Economies around the world are recovering and rebounding as vaccination levels stabilise and Covid infections decrease. But just as we were entering this turn of good news, the financial markets and supply chains around the world were hit by rising inflation, interest rates and the war in Ukraine.
Like it or not, risk will always be there, and the pursuit of financial stability is ever more critical. For people and businesses alike, this starts with productivity and revenue.
The pandemic accelerated changes in the nature of work. Even as companies call employees back to the office, remote and part-time work have become widely accepted and are still popular options in many firms. Gig workers continue to deliver essential—and less-essential—goods to our doorsteps.
Many new business models continue to emerge. Digital entertainment such as gaming and esports are now providing and generating new jobs. The rise of Web3 and the metaverse, NFTs, DAOs, leader-less “companies of the future” governed by transparent code on a blockchain, while extremely risky, have the potential to truly change the future.
The younger cohorts, predominantly millennials and Gen Zs, are re-imagining the future, especially their own job future. The “great resignation” saw employees quitting 9-to-6 positions in the search for a better work-life balance. Self-employment and the gig economy offer a certain degree of freedom, with side jobs as yoga instructor or café owner—for example—that provide additional income.
Amidst all this, the basic need to manage risk through insurance has never been more important.
Different insurance products
Businesses are looking for real-time solutions to better align risk management and costs. They want flexible, stackable and portable insurance products that are still simple and easy-to-use. Insurtechs are bringing new software and new data to make this possible for lines of insurance such as motor insurance, gadget protection, liability, indemnity and goods-in-transit.
Employee benefits have to change as well, so that they no longer discriminate against certain types of workers. Whether they are on full-time or part-time contracts, or whether they are just project-based independent contractors, everyone should be entitled to their health benefits. In this context, employers also need to pay attention to potential mental health issues that have been on the rise during the pandemic and offer appropriate help.
New types of health risks are also emerging, such as mental health, carpal tunnel syndrome, fatigue or seizures associated with prolonged use of screens and computers. We need new insurance products to address these risks.
New ways of distribution and fulfilling
Apart from product innovation, distribution and fulfilment of risk management are also changing.
Many businesses are looking to integrate risk management into their operations through Open APIs. Large companies want to embed insurance products into their customer journeys to increase protection levels and engender more trust and protection throughout their ecosystems.
New blockchain applications that allow for more trust and transparency are being noticed. Hong Kong has been using distributed ledger technologies to tackle motor insurance fraud. In the agricultural sector, parametric insurance can be triggered on climate conditions and payouts can be done by automated smart contacts to farmer's e-wallets.
The industry will continue to benefit from the continued growth in data collection and data accessibility that’s driven by digitization. Giving insurers access to basic information, for example via the Singpass, will make the underwriting a more seamless experience. Insights generated by digital commerce platforms and marketplaces improve pricing and risk understanding.
Increasing insurance penetration in the Philippines
In the Philippines, the literacy for Insurance products have grown since the onset of the pandemic. More and more people have come to understand the value and need for such products and as the growth of the InsurTech industry continues, more and more Filipinos now have the ability to access Insurance on a micro level all the way up to the more comprehensive packages.
Still, there is a gap that needs to be addressed as far as product relevance goes. With Gigacover’s growth in the Philippines, we’ve seen more and more individuals and groups seeking out products more relevant to theirs and their employees' respective life stages, paving the way for our efforts in further developing flexible Insurance and EB programs.
Across the entire insurance value chain, there are increasingly more gaps that traditional insurers and new insurtechs need to address. Let us look forward to a future with simple, flexible and inclusive insurance and increased levels of financial stability.
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ARTICLE WRITTEN BY: AMERSON LIN & CHESCA FIGUEROA
Amerson Lin is the CEO & Co-Founder of Gigacover.
Chesca Figueroa is the CFMP of Gigacover.
Gigacover is a part of our Batch 3 Global Innovation Alliance (GIA) Manila Program.
To find out more about our GIA Manila Program, click here.