Insurance firms invest P7.46-B in government securities

The country’s insurance industry invested P7.466 billon in government-issued investment for the first nine months this year, with dollar-denominated instruments accounting for a third of the total.

"There were several opportunities to invest in dollar-denominated investments, and obviously, the insurers saw the intelligence in higher yielding investment instruments in US currency," an official of the Insurance Commission (IC) said.

The weakening of the peso and the rest of the Asian currencies versus the dollar made their investments even sweeter, the official said.

Insurers invested a total of $50.22 million, roughly P2.611 billion in various dollar-denominated investment packages.

Gross investment income in 2001 reached P14.47 billion compared to P13.156 billion in 2000. The life sector accounted for P12.22 billion while the non-life sector settled for an estimated P2.249 billion.

In July alone, insurers invested $24.1 million in dollar-denominated bond floats and P190 million in peso-denominated investments. The $24.1-million investment is the biggest in a single month this year, the commission said.

Malayan Insurance Co. Inc. invested $11 million, Malayan Reinsurance Corp. and sister company Malayan Zurich Insurance Co. invested $4 million each, and Tokio Marine Malayan Insurance Co. infused $2 million.

A month later, the Philippine American Life and General Insurance Inc. (Philamlife) invested $6 million on a high yield reserve asset (HYRA) facility offered by Hong Kong and Shanghai Banking Corp. (HSBC). So far, that is the single biggest dollar-denominated investment made by an insurer this year from initial reports of the IC.

In February alone, six insurers and reinsurers invested a total of $8.098 million.

New York Life Insurance (Phils.) Inc. invested $1 million each on three US-dollar denominated bonds offered by the National Government and the Bangko Sentral ng Pilipinas (BSP).

Great Pacific Life Assurance Corp. (Grepalite) placed over $2.2 billion in dollar-denominated bonds offered by the National Government with maturities in 2006 and 2008.

Pioneer Allianz Life Assurance Corp. pumped in $3 million in a HYRA facility in April while Philippine Axa Life Insurance Corp. (PhilAxa Life) preferred to put $1 million with the Ayala Corp. eurobond offer.