Insular Life Assurance Co. Ltd, the largest Filipino insurance company, projects higher total premium income through its bancassurance tie-up with the universal lender UnionBank.
Insular Life anticipates 30 percent to 40 percent rise in premium drawn from the 300 branches of its bancassurance partner UnionBank.
The target is set among the 200 bancassurance agents at the branches to add to 60 percent more premium that the insurance business model alone could generate. Insular Life aims to attract more premium from the more than 6 million clients of UnionBank.
“I hope it will be, especially with the bancassurance partnership. We could grow our premium faster than the pure agency model because they can be complementing each other now,” Insular Life CEO Nina D. Aguas said in an interview with the BusinessMirror.
Last year the total premium income of Insular Life slightly fell by 3 percent, or P380 million, to P12.3 billion, which Aguas said was reflective of the negative growth of the insurance industry.
Aguas said political shifts in the period worldwide, including Britain’s vote of withdrawal from the European Union and the popularity of radical proposals, such as shoot-to-kill order against suspected drug dealers, of then leading presidential candidate Rodrigo R. Duterte, created anxiety in the public that slowed down investments in insurance products.
“It’s 165-percent growth in net income because of what happened in the industry; it was flat from 15 percent to 16 percent. I think it was the nonlife that really showed more significant growth,” she said.
Thus, Insular Life will continue to diversify and calculate risks of its investment portfolio. Aguas said they might adjust strategy for property and equities, which include stocks and bonds, to satisfy requirements for risk-based capital (RBC) by the Insurance Commission (IC) and higher charges for nonrevenue assets. At present the IC requires 100-percent ratio to result from an insurance company’s total capital divided by its RBC requirement to further mitigate losses from unpaid premiums and fulfill insurance claims of other clients. “We’re very careful about making projections and we just have a business plan that covers the bancassurance and we’re following a model, both of us, because we had our independent advisors,” she said.
“We’re confident with the approach that we’re going to do, which has not been done before in other bancassurance partnerships here. We will be successful,” Aguas said.
