Private Employee Benefits PHILIPPINES 2013
Your Local Link to IGP in the Philippines: Insular Life Assurance Company, Ltd. Established on November 25, 1910, Insular Life Assurance Company, Ltd. has withstood world wars, several economic and political upheavals and natural calamities to become the first and largest Filipino life insurance company as well as one of the leading full service financial institutions in the Philippines. Through the years, Insular Life has built its reputation as a strong financial institution worthy of the people s trust. Given the leadership position in the Philippine insurance industry, Insular Life was a direct recipient of this very positive operating environment. Thus, 2012 became another windfall year for the Company. Insular Life s consolidated net income rose 10% to PHP3.2 billion from PHP2.9 billion in 2011. Consolidated revenues were 17 percent higher at PHP18.1 billion than PHP15.5 billion a year ago. Of the amount, net insurance revenues contributed PHP10.4 billion, 20 percent higher than 2011, and other operating revenues such as investment income, equity in net earnings, and net realized gains amounted to PHP7.6 billion. Total insurance benefits and operating expenses reached PHP14.6 billion, a 19 percent jump from PHP12.3 billion. Insular Life s consolidated assets rose 11 percent to PHP89.6 billion from PHP80.5 billion in 2011 while consolidated liabilities grew 11 percent to PHP66.5 billion from PHP59.8 billion. Insular Life s superior product line, which includes ordinary whole life endowment, limited-payment, college education and insurance plans, as well as pension plans, offers the best cost-benefit ratios among insurance plans in the market. It can also lay claim to innovations such as the introduction of group insurance, industrial life insurance and direct marketing for life insurance in the Philippines. Indeed, in recognition of its superior product range, Insular Life was conferred a prestigious Gold Superbrand award by Reader s Digest in 2005 and 2006. The Superbrand award is widely considered as an accurate benchmark of consumer approval. Insular Life was one of only two brands chosen in the insurance category in the Philippines. In 2009, Insular Life embarked on a new journey of self-discovery and came up with a new brand promise: Your far-sighted guardian. This is depicted in its new logo that features the Philippine eagle, the Pithecophaga jefferyi. With its forward gaze, keen and sharp vision, the eagle represents Insular Life s commitment to look out for its customers needs at every life stage and to help them plan ahead for an assured and financially secure future. Insular Life s new brand identity also pays homage to the original Insular Life seal used in 1910 that also depicted an eagle. Along with its new logo and other representations of its new visual identity is its new corporate tagline, Look ahead. Be assured. While insurance remains its core business, Insular Life has diversified into allied financial services, establishing three wholly-owned subsidiaries: Insular Life Health Care, Inc. (I-Care), Insular Investment & Trust Corporation (IITC), and HomeCredit Mutual Building and Loan Association, Inc. (Home Credit). Insular Health Care, Inc. is one of the top ten Health Maintenance Organizations (HMO) in the country in terms of capitalization, comprehensive health care plans and service delivery. Insular Investment Corporation is a full service investment house providing products and services in corporate finance, money market, and trust and investment management. Insular Home Credit provides housing opportunities through its various financing programs notably the Rent-to-Own scheme. Insular Life General Insurance Company, also an Insular Life subsidiary, merged with Mapfre Corporation s local non-life insurance subsidiary, Mapfre Asian Insurance Corporation to form the Mapfre Insular Insurance Corporation in 2005. Mapfre is an international financial group with operations in 45 countries worldwide. 2013 International Group Program 1
Your Local Link to IGP in the Philippines: Insular Life Assurance Company, Ltd. Equally significant is Insular Life s contribution to social development through various corporate social responsibility programs under the Insular Life Foundation, Inc. Over a thousand deserving scholars have received college and vocational education through the company s scholarship programs since 1962. The company s more recent outreach projects include supporting the Department of Education s Adopt-a-School program. True to its Filipino identity, Insular Life has also been supporting the search for The Outstanding Filipino (TOFIL) since its inception in 1988. Insular Life has been an IGP Network Partner since 1967. Key Products Life Life Accidental Death and Disability Permanent and Total Disability Rider Credit Life Dependent Life Dread Disease Group Universal Life Life Cover for Retirees Optional Supplemental Life Medical Dental Hospital and Surgical Major Medical Out-Patient Medical Pensions Managed Funds Other Term Life Policy with Benefits Paid in US Dollars Credit Life Policy with Benefits Paid in US Dollars Endowment Insular Life is located in the internet at http://www.insularlife.com.ph 2013 International Group Program 2
