Philippine Insurance Industry Posts 12% Growth in 2025

The Philippine insurance industry closed 2025 with impressive double-digit growth, posting a 12% increase in total premium income compared to the previous year. This marks the sector's strongest performance in the past five years, driven by increased insurance awareness, digital transformation, and economic recovery.

Key Growth Drivers

1. Digital Transformation

The shift to digital channels accelerated dramatically in 2025. Insurance companies invested heavily in online platforms, mobile apps, and digital payment systems, making it easier for Filipinos to purchase and manage policies.

• Online policy purchases increased by 45%
• Mobile app transactions grew by 60%
• Digital claims processing reduced turnaround time by 40%
• Chatbot and AI-assisted customer service improved response times

2. Rising Insurance Awareness

The pandemic's lasting impact continues to drive insurance awareness among Filipinos. More people now recognize the importance of financial protection against unexpected events.

According to the Insurance Commission, the insurance penetration rate (premiums as % of GDP) increased from 1.9% to 2.3% in 2025 — still below the regional average but showing steady improvement.

3. Motor Insurance Boom

Motor insurance led the non-life segment with 16% growth, driven by:

• Record vehicle sales in 2025 (over 450,000 units)
• Stricter CTPL enforcement by LTO
• Increased awareness of comprehensive coverage benefits
• Competitive pricing from multiple providers

4. Health and Personal Accident Insurance Surge

Health and personal accident insurance saw remarkable 22% growth, reflecting Filipinos' heightened health consciousness post-pandemic. Employers also expanded employee benefits packages to attract and retain talent.

Regional Performance

Growth was not limited to Metro Manila. Provincial markets showed strong performance:

• Visayas: 15% growth, led by Cebu and Iloilo
• Mindanao: 13% growth, driven by Davao and Cagayan de Oro
• Northern Luzon: 11% growth, with strong performance in Baguio and Pampanga
• Southern Luzon: 14% growth, particularly in Cavite and Laguna

Challenges Remain

Despite the positive growth, the industry still faces several challenges:

• Low penetration rate: At 2.3%, still below ASEAN average of 3.8%
• Insurance literacy: Many Filipinos still don't understand insurance products
• Fraudulent claims: Estimated at ₱2-3 billion annually
• Unlicensed agents: Continued reports of fake insurance schemes
• Claims processing speed: Still a pain point for many policyholders

2026 Outlook: Continued Growth Expected

Industry analysts project 10-12% growth for 2026, supported by:

• Economic expansion (projected 6-7% GDP growth)
• Continued digital adoption
• New product innovations (micro-insurance, parametric products)
• Government infrastructure projects driving construction insurance
• Rising middle class with greater purchasing power

What This Means for Consumers

The industry's growth is good news for Filipino consumers:

• More choices: Increased competition means more product options
• Better pricing: Competition drives competitive premiums
• Improved service: Digital tools make insurance more accessible
• Innovation: New products tailored to Filipino needs
• Financial stability: Growing industry means stronger companies

The Bottom Line

The Philippine insurance industry's 12% growth in 2025 signals a maturing market and increasing financial literacy among Filipinos. As digital transformation continues and awareness grows, the sector is poised for sustained expansion in the coming years.

For consumers, this means more accessible, affordable, and innovative insurance products. The key is to work with licensed, reputable agents who can guide you through the options and help you make informed decisions.