Insurers in Southeast Asia face a pressing challenge—attracting the Gen Z demographic, which, despite its financial awareness, often avoids traditional insurance products.
The issue is particularly evident in the Philippines, where insurance penetration remains low at 1.6%, even as the industry is projected to grow to a value of PHP 209 billion by 2028, with a compound annual growth rate (CAGR) of 9.5%.
Regional insurtech company Igloo has outlined strategies to better engage this generation, which is expected to make up a quarter of the Asia Pacific’s population by 2025, including around 40 million Filipinos.
The key to reaching Gen Z, according to Igloo, lies in making insurance simpler, more affordable, and integrated into their digital lifestyles.
One of the primary reasons Gen Z is hesitant about insurance is the perception that it is complex and unnecessary at their age.
A study by EY revealed that nearly 40% of Gen Z are concerned about making poor financial decisions, while an Accenture survey found that 52% of Gen Z in Southeast Asia distrust traditional insurers, fearing hidden clauses and high premiums.
To counter these concerns, Igloo advocates for offering straightforward, microinsurance products that address specific needs like gadget protection, travel mishaps, or pet insurance.
For instance, Igloo’s offerings in the Philippines include Travel Master, which protects travelers against health emergencies and flight cancellations, and Pet Insure, which provides comprehensive coverage for pets, including veterinary care and personal accident coverage for dog owners.
Igloo also emphasizes the importance of meeting Gen Z where they are—online. By embedding insurance options within digital wallets, payment apps, or at the point of purchase for items like mobile phones or laptops, insurers can make insurance a seamless part of Gen Z’s digital experience.
In the Philippines, Igloo has already integrated its insurance products with platforms like GCash, making it easier for young consumers to access the protection they need.
Moreover, Igloo suggests that gamifying the insurance process can significantly boost engagement among Gen Z.
By incorporating game-like elements such as points, badges, and rewards into routine insurance tasks, insurers can make the experience more interactive and appealing. This approach not only simplifies complex insurance concepts but also incentivizes Gen Z to engage with insurance products more regularly.
“By aligning with Gen Z’s preferences for simplicity, accessibility, and rewards, insurers can build trust and loyalty,” an Igloo spokesperson explained. “This is essential for expanding insurance penetration in a market that is poised for growth but remains underinsured.”
As the Philippine insurance industry gears up for growth, Igloo’s insights offer a roadmap for insurers to better connect with a generation that values financial security but demands products that fit seamlessly into their fast-paced, digital lives.
