MANILA – The insurance sector saw another banner year in premiums in 2017 supported by double-digit growth among life and non-life insurers, latest data showed.
Total premiums reached P259.646 billion by end-2017, up by 12% from the P231.883 billion booked in 2016 according to preliminary and unaudited data from the Insurance Commission (IC).
In 2016, industry players reported flat net premiums from the P231.203 billion recorded in 2015.
“The three sectors — life, non-life and MBAs (mutual benefit associations) — all posted positive growth in the four parameters of assets, premiums earned, net worth and paid-up capital or guaranty fund,” Insurance Commissioner Dennis B. Funa said in a speech on Friday during the agency’s 69th anniversary.
Mr. Funa said industry players performed “exceedingly well” in 2017, which led to record highs.
Broken down, life insurers saw premiums rise by a tenth to reach P202.341 billion as of end-December, coming from the P182.794 billion logged during the same period the previous year.
Non-life insurance companies also reported a 16.7% surge in premium incomes which reached P48.561 billion, against the P41.609 billion booked a year ago.
MBAs likewise saw premiums hit P8.744 billion, rising by 16.9% from P7.481 billion the prior year.
Across the industry, total assets of all insurance companies operating in the Philippines grew to P1.55 trillion last year, representing a 17.9% climb from the P1.314 trillion tallied in 2016. Paid-up capital likewise rose by 10.5% to reach P50.75 billion.
Mr. Funa acknowledged emerging trends that involve greater use of online platforms and social media to sell insurance products. The IC released last week new guidelines covering e-commerce, including the use of mobile apps to distribute insurance products.
“With this, and other innovations in the distribution and sales of insurance products, we are expecting heightened product awareness, improved efficiency in their delivery, and ultimately, increase in market penetration,” the official said.
Looking ahead, Mr. Funa also said the industry could be affected by the tax reform law by way of estate tax adjustments: “I understand that the lower and simplified tax on estates will likely affect the business of insurance, particularly life insurance whose proceeds were previously, commonly used to pay off estate taxes.”
“With the new lower tax scheme, resorting to this course may no longer be necessary,” the commissioner added.
Republic Act 10963 took effect this year simplifying estate tax computations to a flat 6%, doing away with varied rates depending on the value of the inherited assets.