Health insurance startup nabs $1m from Gobi, Tryb, others

The MariaHealth team / Photo credit: MariaHealth

Five to 10%. That’s the proportion of people who have access to health insurance in the Philippines, says entrepreneur Vincent Lau.

Spurred by the lack of transparency in the country’s healthcare system, Lau, an American who was based in Silicon Valley, relocated to Manila to co-found MariaHealth, a marketplace where customers can compare and buy health insurance plans.

“The process of getting insurance is confusing for the customer and is very time-intensive,” he shares. As a result, the Philippine Insurance Commission estimates that the country’s underinsurance – the gap between the amount of insurance coverage that people need and what they actually purchase – will grow to US$200 billion by 2020.

The market potential, coupled with the Filipino population’s growing interest in health, has some investors excited in the startup.

MariaHealth raised a US$500,000 pre-seed round in 2017. And now, it has raised another US$1 million round, which was first reported in January 2019, but was only closed this month.

The latest fundraise was led by China’s Gobi Partners, with participation from returning investor Wavemaker Partners, Singapore-based Tryb, US-based Hustle Fund, and some angels.

Catering to the underserved

Health maintenance organizations (HMOs) often market their health insurance plans only to large multinational corporations. That’s why MariaHealth targets small and medium-sized enterprises (SMEs) as well as individual customers to fill the gap.

On its website, customers can sift through a number of health insurance products from HMOs. These include health cards that people can purchase to give them access to unlimited medical consultations and waived emergency room fees, among other benefits. Users can buy these the same way they buy clothes online – adding the product to a cart and checking out.

MariaHealth also allows its customers to request a proposal for a customized plan.

The startup makes money by charging a 15% to 20% transaction fee from bookings done on its platform. It then earns the same fee if the customer renews or purchases another plan, even if it’s directly with the HMO provider. MariaHealth also offers after-sales services, including a customer support desk that answers queries on health policies.

According to Lau, who also serves as the company’s CEO, MariaHealth has grown steadily since it was founded in 2016. He claims that its gross merchandise volume has increased by roughly 50% each quarter and that it has tie-ups with the top five HMO providers in the Philippines.

The startup has insured over 10,000 people and has an employee count of 20, working out of its Manila office.

First-mover advantage

“MariaHealth has a first-mover advantage,” says Jason Strimpel, principal investor at Tryb. According to both Lau and Strimpel, the startup has no direct competitors, but the space in general is heating up.