Throughout our lives, we seek partners that understand us and help us achieve our goals, through both challenges and celebrations. For millions of Filipinos, that partner is BDO Insurance Brokers, Inc. (BDOI). Priding itself on working for its clients, not insurance companies, BDOI has risen to become a top insurance broker in the Philippines.
General Manager Tracy Tan explains that with its size, business volume and profitability, the company has the clout to get its clients the best insurance package, customised for their needs, and at the best price. “We work for our clients, we work for their claims, and we promise peace of mind,” she notes. As a subsidiary of BDO Unibank, and a member of the powerful SM Group, BDOI offers a wide range of coverage in property, motor, engineering, casualty, life, personal accident, employee benefits and specialty lines of insurance.
“We’re a market leader in all major insurance lines – occupying the first or second position in every category except in health, where we’re still in the fifth position,” Tracy explains. “We’ve achieved this by tapping into BDO’s rich customer base and applying a ‘total needs’ approach, where we aggressively capture opportunities beyond the insurance lines required by a loan or lease. We also benefit from the sustained growth of the SM Group, as we’re involved in all its main investment and strategic projects.”
Throughout her career, Tracy has always had ties with the insurance industry. After starting out in product management, in 1995 Tracy joined CMG of Australia, the first integrated financial services provider in the Philippine insurance industry, as its Head of Marketing. Looking for a change of pace, in 2003 she became General Manager of International SOS, a global medical assistance company providing 24/7 medical and security assistance to businesses around the world. “Our biggest client was ADB and we were also the medical assistance partner of a number of travel insurance providers that were outsourcing their medical evacuations and repatriations, and concierge assistance to us,” she recalls.
In 2009, Tracy was headhunted to join BDOI. “They needed my marketing skills to ensure the company served the insurance needs not only of the BDO and SM Group, but also their clients and affiliates. I saw massive potential for growth – all we needed to do was to improve and deliver on our services and leverage on the group’s extensive business and client base,” she says.
We Find Ways
Tracy started these improvements at the core of the organisation by reinforcing its culture. BDO’s corporate governance is anchored on five basic principles: accountability, fairness, integrity, transparency and performance. This governance philosophy is deeply rooted in BDO’s corporate culture, and flows down through each of its subsidiaries. “Culture is the foundation of the success of any business, and ours is rooted in our parent company’s vision, ‘We Find Ways’,” says Tracy. “Technical training is essential in this line of work, and we started this at the top.”
She believes humility is what makes a good leader. “You should be humble enough to accept that you are not omniscient, so you remain open to learning from your employees, clients, suppliers and colleagues,” Tracy notes. “You should be humble enough to accept that you will make mistakes and you should have the discipline to know your own limitations, so you can improve each day.”
Last year, BDOI invested in its chief people managers, training them in the four disciplines of execution before cascading these learnings down the line and incorporating them into the business’ KPIs. “We’ve strengthened our teams’ ability to self-correct their processes by building checks in the workflow rather than having a separate post-activity debrief, and we’re always upskilling our people on the best practices in insurance, risk management and sales management.”
These principles are also evident in BDOI’s interactions with its industry partners. “We build strong and supportive partnerships through constructive engagement, working hand-in-hand, listening and learning from each other, and ensuring that all parties are treated fairly and benefit from the partnership. As a brokerage, having the right partners is critical to delivering the best solutions and services to our clients,” Tracy observes.
These cultural changes saw huge company-wide improvements in discipline, execution, and the rigour in which BDOI accredits insurers. In accrediting an insurer, the firm employs a set of criteria that is religiously reviewed and rated annually. “This ensures that when we broker for our clients, we only refer them to stable and reputable insurers that can pay their claims,” Tracy explains. “We have also instituted scorecards on claims efficiency, measuring turnaround times on claims processing and policy issuance.”
According to the Insurance Commission, total premiums in the Philippine insurance industry reached PHP259.6 billion in 2017, up 11.9% on 2016 results. The three sectors – life, non-life and mutual benefit associations – all experienced positive growth in terms of assets, premiums earned, net worth and paid-up capital or guaranty funds. The industry posted total assets estimated at PHP1.55 trillion at the end of last year, which was 18% higher than at end-2016.
BDOI has continued its trajectory of significant growth by leveraging its size and parentage, achieving economies of scale, fulfilling its claims advocacy as a broker and customising relevant products and services that serve clients’ needs. “I’m very proud of our track record. We remain unmatched in the local insurance industry – doubling premiums produced and commissions generated, and tripling net income after tax in the past four years,” says Tracy. Between 2013–17, BDOI’s net income after tax grew by a massive 307%, reaching PHP730,000 last year.
In line with its vision to make insurance accessible to more people, BDOI has launched easy to understand and affordable insurance products through SM Store Customer Service counters in 57 malls nationwide. To help clients choose from a vast array of insurance solutions and find a tailor-made solution for their business, BDOI has a dedicated team of consultants and offers after-sales service to help people make the most out of their coverage.
Insurance for all
These successes were made possible by the current regulatory push for the financial inclusion of underserved sectors in the Philippines. Tracy explains that these factors have presented both challenges and opportunities for the company. “Micro-insurance means that insurance is no longer too expensive or too complicated for the underserved and low-income community,” she says. “Regulations now are also more open to alternative distribution channels, such as digital, and this means that the industry can start taking advantage of wider, more accessible, and more cost-effective ways to reach the uninsured.”
BDOI is well placed to capitalise on these emerging trends, and is developing micro-insurance products in collaboration with One Network Bank, a subsidiary of BDO. “We are building a new core system and embarking on a transformation to improve operational efficiency and strengthen our capability to deliver excellence,” says Tracy. The business is also enhancing its ability to predict, analyse and respond to market needs and changes by strengthening its teams dedicated to improving the customer experience, simplifying work processes, and creating synergies with bank counterparts to better serve and reach more customers.
Tracy believes the next frontier in insurance is digital transformation. “Innovations in insurance coverage such as pay-per-use policies, new distribution channels such as mobile apps and online platforms, easier price and benefit comparisons through online aggregators, and faster and more accurate motor claims assessment through drones, sensors and telematics, are changing the face of the non-life insurance industry globally. The players that can adapt and create new markets through these changes will emerge as winners,” Tracy explains.
What we do best:
To provide customised risk management and insurance solutions to our corporate clients, to innovate on product bundling, and to pay the majority of our claims within 90 days.
Preparing for the future
By leveraging these new technologies, Tracy hopes to make workloads more manageable for her account brokers while also making it easier for clients to reach out using online messaging and BDOI’s self-service customer portal. “We are looking at automation, insurtech innovations, and industry best practices to streamline our workflows and secure our data privacy,” she says. “This year, we’re also launching a series of product-bundling innovations to benefit our clients. BDOI will continue to do what we do best: to provide customised risk management and insurance solutions to our corporate clients, to innovate on product bundling, and to pay the majority of our claims within 90 days.”
In the short-term, BDOI will continue to offer customised insurance and risk management solutions and improve on the existing packages for its corporate accounts. “For the retail market, we will capitalise on alternative and digital channels to reach new markets and consistently fulfil our customer promise in providing excellent service to all Filipinos.”