DECLINING sales of life insurers pulled down the premium income of the insurance industry by 1.65 percent at end-September 2016, regulators reported Thursday.
Data released by the Insurance Commission (IC) said the industry’s total premium income in the first nine months of the year fell to P169.56 billion from P172.4 billion a year earlier.
“The reason for this is the poor performance of the life sector,” Insurance Commissioner Emmanuel Dooc told a press briefing on Thursday.
However, the non-life sector posted positive growth in all three quarters this year, Dooc said.
The life insurance sector posted an income of P133.85 billion, down 7.99 percent from P145.48 billion in the same comparable period. Non-life insurers recorded P30.09 billion, up 11.81 percent from P26.91 billion.
Despite the drop in the premium income of the industry, Dooc remained optimistic that the industry may get positive results by the end of the year.
“So that means we may exceed the total premium achieved last year which is more or less P230 billion. We are lucky if we hit P250 billion which is far below our target which we set at P280 billion for this year,” he said.
Meanwhile, the industry’s net worth stood at P268.73 billion as of end-September, or 37.54 percent higher than the P195.39 billion recorded in the same period in 2015, the IC reported.
Dooc expects the total industry net worth to further improve, because of the mandatory increase in the
minimum net worth requirements of insurance companies to P550 million from the current P250 million.
“So you can expect that this will go up further by the end of the year which is the deadline for the additional networth infusion or build-up,” he said.
The Insurance Code, as amended by Republic Act 10607, requires an increase in the minimum net worth of all insurers to P550 million by the end of 2016.
The industry recorded total net income of P22.85 billion as of end-September, up 11.9 percent from P20.41 billion a year earlier.
Life insurers posted a 0.85 percent drop in net income to P16.64 billion from P16.79 billion.
The non-life sector also posted a decrease of 3.65 percent year-on-year at P3.48 billion from P3.62 billion.
As of September 30, the industry’s asset base totaled P1.32 trillion, against P1.08 trillion a year earlier.
Total investments amounted to P1.13 trillion, up 19.36 percent from P952.13 billion.