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Insurance industry’s premiums climb 34% as life sector grows

THE INSURANCE INDUSTRY booked a double-digit increase in its total premium income in the third quarter, driven by the continued growth of the life insurance sector.
Preliminary data based on unaudited reports submitted by life and non-life firms as well as mutual benefit associations (MBA) to the Insurance Commission showed the industry’s total premiums in the January to March period rose by 34.38% to P76.64 billion from the P57.04 billion logged during the same period last year.
Broken down, life insurers reported P61.79 billion worth of premiums last quarter, 40.18% higher than the P44.08 billion recorded in the same period a year ago.
Insurance Commissioner Dennis B. Funa said in the statement that increase in premiums collected by life insurers was supported by the 51.24% growth in the sale of variable life insurance products.
He added that premiums from traditional life insurance products also posted double-digit growth.
Likewise, premiums collected by non-life insurance companies rose 13.29% to P12.34 billion in the first quarter from the P10.89 billion tallied in the comparable year-ago period.
Premiums generated from motor and fire insurance products accounted for the majority of total premiums collected by non-life insurers.
Income generated from contributions and premiums by MBAs reached P2.51 billion in the January to March period, rising 21.75% from P2.06 billion last year.
“With the impressive performance of the insurance industry during the beginning quarter of the year, we are optimistic that industry players will maintain this momentum for the rest of the year,” Mr. Funa said.
Meanwhile, the industry’s net income grew 26.72% to P8.03 billion in the first three months of the year, up from the P6.34 billion booked in the same period last year.
The life insurance sector led the growth, with its net profit rising by 31.16% to P6.31 billion from P4.81 billion. Mr. Funa attributed the growth to “remarkable” increases in premium income, underwriting income and gross investment income.
However, non-life insurance firms posted a 19.21% decrease in net income to P469 million last quarter versus the year-ago profit of P580.5 million.
“The decrease…was due to the decreases in premiums earned and commissions earned coupled with the increases in losses incurred, commission expenses and other underwriting expenses,” Mr. Funa said.
The industry’s total paid-up capital grew to P52.87 billion by 10.88% from P47.68 billion year-on-year supported by “significant increases” in the paid-up capital of four life insurers.
Total investments, on the other hand, amounted to P1.31 trillion last quarter, up 6.85% from P1.24 trillion last year.
Total assets reached P1.55 trillion as of end-March, 8.81% bigger than the P1.42 trillion logged in the same period last year. — Karl Angelo N. Vidal

Samsung unveils Galaxy A6, A6+

SAMSUNG PHILIPPINES launched this week its latest smartphones, the Samsung Galaxy A6 and A6+. Both handsets feature Samsung’s bezel-less display with Super AMOLED screen. At P16,490, the A6 features a 5.6-inch diagonal screen, and 16-megapixel (MP) front- and rear cameras. It’s packed with 3 gigabyte (GB) RAM and 32 GB internal storage. Meanwhile, the Galaxy A6+ (P22,990) features a 24-MP front camera and a 16MP + 5MP Professional Dual back camera. It features Live Focus to get that bokeh effect, letting the user adjust depth of field in one step, either as he’s taking the shot or after he has taken it. Samsung said the adjustable LED and selfie flash guarantee high-resolution photos, even in low-light. The A6 and A6+ are powered by Octa-Core 1.6 and 1.8 GHz processors, respectively. The devices will go on sale in June.

Sony rolls out latest soundbars

SONY PHILIPPINES, Inc. announced the availability of its latest Dolby Atmos supported soundbars, the HT-Z9F and HT-X9000F. The premium HT-Z9F with Dolby Atmos/DTS:X was developed through Sony’s unique virtual technology, which makes it possible for this 3.1 channel soundbar to reproduce “vertical” sound without the need for ceiling speakers that create the illusion of height using digital signal processing alone. This means audiences will get a sense of helicopters whizzing above them and feel the thrill of a car chase action around the living room. The HT-Z9F retails for P42,299. The HT-X9000F soundbar, on the other hand, is Sony’s most affordable Dolby Atmos soundbar at P31,199. The 2.1-channel bar matches the design of Sony BRAVIA True 4K TVs, with edges chamfered off at an angle to fit against the legs of a Sony TV stand. Sony said both soundbars support 4K HDR and Dolby Vision so that the original picture quality is passed through the bar directly to the TV without any loss of quality, resulting in great color clarity and brightness.
 

