THE MICROINSURANCE industry’s total premium production dropped by 14.5% last year, but the number of persons covered by these products increased at the height of the coronavirus pandemic, the Insurance Commission (IC) reported on Wednesday.
The IC said in a statement that the total premiums produced by microinsurance companies in the country went down to P7.8 billion in 2020 from P9.12 billion in 2019, citing unaudited financial reports.
The regulator attributed the decline to the strict quarantine measures imposed by the government last year at the height of the coronavirus pandemic.
The nonlife insurance sector posted the largest drop in premiums at P913.51 million, down by 25.46% year on year. This was followed by the mutual benefit association (MBA) sector, which produced P4.46 million in premiums last year, or 15.13% lower from the 2019 level.
The life insurance sector likewise recorded an 8.17% decrease in premiums to P2.42 billion.
“Nevertheless, we are hopeful that these adverse effects are only temporary; and that the situation will improve in the succeeding months. Despite these year-on-year decreases, the microinsurance sector’s premium and contribution production still signified growth [on a quarterly basis],” Insurance Commissioner Dennis B. Funa was quoted as saying.
Meanwhile, the number of lives covered by microinsurance products went up by 11.56% to 50.35 million last year from 45.13 million the year before, breaching the IC’s 50 million goal two years ahead of the 2022 target.
The expansion was led by the life sector, whose microinsurance products’ covered lives rose by 33.48% to 14.7 million in 2020. The MBA sector reported 28.96 million lives insured, up 12.88% year on year.
The growth in the number of lives insured by these two sectors more than offset the 20.96% drop in the coverage of the nonlife insurance sector to 6.69 million last year from 8.47 million in 2019.
Grace periods, the deferment of premium payments, and further extension of various relief measures may have contributed to the lower premiums earned by the industry and the increased number of lives insured, the IC said.
MBAs continued to be the biggest player in the microinsurance industry last year, both in terms of coverage and premiums, with its premium production and total number of lives insured taking market shares of 57.2% and 57.5%, respectively.
For their part, life insurers contributed 31% to the microinsurance industry’s premiums in 2020 and serviced 29.19% of the total market. Meanwhile, the nonlife sector produced 11.7% of total premiums and had a 13.29% share in terms of coverage.
MBAs that led in terms of premiums last year were: CARD Mutual Benefit Association, Inc., Pag-Asa ng Pinoy MBA, Inc.; Tulay sa Pag-unlad Mutual Benefit Association, Inc.; Simbag sa Emerhensiya Asin Dagdag Pasegurohan MBAI; and Alalay sa Kaunlaran Benefit Association, Inc.
Meanwhile, the life insurance firms that recorded the biggest microinsurance premiums last year were: CLIMBS Life and General Insurance Cooperative; Pioneer Life, Inc.; United Coconut Planters Life Assurance Corp.; 1 Cooperative Insurance System of the Philippines; and Country Bankers Life Insurance Corp.
Nonlife insurers that made it to the top five were: CARD Pioneer Microinsurance, Inc.; The Mercantile Insurance Co., Inc.; Pioneer Insurance & Surety Corp.; UCPB General Insurance Co., Inc.; and Visayan Surety & Insurance Corp. — B.M. Laforga