product not accessible to micro, small, and medium entrepreneurs (MSMEs), Almario noted.
He said there is poor insurance penetration among marginalized or the poor sector due to absence of policy and regulatory framework and inappropriate products as these are unaffordable, not tailored fit with complex and complicated contracts and cumbersome requirements.
There is also lack of awareness because people think these are just additional financial burdens and with no immediate benefits and the belief on the a "leave it to destiny mentality."
But through product innovation, micro-insurance is already designed with affordable premium, simpler, and easy-to-understand contract and tailored fit to the needs of the poor, Almario pointed out.
If micro-credit provides the unserved and underserved their present financial needs, mico-insurance will provide for the future unforeseen and unexpected financial needs of the poor, he declared.
Almario said that the Economist Intelligence Unit gave recognition to the micro-finance program of government in 2010.
It was ranked first in regulatory framework, second among 54 countries in overall microfinance business environment, 4th in institutional development and 18th in investment climate. It has maintained its top rank in Regulatory Framework in 2011.
Meantime, Baguio Mayor Mauricio Domogan said there's need to screen insurance companies involved, and strengthen their capability to improve public perception.
He believes the program is important in enhancing the capability of insurance providers to be able to entice those who would like to avail of the product. (JDP/SCA-PIA CAR, Baguio)
Finance Director Joselito Almario, who was one of the lecturers on the Advocacy Seminar on Micro-insurance held in this city last week, said that government together with private sector insurance providers and micro-finance institutions had come up with a micro-insurance program tailored-fit to the needs of the poor and those not formally enrolled in mandated insurance systems.
Almario, who is also deputy director of the National Credit Council, explained that micro-insurance are insurance, insurance-like, and other similar business activity which provide specific products and services that meet the needs of the poor for risk protection and relief against distress, disaster, or any untoward incidents.
The amount of premium or contribution per micro-insurance policy ranges from P1 to P20 per day.
The Asian Development Bank and the German International Cooperation provide technical assistance to the micro-insurance program.
Almario assured that micro-insurance packages are supervised by the Insurance Commission and covered by stringent rules and regulations to be adhered by providers which guarantee benefits to be availed by the poor in the event something happens to them.
He recounted how through the years, micro-finance originally dubbed as micro-credit has evolved and now covers the micro-insurance program with government giving recognition on the need to uplift the standard of living of the poor through insurance access.
There is also a wrong notion that the poor cannot pay. Past experiences prove that they can pay in informal credit institutions, according to Almario.
Insurance, unlike credit, savings, payment transfers, and remittances was the only major financial product not accessible to micro, small, and medium entrepreneurs (MSMEs), Almario noted.
He said there is poor insurance penetration among marginalized or the poor sector due to absence of policy and regulatory framework and inappropriate products as these are unaffordable, not tailored fit with complex and complicated contracts and cumbersome requirements.
There is also lack of awareness because people think these are just additional financial burdens and with no immediate benefits and the belief on the a "leave it to destiny mentality."
But through product innovation, micro-insurance is already designed with affordable premium, simpler, and easy-to-understand contract and tailored fit to the needs of the poor, Almario pointed out.
If micro-credit provides the unserved and underserved their present financial needs, mico-insurance will provide for the future unforeseen and unexpected financial needs of the poor, he declared.
Almario said that the Economist Intelligence Unit gave recognition to the micro-finance program of government in 2010.
It was ranked first in regulatory framework, second among 54 countries in overall microfinance business environment, 4th in institutional development and 18th in investment climate. It has maintained its top rank in Regulatory Framework in 2011.
Meantime, Baguio Mayor Mauricio Domogan said there's need to screen insurance companies involved, and strengthen their capability to improve public perception.
He believes the program is important in enhancing the capability of insurance providers to be able to entice those who would like to avail of the product. (JDP/SCA-PIA CAR, Baguio)
Thursday, July 26, 2012
IC targets higher insurance penetration
Business World
Finance
Posted on July 24, 2012 09:12:15 PM
THE INSURANCE Commission (IC) wants to increase the penetration rate of insurance in the country to 1.5% within the next two years through the cooperation of the government and the private sector, its top official said yesterday.
“Our target is to increase our penetration rate to around 1.5% within the next two years,” IC Commissioner Emmanuel F. Dooc toldBusinessWorld on the sidelines of the 6th Asia Conference on Microinsurance yesterday.
The country’s insurance penetration rate -- insurance premiums as percentage of gross domestic product -- stood at 1.2% as of end-December, according to IC data.
“To achieve growth, we should see more activity from both the private sector and the government,” Mr. Dooc said.
“The private insurance sector has responded well to our call of increasing the penetration rate in the country by designing and marketing insurance products that promote big benefits in small packages at affordable cost, which are the microinsurance products,” he added.
The 6th Asia Conference on Microinsurance, with its theme of “Microinsurance as a Growth Catalyst for Insurance to Reach out to the Masses,” gathered microinsurance experts in the region to assess and exchange information on the state of microinsurance across Asia.
