AIA Philippines is eyeing to launch by next month an income fund where clients can earn from dividend payouts.

“We will launch a new fund, hopefully next month. It’s called the Global Pandemic Income Fund, it’s one of the top (funds) in AIA Singapore, that is the fund they’re selling over there. I was asking the question: if we have it in Singapore, why don’t we have it here? Customers are looking for an income-generating fund,” AIA Philippines Chief Executive Officer Kelvin Ang said at a briefing on Wednesday.

The AIA Global Dynamic Income-Paying Fund is “ideal for investors looking to maximize their savings and growth opportunities with the possibility of having additional income.”

The fund will be managed by experts from the Association of Independent Asset Managers Singapore.

“This product will allow customers to earn dividend payouts with a potential increasing percentage when available. They can stay invested while receiving potential dividend pay-outs, ensuring that long-term savings growth opportunity is sustained,” AIA said in a statement.

It also noted that the dividend payout will not be treated as a withdrawal from the policy’s account value.

“Previously, if you wanted income, you could narrow down your focus into a small number of funds that had particular exposure to particular asset classes. You can’t do that today because of the nature of the way risk is being transmitted through the capital markets,” AIA Group Chief Investment Officer Mark Konyn said.

“So, what you need to do is take a broader approach and be more inclusive. And I think the introduction of that capability here, to customers here in the Philippines, is a great example,” he added.

Meanwhile, Mr. Ang said he continues to see strong demand for insurance for the remainder of the year.

“The insurance market is very underpenetrated. The way I look at it, this year continues to be a good year, at least for us. One of the areas we are seeing demand is health,” he said,

In terms of investment, Mr. Ang said he sees the market demanding more options.

“We believe our customers are getting more sophisticated too. They want a broad array of investment options. AIA Philippines can provide that opportunity. You can invest locally, or you can invest globally” he added.

Mr. Konyn also cited risks to investments, such as ongoing geopolitical tensions and persistent inflation.

“Inflation has moderated globally, but still so high-level, I think investors are generally in the short-term protecting capital,” he said.

“The effect of inflation is really damaging. The price of food, ingredients have gone up tremendously. This really erodes the value of your savings,” he added.

On the other hand, Mr. Konyn also noted the country’s opportunity areas.

“Of course, that you have a very young workforce, you have an opportunity to improve productivity and to increase value and you also have a domestic economy. These are strengths, which we would say driving the insurance industry and other and other factors of the economy,” he added.

Meanwhile, AIA also emphasized the importance of incorporating environmental, social, and governance (ESG) principles in investments.

“ESG is becoming more relevant from an investment point of view. As we enter this phase, what is valuable today will not necessarily be valuable going forward. Society firstly will adjust to focus on things we need, to protect the environment and produce sustainable outcomes. Just as government policy and people’s consumption behavior changes, so will be the case (with how) we value investment opportunities,” Mr. Konyn said.

He said AIA is starting to be known in the market as a “funder for green opportunities.”

“I think we’re going to start to see more and more of those opportunities come to the market because we’ve got the technology that is now starting to be opened (and) be scalable. I think we’re going to see opportunities now to deploy capital in that way,” he said. — Luisa Maria Jacinta C. Jocson

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