FWD Life Insurance Corp. expects slower growth in premium income in 2019 after it tallied robust expansion last year.
“Inevitably, it’s a bit difficult to defy gravity. Delivering sorts of middle- to high-digit growth in the…first two to three years is easier because the quantity was smaller…. We’re not a small company now in total premium income…. We would expect that there will be slowdown,” said Peter Grimes, FWD Life president and chief executive officer.
FWD Life reported a total premium income of P7.65 billion in 2018, 68% higher than the P4.55 billion recorded the previous year and outpacing the industry’s 13% growth rate.
Mr. Grimes attributed the robust growth to increased distribution reach, larger number of sales as well as the insurer’s messaging.
FWD Life ended the year with 3,300 financial agents, with Million Dollar Round Table members up by almost 40%. The life insurer also had more than 200 bancassurance financial solutions consultants as of end-2018 scattered across the 300 branches of its partner lender Security Bank Corp.
It opened six new business hubs across the country last year, bringing the total to 14.
FWD Life’s first-year weighted premiums, stated in new business annual premium equivalent, surged 54%, surpassing the life industry’s growth of 11% in 2018.
Despite the expected slowdown in income this year, the life insurer still expects strong performance this year.
“What we are saying is mathematically, because of the lower base now becoming higher, the amount of percentage growth may not be as high as before, but that doesn’t mean that the absolute growth will not be as good,” FWD Life Chief Financial Officer Jasper Hendrik Cheng said.
“There’s nothing to suggest that what we’ve achieved in the past few years is a one-off. These are things that are quite sustainable. There’s absolutely an expectation that we will continue this trend.”
Looking ahead, Mr. Grimes said its continuous expansion of its presence as well as its bancassurance channel will “naturally” drive FWD Life’s income moving forward. However, he declined to provide targets for 2019.
“Obviously, our intention is to continue to build more scaled distribution. It will be done in a controlled way. I think physically having more presence, more advisers, hopefully Security Bank will have new customers. That will drive a degree of natural growth,” he said.
“We remain generally positive about the macros in the Philippines. It’s domestic consumption-driven, plus the remittances. We feel pretty good about the market and we’re confident about what we’re doing to our customers.” — K.A.N. Vidal