The Philippine Life Insurance Association (PLIA), established in 1950, is the umbrella organisation of all life insurance companies operating in the Philippines. We spoke with PLIA general manager Mr George Mina.
Young people not inclined to insure
The median age of the Philippines’ population is 24 and about 70% of the population is under 35.
This is an age group that does not have life insurance on its list of priorities in any demography and the Philippines is no exception.
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Mr Mina said, “This is the backdrop against which life insurers have to conduct their awareness exercises. The problem of low penetration can be sorted out provided this section can be brought on board.
Strategy to connect with this section
To crack the tough nut, life insurers have started directing their sales pitches “alongside with active lifestyle programmes, wellness campaigns and positioning life insurance as a means to prepare for one’s ultimate future life goals as one makes the best out of life in the present,” said Mr Mina.
Bancassurance is the entrenched distribution channel
“Bancassurance has gained quite a foothold in the Philippines. Eight of the top 10 universal and commercial banks are engaged in cross-selling products of top life insurers” he said.
Total premiums of life insurers with bancassurance arrangements accounted for 73% of the life insurance sector’s overall premiums in 2017.
Linked policies are on the rise
Patronage of variable unit linked (VUL) products has been continuously increasing as shown by the enormous jump in premiums generated, from PHP26.5bn ($509m) in 2010 to PHP148.9bn ($2.86bn) in 2017, representing an aggregate growth of 462% over seven years. In terms of VUL share to total premiums, it was only at 37% in 2010 but this has reached 73% by 2017.
Read the full interview in Asia Insurance Review here.