Life Insurance Guide
Published: February 16, 2021. Last updated: June 22, 2022
- Life Insurance in the Philippines is a very useful option.
- You can consider several options for buying life insurance and choose the best one.
- And if you don’t have enough money to buy an insurance policy, you can take out a loan from Digido.
- Every Filipino has access to Digido loan up to 25,000 pesos for up to 1 month.
“Life insurance is an unwanted expense” is a deep-rooted popular notion in many developing countries, including the Philippines. People in these countries live on their income without any proper government support, as in the USA or the UK.
So they try to reduce their out-of-pocket expenses to save money for the future. Naturally, setting aside a portion of their savings in the form of life insurance premiums won’t be appealing for the majority.
However, life is unpredictable. People can be sick, bedridden, or even die quite unexpectedly. The medical expenses alone can make your savings evaporate in the thin air, leaving nothing much for your dependent family.
Insuring your life against all these odds is the only practical way to secure the well-being of your family, even in your absence.
Even though life insurance cannot reduce the grief, vacuum, or void a death creates, it can significantly reduce the family’s financial dilemma.
What is Life Insurance?
Life insurance is a financial product offered by insurance companies. In a basic level, life insurance works as follows:
A customer gets into an agreement with the company to pay a regular premium for a certain period. In the event of the customer’s unfortunate death, the company has to pay a certain amount as the death benefit to the customer’s heirs as specified in the life insurance policy conditions.
Each company will have several schemes with various features. It helps people choose the appropriate plan as per their requirements and financial status.
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Types of Life Insurance in the Philippines
There are primarily four categories of life insurances available in the Philippines.
A. Term of Life Insurance:
It is the pure and simplest form of life insurance. The policy assures you a sum in the event of death during the specified period of the insurance coverage.
The significant advantage is that the premium amounts are much lower than those of any other insurance scheme. On the flip side, if the insured outlives the policy term, he or she won’t get any returns of the paid premiums or continuation of the Life Insurance Benefits.
Endowment plans are a mix of insurance and savings. In case of death during the policy period, you get the death benefits similar to the term insurances.
If you outlive the policy term, the company will pay you a lump sum amount as a survival benefit. Usually, the survival benefit will be an accumulated fund of your paid premiums and interest. It can act as savings for your children’s education or retirement planning.
The premium amount is often much higher, and the coverage ceases on the maturity of the policy.
C. Whole Life
Here you get life insurance coverage for your entire life, typically till your 100th birthday, with a saving feature. A particular portion of the premium will go towards the insurance. The remaining will be set aside for investment and is known as cash value.
The customer can withdraw the cash value whenever in need subject to the policy condition. After the insured’s death, the company will transfer the death benefits and the remaining cash value to the benefactors.
The noticeable drawback of whole life insurance schemes is the higher premiums as well as some difficulties in understanding policy conditions.
D. Variable Universal Life Insurance (VUL)
In this type of insurance, the company invests the bulk of the premium in one or two investment options, usually mutual funds or equities. The customer can decide the allocation. The insurance company deducts a certain amount to cover the mortality and administrative charges.
The primary advantage is that it works as an insurance and an investment at the same time. There is no maturity date, and you can withdraw your funds when you need them.
There is no guarantee about the death benefits. If the fund performance is low, you don’t have much left. Also, the allocation and fund management fees are high.
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List of Life Insurance Companies in the Philippines
The insurance segment in the Philippines is showing impressive growth for the last few years. Still, it is alarming that nearly 50% of Filipinos are still not covered by any life insurance.
Some of the best life insurance companies that operate in the Philippines are the following:
1. Manulife Life Philippines
The Manufacturers Life Insurance Company Philippines, Inc. or more popularly known as Manulife, is one of the Philippines’ largest insurance companies with a customer base of 30 million.
Manulife offers a wide range of comprehensive insurance plans and efficiently managed funds to invest and secure your life. Regular premium payments will earn you loyalty points at the end of every 5 years.
2. AXA Life Insurance
Philippine AXA Life Insurance, Corp. is one of the largest and fastest-growing insurance companies in the country.
With a fleet of more than 8,000 professionals working from their branches and partner banks such as Metrobank and PSBank, AXA Philippines enjoys a substantial presence throughout the country.
Insurance products such as Life BasiX and BasiX Plus outshine the competitors with their high returns and riders feature enhancements.
3. Sun Life Insurance
Founded in 1895, Sun Life Of Canada is the first and longest-standing life insurer in the Philippines with a legacy of 125 years.
It offers comprehensive insurance coverage schemes with a variety of features. For instance, Sun Cancer Care, a specialized health insurance plan, provides cash benefits upon a cancer diagnosis to ensure timely treatment and recovery.
