Among the dead were parents and breadwinners who could not have possibly imagined a more horrible fate. It was a tragedy that many families have had to endure. It was heart-breaking and also financially-taxing. Those who survived faced daunting struggles ahead both emotionally and financially especially children.
In moments such as this, we tend to become more appreciative of the value of life. We feel how precious life really is and how uncertain what the future holds. We tend to view life differently and reassess how we live.
Why Life Insurance is EssentialThese events are exactly what life insurance policies are meant to alleviate. As valuable as life is, it should be insured so that dependents would not have to suffer the financial consequences of losing a provider. It will not be able to replace the provider, but it will help.
Being a developing country, the Philippines has a population that is slowly opening up to life insurance. As of 2013, life insurance penetration rate stood at 1.78% of the population. This is relatively low but it’s increasing.
After the fight with poverty is won by any Filipino family, the next logical step is to establish the financial foundation which includes “protection”.
Many people view life insurance as a waste of money or a worthless expense. This view, however, is not helped by two facts:
- Death is certain, only the time of death is not
- The uncertainty in the timing means not having a life insurance coverage is even more risky for dependents
Financial DisciplineYou see, a sound financial portfolio for any family should comprise of emergency funds, savings, investments, cash and insurance. That’s because as a working provider, you (if you are a breadwinner) or your parents (if you are a dependent) have earnings potential that can vanish in an instant.
Life insurance policies are one effective way of mitigating that risk to the people who depend on the breadwinner.
As more and more Filipinos are made aware of what life insurance policies are all about, they get to know that there are many insurance companies that offer different or similar life insurance products.
Knowing Who You're Dealing WithLike any wise consumer, we will be helped to know which among them are trustworthy and financially sound. Life insurance policies can have terms that span years or even decades. Therefore, it’s worth knowing that the company will be able to deliver in that long duration.
As a starting point, we can compare all the insurance companies and see which among them is ranked among the top 10. This is exactly what the Insurance Commission is doing every year for us.
They have four (4) metrics by which these ranking are made.
- According to Assets
- According to Net Income
- According to Net Worth
- According to Premium Income
I’d say everyone of these metrics are important. While performance is usually associated with Premium Income, I would place more weight on Net Worth if I were to choose which companies to avail life insurance policies from. That is because the higher the net worth, the more is the company financially capable to deliver on its financial obligations particularly to its customers.
The Top 10 Life Insurance CompaniesAlthough I have to admit, it is not the only consideration. Nonetheless, I have the list below of the top 10 life insurance companies in the Philippines according to net worth.
- Philam Life
- Insular Life
- Sun Life
- Manufacturers Life
- United Coconut Planters Life
- BPI-Philam (Ayala Life)
- Sun Life Grepa Financial
- Pru Life U.K.
- Philippine Axa Life
- Generali Pilipinas Life
*Photo Credit: Jun Acullador (Creative Commons)