Manulife premiums up 60%

MANILA, Philippines - Manulife Philippines has reported a 60-percent growth in total premiums and deposits in the first nine months of 2012.

Total funds under management ballooned to a record P58.5 billion, while wealth sales increased 169 percent.

Total premium income reached P4.98 billion in 2011 based on data coming from the Insurance Commission (IC). That implies that premium income, including deposits, is around P7 billion end September this year.

The Asia Pacific Bond Fund (APBF) contributed significantly to the insurer’s AUMs despite having been launched in October 2011.

As of end-September 2012, APBF turned out a 7.06-percent return year-to-date – an impressive feat relative to similar funds. This is also much better than time deposit rates offered by most banks at currently below one percent.

APBF is available through Manulife Philippines’ dollar-denominated single pay (Affluence Max/Affluence Max Gold) and regular pay (Affluence Builder series) variable life products.

As of end-September 2012, total subscriptions amounted to $26 million for the fund.

According to Manulife Philippines president and chief executive officer Indren Naidoo, insurance sales in the third quarter were stimulated by the availability of new endowment and whole life products.

Endowment and whole life products are protection products that usually result in recurring business as payments are generally paid over a long period of time, in contrast to onetime or single pay premium products.

“The enhanced anticipated endowment are the Freedom series for the agency channel and MoneyMax series for the bancassurance channel, and whole life or the Seasons 100 for the agency channel and Legacy Protect 100 for the bancassurance channel products with financial protection coverage and guaranteed benefits,” Naidoo explained.

Total policies-in-force stood at nearly 400,000.

The Manulife Philippines chief executive said that the insurer expanded close to 4,000 agents primarily due to its rapid and aggressive branch office expansion throughout the country.   

In the first nine months alone, Manulife Philippines opened six new branches in Banawe Avenue, Quezon City; Angeles City in Pampanga; Tacloban City in Leyte; Zamboanga City in Zamboanga province in Southern Mindanao; Balanga City in Bataan, and Batangas City in Batangas (southern Luzon), bringing the total number to 28 branches nationwide.

“We are planning to significantly add more new branches next year,” Naidoo added.

Meanwhile, Manulife Chinabank Life Assurance Corp., the bancassurance joint venture company between China Banking Corp. (China Bank) and Manulife, reached its fifth year of operation. It has contributed a third of the insurer’s total business while the rest are mainly products of its branch and agency network.

To date, the bancassurance joint venture company will end the year with nearly 250 financial sales associate (FSA) and will grow to at least 260 end 2013.  FSA are trained financial advisers deployed in branches of China Bank that market Manulife Philippines’ insurance products.

China Bank has a little over 300 branches and it is targeted to hit 400 by end 2014. The expanded commercial bank recently acquired Unity Rural Bank including its 15 branches. It is, however, not clear whether it will absorb all the branches or if subsidiary China Bank Savings will acquire the same.

Last year, Manulife Philippines ranked seventh best performer among the 32 life insurance companies, while Manulife Chinabank Life Assurance ranked 13th overall.

Meanwhile, Manulife Financial Corp., the principal of Manulife Philippines, reported that its Asian division generated core earnings of $231 million at the end of the third quarter of 2012.

Manulife Financial chief financial officer and senior executive vice president Stephen Bernard Roder in his global financial report said that Asia’s strong growth was driven by in-force earnings growth which is largely offset, however, by expenses related to expansion initiatives in the region.

Roder further pointed to the record insurance sales in Southeast Asia, although anticipated lower sales in Japan somewhat dampened dramatic sales growth.

“Wealth sales in the region were 22-percent higher than the third quarter of the prior year due to the continued success of fixed annuity products in Japan and increased bond fund sales for Manulife-TEDA in China,” the chief financial officer added.

He said that the Asia division’s annualized premium equivalents, excluding variable annuities, increased six percent over the third quarter of 2011 on strong wealth sales this quarter.

However, it was down sequentially due to the expected lower insurance sales in Hong Kong and Japan, in line with the product and tax changes.

Nonetheless, Asia’s total weighted premium income, excluding variable annuities, increased 13 percent over the third quarter of 2011 due to strong persistency of our in-force business.

Roder said that its Asia division was tracking ahead of expectations in regard to its expanded distribution relationship with Bank Danamon in Indonesia, and enhanced distribution network with additional partners in Malaysia and Japan.

“We are very pleased with our overall performance in Asia as we continue to execute on our strategy,” he added.