Southeast Asian local services and ride-hailing platform Grab is entering the digital insurance distribution business in Southeast Asia through a partnership with China’s first online-only insurer, ZhongAn, according to an announcement on Wednesday.
The joint venture, which will start rolling out insurance products in Singapore in the first half of this year, will offer a range of products at reduced premiums directly to users through Grab’s mobile app. After the Singapore launch, Grab said the platform will be rolled out in other markets.
“We are still evaluating which markets will follow Singapore this year, but certainly there’s huge potential in a large, under-penetrated insurance market like Indonesia, where insurance premium spending per capita was just US$91 in 2017, compared to a global average of US$650,” Reuben Lai, head of Grab Financial, told KrASIA.
The JV between Grab and ZhongAn Insurance, a subsidiary of ZhongAn Technologies International, will see Grab first collaborate with global insurance partners to come up with insurance products that are tailored specifically to the needs and demands of Southeast Asian customers. The insurance marketplace will be built based on ZhongAn International’s backend technology.
“This [insurance marketplace] is a much more comprehensive and flexible model than just partnering with a single insurance provider,” Lai said.
“It will give millions of uninsured and underinsured people access to insurance products through their mobile phones, allowing them to directly browse and pay for affordable insurance products through the Grab app, without going through an agent or broker,” Grab said in a statement.
As a starter, Grab, in conjunction with global insurer Chubb, will offer a drivers’ insurance product to its drivers in Singapore to protect them from loss of income owing to illness or accident.
Grab President Ming Maa said the launch of the insurance platform is part of the company’s goal of becoming an every day “superapp” in the region. Grab services are available across 336 cities in Southeast Asia and the app has been downloaded over 130 million times.
Lai underscores the huge opportunity in the insurance distribution business in Southeast Asia. In an interview with The Business Times, Lai said the insurance market in the region is about US$80 billion to US$100 billion even though the penetration level is still low. The market, he added, is set to double in the next few years.
Asked about Grab Financial’s plans for this year, Lai told KrASIA that remittance is an upcoming service that the company is very excited about. “We will launch a cross-border service between Singapore and the Philippines this year. This service is unique because it will allow users to send, receive and pay from within a single app,” he said.
Editor: Nadine Freischlad