Premium written as percent of local output, or the gross domestic product (GDP), more known as the insurance-penetration rate, averaged 32 percent in 2014, its deepest, according to Insurance Commissioner Emmanuel F. Dooc.
At the 66th anniversary celebration of the Insurance Commission on Friday, Dooc said the record 32-percent penetration rate in 2014 was due to the high penetration rate achieved by the microinsurance industry.
The Philippines is a global leader in terms of the number of persons with some form of risk cover against natural disasters and so-called contingent events that result to loss of income.
As of the third quarter of 2014, the number of Filipinos with microinsurance cover has already reached 28 million, or 28 percent of the total population.
Another 4 million Filipinos, or 4 percent of the population, have regular life-insurance coverage, bringing the total percentage of Filipinos with insurance to a record-high of 32 percent.
Dooc said the figure does not include the insurance cover provided by the mandatory contributions to the Social Security System and the Government Service Insurance System.
“This high penetration rate reflects favorably upon our efforts for financial inclusion, because, although we might have lower premium collection this year, we have increased the number of Filipinos with insurance coverage,” Dooc said, noting that, in 2009, the market penetration rate of the insurance industry is only 14 percent of the population.
Dooc said the total premium collection by insurance companies, as of the third quarter of 2014, amounted to P109 billion for life insurance companies, and P23 billion for the nonlife insurance companies.
Premium collection by life insurance companies was seen hitting the P150-billion mark by end-2014, or much lower than the P170-billion premium collection in 2013 reported by life insurance companies.
However, nonlife insurance companies were expected to report higher premium collection in 2014 totaling P30 billion, or 11 percent more than their collection in 2013. This brings the total net premium collection of the insurance industry to more or less P180 billion for the full year of 2014.
Dooc said in his speech that the insurance industry is fast becoming a pillar in the economy, since, despite the mergers and acquisitions among the insurance companies, total paid up capital and assets of the insurance industry had increased.
Mergers and acquisitions among insurance companies were necessitated by the new Insurance Code that prescribed a gradual increase in the capital base of existing insurance companies, to a minimum capitalization of P1.3 billion by 2022.
But, Dooc said that, despite the reduced number of players due to mergers, the paid-up capital among insurers increased by 21.22 percent, and that the industry breached the P1-trillion mark in total assets last year.
Total investments of the insurance industry also increased to P800 billion as of last year, half of which are invested in government securities.