SURENDRA M. MENON Chief Executive Officer

BPI-Philam Life Assurance Corp.

With the country’s economy moving towards a strategic growth and more Filipinos joining the upwardly mobile middle class, the insurance industry is not far behind.

Surendra M. Menon, a true-blue insurance man with an actuarial background, is here to secure BPI-Philam’s space in this industry and keep abreast with competition. He may be a businessman first and foremost, but to him insurance has a moral purpose that is not really all for profit shooting, but seeking to protect a wider base of the population.

BPI-Philam

BPI-Philam was formed in 2009 by a partnership between two financial giants in the Philippines – the Bank of the Philippine Islands (BPI) and the Philippine American Life and General Insurance Company (Philam Life)/AIA.

It is the number one Bancassurance company in the country and currently ranks third in the life insurance industry based on total premium income.

BPI-Philam envisions to make insurance accessible and personalized for every Filipino. It aims to make insurance easy to get and easy to have by having a Bancassurance Sales Executive (BSE) in every BPI branch nationwide. Currently, it has over 900 BSEs around the country, excluding the direct supervisors.

BPI-Philam is always changing and improving to develop products based on what the customers need and how they can help them protect themselves, their loved ones, and their future.

It is keen on continuous reinvention to keep up with and rise against challenges in a constantly changing environment, to be able to provide the best service and solutions to its customers.

BPI-Philam understands that every Filipino is at a different life stage and has different lifestyles.

As such, its products are based on what key moment they are in – whether they’re starting their business, getting married, starting a family, working abroad or planning for retirement.

Menon said BPI-Philam makes sure that its products are based on actual needs and will provide real value to them.

It aspires to change the way it promotes insurance by providing quality, affordable, and appropriate services and solutions anywhere whether offline or online.

Distribution

BPI, the country’s leading banking institution, is the main distribution outlet of Philam although two years ago they’ve been distributed by Citibank, as well. Despite being carried by both, BPI still accounts for more than 90 percent of total. It has close to a thousand-people assigned in BPI branches across the country.

This 70-year-old-company is the youngest among its peers, but is now the third largest in terms of premium income.

“We are the youngest in the block and our sales force have been built and trained from general sales insurance to conventional products,” says Menon.

Some of its products are bundled with BPI like Pamana but there are various methods of distribution as the insurance firm joined the social media bandwagon to reach a wider audience for their products.

It has also tapped other outlets such as the Tambunting Pawnshops to distribute insurance products catering largely to micro and small enterprises.

“We have various socio-economic social distribution structure all the way to private banking and corporate health life and to the side of the masses, it is a full range of products,” he adds. ‘’

Growth According to Menon, the insurance industry will grow according to the growth of the economy.

“When the middle income grows, insurance follows. The Philippines is now a middle-income economy,” he adds, noting the huge traffic with more Filipinos now being able to afford to buy their own vehicles.

Also driving the economy is the young demographics with 23 as the average age of Filipinos. He cited the high population growth in the Philippines at 2.5 to 2.8 percent, which means that the Philippines has a very high net reproduction rate compared with other Asian countries with Japan at only 1.1, Singapore at 1.4 and Malaysia at 1.7.

“These countries require manpower, making Filipinos more in demand for work opportunities abroad,” he adds, noting that the US and Europe are also short of workers. The huge number of overseas Filipino workers has been fueling the domestic economy.

Another advantage of the Philippines is its English language capability.

The competition of the Philippines in the region should be Indonesia in terms of the young demographics, but the latter does not speak English, according to Menon.

“I see this continuing for some time with more young people coming into the labor force. The only competition in the future could be China, which has already lifted its One-Child policy, but that is quite late already and may impact in the next 30 years yet,” he adds.

“We see a lot of bright prospects going for the Philippines because of the growing economy and demographic points. These are the main reasons we are in the growth trajectory.”

The English-speaking young population has also attracted the BPO industry although India is bigger mainly because it has 10 times more people than the Philippines, but the cost of living and manpower in India is more expensive than the Philippines.

“India can supply but the Philippines has better competitive advantage,” he adds.

All these factors will redound to the growth in the insurance sector. In the case of Philam, Menon said, it has posted good growth.

“It is good,” says Menon refusing to give the exact growth figure of the company.

The industry, however, posted a 3 percent decline in terms of total premium. Despite that Philam managed to post positive growth making it the third in the industry’s ranking.

But Menon cited that the correct measure of growth in this industry is not really in terms of premiums paid or ranking among players, but on the number of people insured. He noted a shift to more single premiums since 2010. In 2014, the estimate was that 40 percent was single premium.

“We see this as not just a trend but a function of population and economy,” he adds.

The government’s thrust towards more inclusiveness also augurs well for the need for more people who should get insured. As more people move up into the middle-income class, there will be more people who can afford to get insurance policies.

“We are making sure that we have facilities across the country to ensure we are accessible and our products, affordable. So, we look at everybody and we also follow the BPO footprint,” he adds.

He further explained that its focus is not on bringing its position to the top, but serving the population.

“We look at people’s needs and how we can serve them in different ways because some want to go direct to our branches, some through phones and others are via digital. We make sure that we are present wherever the customer wants us, so we are present on all channels,” he adds.

In terms of products, he said, the key is affordability. This leads them to design products for each category of the population, thus they have as low as R5 for micro enterprises.

“We do have more micro insurance products but these require us to be a bit creative on our distribution because we have to look at models to make it easy for customers,” he adds. Its partnership with Tambunting is one channel.

