WHO IS RURALNET

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Justin Arcenas’ RuralNet is dedicated to the mission of enhancing insurance accessibility for Filipinos. As a cutting-edge digital intermediary, RuralNet partners with largely provincial financial institutions to improve access to and ensure a better product fit for Filipinos to health, accident, life, and other insurance products.  

 

As a brokerage, they offer custom insurance programs and implementation alongside tech services. As an insurtech company, they offer insurance distribution SaaS to insurers in order to help them enter captive markets.

 

Currently, RuralNet has partnered with 25 financial institutions that serve about 2 million Filipinos. They have been able to cut claims processing time by 65%, making the insurance process more efficient. 

 

WHY RURALNET STOOD OUT TO US 

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The Market: RuralNet demonstrated their potential in filling the insurance gap in the Philippines through customization for the mass market. Currently, there are 65 million Filipinos who are 20 years old and above, 85% of which belong to lower income groups. This means that there is an addressable market of 55 million low-income Filipinos who could be insured. 

 

However, the Philippines has a low insurance penetration rate that lags behind neighboring nations like Vietnam, Thailand, and Malaysia. This is due to a lack of access to, familiarity with, and product fit of existing insurance products. Many Filipinos are reluctant to purchase insurance as it is unaffordable, complex, and inefficient, creating the misconception that it is an unnecessary expense.

 

RuralNet mitigates these worries by providing a seamless path from enrollment to efficient claims processing, using local partners where there is an immediate use-case for an insurance product, as well as offering clients sachet-size pricing with insurance policies as low as US$1. 

 

At Foxmont, we believe it is crucial for lower-income populations to have access to insurance as a way to provide financial protection against unexpected events, grant access to essential services like healthcare, promote economic stability, prevent debt and poverty cycles, and enhance community resilience. Foxmont’s investment into RuralNet allows us to help give millions of Filipinos that peace-of-mind and financial stability. 

 

The Founder: When we first met Justin in October of 2022, we quickly realized his potential. At the age of 18, Justin was the youngest hire of Boston Consulting Group (BCG) in the Philippines. Well-spoken and intelligent, what truly set Justin apart was his understanding of RuralNet in the context of the insurance market outside of Metro Manila. 

 

Being from a secondary city, Justin recognized a significant gap in the insurance landscape within the Philippines, and his solution was created to empower rural brokers and communities, providing them access to easily digestible insurance products. As he said, “when our average customer is a 40-year-old married woman with three children but no smartphone, direct online interfacing with the customer doesn't work.”

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The Company: Not only does RuralNet embrace the transformative power of digitalization, but it also recognizes the importance of personalized interactions in serving its customers. RuralNet’s ability to cross-sell with microfinance products while pairing it with physical purchase locations of its partners captures and educates potential clients who lack knowledge about insurance. Lastly, Justin’s focus on sustainable unit economics makes the company well-placed for continued growth and success. 

 

ABOUT THE ROUND

 

This $2.15M funding round was led by Kickstart Ventures, with other investors including Foxmont, Gentree, and Kaya Founders.  With this funding, RuralNet aims to grow their microinsurance business by having more partners and expanding their insurance solutions to Small and Midsized Enterprises (SMEs) through their SME digital insurance portal CashKO. 

 

SMEs make up 99.56% of businesses in the Philippines, however the majority of their employees are underserved by insurance. In a survey done by RuralNet, they found that most SMEs want and need insurance, but they do not have access to them. This is due to the amount of effort an agent would need to close them. Through RuralNet and CashKO, the SME insurance process will be shortened from a multi-week to a same-day sales cycle. 

 

To learn more about RuralNet, visit: https://ruralnet.ph/