Shift from traditional to product-based insurance

Product strategy is increasingly important in Asia life insurance. In Vietnam and Indonesia investment-linked (ILP) sales have basically disappeared as regulators imposed strict rules and the buying public has lost confidence in the product. In Singapore and Japan we see the opposite. ALL growth since 2019 has come from ILP in both markets. In Singapore, ILP sales increased almost 5x from Q1:19 to Q1:25 at a CAGR of 30%. Non-ILP sales grew only 1.5% py in the same period. In Q1:25 ILP accounted for 45% of total new business. In Japan, variable life insurance (=ILP) also saw a 30% CAGR in the period 2019-2023. The sum assured tripled in this period and the product share went from 5% to 14%. Non-ILP contracted by -1% py with total NB sum assured growing at an anemic 1% py. Life insurers tend to look mostly at distribution opportunities for growth. However, it seems in Asia taking a product lens is now at least as important triggering the question what the next product shift will be in your key markets. Two predictions: Philippines will follow the pattern of Indonesia and Vietnam as the ILP product and sales issues are quite similar. Variable sales in Japan will continue to grow faster than market as more insurers are launching their ILP propositions and customers get more familiar with the concept.

Future of insurance is unfolding before our eyes, reshaping not just how policies are sold but how customers experience protection itself. Digital platform ecosystems are at the centre of this transformation, integrating insurance seamlessly into everyday activities like purchasing a car, planning a trip, or managing health. These ecosystems are not just about convenience, they represent a bold redefinition of the insurance value chain, making products more accessible, personalized, and relevant in ways traditional models could never achieve. In these ecosystems, insurers act as orchestrators, co developers, or partners, embedding themselves into digital platforms that customers already trust. Tesla’s usage based insurance, built on real time driving data, and Ping An’s platform combining financial, healthcare, and insurance services demonstrate how ecosystems can enhance customer engagement while unlocking entirely new markets. These innovations are not optional, they are necessary for insurers to remain competitive in a rapidly evolving digital economy. But this shift demands more than technology; it requires insurers to rethink their purpose. Customers no longer view insurance as a standalone product , they see it as part of a larger ecosystem that enhances their lives. Insurers must move from being policy sellers to becoming enablers of security, convenience, and trust. Platforms themselves are becoming matchmakers, administrators, and innovators, reducing search costs, facilitating transactions, and enabling dynamic, data driven product offerings. Yet, challenges loom large. Legacy systems, regulatory hurdles, and data privacy concerns threaten to slow progress. Smaller insurers face the risk of being overshadowed by larger players who can afford to build their own ecosystems. Collaboration, innovation, and a customer first mindset are no longer just strategies they are survival imperatives. This ecosystem model also forces the industry to address critical questions: Are we building systems that truly close protection gaps, or are we creating exclusionary models that leave vulnerable customers behind? In my opinion digital platform ecosystems are not a passing trend , they are the future of insurance. Insurers who embrace this shift stand to redefine their role in society, creating value for customers, partners, and themselves in equal measure. Those who cling to outdated models risk irrelevance in a world that demands seamless integration, personalization, and purpose. The transformation has begun, and the big question is will the industry rise to meet it? Refer attached report for detailed insights.⬇️ #DigitalTransformation #InsuranceInnovation #InsureTech #EmbeddedInsurance #FutureOfInsurance #CustomerExperience #LinkedIn

🚀 The $1.03 Trillion Opportunity: Why Embedded Insurance is the Future of Digital Commerce 🛒 The digital economy is experiencing unprecedented growth, with 59% of global online sales expected to be made via digital marketplaces by 2027. Yet beneath this remarkable expansion lies a critical vulnerability: the platform and marketplace economy is both underinsured and underutilizing digital insurance technology. This represents not just a risk, but the largest untapped opportunity in modern insurance—a projected $1.03 trillion market by 2029. The transformation from traditional economies of scope to network effects fundamentally changes how insurance creates value. In traditional B2B2C models, success comes from optimizing shared platforms and distribution channels to reduce costs. But in the platform economy, value creation follows the network effect logic—the more users and services a platform adds, the more attractive it becomes to all participants. This shift demands a complete reimagining of insurance distribution. Consider that 100% of platforms and marketplaces we surveyed said the impact of embedding insurance offerings into their ecosystem had been "positive" or a "game changer." These aren't incremental improvements—they're business transformation stories. The data reveals the magnitude of the opportunity: 72% of platforms and marketplaces will offer some kind of protection and insurance services to their retail customers, while 32% will serve business users. With 87% of micro, small, and medium enterprises expected to use digital platforms within five years, and 13% open to purchasing embedded insurance, we're looking at a fundamental restructuring of how protection is distributed and consumed. ♟️ The Strategic Imperative For insurers, this isn't about adapting existing products—it's about developing entirely new capabilities. API-driven integration, data utilization and analytics, product customization and flexibility, seamless user experience design, and regulatory compliance across multiple jurisdictions become table stakes. The insurers who recognize this imperative and act decisively will lead the industry into its next growth phase. The window for first-mover advantage remains open, but it's closing rapidly. As platforms increasingly expect insurance partners who can deliver embedded solutions at the point of need, traditional insurers must evolve or risk displacement by more agile competitors who understand the platform economy's unique demands. Full report --> https://lnkd.in/djWVTM3a #EmbeddedInsurance #InsuranceGrowth #DigitalPlatforms #MarketplaceEconomy #Underinsurance Wayne Slavin Phil Hobson Ramitha Soysa Leonardo Cardone Peter C. Evans, PhD