MANILA, Philippines - Life insurance provider AXA Philippines saw a dip in its total premium income in the first quarter of the year compared to last year's figures due to more cautious investors.
The firm said its total premium income plunged 26 percent to P3.5 billion compared to the total premium income of more than P4 billion in the same period last year.
"The market volatility experienced in the second half of last year has made investors more cautious going into this year, especially those investing in single premiums," said AXA Philippines president and chairman Rien Hermans.
AXA Philippines president and chairman Rien Hermans
Single premium income plunged to P2 billion in the first quarter, a 43 percent decrease compared to the same period last year.
Hermans noted, however, that AXA has a positive outlook for 2014 due to growth from its new products and innovations.
The firm posted first year premiums (FYP) of P508 million, a record 19 percent growth, for the first quarter of 2014 on the back of three new health products launched in January—Health Exentials, Health Max, and SME Employee Protexion.
Sales from its health insurance products reached P56.3 million, making up nearly 10 percent of total FYPs for the period.
AXA said it will be expanding its business with PSBank, as well as launching AXA Insurance Online, a first-of-its-kind online sales portal, and a new offshore fund within the year.
Hermans said AXA is expanding its distribution channels to ensure access to a higher share of the market.
"We are very bullish about our prospects in 2014. We have a lot of innovations to look forward to in the next several months in terms of new products and funds, as well as new distribution channels," he said.
Hermans said also he expects the insurance industry to gain from the changing demographic and the growing economy in the Philippines in the next 10 to 15 years.
“We are in a very lucky situation that we have a market that is developing and growing for the coming years,” he said.
Hermans said because of the country’s current young demographic, AXA’s potential target market of people aged between 25 to 45 years old may increase by about 50 percent in the next 10 to 15 years.
He said as incomes increase and the economy continues to grow, there will be a higher demand for cars, housing, and other investment-insurance plans.
“That creates a healthy economy but it also creates a situation where people will start thinking about what they will do for the future financially. So people will start saving more, start preparing for the future, and look at how they can protect what they have,” he said.
AXA Philippines, an affiliate of the Metrobank Group, currently provides financial security services to more than half a million Filipinos.