We have another reason to be proud of our country: The Philippines is the venue for the 14th Asia Pacific Life Insurance Congress (APLIC) this February 20 to 22 at the SMX Center in SM Mall of Asia, considered one of the biggest conventions of life insurance and financial service professionals in the region.
Nenette Aseniero, chairperson of this year's APLIC, says the event will be a very special one since the whole world now sees the Philippines as an economy to watch. This is only the second time the country is hosting the gathering after 14 years. ''APLIC will find a different Philippines from '99. The country is now an emerging success story in this region, one we hope to share during the congress,'' she says.
Behind the success of bringing back the conference to the country is the Life Underwriters Association of the Philippines (LUAP). Organized 29 years ago, LUAP is composed of Filipino insurance and financial planning practitioners from various local life insurance companies and has been at the forefront of transforming an ordinary insurance sales agent into ''an equipped life insurance professional.''
How Insured Are Pinoys?
LUAP President Arlyn Tan believes that the local insurance industry has grown stronger over the years. ''We now have roughly 100 companies involved in this industry, each contributing significant figures that boost our overall performance,'' she says.
But this does not necessarily translate to Filipinos getting more life insurance. In fact, only few Pinoys are actually insured. In her speech during the APLIC press conference, Tan shares the results of last year's Philam Life study, where only 1.1 percent of Filipinos have some form of life insurance. Considering the country's population at present, this number is really small. ''In the same study, 88 percent of the Filipinos want to have an emergency fund to protect them from unforeseen events. However, only two percent of these individuals have secured themselves by getting some form of life insurance,'' Tan adds.
This is ironic, considering the country's growth in various economic aspects. Tan cites that this year, JP Morgan has chosen the Philippines as one its ''most favored stock market'' and that the country is ''expected to outperform most of its regional peers.'' The Philippines continues to receive high growth projections. ''The Philippines had a growth rate of 6.5 percent in 2012. However, only one percent of the total Philippine population invests in the stock market based on the 2011 PSE report. Only a very small part of the pie is able to experience the benefits of having at least 20 percent yield on equity investments,'' she says. ''For the middle class and low income segments of the population to experience the great economic prospects, they need to have access to these instruments via managed funds like variable universal life, unit linked products and mutual funds,'' she explains.
This low percentage of insurance penetration is one of the challenges that the life insurance industry is trying to address. According to her, LUAP wants to promote programs on consumer financial literacy, zeroing in on the role financial planners play. ''The service levels of life insurance and financial advisors [need to] improve to meet the demands of the new market,'' she says, adding that in being competent, the financial advisors will be able to better help consumers.
A Demanding Public
Another concern of the industry is the seemingly lessening number of financial advisers.
Aseniero admits that there is indeed a shrinking of financial advisers, but this is due to the regulation in the industry where there are more requirements compared to before. ''It's not like before...20 years ago. Now, life insurance is not just selling [a product]. It has become a need-based selling approach,'' she says.
Although there is still a small number of Filipinos getting life insurance, the public has become more acquisitive, an indication of a higher form of financial literacy, Aseniero observes. ''There are more demands from the public, [there is] an informed decision among clients,'' she says.
Amelita Tamayo, Insular Life Philippines first VP for Marketing and Support Division, agrees. She says there is now a move towards quality. ''Even if the number of agents are shrinking, premiums generated are getting larger,'' asserts Tamayo. And with financial situations changing as years pass, there is a need for financial advisers to be further educated. ''This work cannot be done by a lot of people,'' Tamayo adds, saying that they are actually hoping to attract more people into the profession.
With APLIC, LUAP hopes that life insurance practitioners and financial advisors will be inspired to become better agents of financial literacy. At the same time, APLIC chose the Philippine Red Cross as its beneficiary. Secretary General Gwendolyn Pang says that there are less people helping the victims of Typhoon Pablo when, in fact, the work is not yet done. ''The needs [of the people] continue to grow. As needs continue to change everyday, we will need several months more to fix the area,'' she says of their plans to set up water system in areas hit by the typhoon, enabling residents to start their lives anew.