By Chino S. Leyco
The local insurance industry registered a decline in premiums in the first three months of the year due to weak life business, the government regulator said over the weekend.
Insurance Commissioner Dennis B. Funa said that total premiums of the industry decreased by 8 percent to P70.7 billion in January to March this year from P76.6 billion in the same period last year. But, Funa said that both non-life insurance business and mutual benefit associations (MBA) saw their premium income increase during the period.
“The decrease in the total premiums of the life sector can be attributed to the year-on-year 59 percent decrease in premiums collected from single premium variable life insurance products,” Funa said in a statement.
Despite the drop in premiums, Funa noted that total assets of the insurance sector managed to grow by 8 percent in the first quarter to P1.68 trillion from P1.55 trillion in the previous year.
The total net worth of the insurance industry also increased by 20 percent to P371.38 billion at end-March from P309.04 billion a year before. Likewise, the industry’s total investments rose by 14 percent year-on-year to P1.5 trillion from P1.32 trillion.
For this reason, the insurance industry’s consolidated net income increased 46 percent to P11.7 billion from P8.04 billion in the same period last year.
For life insurance, its profit jumped 44 percent year-on-year to P9.08 billion in the first quarter from P6.31 billion.
Funa said the increase can be attributed to declines in reserve, benefits payment, and other underwriting expenses.
Net income among non-life insurers, meanwhile, surged 121 percent to P1.04 billion this year from P470 million last year due to huge increases in premiums earned, commissions earned, and other underwriting income.