UnionBank turns to fintech to push insurance coverage

MANILA, Philippines — The fintech arm of Aboitiz-led Union Bank of the Philippines is ramping up efforts to encourage more Filipinos to avail insurance products.

John Januszczak, president and chief executive officer at UBX Philippines Corp., said in an online forum the company’s insurance platform Assured is helping address the industry’s crisis through embedded insurance with everyday Filipino experiences powered by innovation and co-creation.

Januszczak said the UBX sees more consumers availing embedded insurance as the pandemic has served as a catalyst to digitalization in the Philippines.

Embedded Insurance means abstracting insurance functionality into technology to enable any third-party product or service provider or developer in any sector to seamlessly integrate innovative insurance solutions into their customer propositions and experiences, either as complementary add-ons to their core offerings or as new native components.

Januszczak said three possible factors that are keeping a lot of Filipinos from availing insurance products include the lack of understanding about the product, distribution, and lack of appreciation about the importance of insurance.

“Products are often too complicated, predicated on old sales models with corresponding jargon that inevitably develops over the years. Often, what is sold is in many cases essentially the same kind of product that my own parents bought over 50 years ago. What is equally concerning is the sub-optimal impact that the complexity has not just on customers but conventionally, on insurance agents and advisors,” Januszczak said.

Januszczak also said traditional intermediaries such as agents, brokers, and bank partners have only so much reach without leveraging digital.

“On top of this, distribution via these traditional channels requires higher value products to be economically feasible. The cause of traditional sales channels is noble, but ultimately, only economically feasible for the more affluent in our society,” Januszczak said.

Furthermore, it’s not easy for most to have even a basic understanding of how valuable insurance can be for them, which is why it’s important for providers to make it easier to discover.

“You have to make it easier for the consumers to discover the value of insurance. And insurance is obvious when it is hyper-personalized and offered in a hyper-relevant context,” Januszczak said.

With Assured, the goal of UBX is to take monolithic, complex, and expensive products from insurers and make them more accessible.

Coherent CEO and co-founder John Brisco said Filipinos particularly the younger ones are now comfortable with online transactions.

“What we’re trying to do is help   insurers by making it much easier for them to bring their products and integrate them into the UBX ecosystem. So, we’re acting as the facilitator between UBX and insurers so that all the data that has to interact between an insurer and UBX is as consistent and seamless as possible,” Brisco said.