Allianz Taiwan Life Insurance Co (安聯人壽), the nation’s fifth--largest insurance company by market share, aims to maintain its leadership in sales of investment-linked insurance products this year, a top executive said on Saturday.
The German firm, which relies on partnerships with banks to sell products, saw its gross written premium expanding 10.18 percent year-on-year to nearly NT$91 billion (US$3.09 billion) last year, from NT$82.59 billion a year -earlier, -company president and chief executive Chris James said.
First-year premiums totaled NT$53.3 billion last year with sales of unit-linked products taking up a 34 percent market share, topping all rivals, James told a media briefing.
“We aim to maintain the leading position this year by providing customers with products that can yield sustainable profits,” he said.
In terms of overall performance, Allianz Taiwan has a market share of 4.6 percent after Cathay Life Insurance Co (國泰人壽), Fubon Life Insurance Co (富邦人壽), Taiwan Life Insurance Co (台灣人壽) and China Life Insurance Co (中國人壽).
The upturn in investor confidence and low interest rates bodes well for the unit-linked insurance market because the flexible investment platform allows policyholders to invest in a wide range of fund types, James said.
“The interest rates are likely to stay depressed this year despite the upward revaluation of the New Taiwan dollar,” which is favorable for sales of unit-linked insurance products, he said.
However, James expects the market to become increasingly competitive with product structuring growing more innovative, new functions being introduced and pressure to keep charges down sharpening.
To stay competitive, Allianz Taiwan will focus on the impact of the fast-aging population and underscore the benefits of effective financial planning for retirement and old age, James said.
“With people in Taiwan living longer and having fewer children, the typical Taiwanese family is gradually evolving toward a 4-2-1 inverted pyramid structure — where two young people are supporting four elderly parents and one child,” he said.
The trend, coupled with the aging of the population, is driving up medical expanse and living costs and making ensuring a comfortable retirement an important goal for many, he said.
“Unit-linked insurance can help plug gaps in the social security system because of their combined saving and protection functions,” he said.
Bill Chang (張士傑), risk management and insurance professor at National Chengchi University, said as long as interest rates remain low, protection insurance products will appear less attractive because of their higher costs.
He expects life insurers to promote shorter term policies amid the easy monetary environment.