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April 12, 2024

Sunlife: Philippine insurance sector set for surge as economy eyes upper middle-income status

The Philippine insurance industry is poised for significant growth as the country progresses towards achieving upper middle-income status, according to SunLife Grepa Financial director Rizalina G. Mantaring.

The sector has already shown substantial growth, with SunLife experiencing a 42% increase in new business premiums, including bancassurance, during the 2010s when per capita income hit $3,000.

Mantaring highlighted the critical link between increasing prosperity and the uptake of insurance products, pointing to disposable income as a key factor.

The government’s ambition to reach upper middle-income status by 2025, with a gross national income (GNI) per capita between $4,466 and $13,845, is expected to further accelerate this growth.

Despite being classified as a lower middle-income country by the World Bank since 1987, with a current GNI per capita of $3,950, the Philippines is on the brink of an economic transformation.

This shift could see insurance penetration rates rise to 5-6% of the gross domestic product (GDP), comparable to figures seen in other regional economies.

Mantaring also stressed the importance of digitalization and financial literacy in expanding the insurance market.