Viacom’s SpongeBob keeps rights to Krusty Krab restaurant name

AYE, AYE, captain: the rights to The Krusty Krab, the greasy spoon featured in the popular children’s TV series SpongeBob SquarePants, belong to Viacom, Inc. and not to a Texas restaurateur hoping to open a seafood chain with that name.
The 5th US Circuit Court of Appeals ruled 3-0 on Tuesday that Viacom deserves trademark protection for The Krusty Krab, and that IJR Capital Investments LLC and its owner Javier Ramos cannot use it for their restaurants.
Circuit Judge Priscilla Owen wrote that Viacom proved that diners would likely be confused if IJR used the name The Krusty Krab, the restaurant located in the underwater city of Bikini Bottom where SpongeBob works as a fry cook.
She also said while Viacom had not registered “The Krusty Krab” with the US Patent and Trademark Office, the name was important enough to the SpongeBob series to deserve trademark protection, despite not being the title.
Owen said The Krusty Krab has appeared in 166 of 203 SpongeBob episodes since its 1999 premiere on Viacom’s Nickelodeon network, as well as in two feature films.
She said that made it like the Daily Planet, the newspaper that employed Clark Kent in Superman, and the orange General Lee muscle car from The Dukes of Hazzard, both of which received trademark protection in earlier court rulings.
“In the minds of consumers, The Krusty Krab identifies the source of products, which is Viacom, the creator of the SpongeBob SquarePants fictional universe and its inhabitants,” Owen wrote.
A lawyer for IJR and Ramos declined immediate comment.
Ramos claimed not to have heard of The Krusty Krab when he began fishing for a name, and chose it after checking Google and finding no restaurants using that name.
Viacom said it was pleased the court found that its rights in The Krusty Krab mark were “strong” and deserved protection.
The decision by the New Orleans-based appeals court upheld an April 2017 ruling by US District Judge Gray Miller in Houston.
The case is Viacom International Inc. v IJR Capital Investments LLC, 5th US Circuit Court of Appeals, No. 17-20334. — Reuters

Workspace operator set to open BGC hub

EUROPEAN workspace pioneer Spaces is opening its first hub in the country in June.
In a statement, Spaces Philippines is opening a 3,000-square meter (sq.m.) work hub at World Plaza in Bonifacio Global City (BGC), Taguig City, of which 500 sq.m. are allocated for co-working spaces.
The company said the BGC hub will have 477 work stations, meeting rooms, and a cafe serving coffee and food from Wildflour Cafe + Bakery. It aims to attract entrepreneurs, small and medium enterprises, as well as corporates.
“Spaces is redefining the way work is done, providing a contemporary, social and inspirational environment with a real focus on community. The site is a perfect fit for Manila, where start-ups and SMEs are growing,” Spaces Philippines Country Manager Lars Wittig was quoted as saying.
Spaces members can also visit its offices around the world. It currently has branches across 25 cities in Europe, United States, Latin-America, Australia and Asia.
“Manila is a city on the rise and a great fit for Spaces. We are very excited to add this beautiful and buzzing city to our international spread and connect our community with Manila,” the statement quoted Spaces cofounder Martijn Roordink as saying.
Spaces was founded in Amsterdam in 2006 and is under the International Workplace Group (IWG), also the parent company of workplace firm Regus. IWG also owns No18, OpenOffice, Basepoint Business Centers and Signature.
IWG is looking to expand further in the Philippines, saying a Spaces branch in Makati is also being planned. — Denise A. Valdez