4. Philam Life Insurance
The Philippine American Life and General Insurance Company (also commonly known by its trade name, Philam Life) has a 100% focus on its operations in the ASIA Pacific region.
It makes them true champions in devising innovative solutions with a core emphasis on Filipino culture, lifestyle, spending habits, and insurance requirements.
5. FWD Life Insurance
FWD Life Insurance Corporation offers a slew of insurance products ranging from life insurance, health insurance, and investment options. They leverage technology to empower the customer to manage their policies entirely paperless through the Tapp mobile app.
Some of their unique insurance plan features are the financial protection offered against terrorist acts and investment options in the US dollar denomination.
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6. Pru Life Insurance
“Insurance with Investment” is the tagline of life insurance products from Pru Life Insurance Corp. The innovative insurance schemes for family protection, medium to long-term goals, and wealth accumulation help one achieve his or her financial goals without compromising the life insurance coverage.
PRUAccess, the complete user portal, makes policy management easier and comfortable for the user.
7. BDO Life Insurance
Originally called Generali Pilipinas Holding Co. Inc., BDO Unibank Inc. acquired the company in 2016 and is currently operating as a subsidiary of BDO Unibank, Inc.
Be it a whole life policy or fund accumulation for your kid’s education expenses or group insurance for your employees, BDO life has plans for all.
8. Prudential Life Insurance
Philippine Prudential Life Insurance Company, Inc. (Philippine Prudential) is a 100% Filipino-owned company with a sales force of over 1,200 and sales offices in key cities nationwide.
As a wholly Filipino owned company, it has some exceptional insurance products that address the dire necessities of Pinoys. For instance, the Life Accident and Dismemberment Burial Benefit (LABB) is an excellent relief for low-income families to meet the urgent financial requirement for the burial of a deceased one.
9. Fortune Life Insurances
Fortune Life Insurance Co., Inc. offers a wide range of insurance products well crafted for the Philippines market, such as individual insurance, worksite insurance, group insurance, and migrant workers insurance.
Their deep understanding of Filipino requirements and focus on delivering innovative solutions make them one of the most popular insurance providers across the Philippines.
10. BPI Life Insurance
BPI-Philam enjoys the reputation of an accessible, affordable, and personalized insurance provider through its vast network of branches and customer-centric approaches.
Their innovative plans fulfill the conventional notions of protection and ensure high returns for the customer. For instance, the DOLLAR PROTECT PLUS insurance scheme allows the customer to invest in the global market and tap its enormous potential effortlessly.
Benefits of Life Insurance
The primary benefit of life insurance is your assurance about your family’s well-being even in the unfortunate event of your absence.
A properly planned insurance will give your spouse the necessary financial support to settle the hospital bills, clear the debts, and meet your children’s educational expenses.
How do I Avail Life Insurance?
Life insurance is a long-term commitment. Hence, choosing the right company is quite essential. The most crucial elements to consider while selecting a company are:
- License to operate in the Philippines;
- Company background;
- Financial performance.
You can rely on information available at the Insurance Commission for the majority of cases. Also, check for the company reviews on various online and offline channels.
Once you have identified the right company, check whether their plans suit your requirements. Contact the financial advisor or website for required information and quotes. Then you need to compare the life insurance quotes given by agents and zero in the appropriate one.
After that, you can purchase the insurance either through designated agents/branches or online.
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How much is Life Insurance in the Philippines?
Life insurance costs heavily depending on your age, health conditions, amount, period, lifestyle, and other features. Suppose you are a smoker or suffering from lifestyle diseases such as diabetes. In that case, the premium will be on the higher end.
The majority of the websites have an online premium calculator that you can use to identify the right plan within your affordable premium.
Where to Find Money for Life Insurance?
Any life insurance and its protection exists as long as you make the premium payments on time. If you miss them, the policy will be void, and it won’t give you any protection.
When an unforeseen financial emergency strikes, people tend to put life insurance premium payment on the back burner.
Lending agencies like Digido can be a great help during such times. The company with a fully automated system for loan disbursal is open around the clock on all days. So you can use the Digido portal for availing a personal loan without bothering about the office hours.
To get a personal loan of up to PHP 25,000, you only need to be a Filipino citizen of 21 years of age or older with a working mobile connection.
The loan approval happens in an unbiased way, and it takes only a few minutes. Digido has a loan approval rate of more than 95%, and the loan disbursal happens within a couple of hours.
In short, you can stop your temporary financial troubles from pausing your protection by efficient utilization of services of state-licensed, legit lender Digido.
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