"We have reset our 2002 target to P2.5 billion after surpassing the P2-billion psychological barrier last month," said Victor P. Quisumbing, president and chief executive officer of PhilAxa Life. The company’s original target for 2002 was just a little below the P2-billion mark.
Last year, the life insurance company moved into fifth place overall with total premiums of P1.491 billion, dislodging Ayala Life Assurance Inc. which had held the fifth place overall in 2000.
Last year, Ayala Life incurred a statutory net loss of P145 million due to poor claims, agency expansion, and establishment cost of BankAssure operations. It expects to return to profitability this year.
PhilAxa Life’s extraordinary growth of premiums in the first nine months this year was attributed to the positive results from its group insurance market, individual accounts, bancassurance, and the quantitative and qualitative expansion base of Metrobank and its other bank affiliates like PSBank.
Industry players said the key to the tremendous premium growth of PhilAxa Life was the synergy between Metrobank, the largest commercial bank in the country, and Paris-based reportedly the largest life insurer in the world.
It would take advantage of the huge bank clientele base and the bank’s branch network, which is the largest in the country, as its "captive market."
Insurance officials said they were just awaiting the release of the cross-selling circular of the Bangko Sentral ng Pilipinas (BSP), which would outline the extent of bancassurance in the country.
"The bank becomes a captive market for its other subsidiaries like Philippine Axa Life. That is the strength and that is what sets us apart from the rest of the competition," Dela Cruz said. "We can cross sell to each other, and that is a mark of an emerging company, which means first developing the internal market before going outside the direct influences."
Meanwhile, investment income was recorded at P218 million as of September. For the whole of 2001, earnings from investments and other sources reached P203.5 million and P142.7 million the year before.
Quisumbing said investments this year appear to be modest for the insurance industry as interest rates in the financial system remain in the low single digit levels.
Over 60 percent of its investments are with government securities and bonds while the rest are policy loans and various deposit instruments with banks. The insurer has stayed clear of the securities market and produced limited commercial loans.