Stock News 2013: China's Life Insurance Companies

Insurance (Photo credit: Christopher S. Penn)

China’s life insurance companies expect a lower growth on premium in the next year or two. Over the long term, insurance companies will benefit as they adapt to the changes.

Sally Yim of Moody’s said, “For now, the sector is experiencing the constraints from its previous focus on short-term and savings-type products, as well as a significant reliance on the bancassurance channel.”

Some of Moody’s assumptions are:

• Premium growth will lag behind China’s GDP growth
• Profitability will remain a challenge due to rising expenditures
• Insurance companies are exposed to the volatility of equity markets
• New businesses will be limited due to low premium growth
• In 2012, premiums were at 4.5%. Growth in household incomes will generate premium growths of 7.5% to 8.5% in 2013 and 7.0% to 8.0% in 2014.

The expected single digit low growth is driven by:

• Narrow platform for insurance companies
• Wealth products sold by banks as alternative to insurance products
• Increase in competition as more Chinese banks distribute their own insurance products
• Chinese insurance companies are moving toward risk-based liberalization of investments and products. This include moving away from low-margin savings-type products and focus on protection-type products.

http://pinoyfiq.com/pinoyfiq/financial-education/state-of-life-insurance-companies-of-china

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Stock News 2012: Cocolife's 1st yr premiums breach P1-B mark

Insurance (Photo credit: Christopher S. Penn)
United Coconut Planters Life Assurance Corp., popularly known as Cocolife, ranked as the second highest producer in the traditional life insurance business among 33 listed companies last year, according to a listing released by the Insurance Commission.

According to Cocolife, it brought in P1.087 billion in first year premiums, the only company other than Philam Life to have breached the one billion mark in the category.

Cocolife president Alfredo Tumacder Jr. said in a statement over the weekend that the company’s Healthcare business also exceeded its premium goals with the introduction of new products and enhanced services for their clients and partners.

Tumacder attributed the strong performance of the company last year to continued efforts to expand the market reach of its Individual business line, with the creation of branch sites in major malls and growth areas nationwide.

Cocolife’s Traditional Life Insurance products focus primarily on providing for the protection needs of the client.

“They are simpler and generally more affordable than most wealth management products yet offer highest value for money. More importantly, they are virtually immune to market fluctuations, which make them a safe and guaranteed investment in these uncertain times,” Tumacder said.

The company’s strong performance in this business line is a reflection of its renewed efforts to get back to basics which involves designing and selling products in such a way that the customer will have confidence that what they are buying is right for them.

http://www.philstar.com/Article.aspx?articleId=839455&publicationSubCategoryId=66

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Stock News 2011: GPLAC gears up for expansion after record year in profitability

Image by Leader Nancy Pelosi via Flickr
Generali Pilipinas Life Assurance Company (GPLAC) described 2010 as a record year in terms of profitability following the strategic focus it successfully implemented on its bancassurance distribution channel.

Central to this strategic focus was a dramatic shift from single-pay plans to selling products with recurring premiums, a move purposely designed to create a steady source of premium income, and thus resulting to stable profits for the company.

The company’s bancassurance operations showed an impressive growth of more than 167% in terms of new business recurring premiums to P550 million from P205 million the year before. Group insurance premiums also climbed up 21 percent at the end of 2010.

"Now that we have successfully enhanced our business model, with a much better equipped bancassurance sales force, coupled with a steady and profitable group insurance customer base, this company can look forward to sustainable long-term growth, " said Generali chief executive Renato Vergel De Dios. "We are committed to continually strengthen our financial position and deliver value to our clients and stakeholders."

The strong performance of GPLAC in 2010 continued in the first quarter of this year, posting significant increases in premiums from its individual business and group business by 64 percent and 10 percent, respectively.

http://www.mb.com.ph/node/322249/gplac-gear

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