Insular Life income jumps 61%

The Insular Life Assurance Co. Ltd. reported yesterday that its net income rose 61 percent to P488 million last year despite economic and political difficulties.

The company’s consolidated revenues also rose eight percent to P8.2 billion, Insular Life said in a report to policyholders.

Company chairman Vicente Ayllon said the resilience and strong corporate fundamentals helped the 91-year-old company survive the "extraordinary circumstances" of 2001, including the EDSA II and III and the Sept. 11 terrorist attacks in the United States.

One of the reasons for a sharp increase on its net profit may have come from the sale of the company’s Makati Avenue building, which had previously been leased by Petron Corp. In the report, Ayllon said Insular Life sold the building for P300 million.

Other key figures in Ayllon’s report:

• Total consolidated assets reached P31.1 billion in 2001, up seven percent from the previous year’s P29 billion;

• Total benefits paid to both life and non-life policyholders rose eight percent to P2.8 billion;

• Dividends paid to individual life insurance policyholders amounted to P890 million, while experience refunds on group insurance hit P13 million;

• Life insurance business in force as of end-2001 stood at P169.6 billion, and;

Ayllon said Insular Life also faced tougher competition, with 17 new foreign life insurance companies vying for the same market. "In this environment, Insular Life chose to anchor its strategy on a three-pronged approach of strengthening its traditional distribution channel, while exploring alternative channels, creating a customer-centered culture among its employees and agency force, and managing costs," he said.

Ayllon reported that Insular Life’s investments last year reflected the company’s strategy of maintaining a liquid position, moving to fixed-income generating instruments and diversification of risks.

Insular Life’s investments in the money market reached P1.56 billion; term loans stood at P630 million. The company’s equity investments in its various affiliates brought in P248 million in dividends.

The company also completed last year funding for $25-million "Global Fund" investment, "part of our overall risk management plan to spread our investment exposure," Ayllon said.

Ayllon also reported that Insular Life’s financial services subsidies "showed resilience amid particularly trying situations in their own industries."

For example, Insular Life Health Care posted a net income of P6.7 million, while Insular Investment and Trust Corp. bagged two major account; the P810-million syndicated term loan for an information technology park of a leading property developer and the P575-million loan for the leading broadcast network.

Insular Savings Bank raised its total resources by 15 percent to P4.1 billion. Its deposits grew 19 percent to P3.3 billion, while net loans rose 23 percent to P2.2 billlion.