The insurance sector of the Philippines is one of the budding sectors of the country driven by financial inclusion, digital innovations and increasing the consciousness of consumers. The Insurance Committee (IC) is responsible for strengthening and regulating these previous companies in the Philippines and, since its establishment in 1949, has carried out a cautious and progressive regulatory and supervisory policies on the same rate with international standards.
The most important goals of the committee jointly support the development, regulations and consumer protection of the insurance sector. One of the objectives is to promote growth and financial stability of insurance, pre-needed and health maintenance organizations (HMOs); to professionalize insurance, pre-need and HMO services and to develop insurance, pre-need and HMO consciousness among the general population; to set up a solid market for national insurance policies; And to protect the rights and importance of the insurance of the insurance insurance.
To achieve these objectives, the IC continues to introduce strategic initiatives and reforms that are aimed at improving the resilience of industry, expanding market range and guaranteeing the well -being of consumers.
This year, the IC wants to determine standards for the calculation of policy reserves of the Mutual Benefit Associations’ (MBA). The MBAs are organizations that offer security, protection and meaningful financial solutions to their members; Although policy reserves are the funds reserved by the insurance companies to pay future benefits and to ensure that insurers have enough money to pay claims when they occur.
The valuation standards that the IC expects will be in accordance with internationally accepted actuarial standards, as well as the principles of the financial reporting frame promoted by the Actuarial Society of the Philippines. The MBAs must calculate their required reserves using the gross premium rating.
“Every MBA that is supervised by the insurance committee will appreciate the reserves of their policy for basic insurance and optional life insurance coverage at the end of each valuation period in accordance with this set of valuation standards,” said the industrial regulator in a draft circular last December.
Similarly, the Commission plans to regulate the sale of insurance to Overseas Filipino employees. This would ensure that Filipinos working outside the country get sufficient protection and benefits while working abroad, in accordance with industrial standards and consumer protectors.
However, there are some roadblocks for the potential circular. ACT no. 10607 of the Republic, also known as the changed insurance code, states that all licenses granted to companies and agents are only valid within the Philippines. In addition, IC-Circular letter no. 2020-109 also emphasizes that insurers may only cover persons or risks in the Philippines.
“We can’t remove that. We have to see how best we can have implemented. There must be a way even before they enter a foreign country, “said insurance commissioner Reynaldo A. Regalado in a business world report last August.
Another initiative that the IC is working on means that the supervision and regulation of HMOs is transferred to another government agency under the Ministry of Finance. Although the transfer of responsibilities is still being discussed with other agencies involved, the supervision of a financial regulatory body is required because HMOs are subject to anti-money laundering practices.
In order to further strengthen the industry and make insurance more accessible to Filipinos, the IC has actively pursued initiatives to increase the penetration of the insurance, because higher incomes can stimulate a greater demand for protection products, possibly improving the country’s penetration.
Last year, insurance penetration, which measures the premium volume as a percentage of the gross domestic product and the contribution of the insurance sector to the national economy, continued to be low at 1.67% for 2024, albeit higher than 1.61% per year earlier .
One of the reasons quoted for the penetration of the country is a lack of financial literacy and consciousness. To tackle this, the IC hopes to help Life Insurance Agents and Insurers to advocate financial literacy and caution in Filipinos, “for the ultimate goal of financial inclusion for everyone.”
Recognizing the role of financial literacy in improving the penetration of insurance and financial inclusion, has submitted a house account policy makers no. 9162, or the financial letters for education, which aims to equip senior high school students with the knowledge, skills and attitudes that are necessary for informed financial decision -making.
As the insurance sector is slow for more Filipinos, the cooperation between supervisors, industrial players and policy makers has become crucial in forming a financially safe and well -informed society. With the insurance committee at the helm of these efforts, initiatives such as legal reforms, financial literacy programs and industrial cooperation have been acquitted the way to a future in which Filipinos are safe and confident about their finances. – Jomarc Angelo M. Corpuz