The Philippine Life Insurance Association (PLIA) looks forward to double-digit industry growth this year on the back of the country's strong macroeconomic fundamentals.
According to PLIA President Olaf Kliesow, the life insurance industry should benefit this year from factors including the country’s demographics and the impact of reforms under the Tax Reform for Acceleration and Inclusion Act (TRAIN) which was signed into law in December 2017, reported Business Mirror.
“In the Philippines, the macro fundamentals are very sound. I expect double-digit growth. The GDP growth is projected to be above 7% by most analysts this year. Inflation is going up slightly, but that’s related to the TRAIN [and] not generally expected to further increase very much. Then you have the macroeconomics, the demographic development with a population that is growing, I think [these will be] a good year for the industry,” he said.
Mr Kliesow, who is also the President and CEO of Allianz PNB Life Insurance, said the lower income classes can start protecting themselves since they now accumulate wealth as a result of the TRAIN.
The TRAIN should provide most of the population with tax cuts and hence a larger take-home pay, and encourage consumers to seek protection from risks and buy insurance products.
He said that an area which PLIA can lend support is increasing financial literacy and awareness. “About half of the population is still not familiar with insurance,” he said.
The Insurance Commission has stated that the Philippine life insurance industry grew by 10.7% in 2017, with total premiums reaching PHP202.3 billion (US$3.9 billion).