Malayan Insurance on the value of stability amid challenging global climate

Amid challenging global market climate, leading non-life insurance company Malayan Insurance Co. Inc. (MICO) remains strong and stable. 

This assurance was issued by Malayan Insurance President and CEO Paolo Y. Abaya, who outlined the challenges that the insurance industry is dealing with in light of global events and economic conditions.

One of these challenges is pricing amidst rising inflation,  ongoing geo-political issues and the Philippines’ vulnerability to natural disasters which have contributed to increasing non-life insurance premiums as well as reinsurance rates.

“With global reinsurance pricing continuing to rise, insurance is getting more expensive and is affecting our property insurance business” Abaya states.

PIRA (Philippine Insurers and Reinsurers Association) has earlier explained the reason behind the increased reinsurance rates.

“Reinsurers, like insurers, are subject to the same perils such as fire, natural calamities, and as recently demonstrated, from pandemics. Reinsurers (and insurers) are also not immune to inflation which impacts their operational costs and efficiencies. Simply put, the more losses they sustain, the higher premiums they will charge in the following period of cover. Just like any business they (and insurers also) need to recover from their losses,” PIRA chairperson Eden R. Tesoro explains.

It is because of these challenges that many non-life insurance players are strengthening the retail aspect of the business making the scene more competitive.

Abaya says there should be a sustainable way to deal with the increased rates of reinsurance, which primarily affects large corporate accounts. This is why Malayan has been expanding its retail business which is less reliant on reinsurance. Worth noting is how Malayan’s overall earnings on motor insurance products, one of Malayan’s core retail lines, and investment income are seen as major contributors to the company’s strong performance.

“We want to grow the other areas of our business like the motor, even as we try to manage our property  portfolio. As mentioned earlier, the reinsurance cost has become so expensive that it takes a huge balancing act to charge risk-adequate but competitive premium rates and keep the property  business sustainable,” he says.

Under Abaya’s helm, Malayan Insurance continues to soar and keep its legacy of being on top of the non-life category. Malayan also recently retained its B++ Financial Strength rating and received long-term issuer credit rating of “bbb” (good) from international credit rating agency AM Best, a global authority for rating insurance companies. These ratings reflect the company’s stability of financial position, business profile, operating performance and enterprise risk management among others. The company has been consistently receiving favorable ratings for the past eight years. 

Apart from its assets and net worth that are among the highest in the industry, Malayan Insurance takes pride in providing quality service to its clients.

“Malayan is committed to being a  reliable company in paying valid claims on time—which is the key consideration of policyholders in choosing an insurance provider. It strives to respond to the evolving needs and preferences of the clients. Aside from providing the comprehensive and properly designed insurance policies, Malayan also focuses on providing better customer experience at any point of a policyholder's journey,” he adds. 

True to its customer commitment, Malayan continues to work on best practices to improve accessibility and reliability by launching the following efforts last year: the MICA Portal, an assistive technology developed to enable agents in generating insurance quotations for clients; an improved Malayan website to provide ease of transaction; and a Customer Experience (CX) Unit to establish best customer experience practices.

This year, Malayan Insurance is also set to launch and announce a number of new, innovative products to serve clients’ evolving needs.

Malayan Insurance’s 94 years in the insurance business serves as a testament to its commitment to provide protection in terms of quality insurance products and timely payment of claims to the insuring public. The year 2023 also marked the 54th year that Malayan has been the biggest Philippine non-life insurance company in terms of gross premiums written (GPW), based on the Insurance Commission (IC) reports. 

The impressive track record of Malayan, backed by its conglomerate Yuchengco Group of Companies, keeps Malayan’s operations as strong as ever  even in the face of the challenging environment.

For more information on Malayan Insurance products and offerings, visit www.malayan.com