Generali Pilipinas rides on BDO crest

MANILA, Philippines - Generali Pilipinas is benefiting from its unique relationship with Banco de Oro Unibank Inc. (BDO) and the SM Group of Companies.

The life insurance company has a bancassurance agreement with BDO, allowing Generali to deploy financial advisors (FAs) within the bank’s 700 or so branches nationwide.

Actually, Generali Pilipinas is a partnership among three financial giants.

Assicurazioni Generali of Italy, one of the world’s largest insurance company, Jerneh Asia Berhad of Malaysia, a specialist insurer in the marine, industrial, and engineering fields, and BDO, the country’s recognized banking giant.

Last year, total premium income hit a record P3.2 billion, and good enough to cement its ranking as seventh best among the 34 industry players.

First year premiums in the same period amounted to P2.6 billion, of which majority was produced by the bancassurance distribution network. Incidentally, the new business generated by Generali Pilipinas in 2009 was ranked second best, another internal record.

But Generali Pilipinas president and chief executive officer Renato Vergel de Dios is not sitting on his laurels.

In the immediate future, the insurer will concentrate more on its life business over the non-life segment. In the life business, it will reflect a bias on the individual sector over group.

Generalli Pilipinas is a holder of a composite life and non-life insurance license issue by the Insurance Commission, one of only three similar license holders.

“If an individual tries to capture two hares at the same time, he will likely end up empty handed,” the veteran insurance executive pointed out.

In the life business, Vergel de Dios wants to place more emphasis on the individual segment over the group business. And in the individual life sector, preference goes to the bancassurance distribution network over the sales agency network.

One reason for this is that the group business is already doing exceptionally well, the chief executive explained.

In group insurance business last year, Generali Pilipinas was ranked among the top three which already accounted for majority of the business. In fact, 50 percent of its premiums last year came from the group business.

Since late 2009 to the first semester of 2010, Generali Pilipinas “cleaned” its rooster of group insurance accounts. It helped no doubt that a major portion of its group insurance business had to do with the SM Group of Companies.

That is likely the reason for streamlining its non-life insurance business since it had a large property and fire business with the SM’s property and real estate business.

Vergel de Dios wants to increase the present compliment of 250 FAs fielded in BDO’s branch network to 600 by 2012. That may not be a one FA for one BDO branch ratio since the commercial bank of the SM Group is still in an acquisition mode.

BDO is in the process of acquiring Export and Industry Bank (EIB) including its 50 branch network. Likewise, BDO reportedly has more than 30 unutilized branch licenses.

The Generali Pilipinas chief executive is not looking at a strong 2010 in terms of total premiums written.

“Total premium growth will likely be the same as 2009, but a 25-percent growth in our bottomline is on track,” Vergel de Dios added.