Philamlife poised for another record year in premiums

After being the first life insurer to break the P10-billion barrier in terms of premium income in 2003, the Philippine American Life and General Insurance Co. (Philamlife) recorded a P12.3 billion in total premiums last year, again an industry first.

Following the basic policy of the American International Group (AIG) for a minimum annual growth of between 10 to 15 percent, then Philamlife, an AIG subsidiary, is looking at nearly P15 billion in total premiums at the start of 2006.

But Philamlife president and chief executive officer Jose L. Cuisia expressed concern that higher inflation, new tax measures, negative impact resulting from the CAP and Pacific Plans debucle, and a slowing economy would poise a major challenge to achieving its minimum premium targets this year.

"The value-added tax (VAT) will definitely affect the poorer sectors of society and the inflationary impact of higher oil prices, and higher transport costs and fares, would weigh heavily on our sales efforts," Cuisia added.

At the end of 2003, Philamlife was looking at a minimum 10-percent growth as the Philippine economy showed signs of weakening. However, it was able to outperform its targets as the country’s economy rebounded.

Gross revenues hit P20.8 billion while total assets reached P88.9 billion last year.

Total investable assets grew to P84.6 billion while it paid taxes amounting to P1.4 billion.

Net income last year reached P2.9 billion versus the P4.4 billion in 2003. The 2003 performance was extraordinary as there were several non-recurring and one-time gains from sales of assets.

Philamlife reported paying benefits worth P4.7 billion or a 24-percent increase from the previous year.

Meanwhile, the Philam Plans Inc. recorded a 23-percent growth in premiums as it likewise maintained its leadership in the pre-need industry.

Total sales reached P9.6 billion equivalent to 26-percent market share. Trust funds reached P14.3 billion which are invested in government securities (80 percent).

"We have more than sufficient funds to pay maturing plans up to 2011, and we will not stop beefing up the trust funds," the Philamlife chief executive said.

Philam Plans growth rate of 23 percent is on contrast to the negative growth figures for the pre-need industry last year.

The negative impact of the College Assurance Plans (CAP) inability to pay claims has continued to dampen sales for most players, and in fact, has even spilled over to the insurance industry.

"It is unfortunate since these are two totally different industries," Cuisia added. – Ted Torres