Philam Life will have a new chief executive officer effective March 1.
AIA GROUP Ltd. is investing P3 billion in its local subsidiary Philippine American Life and General Insurance Co. Inc. (Philam Life) over the next three years to boost agency distribution, officials said on Thursday.
Philam Life Chief Executive Officer Kelvin Ang said in a press briefing on Thursday that the funding will be used to hire and train 5,000 full-time financial advisers that can help bridge the huge protection gap in the Philippines.
“We will invest P3 billion over the next three years in building the agency distribution. This is a significant amount — P3 billion in terms of our investment — because in the past we have done investment in terms of building the agency more than what we want… This time we are making it bigger. We feel that the market opportunity is enormous,” Mr. Ang said.
The official said the company needs the P3-billion investment to hire, nurture, and teach from zero knowledge future full-time financial advisers. Currently, the company has a total of 8,000 full-time and part-time advisers.
Mr. Ang noted that AIA has made similar investments in China, Hong Kong, Malaysia, and Thailand.
Philam Life Chief Financial Officer Gary James Ogilvie said the local market for insurance is huge as the protection gap in the Philippines currently stands at P1.5 trillion and is expected to grow in the next few years.
“People just do not have protection insurance cover. We have a huge insurance market,” Mr. Ogilvie said.
Mr. Ang added that insurance protection in the Philippines is at less than 2%, which calls for a push for financial literacy among Filipinos.
He noted how Filipinos normally depend on family, friends, and relatives in times of sicknesses rather than having their own health insurance coverage.
“We’re concerned about the huge protection gap. Last year, we only paid P2.9 billion in protection benefits. We want to focus more on this given the huge opportunity. It is the focus we believe Philam Life should be looking at,” Mr. Ang said.
“The other parts of ASEAN (Association of Southeast Asian Nations) are slowly moving away from FFR (family, friends, relatives) to private insurance schemes,” Mr. Ang said.
Meanwhile, the company on Thursday also launched a product called AIA Critical Protect 100 aimed to cover 100 critical illnesses of people from age zero to 100.
“Normally, this type of product would terminate at the age of 75,” Philam Life Chief Marketing Officer Leonardo D. Tan, Jr. said.
Mr. Tan said the product would cost less than P100 a day for P1-million coverage. — R.J.N. Ignacio