Insular Life income rises

INSULAR LIFE saw its consolidated net income rise 2% to P5.03 billion in 2017. — BW FILE PHOTO

INSULAR LIFE Assurance Company, Ltd. reported a fresh banner year in 2017, with sustained income growth supported by a wider distribution network via bancassurance as well as a fully-digital sales system.
The life insurer said its consolidated net income reached P5.03 billion in 2017, posting a two percent increase from P4.9 billion the previous year. The growth, however, is softer than the 179% surge posted in 2016 after it sold stocks and properties.
Consolidated total assets expanded to P135.9 billion, up by five percent from P130 billion from a year ago, Insular Life said in a statement yesterday. The firm’s consolidated net worth also grew to P36.5 billion, up by 12% from P32.7 billion year-on-year.
Meanwhile, its parent firm posted a P4-billion net income for 2017, nine percent higher than the P3.7 billion raked in the previous year. Total assets increased to P140 billion while net worth grew by 13% to hit P41 billion.
The bigger bottom line came as the insurance firm digitized its processes, which they said helped improve efficiency and user experience while also trimming operational costs.
“We embarked on the digitalization of our processes and this translates to rendering better services for our policyholders,” Mona Lisa B. dela Cruz, Insular Life president and chief executive officer, was quoted as saying in the statement.
The insurer said it can carry out a fully-automated, end-to-end online sales process within 30 minutes.
Insular executive chairman Nina D. Aguas added the firm targets to be the “most digitally connected company” in their sector over the next five years.
Insular Life also expects a boost from its bancassurance deal with the UnionBank of the Philippines in 2017, which will allow the life insurer to secure new clients through the Aboitiz-led bank’s branch network for the next 15 years.
Insular Life is the seventh-biggest life insurance firm in terms of premium income and the third in asset terms, according to data from the Insurance Commission. — Melissa Luz T. Lopez

Term deposits undersubscribed amid bigger volume

By Melissa Luz T. Lopez, Senior Reporter
YIELDS on term deposits climbed yesterday as the central bank’s bigger offering was met with tepid demand.
Banks only put forward P98.455-billion bids for Wednesday’s auction of term deposits, well below the P120-billion offer made by the Bangko Sentral ng Pilipinas (BSP) which would have been the biggest offering since November last year.
The offers plunged from the P130.526 billion tenders received a week ago, which was well above the P80 billion which the central bank wanted to sell back then.
All three tenors went undersubscribed, which drove yields higher for the week-long and month-long papers.
Bids for the seven-day term deposits totalled P42.589 billion, slipping from the P64.095 billion placements received a week ago to settle below the BSP’s P50-billion offer.
The low turnout forced the central bank to pay bigger returns, with the average yield climbing by 7.4 basis points (bp) to 3.5866%. Bank bids ranged from 3.4-3.75%, hitting the ceiling of the interest rate corridor.
Demand for the 14-day tenor also slipped to P32.155 billion from P44.696 billion a week ago, versus the P40 billion placed on the auction block. However, margins sought by players went a tad lower to average 3.5783%, little changed from 3.5855% fetched the previous Wednesday.
In contrast, appetite improved for the 28-day deposits as bids reached P23.711 billion compared to P21.735 billion a week ago. Still, bets were lower than the P30 billion the BSP wanted to auction off.
The average yield then climbed to 3.5716%, up 7.4bp from 3.4979% last week.
The term deposit facility (TDF) is the central bank’s primary tool in capturing excess money supply in the local financial system. The BSP actively tweaks auction amounts each week in order to bring market and interbank rates within its desired spread, which currently ranges from 2.75-3.75% following a rate hike announced on May 10.
BSP Deputy Governor Diwa C. Guinigundo previously said that banks have been recalibrating their TDF placements as they digest higher benchmark rates following the central bank’s policy decision.
Liquidity has also been normalizing after two holidays in early May, coupled with bigger portfolio investment flows which inject additional liquidity.
The central bank has trimmed the auction volume for May 30 following the pale demand seen this week. The BSP will float P110 billion worth of term deposits, split into P50 billion under a seven-day term, P40 billion with a 14-day maturity, and P20 billion for the 28-day tenor.