“We have to treble our production to be at par with our Southeast Asian neighbors which have an average penetration rate of around 3%,” Mr. Dooc also said.
“A lot of financial literacy programs need to be done and companies must continuously innovate and develop products targeted to the poor.”
The IC chief said microinsurance will help increase the insurance penetration rate in the country given its large market potential.
IC data showed that a total of four million microinsurance policies were sold last year.
Insurers at present are allowed to design their products in line with their target market’s demand. Their products are considered microinsurance products as long as they comply with the IC’s definition for such products.
According to Insurance Memorandum Circular 1-2010, microinsurance products are those whose daily premiums do not exceed 5% of the current daily minimum wage rate of non-agricultural workers in Metro Manila.
Furthermore, the maximum sum of guaranteed benefits should not be 500 times the daily minimum wage rate for non-agricultural workers in Metro Manila.
As of April this year, 18 insurance companies were allowed by the IC to sell microinsurance products. -- Ann Rozainne R. Gregorio
The country’s insurance penetration rate -- insurance premiums as percentage of gross domestic product -- stood at 1.2% as of end-December, according to IC data.
“To achieve growth, we should see more activity from both the private sector and the government,” Mr. Dooc said.
“The private insurance sector has responded well to our call of increasing the penetration rate in the country by designing and marketing insurance products that promote big benefits in small packages at affordable cost, which are the microinsurance products,” he added.
The 6th Asia Conference on Microinsurance, with its theme of “Microinsurance as a Growth Catalyst for Insurance to Reach out to the Masses,” gathered microinsurance experts in the region to assess and exchange information on the state of microinsurance across Asia.
“We have to treble our production to be at par with our Southeast Asian neighbors which have an average penetration rate of around 3%,” Mr. Dooc also said.
“A lot of financial literacy programs need to be done and companies must continuously innovate and develop products targeted to the poor.”
The IC chief said microinsurance will help increase the insurance penetration rate in the country given its large market potential.
IC data showed that a total of four million microinsurance policies were sold last year.
Insurers at present are allowed to design their products in line with their target market’s demand. Their products are considered microinsurance products as long as they comply with the IC’s definition for such products.
According to Insurance Memorandum Circular 1-2010, microinsurance products are those whose daily premiums do not exceed 5% of the current daily minimum wage rate of non-agricultural workers in Metro Manila.
Furthermore, the maximum sum of guaranteed benefits should not be 500 times the daily minimum wage rate for non-agricultural workers in Metro Manila.
As of April this year, 18 insurance companies were allowed by the IC to sell microinsurance products. -- Ann Rozainne R. Gregorio
Beneficial Life offers new microinsurance product at P3-a-day premium payment
BUSINESS MIRROR
FINANCE
WEDNESDAY, 25 JULY 2012 19:36
JUN VALLECERA / REPORTER
BENEFICIAL Life Insurance (BenLife) has started offering a microinsurance product involving premium payments as small as P3 a day but with a potential payout as large as P50,000 for accidental death.
BenLife is offering the product in partnership with Smart Telecommunications through whose platform premium payments may be made.
The product is called InsureTxt, covers death caused by natural calamities and is available to all SMART and Talk N’ Text subscribers.
All InsureTxt transactions, from registration to payment and renewal, are done through text messaging.
The partners presented the product before Finance Secretary Cesar V. Purisima and Insurance Commissioner Emmanual F. Dooc who were pleased this was specifically targeted at poor Filipinos who could not afford the more expensive insurance cover.
Purisima said the product was a much-needed advancement in the insurance field and was a welcome development for those in the lower classes of Philippine society.
For his part, IC Commissioner Emmanuel Dooc, also saw the launch of the mobile micro insurance service of Ben life as very timely.
“With the onset of the typhoon season, everybody can potentially be a victim of tragedies such as floods, landslides, road accidents, etc.,” he said.
This was clearly evident among officials at the Metro Manila Development Authority (MMDA) who on Saturday, July 21 reported on a rash of road accidents along EDSA.
“Mobile microinsurance, as exemplified by InsureTXT, is simply a great idea whose time has finally come,” Dooc said.
“It must be done because Filipinos need this kind of service, and because we can now offer it – thanks to the help of private sector partners like BenLife and SMART,” he said.
Asia Microinsurance Conference, InsureTxt was presented by BenLife and SMART officials to the regulators as their collective response to the challenge of increasing insurance penetration among Filipinos, particularly those living below the poverty line.
“Mobile phones represent the easiest, most cost-efficient way to offer insurance to Filipinos. Through our partnership with SMART, we now are able to reach out to the over 50 million Filipinos on their network,” said Enrique Fernadez, chairman of BenLife.
BenLife also bared full compliance at end of the year to the mandate for insurance companies to increase capitalization to P1 billion by 2020 or eight years ahead of schedule.
According to Fernandez, BenLife’s early compliance underscores the company’s commitment to the industry, to the efforts of government and to the Filipino people.
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