The Pinoy Business Chronicle

Business news and analysis. Covering financial news, economic issues, stock market data, local business, business policy and more.

Finance News

Digital operations to boost Singlife amid coronavirus pandemic

digital operations to boost singlife amid coronavirus pandemic - Digital operations to boost Singlife amid coronavirus pandemic

LIFE INSURER Singapore Life (Singlife) Philippines sees growth in its digital-only and agent-less operations as Filipinos become more open to the use of technology amid the coronavirus disease 2019 (COVID-19) pandemic.

As the ongoing pandemic highlights the use of technology, Singlife Philippines Chief Executive Officer Rien Hermans said selling insurance products through digital means puts the company in a better position than others who use the traditional, face-to-face method.

“[Among the changes that the pandemic has caused] in behavior is people are now more used to communicating digitally, so that would be an advantage for us. And they become very reluctant in meeting strangers [which] might be negative [for the industry] because agents will have a more difficult job to do. But for us, that’s actually a slight advantage. People might move to digital instead of meeting with somebody outside,” Mr. Hermans said.

However, he said an agent-less operation is as a “double-edged sword” even as it lowers distribution costs significantly with the help of technology as they still have to make up for the lack of sales agents who communicate directly to clients.

“Most products are distributed through agents and banks. While they do a very good job, they are also very expensive because on average, an agent in the Philippines sells one policy per month and in banks around five policies a month, so you can imagine the costs of distribution,” Mr. Hermans said.

“Compensating the lack of having a face-to-face sales person with having mobile apps that allow you to transparently see what you are buying and you have control over it 24/7 replaces the need for the face to face contact. And in that way, we can make it much cheaper,” he added.

He said based on their research, potential clients aged 25-35 years and earning decent monthly wages said they do not want to approach an insurance salesperson as “they feel obliged to buy something they don’t need.”

Meanwhile, he said the pandemic also highlighted the importance of insurance among Filipinos and encouraged them to build an emergency fund to prepare for unexpected events such as pandemics.

The use of mobile apps and other digital means surged amid the coronavirus pandemic when people were ordered to stay home during the strict lockdown imposed in March-May. This continued to rise as fears of contracting the disease and other safety protocols forced many businesses and consumers to go digital.

Singlife Philippines secured its license from the Insurance Commission in February to become the first fully digital life insurance company in the country.

It plans to launch its initial products this year through GCash.

While their digital systems have already been established, Mr. Hermans said the slow internet speed in the Philippines might be a challenge for the company and they have to adopt workarounds such as adding offline features.

The insurer plans to introduce its flagship insurance savings plan known as Singlife Account by early next year and capture 500,000 clients in the next five years. — Beatrice M. Laforga

Leave a Reply

Theme by Anders Norén