Man vs machine: Will AI put our humanity at stake?

THE VISION of an all-knowing, omni-present intelligent being that forms the backbone of our everyday lives has been portrayed in movies that captivate the imagination of many. Today, that vision is not too far from reality, and we are seeing this at work through artificial intelligence (AI) — from AI-powered voice assistants like Alexa, to helping solve traffic issues, enabling the sequencing of DNA, tackling business problems and transforming industries such as tech, health care to logistics and fintech.
Current AI technologies are estimated to have the potential to automate about 50% of work activities in ASEAN’s four biggest economies — Indonesia, Malaysia, the Philippines and Thailand, according to McKinsey.
Even as AI increasingly finds its way into our everyday lives, the transformative power of AI is underpinned by a deeper issue that threatens the very fabric of our society — the presence of bias within.
UNCOVERING THE ROOTS OF BIAS
Much of AI’s capabilities as an intelligent, cognitive system rely on it being programmed and trained. At its core, AI operates on algorithms and data sets, the driving force of the digital economy in the 21st century. However, AI also unfortunately inherits and reflects the existing bias of its creators through the data it is given.
For example, when used in recruitment, a biased AI could be trained to shortlist potential candidates based on selected profiles of high-performing employees, which may not be representative of the company’s work force nor consider diversity and inclusion as a factor for hiring, and potentially skew the hiring demographic.
The capabilities of AI are only as objective as the quality of the data inputs, as well as the assumptions around this data. When this data is not carefully selected, AI may not only validate the biases we hold, but further perpetuate them.
Leaving this unaddressed could pose issues for society, given that AI has already found its way into sectors such as telecommunications, medical, legal and finance. For example, a biased AI system might deny a bank loan simply because the borrower is located in a poorer neighborhood.
The possible scenarios are endless, though the conclusion resoundingly clear — bias in AI needs to be swiftly addressed while AI is still at its teething stages, before it progresses too far to root out issues that lie at the conception.
Part of the reason behind the existence of bias in AI points to the lack of diversity, particularly of gender, of the tech industry. Even more so for a highly specialized field like AI, and it has been found that just 18% of C-level executives in AI or machine learning companies are women.
CAN AI BE TRULY OBJECTIVE?
A key agent of change is to ensure that the data used to train AI is representative across various socioeconomic factors including race, religion, sexuality, education, career background and financial status.
Additionally, it is essential to expand and diversify the talent pool of people working on the next generation of AI. These should include women, creatives, sociologists and various industries that can together identify the lacking aspects of AI and provide the needed perspectives to weed out bias. Bringing in the alternative perspectives of women can boost creativity within the industry and cultivate gender diversity, and also prevent AI from becoming a skewed, gendered technology.
AI presents an exciting new frontier for the human race, and could possibly be the defining technology that will change our world like never before. The health care industry has been a key driver for AI, with recent breakthroughs including the world’s first AI-powered stethoscope, a Malaysian invention that enables precise surveillance and detection of heart and lung diseases.
However, as with any new technology, a cautious approach is needed in its design and implementation. While AI is designed to make our lives easier, our responsibilities and ethical obligations cannot be outsourced to machines. A global framework and increased governance of AI is essential to ensure that the very technology we are designing to help us does not do the contrary.
It has been said that bias is an inherent human trait and impossible to eliminate, however, the goal is not to eliminate bias, but reduce it to a negligible level. When we bring together the greatest minds in the industry and involve partners across industries, communities and people from all walks of life, efforts to use AI to make the world a better place, transcending race, religion, color and gender, will deliver unparalleled outcomes for mankind.

