MANILA, Philippines — Insurers generated 10.5 percent more premiums in the first quarter as both the life and non-life sectors enjoyed higher collections before the imposition of community quarantine, the Insurance Commission (IC) reported yesterday.
Premiums generated by the local insurance industry rose to P78.15 billion in the first three months from P70.71 billion in the same period last year.
Insurance Commissioner Dennis Funa said bulk or P60.9 billion came from the life insurance sector, which is 12.02 percent higher than last year’s P54.4 billion.
“This can be attributed to the increase in variable life insurance premiums of 15.22 percent. Despite the decrease in first-year variable life insurance premiums of 6.04 percent, single and renewal premiums posted a significant increase of 25.8 percent and 18.49 percent, respectively,” Funa said.
Traditional life insurance products also posted an overall increase of 4.28 percent during the three-month period.
Moreover, net premiums written (NPW) by the non-life insurance sector in the first quarter increased by seven percent to P14.4 billion compared to P13.46 billion in the same period last year.
“The increase in NPW of the non-life sector is attributable to increases in fire and accident insurance at 59.69 percent and 18.6 percent, respectively,” Funa said.
Overall, Funa said insurance density, which is the amount of premium per capita or average spending of each individual on insurance, posted a growth of nearly 10 percent.
On the other hand, the IC reported that the industry’s aggregate net worth in the first quarter decreased by seven percent to P345.27 billion from P371.39 billion in 2019.
The life insurance sector’s total net worth amounted to P201.6 billion, 19.83 percent down from P251.5 billion in the same period last year. The IC attributed this to the 80.89 percent decrease in fluctuation reserves to P14 billion from P73 billion, as well as a decline in the market value of investments.
Non-life insurers’ net worth, on the other hand, surged by 21.3 percent to P100.37 billion from P82.78 billion. The sector’s total assets also rose by 15.7 percent to P269.5 billion from P232.94 billion.
Meanwhile, mutual benefit associations (MBA), the leading players in the micro-insurance business, registered a 15.4 percent increase in total assets to P105.5 billion in the first quarter from P91.4 billion a year ago. The sector’s fund balance also grew by 16.7 percent to P43.3 billion from P37.1 billion.
Despite this, MBA’s total net surplus contracted by 28 percent to P1.15 billion due to lower collections and income, coupled with an increase in operating and benefit expenses, the IC said.
“Considering that the national government implemented the enhanced community quarantine in Luzon on March 16, the stated figures per the insurance industry’s unaudited (quarterly report) do not yet fully reflect the effects of the COVID-19 pandemic,” Funa said. By:Mary Grace Padin