Social Security Coverage: Coverage under Social Security is compulsory for the following: All private sector employees, whether permanent, temporary or provisional who are not over 60 years of age; Filipino seafarers; Employees of a foreign government, international organization or their wholly-owned operation based in the Philippines, which entered into an administrative agreement with the Social Security System (SSS) for the coverage of its Filipino workers; Self-employed farmers and fishermen earning at least PHP 1,500 a month; All self-employed persons not over 60 years old with an income of at least PHP 1,000 a month; Household helpers who are receiving at least PHP 1,000 a month; Children below 15 years of age; and Parents, spouse or child(ren) (under age 21) of the owner of a single proprietorship business. Coverage is voluntary for the following: Separated Members Employees who are separated from their previous employment and would like to continue paying their contributions on a voluntary basis. Employees Under Foreign Employers Employees of foreign governments, international or governmental organizations, such as embassies. Overseas Workers in Countries with Bilateral Agreements with the Philippines Overseas workers employed in countries that have signed an agreement with the Philippine Government to include Filipinos and their nationals in the Social Security coverage of their countries; e.g., United Kingdom. Employees of Foreign-Based Employers Employees recruited in the Philippines by foreign-based employers for employment abroad. Non-working Spouses of SSS Members A person legally married to an SSS member who devotes his or her full time to the management of his or her household and family affairs. He or she has never been a member of the SSS. His or her contributions will be based on 50% of the working spouse s monthly salary credit, but in no case shall it be lower than PHP 1,000. 2013 International Group Program 3
Contributions: Contribution is based on a schedule per salary bracket for both employer and employee. Benefits: Sickness Benefit: A daily cash allowance paid to a member for the number of days he or she is unable to work due to injury or sickness. Maternity Benefit: A daily cash allowance granted to a female employee who temporarily stops working due to childbirth or miscarriage. Disability Benefit: Cash benefits, a lump sum or monthly pension for a member who becomes either totally or partially permanently disabled. Retirement Benefit: A member who reaches age 60 and is no longer employed, or age 65 whether employed or unemployed, will receive a monthly pension for life if he or she has paid at least 120 monthly contributions, or a lump sum if less than 120 monthly contributions have been paid. Death Benefit: The primary beneficiary will receive a monthly pension if the deceased member has paid at least 36 monthly contributions or a lump sum if he or she has paid less than 36 monthly contributions. Funeral Benefit: A cash benefit of PHP 15,000 is paid to the beneficiaries or to any person who paid the burial expenses. Dependent's Pension: This additional pension is granted to each (up to five) dependent child of a deceased member, a totally disabled member or a retiree pensioner, equal to 10% of the monthly pension or PHP 250, whichever is higher. 2013 International Group Program 4
Employees' Compensation and State Insurance Fund Eligibility: All employees in industrial, commercial, and agricultural establishments, as well as in religious, charitable, and educational institutions, are eligible. All government employees are eligible except elected officials. Contributions: Contributions are paid by the employer. The same amount is paid for all employees. Benefits: Death benefits Disability benefits Medical care and rehabilitation Compensation for survivors Funeral expense benefit National Health Insurance Program (NHIP) Eligibility: Universal coverage for all Filipinos, including their dependents. Contributions: Benefits: Premiums are based on monthly salary. Each sickness or injury