Annual Seminar on Annual Seminar on Regulatory Issues for Regulatory Issues for Senior Officers of Insurance Senior Officers of Insurance Regulatory Agencies Regulatory Agencies Venue: Hotel ITC Kakatiya Sheraton, Hyderabad, India Venue: Hotel ITC Kakatiya Sheraton, Hyderabad, India Date: 14th - 16th November 2005 Date: 14th - 16th November 2005
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Annual Seminar on Regulatory Issues for Senior Officers of Insurance Regulatory Agencies Venue: Hotel ITC Kakatiya Sheraton, Hyderabad, India Date: 14th.
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Annual Seminar onAnnual Seminar onRegulatory Issues for Regulatory Issues for
Senior Officers of Insurance Senior Officers of Insurance Regulatory AgenciesRegulatory Agencies
Venue: Hotel ITC Kakatiya Sheraton, Venue: Hotel ITC Kakatiya Sheraton, Hyderabad, IndiaHyderabad, India
Date: 14th - 16th November 2005Date: 14th - 16th November 2005
COUNTRY PRESENTATION FOR COUNTRY PRESENTATION FOR THE PHILIPPINESTHE PHILIPPINES
Mr. Antonio E. EnanoMr. Antonio E. EnanoSupervising Insurance SpecialistSupervising Insurance Specialist
Rating Division, Insurance CommissionRating Division, Insurance Commission IC Bldg., 1071 UN Avenue, Manila, IC Bldg., 1071 UN Avenue, Manila,
PhilippinesPhilippines
Republic of the Philippines
A. BASIC DATA
National Name : Republika ng Pilipinas
Capital City : 2003 est.-- Manila, 13,790,900 (metro. area), 10,232,900 (city proper)
Land Area : 115,830 sq mi (300,000 sq km) Archipelago comprising 7,107 islands
Population : 2005-- 85.2 million - (growth rate: 1.8%); birth rate: 25.3/1000; infant mortality rate: 23.5/1000; life expectancy: 69.9; density per sq mi: 759
President : Gloria Macapagal Arroyo First term (2001- 2004); Elected in 2004 for a 6-yr. term no reelection
Monetary unit : Peso Convertion: $ 1 = P 54.69 ( Nov. 11, 2005)Languages : Filipino (based on Tagalog), English (both official); eight major dialects: Tagalog, Cebuano, Ilocano, Hiligaynon or Ilonggo, Bicol, Waray, Pampango, and Pangasinense Ethnicity/Race : Christian Malay 91.5%, Muslim Malay 4%, Chinese 1.5%, other 3% Religion : Roman Catholic 83%, Protestant 9%, Islam 5%, Buddhist and other 3%
Net worth – Non Life The financial structure of the non-life sector revealed:
In Million Pesos % Increase 2004 2003
Assets 1.83 65,554.0 64,373.1
Liabilities - 1.77 30,952.80 31,502.60
Net worth 5.26 34,601.2 32,870.5
0.00
10,000.00
20,000.00
30,000.00
40,000.00
50,000.00
60,000.00
70,000.00
2004 2003
Assets
Liabilities
Networth
Net Worth – Non-Life
Life Premium(in million pesos)
% growth
2004% dis.
2004 2003% dis.
2003
Ordinary 1.69 86.73 35,916.4 87.84 35,320.4
Group 1.25 13.27 5,496.7 12.16 4,887.4
Total 2.99 100 41,413.1 100 40,207.8
Life Premiums – In Million Pesos
LIFE PREMIUMLIFE PREMIUM(in millions)(in millions)
0.00
5,000.00
10,000.00
15,000.00
20,000.00
25,000.00
30,000.00
35,000.00
40,000.00
2003 2004
Ordinary
Group
2004 Life Premium Distribution
86.73%
13.27%Ordinary Life
Group Life
Kind of Payment Amount Percent distribution
Death benefits 3,985.3 20.85
Surrenders 4,146.5 21.70
Policy Dividends 3,969.9 20.77
Matured policies 2,662.1 13.93
Supplementary Contract 2,292.8 12.00
Others 2,053.0 10.7
Total 19,109.6 100.00
Life Sector – Benefits
Life Sector – Benefits Life Sector – Benefits
Death21%
Surrender21%
P. Dividend21%
Matured14%
Sup. Con.12%
Others11%
Death
Surrender
P. Dividend
Matured
Sup. Con.