***

For more insights, join Sharala Axryd at the ConnecTechAsia Summit on Conference Day 3 — June 28, speaking on the panel “Man vs Machine — Who is the Biased One?”
 
Sharala Axryd is the chief executive officer of ASEAN Data Analytics Exchange (ADAX).

Restaurant Row (05/24/18)

The Peninsula Manila

THE hotel’s Old Manila restaurant has teamed up with Holy Carabao Holistic Farms to create a menu that respects one’s health, one’s food, and our planet. On offer until June 2 is a six-course menu that is organic, refined, and sugar-free. Meanwhile, over at Spices one can try “A Spicy Touch” focusing on the tastes of North India — the Punjab, Delhi, Lucknow and Kashmir — with guest chef Radhey Shayam. Available until June 11, at 11:30 a.m. to 2:30 p.m., and 6 p.m. to 11 p.m. Over at The obbyn its signature Afternoon Tea takes on a local twist. The Lobby’s premium teas can be enjoyed on weekends from until May 27 with an array of all-time favorite Filipino comfort food including lumpiang ubod (spring roll), lomi (egg noodle soup), pancit palabok (noodle dish with shrimp sauce), arroz caldo (rice congee in ginger and chicken broth), chicken dinakdakan, bibingka (rice cake), ensaymada, ginataan, leche flan, buko pie and dulce de leche cheesecake. Available Fridays to Sundays until May 27 from 2:30 p.m. to 5:30 p.m., for P2,050 (adult), P900 (children under 12 years old), and P2,450 (with a glass of Champagne). The Classic afternoon tea set is available daily at P1,250 and at P1,650 per set with a glass of Champagne.

Ice cream at Makati Diamond

SPECIAL ice cream at Makati Diamond Residences

MAKATI DIAMOND Residences serves refreshing, specialty ice cream including its bestselling Supermoist Chocolate and Baked Cheesecake. Other flavors include Honey and Taro & Jackfruit, made of some of the finest products locally sourced from its community of farmers. For an alternative tart, fruity flavor, order an Ispahan, made with raspberry puree, lychees and rose essence. There are also unique Japanese creations like Genmaicha for a sweet, toasted rice flavor, and Mont Blanc, for a roasted blend of chestnut and nama cream. Each single serve cup sells at an introductory price of P100. Pints and half gallons are also available for advance order. For inquiries and orders, call Baked at 317-0999 local 1116 or e-mail dine@makatidiamond.com. Visit www.makatidiamond.com for more details. Makati Diamond Residences is located at 118 Legazpi St., Legazpi Village, Makati City.

Tori Momo Yakitori

A NEW Japanese restaurant opens at Robinsons Place Manila

THE first branch of Tori Momo Yakitori has opened in Robinsons Place Manila. It offers authentic Japanese-style yakitori using the three traditional seasonings — barbecue, salt, and spice. The restaurant’s concept was created in partnership with Dai-Sho Co. Ltd. and iFoods Group, Inc. The restaurant’s house-made sauces use ingredients from Dai-Sho, the award-winning manufacturer of dipping sauce, soy sauce, and seasonings in Japan. The interiors of the restaurant echo the simple yet iconic look of traditional izakayas in Japan.

Unlimited lobsters on Mondays at the Marriott Café

UNLIMITED lobster on Mondays

LOBSTER is the newest addition in Marriott Manila’s buffet spread at Marriott Café. Here’s the catch: this fancy delicacy is unlimited only on Mondays starting May until August. Available, along with the rest of the array of international dishes, during lunch and dinner for P1,950. The Canadian lobsters are used in Lobster Thermidor, Garlic Lobster flambéed in white wine, or grilled with lemon accent. A different kind of pop-up station comes with this promotion: Claw Machine, exactly like those seen in the arcades. Each guest will be given a token to play the Claw Machine with a goal to capture a lobster stuffed toy to bring home. Another prize in store for catching one is a special platter of 400 grams of lobster.
 

