Pioneer Life premiums up

MANILA, Philippines - Pioneer Life Inc. (Pioneer Life) has reported total gross premium income in 2012 of P1.44 billion, roughly 21 percent higher than the P1.19 billion.

Key to the sustained growth pace was the strong sale of its variable or investment-linked life insurance products.

Pioneer Life senior vice president for professional sales agency Rolando A. Robles said that timely introduction of investment-linked products, the surge of market, the changing mindset of clients, the suspension of traditional insurance products in the last quarter of 2012, and the higher sales volumes of the single pay variant of the variables connived to boost sales last year.

“It was a confluence of events,” Robles said.

In August last year, single pay premium accounted for nearly 37 percent of total premium mix, while traditional accounted for nearly 55 percent and the rest were regular-pay variables.

By December, single pay premiums accounted for nearly 89 percent of the mix, traditional just six percent, and the balance were regular-pay variables.

Variable single pay grew by 128 percent in 2012, or from P107 million in 2011 to P244 million. The original target was P132 million.

Despite the suspension in sales of traditional products in the last quarter of the year, first year premiums for traditional insurance products still managed to grow to P156 million in 2012 or almost 12 percent better than the P140 million in 2011. However, it was below the original full year 2012 target of P165 million.

“Variabless is fast becoming the preferred program for many policyholders looking for long term growth of their investment funds,” the senior vice president added.

Investment-linked policyholders generally fall into two classification: those who already have cash assets and would like to preserve their wealth using insurance as an estate conservation tool; and second, those who would like to accumulate funds to meet future financial needs such as education expenses and retirement funds.

Group insurance and microinsurance products likewise outperformed 2011, and both collaborated for a combined mix of roughly 45 percent of total products. The rest are individual life insurance products such as traditional and variable.

Sales of group insurance and other retail products reached slightly over P425 million while microinsurance products amounted to nearly P124 million.

“In fact, our accumulated microinsurance enrolees have surpassed the one million mark,” Robles pointed out. Microinsurance products are marketed wholesale to microfinance institutions (MFIs), including rural banks (RBs), cooperatives and non-government organizations (NGOs).

This year, Pioneer Life intends to keep traditional insurance products of the market although it still offers variable products with protection features.

It will likewise introduce new products that are attuned to the investment-starved market, including regional-viewed bond or equity ones.