Although most Filipinos view it as a liability or something unnecessary, there's no denying that life insurance can be a big help, especially to your loved ones. If you need more explanation, you can read on to learn more about what it actually is, how it could benefit you, and your available choices of Philippine insurance companies.
What is life insurance, and how does it work?
Life insurance is an agreement between an insurance company and a policy owner. Having life insurance ensures that your loved ones or beneficiaries receive a monetary benefit when you, the insured, die.
There are different insurance policies, so you can choose the one that works best for you and your situation. Some insurance policies even offer medical benefits to the insured in the event of a fatal accident.
The two basic types of life insurance are term insurance and permanent insurance. Basically, a term only covers you for a specified time period—usually 10-30 years of your life. Meanwhile, permanent means that it covers you until you die. More on this, permanent insurance has cash value, and with it, you can accumulate wealth and cash value to use during your lifetime.
In general, here are some terms you would encounter when talking about life insurance:
Insurer and the Insured
The insurers are companies that can provide life insurance, while the insured is the person whose life is insured.
Beneficiaries
These are ultimately the people who will benefit from your chosen service. This is usually a single person (a surviving spouse), or it can also be between people (usually divided in percentages).
Policy Length
This is simply the time period for which the insurer agrees to pay a death benefit. It can be for a specific term, or it can be permanent.
Cash Value
A term policy has no cash value; a permanent policy does. Cash value is a component that builds over time and can be cashed out or borrowed against.
Premium
Premium is the monthly or yearly payment to keep the policy in effect. While Premium income, simply put, is the combination of past and present business of the insurance company.
Premium Income
A good percentage of past business or renewal premiums means that the clients are happy with their service and therefore continue their partnership with the company. Premium Income ensures the quality an insurance company provides.
Importance and Benefits of Life Insurance
Overall, it is a good way to ensure your family has a source of funds in case of an unforeseen accident, illness, disability, or sudden death. Getting life insurance is ultimately for your family to pay for medical bills, mortgages, childcare, tuition, eliminate household debt, or preserve a family business.
It's essentially to help those you value in your life thrive even in the event that you do meet your untimely death. Plus, your beneficiary will be able to enjoy every bit of money you leave them since life insurance has a tax-free benefit.
Top Insurance Companies in the Philippines
The Insurance Commission is an agency that is under the Department of Finance and oversees life insurance providers and health maintenance organizations (HMOs) in the country. They have recently released a list of the top life insurance companies in the Philippines.
It is based on categories such as premium income, net income, New Business Annual Premium Equivalent (NBAPE), Total Assets, and Net Worth. On the basis of these categories, you can decide if the companies you choose are right for you. With that, here is a list of the top insurance companies you can check out.
Sun Life of Canada Philippines Inc.
Sun Life of Canada Philippines Inc. is one of the first and continues to be one of the giants when it comes to insurance providers in the country. Their financial products include insurance, wealth management, and asset management. They are also are leading in net income, with them being number one.
It's the insurance company in the Philippines known as the number one insurer of 2023 in terms of performance. The financial services they provide are for education, health protection, retirement, and so on.
Pru Life Insurance Corporation of UK
Pru Life Insurance Corporation is a company known for its life insurance plans, health and protection services, and affordable premiums. Pru Life also ranked first in the NBAPE category as well as being number four in net income.
Allianz PNB Life Insurance Inc.
Allianz PNB Life is one of those companies that will help you plan to protect your assets, grow your finances, take care of your health, or even help you prepare for your future.
BDO Life Assurance Company Inc
BDO Life Assurance Company, Inc. is one of those companies in the Philippines you can fully trust as it is a wholly-owned subsidiary of BDO Unibank, Inc. They will truly provide for the people.
FWD Life Insurance Corporation
FWD Life Insurance Corporation of the Philippines offers employee benefits, pensions, and financial planning services. Despite the fact that the company is relatively new in the industry, it managed to be ranked as one of the best.
The Philippine American Life and General Insurance Co., Inc.
AIA Philippines, formerly known as AIA Philam Life, is one of those companies that offers comprehensive insurance plans and investment products. They ranked second in net income with it being 4.52 billion. Services they provide are for protection, health and accident insurance, investment plans, and so on.
Insular Life Assurance Company
Insular Life Assurance Company Limited, or InLife, is the first and largest Filipino life insurance company in the country. They offer insurance products such as those for retirement and education plans, investment plans, health and disability protection plans, and accidents.
BPI AIA Life Assurance Corporation
BPI AIA is an alliance between BPI, or Bank of the Philippines Island, and AIA. This life assurance corporation offers a variety of financial products, such as investments, educational funds, retirement funds, personal accident insurance, and more.
This life assurance corporation is especially good considering that it is an alliance between two of the most trusted financial companies here in the Philippines. They will definitely do their utmost for the people.
Sun Life Grepa Financial, Inc.
The Yuchengco Group of Companies and Sun Life Financial Philippines jointly own Sun Life Grepa Financial Inc. They focus on financial literacy and providing financial protection products and services. They rank 8th in net income.
Will you choose what's right for you?
Based on the list above, have you thought about which life insurance companies you want to commit to yet? It's certainly a good investment that you may need to commit to for your loved ones and for your own peace of mind in case you do meet an untimely demise. You are essentially paying for a life insurance policy in order to protect them from future financial problems and ensure they don't incur too many expenses.
You should put your hard-earned money into the right hands and invest in the company that is most favorable for your situation. You need to find the policy that works best for the future you want for those close to you. In the end, you get to decide which life insurance company you can trust. Whichever company you choose will hopefully be the one that best fits you and your needs.
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