Beyond protection: How insurance powers economic growth

For many Filipinos, insurance is seen primarily as protection for difficult moments: an illness, an accident, the loss of a breadwinner or damage caused by a natural disaster.

That role remains fundamental. But increasingly, evidence suggests that the value of insurance extends well beyond the individual policyholder.

Insurance can also be an enabler of economic growth. Research from Prudential plc, developed in partnership with PwC, examines the wider social and economic impact of insurance across six ASEAN markets, including the Philippines. Its findings point to an important opportunity: as more people gain access to appropriate financial protection, the benefits can flow through households and businesses to the broader economy.

For the Philippines, the potential is significant. The study suggests that if life insurance uptake were to increase by 50 percent by 2050, both gross domestic product per capita and total GDP could potentially be up to 5.1 percent higher. A similar increase in non-life insurance uptake, which includes health insurance, could potentially raise GDP per capita and total GDP by up to 2.9 percent.

These are modeled long-term outcomes, not predictions, but they illustrate how wider insurance coverage can contribute to a stronger and more resilient economy.

Protection that strengthens households and the economy

Protection matters particularly in the Philippines, where families face financial risks from illnesses, accidents and natural disasters.

A single unexpected event can quickly erode years of household savings. In 2025, out-of-pocket spending accounted for 41.2 percent of total health expenditure in the Philippines, potentially diverting household resources from savings, education and investment.

Climate-related shocks compound this vulnerability: from January to August 2026, 73,000 houses were reported damaged, alongside an estimated P4.37 billion in agricultural losses and P14.3 billion of infrastructure damage from this year’s series of typhoons and the southwest monsoon. For households and enterprises with limited financial buffers, these shocks underscore the importance of stronger financial protection and resilience.

The value of financial protection is increasingly reflected in the government’s development agenda. In his recent State of the Nation Address, President Marcos welcomed the growing number of Filipinos securing insurance coverage from the private sector. This direction is consistent with the Philippine Development Plan 2023–2028, which recognizes the promotion of social insurance products as part of the broader effort to build a prosperous, inclusive and resilient society.

By helping Filipinos manage life-cycle risks, economic shocks, health emergencies and disasters, insurance can complement public social protection programs and provide families with an additional layer of financial security.

Increasing insurance coverage is therefore not simply an industry ambition. It is a development and nation-building priority, one that can help create a more financially secure and resilient Philippines.

Supporting productivity and human capital

Health insurance helps people access timely and appropriate care without facing significant out-of-pocket expenses. By enabling individuals to stay healthy and recover more quickly from illness, it supports sustained workforce participation and productivity.

Beyond health outcomes, insurance provides households with greater financial security. When families are cushioned from major financial shocks, they are better positioned to focus on long-term priorities such as education, skills development and other investments that strengthen human capital.

Life insurance also contributes to long-term savings and capital formation. By pooling long-term funds, insurers can channel resources into productive investments that support business expansion, infrastructure development and broader economic growth.

Closing ASEAN’s protection gap

The discussion is particularly timely as the Philippines assumes the ASEAN Chairmanship in 2026.

ASEAN is one of the world’s most dynamic economic regions, but continued growth will depend in part on resilience against financial, health and climate-related shocks. However, according to the study, insurance penetration across ASEAN region averages around three percent of GDP. That is less than half the global average of 6.7 percent.

Strengthening financial protection should therefore form part of the broader conversation about sustainable and inclusive development.

Greater regional collaboration can improve financial literacy, encourage innovation, strengthen public-private partnerships and broaden access to protection. Governments, regulators and insurers can also help ensure that insurance complements public policy while supporting financial preparedness.

Insurance should not be viewed solely as a safety net. Properly understood and more widely accessible, it can be a strategic tool for building a more resilient, productive and prosperous Philippines and ASEAN region.