PowerPoint Presentation

INSURANCE COMPANYInsured Company

LIFE INSURANCE

A life insurancepolicy is a contract with aninsurance company. In exchange for premiums (payments), theinsurance companyprovides a lump-sum payment, known as a death benefit, to beneficiaries in the event of the insured's death.

LIST OF INSURANCE COMPANIES WHOSE CERTIFICATES OF AUTHORITY WERE EXTENDED FOR LICENSE YEAR 2014-2015 As of 15 May 2015

Beneficial Life lnsurance Company, lncBF Life lnsurance CorporationBPI-Philam Life Assurance Corporation CAP Life lnsurance Corporation Caritas Life I nsurance CorporationCooperative lnsurance System of the Philippines Country Bankers Life lnsurance CorporationFirst Life FinancialCompany, lnc.Fortune Life lnsurance Company, lnc.FWD Life lnsurance CorporationGenerali Pilipinas Life Assurance Company, lnc. lnsular Life Assurance Company, Ltd.,The Manila Bankers Life lnsurance Corporation

Manufacturers Life lnsurance Company (Phils.), lnc., The Manulife Chinaban k Life Assurance CorporationPhilam Equitable Life Assurance Company, lnc. Philippine AXA Life lnsurance Corporation Philippines lnternational Life lnsurance Company, lnc. Philippine Life Financial Assurance CorporationPhilippine Prudential Life lnsurance Company, lnc. Pioneer Life lnc. PNB Life lnsurance, lnc.Pru Life lnsurance Corporation of U.K. Sun Life Grepa Financial, lnc. Sun Life of Canada (Philippines), lnc.United Coconut Planters Life Assurance CorporationUnited Life Assurance Corporation

NON-LIFE INSURANCE

It is basically an insurance policy to protect an individual against losses and damages other than those covered by Life insurance.

Coverage:

The coverage period for most non-life insurance policies and plans is usually one year, whereby premiums are normally paid on a one time basis. The risks that are covered by non-life insurance is property loss (stolen car or burnt house), liability arising from damage caused by an individual to a third party, accidental death or injury.

LIST OF INSURANCE COMPANIES WHOSE CERTIFICATES OF AUTHORITY WERE EXTENDED FOR LICENSE YEAR 2014-2015 (As of 15 May 2015)

AFP General lnsurance CorporationAIG Philippines lnsurance, lnc. (Formerly: Chartis Phils. lnsurance lnc. name change effec. 13 Dec. 2012)Alliedbankers I nsu rance Corporation Alpha lnsurance and Surety Company, IncAsia lnsurance (Philippines) Corporation (Formerly: Asia Traders lnsurance Corporation - name change effec. 23 June 2004) Asia United lnsurance, lnc. BF General lnsurance Company, lnc. BPI/MS lnsurance Corporation Bankers Assurance CorporationBlue Cross lnsurance, Inc. CARD Pioneer Microinsurance lnc. (Formerly: Pioneer Asia lnsurance Corporation - name changed efiec. 13 Sept. 2013)Centennial Guarantee Assurance Corporation Charter Ping An lnsurance Corporation Cibeles lnsurance CorporationCommonwealth lnsurance Company Country Bankers lnsurance Corporation

Corporate Guarantee and lnsurance Company, lnc. Empire lnsurance CompanyFar Eastern Surety & lnsurance Company, lnc. FLT Prime lnsurance Corporation (Formerly: First Le@nto-Taisho lnsurance Corp. - name changed effec. 11 May 2005) First lntegrated Bonding & lnsurance Co., lnc. First Nationwide Assurance Corporation, The Fortune General lnsurance Corporation FPG lnsurance Co., lnc. (Formerly: Federal Phoenix Assurarce Company, lnc. - name changed effec. 18 Februaty 2015)lnsurance Company of North America lntra Strata Assurance Corporation Investors Assurance Corporation Liberty Insurance Corporation MAA General Assurance Philippines, lnc.Malayan lnsurance Company, lnc. Manila Surety and Fidelity Company, lnc. Mapfre lnsular lnsurance Corporation

