Industry experts expressed optimism on the insurance market despite the lingering impact of the Covid-19 pandemic on players, policyholders and the broader economy.
In a virtual forum organized by The Manila Times on Tuesday, Insurance Commission (IC) Commissioner Dennis Funa reported the income of life and nonlife insurance companies and mutual benefit associations improved in the first quarter of the year.
Citing data from unaudited quarterly reports on select financial statistics, Funa said the first-quarter income of these firms and associations rose by 45.84 percent to P11.85 billion in January to March from P8.13 billion last year.
Total premiums earned also posted a double-digit growth of 27.81 percent in the first three months to almost P100 billion from P78 billion year-on-year.
Funa said the life sector recorded a 38-percent higher income of P9.4 billion during the period from the previous year's P6.8 billion.
The non-life sector's total net income also surged to P1.19 billion in the first quarter from P164 million year-on-year.
"Actually, the current amount is even higher than the prepandemic figure of P1.04 billion back in the first quarter of 2019," he noted.
Rellosa said the nonlife sector reported a 67-percent higher net income of P5.5 billion last year from P3.3 billion in 2019.
He noted that the increase was achieved despite nine out of 10 nonlife insurance companies recording lower premiums during the period.
"The income increase was due to the decline in losses paid by insurance companies. Simply put, [fewer] cars on the road resulted in [fewer] accidents and [fewer] accidents meant less insurance claims," Rellosa explained.
Collectively, he said, the industry's incurred losses went down by more than 20 percent, which lowered the loss ratio to 41 percent in 2020 from 47.1 percent in 2019.
Rellosa added gross premiums of the nonlife sector declined by 16 percent to P75.9 billion from P90.1 billion year-on-year.
Net premium of the sector was also down 15 percent to P40.7 billion from P47.7 billion in 2019.
Rellosa said the drop in premium was caused by a decline in car sales, which prompted the 16-percent slip in car insurance sales, the decline in shipping activities, which dipped marine insurance by 12 percent, and the reduced mobility, which resulted in other businesses slumping by 49 percent last year.
The fire insurance business was the only gainer as it registered an 11-percent increase year-on-year.
Despite the weaker figures, Rellosa said the industry remains "on solid ground" as it is "more than adequately capitalized."