DMCI unit’s energy sales up 17% in Q1

DMCI Power Corp. recorded a 17% increase in its energy sales in the first quarter to 63 gigawatt-hours (GWh) from 54 GWh, after the off-grid areas it serves all recorded higher volumes during the period.
“The increasing electricity demand in our service areas is primarily driven by the growth in household consumption and entrepreneurial activities. This is supported by a reliable and adequate supply of electricity,” said DMCI Power President Nestor D. Dadivas in a statement.
In a disclosure to the stock exchange, its parent firm DMCI Holdings, Inc. said the unit posted a 29% sales growth in Palawan to 28 GWh.
Masbate and Oriental Mindoro both showed a 9% increase in dispatch. Masbate recorded 24 GWh during the first three months from 22 GWh previously, while Mindoro posted a growth to 11 GWh from 10 GWh.
DMCI Power was put up in 2006 to provide sufficient and reliable electricity to areas that are not connected to the main transmission grid.
Earlier this month, DMCI said the off-grid energy subsidiary will have a capital expenditure of P2.034 billion, mainly to fund the development of a 15-megawatt (MW) power plant in Masbate province.
In March, the parent firm said DMCI Power had been allocated P160 million to acquire seven new diesel generating sets for its Masbate and Palawan operations.
The additional units, which have a total capacity of 11.2 MW, will raise DMCI Power’s generation capacity in the two missionary areas to 90 MW, or an improvement of 14% from last year. — Victor V. Saulon

How PSEi member stocks performed — May 23, 2018

Here’s a quick glance at how PSEi stocks fared on Wednesday, May 23, 2018.

Aquino calls for mechanism to suspend fuel excise taxes

SENATOR Paolo Benigno A. Aquino IV on Wednesday said he wants a “reasonable mechanism” for suspending fuel excise taxes if inflation breaches certain thresholds, and denied that such a suspension would significantly set back the government’s revenue collection efforts.
In a privilege speech, Mr. Aquino noted that a bill he filed on May 10 seeks to amend Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) law. The bill specifies an inflation-related trigger event of three months of inflation exceeding government targets leading to the automatic suspension of excise taxes on fuel, which have been blamed for stoking inflation.
“There are those who are saying that if we suspend the excise taxes, there would be no money for ‘Build, Build, Build,’ free tuition law, and other programs of the government. This is not true. After all, the target collection of excise tax on fuel based on TRAIN (Tax Reform for Acceleration and Inclusion) is only P70 billion,” he said in his speech.
He said the current provision to suspend fuel excise taxes under TRAIN only applies to price increases after January 2019.
TRAIN raised the excise on gasoline and diesel to P7 per liter and P2.50 per liter, respectively. It also contains a suspension provision on the scheduled increase of fuel excise tax if the Dubai light sweet crude benchmark in the three months prior to the scheduled increase averages $80 per barrel or higher.
“What we need is a safeguard, Mr. President, which is responsive to the surges in prices and the needs of our countrymen,” Mr. Aquino said.
The senator also maintained that the government could replace the P70 billion worth of foregone fuel excise taxes from its P319 billion worth of underspending in 2017.
He also called for more efficient tax collection by the Bureau of Internal Revenue (BIR) and the Bureau of Customs (BoC).
“I’m sure we can find that P70 billion from different government departments and agencies to cover the losses if we will suspend the fuel excise tax,” he said.
While acknowledging the external factors causing inflation, Mr. Aquino maintained that the government could act on other fronts to address rising inflation.
Aside from the suspension of fuel excise taxes under TRAIN, Mr. Aquino also called for the full implementation and an increase in unconditional cash transfers under TRAIN, issued to the poorest families to counter the impact of higher taxes.
The senator also pushed for the passage of the rice tariffication bill, which remains pending in the committee level, to address high rice prices. — Camille A. Aguinaldo

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