Philippines charts insurtech age with inaugural sandbox

July 13 2020 by Yvonne Lau

In what looks to be a promising move for Asean insurtech, the Philippines’ Insurance Commission (IC) on June 14 released guidelines for its first-ever insurtech regulatory sandbox.

Dennis Funa, the IC commissioner, told InsuranceAsia News (IAN): “[It] is a pioneering moment for Philippines’ insurance regulation at this technological day and age.”

Funa said “immense benefits” are brought to market through tech development and innovation — and this is achieved through experimentation, testing and learning — which is what the sandbox is designed to facilitate.

The Philippines’ insurance penetration rate currently stands at a meagre 1.67%  — lower than that of its neighbours in Thailand, Indonesia and Vietnam.

“The sandbox will…help insurers better evaluate risks and opportunities, particularly in terms of risk management, data privacy, cybersecurity and sustainability.” Richard Bates, Manulife Philippines

InsuranceAsia News (IAN) reported on the current state and future outlook of Asean insurtech back in May — and the potential of South-east Asia’s internet economy is huge.

How will the new sandbox help the Philippines to tap into the market’s digital potential?

The programme
All insurance providers may set up a “controlled system that allows [for] small-scale and live testing of technical innovations operating under special circumstances.” Each programme must be first approved by the IC before being implemented.

Once approved, the experimental cycle will last for one year, and providers can request a six-month extension.

Fundamentally, notes Funa, the sandbox allows Philippine insurtech the chance to innovate and stay competitive — in a supervised and organised manner.

“It provides Philippine insurtech to develop at a similar pace to its regional and global counterparts. It also allows Philippine [insurers] and mutual benefit associations, to safely test insurtech solutions [for business] while simultaneously ensuring the protection of the greater public,” he said.

Richard Bates, Manulife Philippines’ president and chief executive, told IAN: “[Operating] within a controlled environment, the sandbox will also help insurers better evaluate risks and opportunities, particularly in terms of risk management, data privacy, cybersecurity, and sustainability. This helps us [as insurers] better assess the technology we will invest in that is right for the Philippine environment.”

Simon Smallcombe, head of strategy, Asia Pacific, insurance consulting and technology at Willis Towers Watson (WTW), added: “Operating a sandbox with close supervision is a pragmatic decision, and one that many regulators have adopted at times of significant change. The [IC’s framework] is a positive step.”

“With the rise of fintech [and insurtech] platforms due to [Covid-19] and the new normal – now would be the best time for insurtech companies to help bridge the gap.” Hamilton Angluben,

The Commission noted that there currently are 55 non-life insurers, 27 life insurers, five composite insurers and 33 mutual benefit associations authorised to conduct business and eligible to participate in the sandbox.

Progress and synergies
But progress must be spurred by collaboration — from public-private cooperation, to partnerships between major insurers and insurtech start-ups, to cross-market synergies across Asean.

For Manulife Philippines, Bates noted to IAN: “The sandbox will enable experimentation, and open up our industry for all innovators, whether tech-driven start-ups or established companies. It will allow us to explore new solutions and technology in the market that can enable and speed up our digital shift. Innovation is key — however, it doesn’t always have to be in-house.”

Manulife Philippines’ innovation team looks beyond the company to find solutions, says Bates, which has led to the enablement of a payment channel, communication platform, leads management tool and new customer services. The company is also the committee chair for the Fintech Philippines Association — which provides more exploration and collaboration with insurtechs and start-ups. 

Indeed, partnerships will be necessary. Philippines insurtech recently announced the launch of a digital platform by Q4 2020 — which has spurred discussions with over 20 insurers for distribution partnerships, including Canadian major Sun Life (Philippines).

Hamilton Angluben, founder and chief executive of, noted: “With the rise of fintech [and insurtech] platforms due to [Covid-19] and the new normal – now would be the best time for insurtech companies to help bridge the gap.”

And while Singapore leads the way in insurtech investments and activity across South-East Asia, this highlights the potential of cross-border synergies and the importance of tapping into all of the region.

For instance, recognised Singaporean insurtech Axinan, entered the Philippine market through a partnership with general insurer Mercantile Insurance. And Singlife, one of Asean’s most well-funded start-ups, is also moving into the Philippines. IC commissioner Funa wrote in a commentary that Singlife’s move highlights its intention “to capture South-East Asia through the Philippine market.” emphasised that while their starting point is the Philippines, the goal is to reach all of South-East Asia.

Opportunity knocks
While Funa acknowledged that Covid-19 may delay sandbox applications, he noted the Commission is readily awaiting applications.

Indeed, the Philippines’ insurtech sector is still maturing. But the sandbox, along with a collaborative approach, is set to foster innovation in the age of tech-first (re)insurance.