A strategic management paper for PRU Life Insurance Corporation of UK / Prince C. Cesar, Charmaine D. Dacutanan, Diana Jean G. Maala, Mannilyn D. Marcaida, Ma. Celina R. Ramos.

Thesis (M.A)--Pamantasan ng Lungsod ng Maynila, 2023.

A strategic management paper presented to the Faculty of the PLM Business School--Graduate Program in partial fulfillment of the requirements for the degree Master in Business Administration.

Pru Life UK (the Company) is one of the first life insurance companies approved to distribute US dollar-denominated investment-linked life insurance policies in the country. Established in 1996, the company offers four (4) major types of products and services suitable to its customers. Pru Life UK offers insurance with investments, term insurance which extends its protection for corporate clients, accident, and disability, and Prulink funds. Furthermore, the company is the pioneer of insuravest, or investment-linked life insurance products. The establishment of Pru Life UK has expanded its reach with 190 branches with more than 35,000 licensed agents-the biggest life agency force in the Philippines.

The standpoint of the Company in the insurance industry here in the Philippines resembles an oligopoly that is dominated by only a few companies holding the majority of the market share and by a few large players. The Philippines's life insurance sector generated Php46.16 billion sales in 2020 based on the New Business Annual Premium Equivalent (NBAPE). There are 3l companies under the life insurance sector operating in the Philippines as of 2020 and in the same year, the Company holds 17% of the market share. It ranked as number 1 in the life insurance industry in the Philippines based on New Business Annual Premium Equivalent (NBAPE) for the year 2020.

As shown in the competitive profile matrix, the company has a total score of 3.80 which signifies that it has a strong competitive profile based on the analysis. The score was derived firstly, through the comparative study of the top four (4) competitors in the insurance industry based on the 2020 Premium Income. Lastly, it uses the identified critical success factors to reveal each company's strengths and weaknesses. In addition, the Company won three (3) awards at the 17th Philippine Quill Awards being in the position as the country's most prestigious awards program in the field of business communication.

Based on the External Factor Evaluation (EFE) Matrix of Pru Life UK, the company's responsiveness to the existing opportunities and threats is above average as indicated by a total weighted score of 3.07. Significant threats to the company include high forecasted inflation which may result in the decrease of consumption of life insurance. On the other hand, the EFE matrix has revealed opportunities for the company to take into consideration formulating a strategy. This opportunity states that consumers' perceptions of the significance of life insurance are higher during the pandemic.

The Internal Factor Evaluation (IFE) Matrix of the Company, highlights its strengths and weaknesses as identified from the Internal Analysis conducted, has a total weighted score of 2.83, and implied a strong internal position. It revealed that the company's major strengths are being the top insurance company based on NBAPE and being a pioneer of investment-linked insurance products. Although it indicated strong internal factors, it also signified a weakness for the company which is the lack of promotional activities.

The significant strategic issues that the Company is currently facing are inflation, administration, and the COVID-19 pandemic. Moreover, the lack of promotional activities and heavy reliance on direct selling to reach the target market reduced the company's growth as it limits the capacity of the company to further capture the market.

Based on the analysis of the Internal-External (IE) Matrix, which is a combination of the EFE matrix and IFE matrix models, and the results of other strategic management tools used in this research, the company should focus on the Market Penetration strategies. The chosen alternative strategies will help the company achieve its short-term and long-term Strategic and Financial objectives.

Market Penetration strategy is important in ensuring that the company is on the right track and it seeks to achieve an increase with regards to the company's net income and market share, enabling them to expand their markets with relatively lower costs as compared to other competitors. The execution of the Market Penetration strategy will help the company increase its market share. It is believed that the company will achieve its goal based on the grand strategy matrix that it has a strong competitive position and rapid market growth among its competitors.

In relation to the above statement, the Market Penetration strategy that the company will implement includes maximizing the Pulse app with the use of Artificial Intelligence (AI) and chatbots, partnership with digital online banks, maximizing digital transformation, and tie-up with Customer Service Representatives or third party agents. With these recommended business strategies, the company shall be able to achieve its financial objectives. Premiums will increase by 5%, 6%, 7%, 8%, and 10% for the year 2022-2026 respectively.

The implementation and execution of the balanced scorecard was derived based on the formulated strategic and financial strategies which provided the Company four perspectives- financial perspective, customer perspective, internal business processes, and learning and growth. The contingency plan is determined to take in response to an unforeseen event and to identify possible scenarios that may affect the Company's operation. It was developed to help Pru Life UK continue its operations and to minimize the damages in terms of profits and resources.