AXA Phils premium income hits P8.3B

MANILA, Philippines - AXA Philippines has reported that its total premium income in 2010 ballooned to P8.3 billion, or a growth of 88.6 percent from the P4.4 billion recorded in 2009.

Likewise, it is 34.7-percent higher than its original target of P6.6 billion set in early 2010.

“With this production in our total premium income, it should put us in the third spot after he Philippine American Life and General Insurance Co. (Philamlife) including the output of the joint venture bancassurance BPI Philam, and Sun Life Financial,” Rien Hermans, president and chief executive officer of AXA Philippines.

Last week, Sun Life Financial reported that total premium income last year reached P10.6 billion. Philamlife however has not released any official report on the matter.

New business income (NBI) in the same period expanded by a whopping 77 percent, or from P1.035 billion in 2009 to P1.835 billion last year.

NBI refers to the total amount of premiums collected from new policies sold in a given year.

Hermans said that the outstanding growth in 2010 was a result of a positive growth in all distribution channels.

Of the total new business, bancassurance accounted for 60 percent, agency for 20 percent, and the remaining 20 percent from alternative distribution channels (direct marketing and group insurance through brokers or direct sales). In 2009, bancassurance contributed just half of NBIs.

Bancassurance (also known as cross selling in the banking sector) refers to life insurance policies sold through the branch network of an allied banking institution. In this case, AXA Philippines entered into a bancassurance alliance with the Metropolitan Bank & Trust Co. (Metrobank).

Hermans said that AXA fielded a total of 520 financial executives (FEs) deployed in all 560 branches of Metrobank. It also manages an agency force of 1,100.

He added that the share of sales agency force almost doubled compared to a 70-percent increase in the other distribution channels.

Of the total premiums, around 30 percent are single-pay premiums while the remaining 70 percent are regular premium products.

Hermans said that the most attractive single-pay premium product was the investment-linked product that guaranteed return of the premium plus some returns apart from the life insurance coverage, and offered an upside depending on the developments of the equity and bond markets.

Investment-linked insurance products are a combination of insurance protection and investments in the equity and bond markets, through AXA’s fund managers. It is similar to trust or mutual funds except that it offers individual protection.

“The regular premium production is equally split between investment-linked and traditional products,” the AXA Philippines chief executive added.

AXA Philippines manages 150,000 individual policies and several group policies, or a total insured of 350,000.