[av_one_full first min_height=” vertical_alignment=” space=” custom_margin=” margin=’0px’ padding=’0px’ border=” border_color=” radius=’0px’ background_color=” src=” background_position=’top left’ background_repeat=’no-repeat’ animation=”]
[av_heading heading=’AN INDEPENDENT VIEW ‘ tag=’h3′ style=’blockquote modern-quote’ size=’30’ subheading_active=’subheading_below’ subheading_size=’15’ padding=’10’ color=” custom_font=” av-medium-font-size-title=” av-small-font-size-title=” av-mini-font-size-title=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” admin_preview_bg=”]
BY NEIL HONEYMAN
[/av_heading]
[av_textblock size=” font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” admin_preview_bg=”]
Tuesday, November 7, 2017
[/av_textblock]
[av_textblock size=’18’ font_color=” color=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” admin_preview_bg=”]
THERE are those who tell us that the title is an obvious oxymoron. How unkind! We do, however, try to accentuate the positive whenever possible.
The SunLife of Canada (Philippines), Inc. Legal Team was recognized in this year’s Philippine Law Awards as the Insurance In-House Team of the Year. The citation reads, in part, that SunLife Legal made outstanding contributions not just within the company, but also within the life insurance and asset management industries.
Impressive. This also suggests that some of the best practices adopted by SunLife should be implemented throughout the insurance sector. The Insurance Commission, which has difficulty in enforcing necessary discipline within insurance companies, should empower itself to cause these companies to specify and implement a code of conduct which would enable them to achieve a higher standard of probity than that which exists at present.
Philippine Law Awards also mentioned that Sun Life Legal advises a cross-functional team in dealing with and resolving issues relating to e-commerce, data privacy, anti-money laundering, and information security. Conflict resolution is vital in helping the insurance sector attain the market size and respect that its importance warrants.
The splendid Philippine institution of mediation would be helpful. Much lack of probity within the insurance industry is due to inaccurate internal communications which would be identified and addressed by the mediation process.
There have been those, such as former Insurance Commissioner Emmanuel F. Dooc, and former AIA (PhilamLife’s parent company) CEO Mark Tucker who opine that the reason for the insurance sector’s small size in the Philippines is because the Filipino is financially illiterate. I have always regarded this assertion to be erroneous. Ratings Agency Standard and Poor has defined financial literacy to include an appreciation of the risk factors involved in investment. Dealing with insurance companies in the Philippines has involved the investor with far too much risk due to the lack of probity within the industry. The consequential lack of market size is much more due to operational risk than it has to do with alleged financial illiteracy.
I was saddened to read in Sunday’s Panay News that a seaman who invested P300,000 in CAP to help support his retirement, has lost everything. Government entities need to be more vigorous in holding accountable those who misuse investors’ money. A few years ago, some CAP victims filed a case at Makati RTC. No satisfaction was obtained. An ineffective justice system does not help the industry.
Fortunately, the replacements to Dooc and Tucker, namely Dennis B. Funa (Insurance Commissioner) and Mr. Ng (AIA CEO) have not spoken of financial illiteracy. Quite right! Now is the time for these executives to improve market size, in part by dealing with the manifest improbity that exists within the insurance sector.
Attaining probity is not only the right thing to do but it makes sound business sense. SunLife has increased its market share whereas other insurance companies, whose efforts to achieve probity lack the necessary vigor, are corresponding losers.
Would it be possible for the Insurance Commission to impose a rigorous code of conduct on the whole industry? This would enable the insurance sector to be a safer place for investors./PN
[/av_textblock]
[/av_one_full]
