The results are in! Sun Life has retained it’s dominance of the life insurance industry making them the top insurer, a spot they have held for the 3rd consecutive year. Not only did they manage to keep the top spot, they have managed to even widen the gap between the number 2 spot with about 10 Billion Pesos worth of premiums — truly an astounding feat. Sun Life’s strength remains to be their strong agency force which has remained to be a strong distribution channel with higher than average productivity. Sun Life’s agency has grown in leaps and bounds from about 2,000 agents in 2003 to over 7,000 in 2013 — a growth of over 300% in a span of 10 years. Further, Sun Life’s timely and relevant marketing campaigns has cemented their stronghold of the top spot. Congratulations Sun Life, your performance is truly amazing.

2013 saw a realignment of the rankings in total premium income. Philamlife’s phenomenal 2013 performance has allowed them to go back to the 2nd position, a rank they relinquished in 2012. Philamlife’s renewed vigor, new strategies, re-tooling of advisers and aggressive recruitment strategies resulted to a jump of almost 5 Billion. Philamlife’s vast network, brand premium and fresh strategies not only allowed them to regain the 2nd spot, it also widen their gap with the 3rd spot by almost 1.8 Billion worth of premiums. What Philamlife has accomplished is phenomenal as well, at the rate they are going, there is much to be expected from this insurer.

Landing on the 3rd post is AXA Philippines, a post they have held for many years and and a spot they ceded in 2012. Just like Philamlife, AXA’s current strategies and their dominance of the bancassurance environment and a stronger agency force produced a growth of almost 6 billion more premiums in 2013 from their 2012 numbers. AXA Philippines is a joint venture partnership between the French insurer and global dominant player AXA and Metrobank.

Slipping down to the 4th spot from their 2012 ranking of number 2 is Pru Life U.K. In 2012, Pru Life UK surpassed Philamlife which landed them on the 2nd spot but their 2013 performance was not strong enough for them to defend their rank. Pru Life UK slips down by 2 spots in 2013, however, they still delivered positive growth from their 2012 numbers.

Manulife jumps by 2 spots from number 7 in 2013 to number 5 in 2013.  Their rise is attributable to their spectacular performance and they more than doubled their premiums in just 1 year, from 7.4 Billion in 2012 to 15 Billion in 2013! Manulife’s strong productivity is a truly admirable asset and  more than doubling revenues in just a year is truly one for the books. Bravo Manulife!

There were many changes in the 2013 rankings — SunLife Grepa improves to the number 7 spot and they are now behind BPI Philam’s number 6 slot, down from number 5 in 2012. Insular Life, the largest Filipino-owned insurance company slips to the number 8 spot — down 2 spots from 2012. Manulife Chinabank and PNB Life retains their 2012 ranks of number 9 and 10 respectively.

The life insurance industry as whole delivered P 170,280,660,057 worth of premium income, up from P119,454,550,174 in 2012 or a growth of 42.5%.

The life insurance industry has been growing tremendously for many years and this can be attributed to the more Filipinos having better income and improving awareness of financial products and the importance of financial planning. While P 170 Billion bucks is a huge amount of money, it is merely a drop of the bucket from the money in the banks which has reported to be more than 6 Trillion Pesos in 2013. Clearly, the life insurance industry has a long way to go and a daunting task to get more Filipinos financially secured and this is something all of us should be advocating for.

* Data from the Insurance Commission.

It is always a pleasure to present the views of one of the persons I admire a lot, a former colleague and now the CEO of the country’s largest life insurance company, Riza Gervasio Mantaring. A marathon runner, Riza’s disciplined approach in life helped her propel Sun Life to the top spot. I also admire Ms. Mantaring’s passion to help improve the nation’s financial literacy through many endeavors.

The 2014 Outlook of Riza Mantaring

2013 was the proverbial “start with a bang, end with a whimper” year. While fundamentals in the Philippines remained solid, changes in the external environment dragged the market down so that we basically ended the year back where we started.

So as we start 2014, to what do we have to look forward?

The first half of the year is likely to be volatile as the US winds down its economic stimulus program given its improving economy. Performance of its equity markets in 2013 has been stellar, reflecting the outflow of funds from developing economies back to the more developed markets.

