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Healthcare policies boost Prudential's premiums
[SINGAPORE] Conversations about healthcare spell good business for Prudential Singapore, as its results for 2013 attest.
Strong sales in healthcare policies such as PruShield helped the insurer generate $706 million in new business premiums last year, an 18 per cent jump from $597 million in 2012.
The sales are based on annual premium equivalent (APE), which takes the value of policies' annual premium plus 10 per cent of single premium sales.
Prudential's flagship health product is PruShield, under the Central Provident Fund's menu of Integrated Shield plans. It is also strong in the early stage critical illness market.
Prudential was a relative latecomer to the Shield market in 2005. In 2008 it enhanced its offering to provide coverage on "as charged" basis rather than the traditional structure of inner limits on cover. To date there are around 400,000 PruShield policyholders. Said Prudential chief executive Tomas Urbanec: "We made the decision over the last few years to increase our coverage . . . Customers have responded. As Singaporeans get older and the cost of hospitalisation increases, it will be a bigger issue and it's one we're happy to play a part in."
Health, he added, is "number one in terms of bringing new customers to Pru".
The firm has found, based on a survey, that many people are bewildered when it comes to healthcare advice and options. It recently launched a helpline called "PRUhealthcare Assist" to bridge this gap.
"Overwhelmingly the number one issue was - I don't know who to talk to or where to get advice. I don't know how to make the best decision that drives the most economic outcome."
The helpline aims to help PruShield customers to help them understand their cover, and obtain other information such as the available doctors, the types of wards and benefits. It also proffers information on specialists and hospitals. Mr Urbanec said feedback to this service has been "very very positive".
In the protection area such as critical illness, the firm is looking into the possibility of allowing policyholders to raise their cover with minimum underwriting. "The critical illness plan you bought five years ago may not be sufficient for the next five years," he said.
Another growth area is the high net worth business. New business in this segment rose 63 per cent over 2012 and accounted for 13 per cent of new premiums.
The high net worth business comprises protection products such as term assurance, critical illness and universal life policies. Protection values may range between $2 and 3 million in sums assured.
"The high net worth business will be a major growth area for us and for Singapore for years to come. There are many who have benefited from the property boom and the overall economic environment. They have become more affluent and need the right level of protection and legacy planning."
Prudential has an agency force of about 3,600. Its bancassurance partners include Maybank, UOB and Standard Chartered Bank.