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Potential of online shopping platforms yet to be tapped fully

Pru Life UK, a leading life insurer in the Philippines, has released a policy paper titled "InsurTech: Driving Broader Insurance Access," giving a better understanding of how InsurTech, such as online shopping platforms, can be used to broaden Filipinos' access to life and health protection products.

Authored by the law firm Romulo Mabanta Buenaventura Sayoc & de los Angeles, the policy paper reviews the current regulatory framework for online insurance sales and looks at how online shopping platforms can serve as insurance intermediaries.

“The full potential of online shopping platforms has up to now not yet been maximized, likely because online shopping platforms are not insurance-specific. As InsurTech evolves the way of doing the insurance business, insurers need to keep up,” said Ms. Cynthia Del Castillo, senior partner and head of the Capital Markets Practice at Romulo Mabanta Buenaventura Sayoc & de los Angeles.

A key recommendation of the paper is for the Insurance Commission to consider allowing online shopping platforms, including electronic wallets that serve as e-commerce platforms, to act as an “intermediary” for the sale and distribution of insurance products, including investment-linked insurance products, under a three-tiered classification of intermediaries as follows:

  • Those that provide advice and client servicing such as insurance agents and brokers;

  • Those that provide advice but not client servicing, but require a degree of knowledge of insurance products such as online insurance aggregators; and

  • Those that merely provide a platform that connects the insurer and the consumer for online distribution of insurance products, and do not provide advice and/or client servicing such as online shopping platforms, online marketplaces and e-wallets.

Pru Life UK president and CEO Mr. Eng Teng Wong said, “Digitalization has accelerated almost every aspect of our lives. However, the insurance penetration in the Philippines as a percentage of the national Gross Domestic Product (GDP) is less than 2%. This is amongst the lowest in Asia. By harnessing the combined strengths of the financial advisor workforce and the power of mobile and online apps and platforms, we can quickly broaden the reach and accessibility to many more affordable life and health insurance solutions, including investment-linked plans.”

Mr. Wong is also FinTech Alliance Philippines’ Insurtech Committee chairman leading the organization's role in engaging, building, and expanding a sustainable digital finance ecosystem.



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