requiring hospitalization/surgical operation is covered. Complications of pregnancy and surgical family planning procedures like vasectomy and ligation are also covered. Home Development Mutual Fund (Pag-IBIG Fund) The Home Development Mutual Fund (HDMF) was established in 1978 by Presidential decree to promote home ownership via a nationwide savings scheme. It also provides small and short-term loans and other benefits for its members. The Social Security System (SSS) handled the funds of private employees, and the Government Service Insurance System (GSIS) handled the funds of government workers. In 1979, the two funds were merged and became what is known as the Pag-IBIG Fund. Coverage: Membership in the Fund is mandatory for all employees covered by the Social Security System and the Government Service Insurance System, and their respective employers. Coverage for employees whose monthly earnings are less than PHP 4,000 is voluntary. 2013 International Group Program 5
Membership in the fund is also open to: Self-employed workers such as professionals and businessmen Overseas contract workers (OCWs) Residents and immigrants in the US and Canada Informal income groups such as cooperative members Non-working spouses Contributions: Employees must contribute 2% of monthly compensation, (or 1% if earning PHP 1,500 per month or less); additional contributions may also be made. Employers are mandated to match their employees monthly contributions with an amount equivalent to 2% of the monthly compensation of each covered employee. For self-employed members, the monthly contribution is equivalent to 2% of their monthly gross earnings. Benefits: Upon termination of membership, in accordance with the rules on termination, an eligible member is entitled to receive his or her total accumulated value in the Fund. In addition to the member s total accumulated value in the Fund, there is a death benefit payable of PHP 6,000. The Pag-IBIG Expanded Housing Loan Program (EHLP) is available to eligible members. The maximum loan is PHP 6,000,000. The Multi-Purpose Loan (MPL) Program provides immediate assistance to eligible Pag-IBIG members so that they can finance medical, educational, livelihood, minor home improvement, purchase of appliances and furniture, and other related needs. The Pag-IBIG Overseas Program (POP) provides eligible Filipino overseas workers/immigrants the opportunity to obtain a housing loan for as much as PHP 2,000,000. Other loan programs include the Land Development and Construction Program, Stock Investment Loan Program and Home Repair/Improvement Loan Program. Information on the Pag-IBIG Fund can be found on: http://www.pagibigfund.gov.ph 2013 International Group Program 6
Private Employee Benefits Group Life Insurance, Group Medical Insurance, and Retirement Benefit Plans are part of the total compensation scheme of private employers. These plans are formal in nature and are funded systematically. Group Life Insurance Plans: This plan is issued on a yearly renewable term with some supplementary benefits, such as accidental death and disability, waiver of premium, permanent and total disability, and dependent's life insurance providing nominal coverages for an employee's spouse and children. Two times annual salary is a typical benefit. The majority of group life plans are employer-financed. Group Medical Insurance Plans: This plan is also issued on a yearly renewable term and falls under two general categories basic hospitalization and major medical insurance plans. The basic hospitalization plan provides reimbursements for specific medical expenses such as room and board, special hospital services, surgical fees and doctor's calls. A Major Medical plan, on the other hand, provides payment of a percentage of the covered medical expenses in excess of a specified deductible amount, up to a specified maximum. Private medical plans are usually coordinated with the National Health Insurance Program (NHIP). Some are integrated with, inclusive of or superimposed on NHIP and are payable only after NHIP payments. Most of the existing health insurance plans are paid for entirely by the employer, in so far as employee coverage is concerned. Dependent's coverage is either partially or totally employee-financed. Retirement Benefit Plans: The normal retirement age is 60, to coincide with Social Security. Full benefits are payable after 10 years and as early as age 50. The most common benefit at retirement is a lump sum. In fixed-benefit type plans, the amount is usually one final month's salary per year of pensionable service. A majority of retirement plans are non-contributory. 2013 International Group Program 7