By Herminia S. Jacinto
THE insurance industry throughout the Association of Southeast Asian Nations (Asean) earmarks at least a week in the month of October for the celebration of Insurance Consciousness. The Philippines decided to dedicate the whole month of October to give ample time to hold several events that will further enhance the consciousness of insurance. Several activities were lined up by the various associations in the industry, led by the Philippine Insurers and Reinsurers Association (PIRA) and the Philippine Life Insurance Association (PLIA). PIRA chose the theme "Strengthening Disaster Preparedness and Resilience through Insurance." To kick off the month-long celebration, a Mass and opening ceremonies were held at the Makati Sports Club, attended by Insurance Commissioner Reynaldo Regalado and officers, intermediaries and employees from the insurance industry. PLIA held a golf tournament, whereas PIRA held a bowling tournament, which drew around 60 bowlers. Some executives were guests on the radio program of Mr. Errol Dacame of DZRJ, where they had a very lively discussion on the importance of insurance. On Thursday, a Conference on Marine Insurance will be jointly sponsored by PIRA and the International Union of Marine Insurance. Several experts on marine insurance will be flying in to share with us the current developments and issues on marine insurance coverage. PLIA has launched a social media campaign to promote financial stability and security, especially among the young.
From the above list of activities, one can see that the events were attended by the insurance men and women and not by the clients or insureds. Maybe there were listeners of the radio program, but perhaps it should have been longer and announced to the public earlier so they could tune in. Radio is the best way of reaching even the farthest places in the country. We should use this more to explain the need for insurance. I believe the best way to convince them to secure their properties or themselves and their families through microinsurance is through insurance education.
I saw a news item that mentioned that the insurance penetration in the Philippines is still a low 1.75 percent. Insurance penetration is the contribution of insurance premiums to the GDP of the country. This ratio refers to the life insurance premiums or coverage of our population. And yet our insurance agents or financial advisors, as we call them now, are the best in the region and very well qualified to sell the various insurance products. Advancement in technology has made it possible to sell online, but I think it is still more effective to do it on a person-to-person basis.
How about property and casualty insurance, or non-life insurance, as it is more popularly known? There are many types of insurance that are needed to protect property, vehicles, ships, business contracts, events and many more. Agents and other intermediaries have to exert a lot more effort to convince property owners to insure and insure to value their assets. The tendency is to insure only the amount that is covered by a loan, and it is the bank that most likely requires the insurance cover. Walking around our village, I keep on wondering if all the houses there are insured. How about all other houses and buildings and their contents? Are they insured against fire and natural perils like typhoons, floods or earthquakes? The insurance industry has been lobbying against the imposition of more taxes on insurance premiums to make insurance more affordable to the public. Cost is the number one reason why they are either not insured or underinsured.
There are many other lines of insurance that a businessman can avail of to protect his property, inventory and employees, but this has to be explained to him very well. Individual insurance agents are more effective in selling on a person-to-person basis. They should continue updating themselves on the current trends and not be intimidated by corporate intermediaries. They still have a big role in convincing small and medium companies to get adequate insurance protection.
Insurance is a very interesting, albeit challenging business. There is no end to the knowledge that one must acquire, especially if one wants to be an effective agent or seller of insurance. In addition to training in the technical aspects, agents may need to improve their communication skills. This is what the insurance companies should focus on — to continue educating the insuring public so there will be a positive attitude towards it. Celebrations of insurance consciousness should be geared more toward the buyers and beneficiaries of insurance rather than their own groups. Maybe there should be a regular TV or radio program or a dedicated column in one of the major dailies about the benefits of insurance.