EastWest Ageas Life Insurance Corp. expects only minimal fallout on its business from the tighter economic conditions brought on by the ongoing Middle East war, with financial strain concentrated mainly among lower-income segments, its top official said.

"So, initially when inflation started to hit, we were a bit worried that that would hit significantly on renewal premiums. We have seen minor impacts, but not very significant," EastWest Ageas President and Chief Executive Officer Sjoerd Smeets told a media briefing in Mandaluyong City on Tuesday.

Renewal premiums — payments from existing policyholders to keep coverage in force — are a recurring income stream for life insurers, which is why management had worried they would take a significant hit when inflation first accelerated.

"So, overall to us as an insurance company, it's not a big impact. But I do see from the data that segments within the Philippines have very different perspectives."

According to Mr. Smeets, the effects of the East war have been more visible among the insurer's customers in the middle- to lower-middle income brackets.

"If you look at segments where, for example, the spending power is less and that's mainly a segment that is normally being serviced by agents, there you see indeed that in that segment, people do have more financial difficulty."

Growth Momentum

Mr. Smeets said the company's premium income grew by around 30% year on year in the first half, adding that the insurer is positioned to sustain similar growth for the remainder of the year.

"This year, I think it should be quite strong," he said. "If you did not ask me, last year, we were number 15 in the market. So we're really growing fast. But I don't expect that by the end of the year that we'll significantly be higher."

Based on Insurance Commission data, EastWest Ageas booked a premium income of P6.576 billion last year, a 32.14% increase from the P4.976 billion posted in 2024.

Household Finances Under Pressure

In its latest PURPLE Report, released at the briefing, the insurer found that at least four in 10 Filipino adults faced tighter financial conditions in the second quarter of the year as red-hot inflation squeezed household budgets.

"While many Filipinos report that their financial situation remains stable, few feel that they are meaningfully better off than they were at the start of the year," the report read.

"Compared to January-February 2026, 43% describe their household's financial situation in Q2 as worse, while a sizeable proportion — at 42% report little change or financially the same/stable," EastWest Ageas added.

The survey supplies the household backdrop to that assessment: budget cuts broad enough to reach most respondents, yet — by management's account — not deep enough to materially hurt premium collections, with the strain concentrated in specific income segments.

Inflation began accelerating at the height of the Middle East war, which broke out in late February. It peaked at 7.2% in April and averaged 6.8% in the second quarter.

The report said this prompted at least half of respondents (56%) to reduce their budgets to prioritize basic needs, while 42% also cut back on nonessentials.

"Healthcare and medicines remain among the last expenses consumers are willing to compromise, with adjustments focused instead on more flexible categories," EastWest Ageas said. "In practice, however, these adjustments unlikely created extra room in the budget; they simply help Filipinos keep pace with rising costs elsewhere."

Coping Mechanisms

The report also showed that 19% of respondents were taking on additional jobs or creating livelihoods, while 14% were drawing on their savings to cover usual expenses amid the current macroeconomic backdrop.

Even so, nine out of 10 Filipinos said they value building financial buffers for their families amid soaring prices, thinning emergency funds, and unstable or insufficient earnings.

The study surveyed Filipino consumers aged 22 to 55 in key metropolitan areas across the country, including Metro Manila, Broad Luzon, Metro Cebu, and Metro Davao.

For the remainder of the year, the figures to watch are whether EastWest Ageas sustains the roughly 30% first-half pace its chief executive expects to maintain, and how the income-segment divide documented in the PURPLE Report shifts in future readings of the survey.

Source: BusinessWorld — By Katherine K. Chan, Reporter