The micro insurance may not be huge in terms of premium but it has a wider coverage. And that is one of the missions of BPI-Philam. At this point, the micro insurance is still very small in terms of premium and still lower coverage, but they are going there.

“BPI-Philam though is a little bit different because it is distinct in terms of affordability and accessibility. We want to serve as many people as possible because our product is fundamental for everyone. That is basically our objective, not profit all the time, but we are looking at products that would benefit our clients,” he adds.

“We are not worried about being number one or two in the industry as long as we have the number of people to serve and we contribute to the economy,” says Menon.

Their expansion is also being aided by the fast adoption of technology, which equalizes everyone.

In the medium term, Menon said, the prospects are very good because as partner of BPI they are very focused. Filipinos are the ones running the company with Menon as the only expatriate, making him one of the most seniors in the organization. The oldest though is in the 50s and the next oldest is just in his early 40s.

To sustain growth in its operation, Menon said they also need to continuously improve its good customer relationship.

Vitality program

Menon cannot over emphasize the need for insurance as protection for everyone.

“Insurance protection is critical for everyone,” stresses Menon noting that insurance cover should be embedded in all individuals.

Only 4 percent of employees have group insurance policies or company insurance and there is also very little coverage for social security. Thus, the need for individual insurance policy to make up for this insufficiency. Insurance is there to answer for health and medical needs.

To further widen its product portfolio and services, BPI-Philam is tying up its offers with preventive measures by giving individuals incentives to stay healthy and prevent illness.

This means that BPI-Philam is not just selling insurance products but it is going into the health and fitness arena to ensure the vitality of people and to improve life expectancy.

Philam Vitality is the science-backed wellness program that works with you to make real change to your health. It has three easy steps: Know Your Health, Improve Your Health, and Enjoy the Rewards.

The idea is to get the knowledge, tools and motivation you need to do well on your journey towards healthy living so that you get more out of life and enjoy the rewards, while being protected against risk.

This Philam vitality is focused on health where the insured is provided with activities that comes with an electronic gadget that should monitor his health. If the insured has followed the health regimen like his prescribed exercise activity needed and improved his health as result, he will be rewarded for that.

“So, we are going into the health and fitness products for our clients to stay healthy,” says Menon.

The rewards come in the form of discounts in some health and fitness facilities and other forms of incentives that promote healthy living.

So, when a person wakes up in the morning the first thing he does is check on his health monitor. With that he will be able to control his diet, get enough rest and take care of his overall health.

The actuarian

Menon, an actuarian with a degree in natural science, first rendered a national service to the Singapore government before he entered the university. He once served as a police inspector because he was a senior police officer in college.

“I investigated crimes at 18 up to 21 years of age,” says Menon.

While doing actuarian work, Menon still continued his military service from police to civil defense where handled disaster rescue operations at times. He then proceeded to Indonesia where he ran an insurance company and then the AIA, the parent bank of Philam.

He served a deputy resident director for AIA Indonesia while holding regional jobs. In 2014, he was assigned with BPIPhilam.

“It is good to be here, you have lots of intelligent people,” says Menon, referring to the Filipino talent. In fact, he cited the BPI-Philam as having the youngest talents.

When Menon was in Indonesia in 2013, he saw this similar demographic window Indonesia was going into. He sees 15 years from then for these people to help drive income in the future.

Fulfillment

Menon is a great believer in investing in insurance policies. The first insurance he bought has helped his parents. What followed was a series of insurance policies. When he was promoted, he got another one and when he got married and had enough money he bought another policy.

Then he got an education cover for his child, a house insurance and a couple more. The latest policy that he took was a new product that covers critical illnesses. He also got travel insurance from a non-life company because he travels a lot. When he retires, Menon has an amazing coverage of at least $1.5 million.

According to Menon, the insurance industry provides very tangible fulfillment, and benefits and most of these happen during the most difficult times in a life of an individual.

He has witnessed and personally come to some of the beneficiaries during their bereavement to hand them insurance benefits left by a loved one.

“When we give money to a widow whose husband died in an accident, that is a kind of fulfillment on my part,” says Menon. The money given to the surviving relatives are far higher than the premium paid. It may not bring back the life of a loved one, but it can help ease the financial burden during times of difficulty.

“It makes a lot of difference,” he adds.

In the Philippines, Menon observes, when a person dies, the first thing the banks do is close all the bank accounts of the dead, stopping the sources of cash flow. The only resource should be the insurance policy. In the case of BPIPhilam, the surviving spouse can claim the money within five days, sometimes the money can be released within a day or two as long as documents are ready.

Like most Singaporeans, Menon is very direct and quite frank when dealing with people. He is straightforward, but he also delegates some responsibilities and lets his people run their own show.

With 900 BES, the bancassurance sees the need to grow its personnel complement to service its clients. In the insurance industry, Menon noted that people come and go. (BCM)

“It is not so much on keeping people, because not everybody can sell, but sometimes this is also their stepping stone. Some would leave to take up jobs of their primary training, but some also come back to us,” he adds.

In Indonesia where he worked for 20 years, he noticed that what is more important is not what you said but what you read between the lines.

“To some extent that is the same here in the Philippines, the body language is more important,” adds Menon, who has been acclimatized the Filipino ways since he is married to a Filipina with whom he is blessed with a daughter.

Most of all, Menon enjoys his stay in the country because he is surrounded by family and relatives.

“I am enjoying my stay here with my wife’s relatives,” says Menon, who cannot be mistaken for being a Singaporean given his easy smile.

He loves the Filipino family life where everyone is almost always a relative.

“Family life here is half the town, we are always cousins,” he observes.