UBX PHILIPPINES Corp. is bullish on the growth prospects of embedded insurance in the country as the market remains under-penetrated.
The fintech arm of UnionBank of the Philippines, Inc. said the increased use of digital channels will help attract more consumers to avail of embedded insurance, UBX Philippines President and Chief Executive Officer John Januszczak said at an online forum on Wednesday.
“Digital natives engage with companies in new and different ways. With the emergence of subscription models — like Netflix and Spotify, the sharing economy, like Airbnb and Grab, cryptocurrency — insurance likewise needs to be digitally native,” Mr. Januszczak said.
Embedded insurance works by making it an add-on to another product or service accessed by a consumer.
UBX has an embedded insurance platform called Assured. UBX, through its payments channel i2i, offers consumers paying bills via the platform access to a personal accident insurance underwritten by Chubb.
Mr. Januszczak said they want to offer embedded insurance to Filipinos through e-commerce.
“The Philippines’ e-commerce market for consumers grew to P200 billion and with this comes the risk of mishaps in delivery. Imagine protection for lost or damaged items, extendable returns and failed delivery takes directly into the online shopping experience,” he said.
Another sector that could benefit from embedded insurance are micro-, small- and medium-sized enterprises (MSMEs) struggling during the crisis, he added.
“We aim to introduce MSMEs to insurance with coverage that is relevant, seamlessly integrated into the activities that truly matter to them, like managing their inventory, buying products and paying staff,” Mr. Januszczak said.
The official said he believes Filipinos will appreciate how embedded insurance will give them protection broken down into “simple, bite-size products.”
Meanwhile, Coherent CEO and co-founder John Brisco said with younger Filipinos becoming more comfortable with online transactions, prospects for the embedded insurance market are bright. Coherent, an insurtech firm, partnered with UBX for Assured.
“Embedded insurance in the next 10 years is going to be a trillion-dollar market. This is an opportunity from the population of younger adults who wanted a different experience of how they acquire insurance,” Mr. Brisco said. — LWTN