Finance Secretary Carlos Dominguez III asked insurance companies to invest in the government’s ‘Build, Build, Build’ infrastructure program and become major players in inclusive economic growth.
The Insurance Commission is currently working on the circular setting the framework for these investments in infrastructure, which, “from a risk management standpoint, diversifies the insurance industry’s profit-making ventures that are mainly concentrated in accumulating real estate assets,” Dominguez said.
“I urge you to more closely review the investment opportunities opened by the infrastructure program and making a conscious effort to participate. It not only makes sound business sense to do so. It is also a patriotic thing to do,” Dominguez told leaders of the insurance industry during the 68th-anniversary celebration of the Philippine Life Insurance Association Inc. in Makati City.
Dominguez also challenged industry players to come up with new products that would encourage more Filipinos to avail of insurance coverage.
He cited 2017 data from the Insurance Commission showing that around half of the population were insured through traditional life insurance and mutual benefit associations while the rest “are left vulnerable to the uncertainties of life.”
“There should be a way for the insurance industry to design products that will broaden the base of life insurance coverage. That will be a service to our people,” Dominguez said.
Dominguez described 2017 as a “banner year” for the insurance industry, with assets rising to an all-time high of P1.56 trillion, of which P1.26 trillion or 81 percent was held by the life insurance sector.
He said IC Commissioner Dennis Funa informed him that the industry was set to surpass its 2017 feat through another record-breaking accomplishment this year.
“I take that to be both good news and bad. It suggests that there is too much headroom for expansion in the non-life sector, where insurance coverage will help our enterprises better manage risks,” Dominguez said.
He said that with much headroom for the industry to grow, life insurance companies would sustain the healthy rate of growth it has achieved in the last few years.
“You have the wind in your sails,” he told life insurers gathered at the event.
“The Philippine economy is growing at a faster rate. It is a growth that is robust and sustainable. The insurance industry will yet be another ship that rises with the tide,” he said.
Dominguez said the government would ensure that the massive infrastructure program would remain sustainable amid a fiscally stable environment through reliable revenue flows from the Duterte
administration’s comprehensive tax reform program, prudent debt management and measures to ensure a business-friendly climate.