As Pan-American Life Insurance Group celebrated its 110th anniversary of providing trusted financial security and peace of mind for millions of families and businesses across the Americas, I could not help but reflect on the past two years,
which have been among the most challenging in the history of our company and the industry. What strikes me the most is that I could not be prouder of how we have risen to that challenge. It is deeply humbling to be in this noble profession
that is truly making a difference in people’s lives every day.
Over the past two years, as the pandemic has taken its tragic toll, we have upheld our promise to our customers to be there when they need us most. In 2021, a record year, we paid out more than $1 billion in policy loans, surrenders, claims,
including more than $90 million in death and health insurance claims related to the COVID-19 pandemic, bringing our 2-year COVID-19 related paid claims to $134 million, that in the absence of this unprecedented global challenge, we would not
have had. As a leading insurance provider in the Americas, ensuring our policyholders have the support they need with access to prevention, testing and treatment options continues to be a top priority.
Our enduring financial strength is what made that possible. Amid these extraordinary circumstances, AM Best and Fitch Ratings maintained our “A” rating with a stable outlook, a remarkable achievement that few in the industry have been able to
match. In a low interest rate environment, PALIG’s consolidated bond yield outperformed the Life Industry average, a reflection of our strong investment profile.
That strength, combined with
the dedication of our resilient team and continued investment in our people and technology - in this second year of our three- year, $40 million IT strategic
plan - enabled us to rise above the challenges and deliver solid results. Revenues grew 3% to $1.218 billion in 2021, driven by growth across all lines of our highly diversified businesses. Pre-tax operating income was $37 million, as we continued to pay out significant pandemic related claims. Our balance sheet remains stronger than ever, with GAAP Equity reaching a record high of $1.38 billion, reflecting the underlying financial strength of our business.
Our ability to resolutely confront the challenges posed by COVID-19 are a testament to PALIG’s robust business continuity planning, experienced management team and strong enterprise risk management. The lessons we have learned and the investments underway
in technology and our people are making PALIG a more nimble, adaptable and productive organization. This is evident
in how we were able to quickly adopt
a Work-From-Home posture as the pandemic emerged, and evolve that into a hybrid, flexible work environment strategy that positions PALIG for the future. We will continue to strengthen our systems and processes and nurture the talent that are integral to our continued success.
That success has been due in no small part to the talent of leaders like Carlos Mickan, who retired as Vice Chairman of the Board and Head of Finance and Administration at the end of 2021 after a long and distinguished career at PALIG and in the industry. Carlos was instrumental in PALIG’s transformation and his expert financial stewardship helped ensure that we have the financial strength to weather even
the most unexpected storm, as recent events have borne out. We are glad
to announce that he will remain on the PALIG Board as a Director and we will continue to benefit from his deep understanding of the business.
Early this year, we announced steps
to further strengthen and deepen our leadership structure. I relinquished
my role as President to transition to
three Presidents at the helm of three priority pillars to advance our corporate initiatives: Robert DiCianni, President Global Benefits; Bruce Parker, President Global Life; and Steve Friedman, President Finance and Investments. Their leadership will be instrumental in driving our corporate strategy. I will continue to serve as Chairman of the Board and CEO. Fellow Director Martha Hesse will retire from the PALIG Board in August 2022 after more than six years of service.
The commitment, thoughtfulness and insightful perspective she brought to PALIG, from many years of experience on public and private company boards, will be missed. We wish Martha the very best as she embarks on her next chapter.
Having demonstrated our resiliency and ability to thrive and rise above even the most challenging circumstances, it’s full steam ahead in 2022 as we look to renewed growth, margin improvement driven by operational excellence and acceleration of our digital journey. Our strategic focus going forward will be
on organically growing our business, strengthening our cyber security solutions and enterprise risk management process, and targeting key sectors for mergers and acquisition opportunities.
We have gone through so much together these past two years. In the face of a global crisis, we discovered the depths of our resilience and courage, the power of compassion and empathy, and the value of service, all while facing hardships and challenges never imagined. And during this time, we have evaluated what is truly important and remained focused on what matters most. Together we have made a difference. And that is why I am more confident than ever in the future of PALIG as we continue to proudly uphold our promise to be there when you need us most.
José S. Suquet
Chairman of the Board & CEO
Pan-American Life Insurance Group
