Life insurance sales in the Philippines boomed in the first half of 2023, with growth of nearly 10%. The increase signals the industry's rebound from pandemic lows and suggests it may surpass pre-pandemic sales by year's end.
Known for its heavy reliance on face-to-face transactions in marketing its products, the life insurance sector was seen to be among the most impacted during the pandemic years. However, under the prevailing economic climate, Filipino families are increasingly seen to prioritize insurance to safeguard themselves and their loved ones against unforeseen events. Moreover, they also look for ways to ensure they are secure financially through whatever means.
There are five critical assets a person should consider to achieve financial security:
• Emergency Funds: Emergency funds are savings for unanticipated expenses like medical incidents and house repairs. This fund would prevent someone from relying on high-interest lenders when unexpected events occur.
• Investments: Investing money in assets like real estate and stocks can grow wealth over time, providing investors with a financial cushion for long-term goals such as retirement. The underlying assumption here is that one’s income exceeds one’s expenses, thereby creating savings that can be channeled to investments.
• Multiple Income Streams: Creating various revenue streams, such as side gigs and freelance work, can help boost financial stability. Besides lessening one’s susceptibility to volatility in the economy, additional income provides surplus earnings that can be used to increase savings and investments.
• Insurance Coverage: Good insurance protection, which safeguards other insurance types, including health, life, and property, is a cushion against unforeseen economic fluctuations that can impact one’s investments. Life insurance in particular is seen to protect one’s potential future earnings in the unlikely event of premature death.
• Financial Education: Through financial literacy, individuals can make well-informed decisions regarding investments, budgeting, and debt management. This development of financial resources contributes to long-term security.
Renato A. Vergel De Dios, an insurance industry expert and President and CEO of BDO Life Assurance Company (BDO Life), said it is now crucial for individuals to seriously consider insurance and start acquiring the four essential assets, given the robust financial performance of insurance providers.
“The industry’s growth directly translates into enhanced benefits and security for our valued policyholders, reinforcing our commitment to their financial well-being. Just as now is an opportune time to invest and acquire other personal assets, it is equally timely that our future income is preserved, in the event of untimely death, and its value passed on to our loved ones,” said Vergel De Dios.
He added that “Only life insurance has the power to transfer future income otherwise foregone, to those who rely on us for financial support. This is the peace of mind that only life insurance can provide so that our loved ones need not worry should anything happen to their financial provider or breadwinner.”
Vergel De Dios further explained that securing oneself with life insurance and other assets ensures genuine financial security. The primary purpose of life insurance is to act as a safety net for losses due to death, illness, or disability. It is a viable financial Plan B when a person’s program of savings and investments, his Plan A, fails.
Learn more about how life insurance can protect you and your loved ones by visiting a nearby BDO branch and speaking with a BDO Life Financial Advisor or at www.bdo.com.ph/bdo-life.