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Insurance industry posts growth in premiums, net income in 2021

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UNSPLASH

THE INSURANCE SECTOR posted “significant” growth in various performance metrics in 2021, reflecting its recovery from the adverse effect of the coronavirus pandemic.

THE INSURANCE INDUSTRY posted growth in premiums, income and benefits paid in 2021, data from the regulator showed.

The Insurance Commission (IC) said in a statement on Thursday that life and nonlife insurers and mutual benefit associations (MBAs) showed “significant” growth year on year, based on data from the unaudited quarterly reports of 130 out of 136 licensed entities.

“Life and nonlife insurers and MBAs are bouncing back from the adverse economic effects of the pandemic, as evidenced by these numbers for Q4 2021. Moreover, the year-on-year increase in benefits paid during the same quarter highlighted the commitment and responsiveness of our insurers and MBAs to the needs of the insuring public despite the challenges posed by the pandemic,” Insurance Commissioner Dennis B. Funa said in the statement.

Life and nonlife insurers’ and MBAs’ total premium income was at P374.67 billion in 2021, up by 21.55% from P308.25 billion in 2020, IC data showed.

Broken down, the life insurance sector posted a 25.24% increase in its premium income to P310.24 billion from P247.72 billion as variable and traditional life premiums grew by 30.57% and 10.11%, respec-tively.

“The increase can be attributed to the good performance shown by the single premiums of variable life insurance that reported a significant increase of 79.17%. Of the total life premiums, 77.12% came from variable life in-surance, while the remaining 22.88% came from traditional life insurance,” Mr. Funa said.

The nonlife sector’s net premiums written went up by 3.82% to P51.19 billion in 2021, attributed to an increase in motor car premiums, while MBAs’ premiums or contributions rose by 17.84% to P13.24 billion.

Meanwhile, these three industries’ net income increased by 18.57% to P40.72 billion from P48.29 billion.

The life insurance sector’s total net income rose by 29.7% year on year to P39.17 billion despite the increase in benefit payments amid a 31.46% increase in total underwriting income and a surge in capital gains.

On the other hand, the nonlife industry’s net income grew by 6.68% to P5.53 billion from P5.13 billion.

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“A majority of the nonlife insurance companies exhibited net income for this period. However, as compared to 2020’s data per company, there were 27 companies whose net incomes contracted in 2021. The net losses for Q4 2021 are 15.14% higher compared to the same period last year,” Mr. Funa noted.

Lastly, benefits paid grew by 41.92% to P139.78 billion from P98.49 billion as the pandemic continued.

These three industries’ assets likewise went up by 8.4% to P2.09 trillion in 2021 from P1.93 trillion a year prior.

The aggregate assets of the life insurance sector grew by 7.45% to P1.65 trillion in 2021 while the nonlife sector’s assets rose by 13.68% to P318.59 billion. MBAs’ assets climbed by 8.18%.

Insurers and MBAs’ investments also “performed very well” in 2021, the IC said. Their aggregate invested assets went up by 7.9% to P1.84 trillion last year from P1.7 trillion.

As for other indicators, the life sector’s aggregate paid-up capital went up by 1.06% to P26.15 billion in 2021, while its net worth increased by 7.93% year on year.

Total policies and estimated insured lives of life insurers rose by 10.76% and 5.96%, respectively.

Meanwhile, the nonlife industry’s net worth climbed by 9.45% to P115.64 billion.

Lastly, MBAs’ aggregated net surplus decreased by 33.56% year on year to P3.58 billion in 2021, while liabilities rose by 9.98%. Their corresponding total fund balance increased to P49.68 billion in 2021 from P47.04 billion a year prior.



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