Philippines insurance penetration remains stubbornly low despite the country’s rising financial vulnerabilities and exposure to natural catastrophes, according to an executive at Singlife Philippines.

Lester Cruz, Singlife Philippines chief executive officer, said affordability, access, and consumer knowledge are the primary obstacles preventing wider coverage.

The nation is one of the world’s most vulnerable to typhoons, while a significant portion of its population is classified as low-income.

“When the distribution model for most insurance companies is high cost, it becomes quite difficult to avoid the larger requirements for customers to be just purchasing a single product,” Cruz said in an interview. This suggests a direct correlation between distribution expenses and the final price paid by consumers.

Access is complicated by the low digital literacy among the company’s target market—the general adult demographic. Furthermore, the traditional sales model can be a deterrent.

“[It’s] very difficult for a lot of customers, historically, to gain access to insurance without having to pass through other people, agents,” Cruz expounded. “Sometimes, it could rather be an intimidating process to have to disclose to people the intimate details about yourself and about your presence.”

Compounding the cost and access issues is a lack of understanding about available financial products. Cruz stressed the need for customers to be more informed about financial solutions and services.

“Every single solution that we have in place right now, I would argue, is market-best,” he said. “Our burden or challenge right now is to have as many Filipinos see what we’ve built and understand.”

He added that the industry needs to transform into a more modernized system for insurance distribution.

Singlife, a unit of Singlife Singapore and ultimately owned by Japan’s Sumitomo Life, is attempting to power through these challenges with its latest product.

The new Singlife NextGen model allows customers up to ₱6 million ($106,000) in coverage for daily needs, children’s education, or future ventures. The product allows for flexible payment periods of between five and 10 years.

To customize plans, the firm provides users with a financial needs analysis based on their budget and requirements. The offerings are distributed via the Singlife Plan & Protect App.