Mercantile lnsurance Company, lnc. Meridian Assurance CorporationMetropolitan lnsurance Company, lnc. Milestone Guaranty and Assurance Corporation New lndia Assurance Company, Ltd., The Northwest lnsurance & Surety Company, lnc. Oriental Assurance Corporation Pacific Union lnsurance CompANYPeople's General lnsurance Corporation Perla Compaffia de Seguros, lnc. Petrogen Insurance Corporation PGA Sompo Japan lnsurance, lnc.Philippine British Assurance Company, lnc.Philippine Fire and Marine lnsurance CorporationPhilippines First lnsurance Company, lnc. Pioneer lnsurance and Surety Corporation Pioneer lntercontinental lnsurance Corporation Plaridel Surety and lnsurance Company

PNB General lnsurers Company, lnc. Premier lnsurance & Surety Corporation, The Prudential Guarantee and Assurance lnc. QBE Seaboard lnsurance Philippines, lnc. (Formerly: QBE lnsurance (Philippines), lnc- - name changed eftec. 27 December 2013) Reliance Surety and lnsurance Company, lnc.Republic Surety and lnsurance Company, lnc. SGI Philippines General lnsurance Company, lnc. (Formerly: Monarch lnsurance Company, lnc. - name changed effec. 26 May 2014)Solid Guaranty, lnc. The Standard lnsurance Company, lnc. Starr lnternational lnsurance Philippines BranchSterling lnsurance Company, lnc. Stronghold lnsurance Company, lnc. Travellers lnsurance & Surety Corporation UCPB General lnsurance Company, lnc. United lnsurance Company, lnc. Visayan Surety and lnsurance Corporation Western Guaranty Corporation

FUNCTIONS OF INSURANCEPrimary Functions:

Insurance provides certainly:Insurance provides certainly of payment at uncertainty of loss. The uncertainty of loss can be reduced by better planning and administration.

Insurance provides protection:The main function of the insurance is to provide protection against probable chances of loss.

Risk-Sharing:The risk is sharing in ancient time was done only at the time of damage or death but today on the basis of probability of risk, the share obtained from each and every insured in the shape of premium without which protection is not guaranteed by the insurer.

Secondary Functions:

1. Prevention of Loss - The insurance joins hands with those institutions which are engaged in preventing the losses of the society. 2. Improves Efficiency - The insurance eliminates worries and miseries of losses at death and destruction of property. 3. It helps Economic Progress -By protecting the society from huge losses of damage, destruction and death, provides an opportunity to develop to those larger industries which have more risks in their setting up.

BANCASSURANCE

the partnership or relationship between a bank and an insurance company whereby the insurance company uses the bank sales channel in order to sell insurance products.

also known as cross-selling, is defined as the presentation and sale to bank customers by an insurance company of its insurance products within the premises of the head office of such banksduly licensed by the Bangko Sentral ng Pilipinas (BSPor Philippine Central Bank)

Amended Insurance Code of the Philippines Institutionalizes Bancassurance

On 15 August 2013, the President of the Philippines signed into law Republic Act No. 10607 or the revised Insurance Code of the Philippines (RA 10607).RA 10607, whichamendsthe 38-year-old Insurance Code under Presidential Decree No. 612, seeks to strengthen the Philippine insurance industry and re-align Philippine law with global developments in the insurance sector.

IMPACT ON THE INSURANCE SECTOR

All financial institutions supervised by the Insurance Commission (IC), including insurers/insurance companies, agents, and brokers (collectively, theSupervised Entities), are subject to the new provisions of RA 10607, including those relating to bancassurance.

At present, the BSP for its part is revising its cross-selling regulations applicable to banks.Proposed amendments to current BSP regulations are expected to grant authority to commercial and thrift banks to engage in cross-selling, in addition to universal banks and expanded commercial banks which were presently allowed under BSP rules.

NEW BANCASSURANCE PROVISIONSAmendments relating to bancassurance which are brought about by RA 10607 include the following:To engage in a bancassurance arrangement, a bank is not required anymore to have equity ownership of the insurance company.All bancassurance products, whether life or non-life, are required to be issued or delivered in the form previously approved by the Insurance Commission.Personnel tasked to present and sell insurance products within the bank premises must be duly licensed by the Insurance Commission.Such personnel will also be subject to the rules and regulations of RA 10607 to be promulgated by the Insurance Commission and the BSP.

