FWD LIFE Insurance Corp. (FWD Philippines) expects insurance demand to slow down as high market volatility and inflation hit sectors most exposed to rising prices.
“If I look at the real activity, I would guarantee that the mass segment is going to be affected. Things are very slow, and it’s going to be worse for the next, say, six months or half a year. We are already seeing signs with people shying from insurance,” FWD Philippines President and Chief Executive Officer Lau Soon Liang told reporters last week.
“Actually, I’m quite worried about that because this is always a negative spiral.”
Demand from lower-income segments has weakened as rising costs are leading consumers to prioritize their day-to-day expenses over financial protection products, he said.
“Generally speaking, what we really feel and observe in the market, the lower segment is affected… We see that segment will slow down quite a bit,” Mr. Lau said.
He added that small and medium enterprises are also being pressured, with some small businesses withdrawing from their policies for their immediate liquidity needs and to cope with high oil prices, particularly in the second quarter.
“It’s actually the withdrawal situation. I think it has kind of slowed down or moderated, in the sense that the big withdrawals are actually more coming from the businesses. They withdraw for their own benefit. But even if they withdraw, we still advise them to keep to a certain level so that they’re still protected. So they withdraw what they can withdraw while keeping their policy healthy,” Mr. Lau said.
Still, the company sees growth opportunities in the middle-income segment despite the weak demand seen earlier in the year.
“As an insurance company, our pitch is always to tell them that this is exactly the period you should not shy away because if the market comes down and anything happens to you, you don’t even get protected,” he said.
“We actually try to focus on the segment. We also try to say, yes, you cannot buy this amount, let’s go to the lower amount that you can.”
FWD Philippines is also seeing increased demand for traditional products amid the ongoing market volatility. Mr. Lau said their first traditional product FutureSure, which launched earlier this year, has seen strong traction and performance, with more than 40% of policy owners being repeat customers.
He said the insurer is planning to launch a 10-year protection guarantee product this month.
Mr. Lau said they also target to expand their market share in areas outside Luzon, as only 25% of their business currently comes from the Visayas and Mindanao, to help maintain their new business growth.
“It will take quite a while for us to actually penetrate. I would say that we still focus on that. I think we are being constrained by the structure that we have.”
For next year, Mr. Lau said they hope to expand in Cebu before reaching other cities, with its bancassurance partnership with Security Bank Corp. expected to help in raising awareness about the insurer.
“If you ask me where I want to focus on to actually expand, next year, I will focus on Cebu. That is the first step. Once I am in Cebu, it is easier for me to move to Davao. It will take a while,” he said.
FWD Philippines booked a premium income of P52.47 billion in 2025, latest Insurance Commission data showed, while its net income was at P1.33 billion.
At end-June, it led the life insurance industry in new business annual premium equivalent with P5.26 billion, up 23.5% year on year and for a market share of 12.2%. — Aaron Michael C. Sy