Inflation may creep upwards, possibly curbing spending which has been driving our economy. In terms of public spending, government rehabilitation efforts in quake and typhoon-hit areas may somewhat offset the withdrawal of the PDAF and DAP, and hopefully PPP projects finally get underway at the pace necessary to sustain growth.

With an expectation of higher inflation,  we may see local bond rates continue to creep up.  Likewise, with a weaker earnings growth expectation from the banking sector, we are anticipating lower aggregate earnings growth for the market.

Still, despite a possibly volatile first half of 2014, the second half of the year should be more positive as we get better indicators on company earnings growth and the progress of government infrastructure spending. Longer term, the Philippines remains a favored destination and is forecast to continue its rapid growth over the next few years.

As to where the market will end?  We expect a base scenario of 6500 for the Phisix, possibly reaching 6800.  Remember, though, that the best time to buy is when the news is negative, not when it is positive!

Riza Mantaring is the President & CEO of the Sun Life Financial group of companies in the Philippines, and a member of its various boards.She started out in Information Technology and took on various roles through her 20+ years at Sun Life before becoming CEO.

Riza is a member of the Sun Life Asia Leadership Team.  She has also participated in various international special projects and teams such as the task force for worldwide restructuring of the company, the task force for business processes, and special teams for Mergers & Acquisitions.

In 2010, on the occasion of the 100^th anniversary of the University of the Philippines College of Engineering, she was selected one of the 100 Most Outstanding Alumni of the past century. In 2011, she was named by Moneysense Magazine one of the 12 Most Influential in Personal Finance, and became a recipient of the 2011 CEO EXCEL award given by the International Association of Business Communicators.  Riza was recognized for bold and innovative programs and harnessing the power of communication to implement these programs, including the multi-awarded and pioneering “It’s Time!” financial literacy advocacy.

Riza graduated with a B.S. Electrical Engineering degree (cum laude) from the University of the Philippines, and an M.S. Computer Science from the State University of New York at Albany.  She has also attended numerous executive development programs conducted by Harvard University, The Wharton School, Duke University, Oxford University, Asian Institute of Management, and The Niagara Institute.  She is a Fellow of the Life Management Institute (with distinction).

She has been a board director of the Philippine Life Insurance Association since 2011 and is currently its Treasurer, and served as a board director of the Philippine Federation of Pre-need Companies from 2006-2008.

It will be interesting to read the views of a Dutch national but has a big heart for the Philippines. Rien Hermans is the President & CEO of AXA Philippines, one of the top 5 largest life insurance companies in the country, a partnership with Metrobank. It’s parent company, the international insurer from France, AXA is the world’s largest insurer.

The 2014 Outlook of Rien Hermans

I feel that the air is pushed out of the index in the second half of last year, the fundamentals are strong, P/E ratio’s back to more acceptable levels and the economy is going to deliver 80% of the promise that has been extensively communicated in the press. In line with that I see the equity index increasing in the coming 5 years to levels between 8,000 and 11,000, fort a large part dependent on the ability of the government to consistently convince the international business community that its able to collect taxes and reduce corruption.

In the coming 12 months I would expect that the index moves side ways but up and reaches around 6,800 at year-end. For investors I would assume that beating the index by picking the right stocks based on strong fundamentals combined with the right timing will allow over-performing the benchmark with 4%-7%, without increasing risk.

Convinced of the value that financial products deliver to customers Rien has spent 25 years in the financial service industry in the fields of product development, distribution, marketing, strategy and general management.  

In 1990 he started with ING Bank in the Netherlands, where he was responsible for developing and implementing Life insurance as a new product group offered by the bank. His analytical skills and strategic vision were recognized and for 4 years he was vice president Strategy & Planning advising the Board of ING on strategic issues.

In 1999 he moved to Asia and after a short stint in Hong Kong he was assigned as the CEO of ING Life as well as CEO of Aetna Life & Healthcare in the Philippines, Executive Director and General Manager of ING Malaysia and the last position he held in ING was Board Member of ING Financial Services Poland.
In 2009 Rien ‘crossed the line’ and joined AXA with the assignment to transform AXA Philippines into a strong player on the domestic market with a sustainable position in the top 5. Focused to be the best in the eyes of the customers the company has strengthened its position in the growing life insurance and investment market in the Philippines.