COMPLIANCE:To comply with the new provisions on bancassurance, Supervised Entitiesmay consider taking the following steps:Review carefully and more in-depth the bancassurance provisions ofRA 10607and further IC regulations/issuances to be issued on the matter;Consider the new bancassurance provisions, review and reconsider their current policies and practices applicable to cross-selling, in order to comply with the recent law;Possibly liaise with relevant IC personnel (in particular, the Regulation, Enforcement and Prosecution Division) to ensure that their policies/practices meet internal rules, policies, and practices of the IC; andMonitor the progress and eventual issuance of therules and regulations to be promulgated by the Insurance Commission and the BSP, specifically with respect to bancassurance, to ensure timely and effective compliance.

NEW RULES OF BANCASSURANCE

Under the said Rules, the selling of insurance products, including variable life insurance products, within the premises of a bank is only allowed after the Insurance Commission (IC) has approved the bancassurance agreement entered into by and between the insurance company and the bankIn order to differentiate insurance products from bank products, the regulation requires that the portion of the bank premises where bancassurance activities are conducted must be distinct and clearly marked off against areas where bank products are sold.The regulator also said: The IC will not require bank employees to obtain a licence as an insurance agent as such task is merely incidental to their duties as bank employees.

INVESTMENT INSURANCE FUNDS

LIFE INSURANCETotal investments placed by life insurance companies comprised 76.41% of total assets of the sector or Php364.05 Billion, 11.17% more than the investments in 2009. Domestic companies and foreign companies accounted for 35.89% and 64.11% of the amount respectively. As in the past years, bonds remained the most popular with 61.22% of the total investments in 2010. This is followed by stocks with 10.60%, Policy Loans with 8.35%, collateral loans with 5.98%, Fixed deposits with 3.53% , Real Estate with 3.50% and other invested assets with 6.82%.

Investments in bonds rose by 10.84% while investments in stocks increased by 20.29%. A significant increase of 40.81% was noted in fixed deposit due to the 139.63% more placements made by domestic companies in 2010. Total investments in long term government bonds and government securities allocated for the 91.98% of the total investments in bonds of the life sector. Treasury notes which took 81.96% of the total government bonds increased by 20.22% during the year under review.

NON-LIFE INSURANCEThe total invested assets in 2010 grew to Php 51.36 Billion, 13.52% more than the Php45.24 Billion investments in 2009. The domestic and foreign companies contributed additional 5.54% and 60.12% respectively, to their previously invested assets. As in past years, bonds shared the biggest 45.56%, followed by fixed deposits of 20.29% and stocks of 17.62% of the total investments placed by the non-life sector.

Data shows that all investments except mortgage loans increased in 2010 by as much as 51.00

Total investments in government securities (long term and shortterm) totaled Php24.44 Billion, 30.00% more than the previous years Php18.80 Billion. The amount was 95.81% of the total investments in bonds which remained the most popular among other placements made by the non-life sector.

INSURANCE COMMISSIONThe Insurance Commission is a government agency under the Department of Finance. The Commission supervises and regulates the operations of life and non-life companies, mutual benefit associations, and trusts for charitable uses. It issues licenses to insurance agents, general agents, resident agents, underwriters, brokers, adjusters and actuaries. It has also the authority to suspend or revoke such licenses.

MISSION

We are committed to protect the interest andwelfare of the insuring public and to developand strengthen the insurance industry VISION

By 2020, as Regulator, we shall provide anopportunity for every Filipino to secure insuranceprotection and we shall observe practices at parwith regional and global standards.

ORGANIZATIONAL STRUCTURE

OBJECTIVES:

To promote growth and financial stability of insurance companies

To professionalize insurance services and develop insurance consciousness among the general populace

To establish a sound national insurance market, and

To safeguard the rights and interest of the insuring people.

