Why OFWs are difficult market for life insurance
MANILA, Philippines – The Overseas Filipino Worker (OFW) market is a very important but hard market to tap, according to executives at Sun Life Financial.
Regulatory restrictions hinder a possibly lucrative market in OFW’s, said Lourdes Lopa, Chief Marketing Officer at Sun Life Financial Philippines at a press conference on Thursday, June 27.
“We’ve always seen OFW’s as a potential market for the past 10 years. We’ve been trying to find a way to reach them. They’re the ones who need it the most,” said Lopa.
Many families in the Philippines rely on OFW remittances as a major part of their income. In many cases they are the sole breadwinner of the family.
“The OFW’s are a group that really need the protection. That is something we are paying a lot of attention to,” added Rizalina Mantaring, president and CEO of Sun Life Financial Philippines.
However, while they’re a market that could stand to benefit from the financial product, regulatory restrictions hinder local life insurance brokers such as Sun Life Financial from tapping into the market.
“OFW’s are difficult because of regulatory restrictions. They have to be in the Philippines to be able to sign the insurance policy. We cannot sell to them when they’re overseas and the restriction is actually that for most jurisdictions: you can only sell product, which is approved and sold by a licensed person in that jurisdiction,” said Mantaring.
“We’re hoping that technology can play a part in changing that. Right now it’s still a grey area as to whether you can conduct business online or on video,” said Lopa.
Using technology to address the challenges of conducting a business overseas also has weak points.
“It’s very difficult to analyze the client. If you aren’t dealing with a person face-to-face, there are certain characteristics you won't see. For example, you can’t see the health conditions of the person, the color of the skin, they way they move, etcetera. There are certain things they won’t disclose that you'll spot only when you see them in the person,” said Mantaring.
“As a regulator I would also want to ensure they receive the right package. When the meeting is not face-to-face it’s hard,” she added.
Capturing the OFW market during their visits to the Philippines is also difficult as the OFW's time is already quite restrained.
“It’s a good time to catch OFWs when they come home. However, most of the time, all of their relatives are lining up to capture them. By the time the relatives are done with them they don’t have any money left,” said Lopa. - Rappler.com