Others
Net Income – Life Sector These sectors experienced:
Income(in million pesos)
%Increase
2004 2003
Underwriting 308.9 (2,064.2) (504.7)
Investment 17.08 18,651.0 15,929.6
Operating expenses -4.51 9,552.5 9,983.2
Net Income b/ tax 29.25 7,034.3 5,441.7
Income Taxes paid 9.59 (93.7) (85.5)
Net Income 29.5 6,940.6 5,356.2
0.00
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
6,000.00
7,000.00
Net Income2003 2004
NET INCOME – Life Sector
Net worth- Life Sector The financial structure of the life sector revealed:
In Million Pesos % Increase 2004 2003
Assets 15.2 240,042.7 208,366.4
Liabilities 20.9 182,805.50 151,180.4
Net worth 0.08 57,237.2 57,186.0
0
50,000
100,000
150,000
200,000
250,000
2003 2004
Assets
Liabilities
Net Worth
Net Worth - Life Sector
C. PROFESSIONAL REINSURERS’ SECTOR Reinsurance Premiums Written
The reinsurance sector comprising of two (2)domestic professional reinsurers accounted forP 2,603.0 million in premium volume for 2004, a slight decrease in comparison with the P 2,612.3 million in 2003, with three (3).
However, this sector wroteP 214.1 million premium on business accepted from overseas which was lower than the 2003 premium of P 253.6.
2598
2600
2602
2604
2606
2608
2610
2612
2614
2004 2003
Premium
Reinsurance Sector – Premium Income
Net Income – Reinsurance These sectors experienced:
Income(in million pesos)
%Increase
2004 2003
Underwriting 153.5 129.5
Investment 250.2 224.2
Operating expenses 214.5 183.9
Net Income b/tax 189.2 169.4
Income Taxes paid 0.6 14.2
Net Income a/tax 21.52 188.6 155.2
0
50
100
150
200
2003 Incr. 2004
2003Incr.
2004
Reinsurance – Net Income
D. The Philippine Market Structure
Here is a chart of the Philippine Market Structure for the last two year 2003 and 2004. We are
fortunate to include herein incomplete data for 2005 because licensing of insurance companies
and intermediaries are done on July 1 of every year.
2005 2004 2003
Number of Licenced Companies 128 137 141
Composite 3 4 4
Domestic 3 3 3
Foreign (locally incorporated) - 1 1
Life 29 34 32
Domestic 24 22
Foreign (locally incorporated) 9 10
(Branch Operation) 1
Non-Life 94 97 102
Domestic 87 91
Foreign (locally incorporated) 5 6
(Branch Operation) 5 5
Professional Reinsurers – Doms. 2 2 3
Sales Agencies and
Technical Services2004 2003
Ordinary Agents 40,762 33,121
General Agents 619 403
Variable Life Agents 857 650
Insurance Brokers 127 127
Reinsurance Brokers 43 43
Public Adjusters 2 2
Independent Adjusters 59 59
Accredited Actuaries 45 42
Resident Agents 62 65
Non-Life Company Underwriters 527 534
E. Government’s Supervision of Insurance
Office Name: Insurance Commission IC Bldg., 1071 UN Avenue
Ermita, Manila
Insurance Commissioner- Ms. Evangeline C. Escobillo
The Philippine insurance industry continues to thrive despite adverse factors affecting the Philippine economy, to mention a few are:
1-Volume of premiums is a function of economic activity.Government’s fiscal problem slowdowns industry’s resultsaffecting insurance needs. 2-Philippines lies in Pacific rim of fire, hence susceptible to volcanic eruptions and earthquakes limiting retention capacity of insurers.
3-The industry feels they are over-taxed, hence there is always the clamor for legislated reduction of existingtaxes or do away with double taxation on premiumsand insurance business corporations. 4-In the light of globalization and competition, insuranceclients may be forced to get coverage in foreign lands, especially marine covers.
5-Although the budget costs of supervision gets higherevery year, the quantity and quality of output are affected because of low salaries of employees in the government sector.
Thank you everybody for your Thank you everybody for your wonderful attention.wonderful attention.