INSURANCE CODE (Decree No. 612)

Chapter 1: The Contract of InsuranceTitle 1: What may be insuredTitle 2: Parties of the contractTitle 3: Insurable InterestTitle 4: ConcealmentTitle 5: RepresentationTitle 6: The PolicyTitle 7: WarrantiesTitle 8: PremiumTitle 9: LossTitle 10: Notice of lossTitle 11: Double InsuranceTitle 12: Reinsurance

Chapter 2: Classes of Insurance

Title 1: Marine InsuranceTitle 2: Fire InsuranceTitle 3: Casualty InsuranceTitle 4: SuretyshipTitle 5: Life InsuranceTitle 6: MicroInsurance

Chapter 3: The Business of InsuranceTitle 1: Insurance Companies, Organization, Capitalization and authorizationTitle 2: SolvencyTitle 3: AssetTitle 4: InvestmentsTitle 5: ReservesTitle 6: Limit of Single RiskTitle 7: Reinsurance TransactionsTitle 8: Annual StatementTitle 9: Policy FormsTitle 10: Variable Contracts

Title 11: Claims SettlementTitle 12: Examination of companiesTitle 13: Suspension or revocation of authorityTitle 14: Appointment of conservatorTitle 15: Proceedings upon insolvencyTitle 16: Consolidation and merger of insurance companyTitle 17: Mutualisation of stock life insurance companies Title 18: Withdrawal of foreign Insurance CompaniesTitle 19: Professional ReinsurersTitle 20: Holding Companies

Chapter 4 : Sales Agencies and Technical Services

Title 1: Insurance Agents and Insurance BrokersTitle 2: Reinsurance BrokersTitle 3: Resident AgentsTitle 4: Non-Life Company UnderwriterTitle 5: AdjustersTitle 7: Rating Organization and Rate MakingTitle 8: Provision common to agents, brokers and adjustersTitle 9: Bancassurance

Chapter 5: Security Fund

Chapter 6: Compulsory Motor Vehicle Liability Insurance

Chapter 7: Mutual Benefit Associations and trusts for charitable usesTitle 1: Mutual Benefit AssociationsTitle 2:Trusts for charitable uses

Chapter 8: Trust Business in General

Chapter 9: Registration, responsibilities and oversight of self-regulatory organization

Chapter 10: The Insurance CommissionerTitle 1: Administrative and Adjudicatory powersTitle 2: Fees and other sources of funds

Types of Insurers in Philippines

1. Government

The Government Services Insurance System (GSIS) which extends life insurance to all government employees, and various general insurance products to government installations and their interests; and the Social Security System (SSS) fall within this category.

2. Private

Two main classifications of private companies:

Proprietary Insurers organized and operated by stockholders mainly for profit. Most of companies in the Philippines fall within this classification.

Cooperative InsurersOperated to provide insurance at cost to members. The insured's are the owners. When a profit is made, part is given back to the insured's as "policy dividends" and the balance is used to build up the surplus.

Definition and Kinds of Insurance

Life Insurance

A policy of life insurance is not a mere contract of indemnity, but is a contract to pay the beneficiary a certain sun of money in the event of death, provided certain conditions are performed by the insured.

Non-Life Insurance

Three (3) main classificationProperty InsuranceMarine InsuranceCasualty Insurance

Property Insurance

provide protection against more risks to property such as the special perils of earthquake, flood, typhoon, riot and strike, falling aircraft, and impact of vehicles are written usually in conjunction which fire coverage.

Marine Insurance

this includes cargo, hull freight, and liability of the ship owner to the crew, passengers, or property of the third parties. Inland marine, covering shipment of goods by trucks, railways, or ferry, is included in this classification.

Casualty Insurance

This is the broadest classification which includes those lines of business that do not fall under Fire or Marine such as motor car, workmen's compensation, personal accident, crime insurance, liability insurance etc.

Motor Insurance

Any kind of insurance pertaining to the ownership, maintenance, or use of motor vehicle may be referred to, in general, as Automobile Insurance. It also refers to insurance on auto home, motor cycles, scooters, mobiles, buses, road building equipment, trailers, etc. Automobile Insurance required in the business of selling, repairing, servicing motor vehicles comes in the category.

Other Insurances

Personal Accident InsuranceA particular type of insurance which provides benefits/indemnity in case of losses to the person or physical well-being of an insured, individual arising out of accident.

Direct Losses

Accidental loss of life or death which results out of injuries sustained by the individual and accidental loss sight or eyes

Indirect Losses

The individual may be disabled for some time, either totally or partially. He could be confined in the hospital or bed-ridden at the house in which case he is unable to engage in his usual means of livelihood

Health Insurance

A type of insurance coverage that pays for medical and surgical expenses that are incurred by the insured. Health insurance can either reimbursed the insured for expenses incurred from illness or injury or pay the care provider directly. Often included in employer benefit packages as a means of enticing quality employees.