Combined insurance, investment products ‘gaining ground in Cebu’

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Monday, March 24, 2014


PRODUCTS that integrate insurance and investment, or unit-linked products (ULP), are fueling growth in the country’s insurance business, an executive said.

Pru Life UK senior vice president and chief marketing officer Belle Tiongco said in an interview last Saturday that ULP products are now preferred more than traditional life insurance.

Under a ULP plan, part of the premium paid will be used to provide insurance cover to the policy-holder, while the remaining portion is invested in various financial platforms.

Tiongco said Pru Life UK was the first life insurance company in the Philippines to introduce ULP in the local market in 2002. She said 95 percent of Pru Life UK’s products is concentrated in ULP.

A person who has availed of a ULP plan can choose to invest in equity funds or stocks and fixed-income funds.

Donald Kanak, Prudential Corp. Asia chairman, said the Philippines is one of the top markets for investment-linked products together with Hong Kong, Japan, South Korea, Indonesia and Malaysia.

Tiongco said those who are interested to avail themselves of ULP plans in Pru Life UK can start at around P1,000 a month.

While banks also offer investment products, Tiongco said availing of ULP products in life insurance companies is a better option since one can get life insurance protection and at the same time build an investment portfolio.

Another advantage of a ULP, she said, is that policy-holders can more easily see how their investments are faring, unlike traditional insurance products where the person is often left clueless as to where the money was invested.

Premiums for ULP products vary, and policy-makers may make a one-time payment or spread the payments over a specified period.

Cebu, she said, is one of Pru Life UK’s biggest markets in the country, especially for ULP products. Tiongco did not disclose figures, but added that a number of agents in Cebu have become part of the Million-Dollar Round Table (MDRT), an international, independent association of life insurance and financial services professionals. Those who have been part of it are agents who obtained the biggest commissions. Currently, Pru Life UK in Cebu has 700 agents.

In a related development, some 100 employee-volunteers of Prudential from 12 countries will head to Sta. Fe in Bantayan Island to build 135 houses in line with the post-Yolanda rebuilding efforts of the Prudence Foundation, the charitable arm of Prudential Corp. Asia.

Prudential Corp. Asia is the Hong Kong-based regional headquarters of Prudential PLC, which is based in the UK.

Prudence Foundation Executive Director Marc Fancy said the organization has allotted US$2 million to support relief and long-term recovery efforts in areas affected by typhoon Yolanda. A portion will be for the residents of Barangay Maricaban in Sta. Fe town.

It has partnered with international non-government organization Habitat for Humanity and the local government unit of Santa Fe for the project.

In addition, Fancy said the foundation will also provide sustainable livelihood in Santa Fe by donating 183 motorized boats with fishing nets and 140 pedicabs or cycle rickshaws.

The foundation is also initiating programs on disaster-preparedness, education, and children in the Philippines and in other countries in partnership with Save the Children and Plan International.

Published in the Sun.Star Cebu newspaper on March 25, 2014.

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