Thursday, October 29, 2020
 
Home Business Low-income Filipinos can rely on microinsurance when disaster strikes

Low-income Filipinos can rely on microinsurance when disaster strikes

 

THE domestic insurance industry posted a stellar growth performance in the past year, registering an estimated 28 million Filipinos protected by microinsurance.

Microinsurance has proven to be a great tool in promoting affordable security in the Philippines with its significant contribution to the increase in insurance penetration, which hit 28 percent, one of the highest rates in the Asian region.

The recent calamities that shook the country highlighted the importance of having insurance protection, especially for the poor who are the most vulnerable. When Super Typhoon Yolanda struck the country in November 2013, over half a billion pesos in microinsurance claims were settled and given as benefits to families to cover calamity assistance for damaged crops, hospitalization and death.

 


Now that its wide-ranging impact is known, microinsurance is currently seen as an important component of risk management, complementing the government’s disaster prevention and rehabilitation program.

To support the industry’s growth, providers are encouraged to look into designing more products that will provide comprehensive coverage to the lives and livelihood of low-income people. One example of this is crop insurance offered by public insurance agencies in partnership with private providers.

There is a need to develop such products to cushion the effects on the low-income segment whose livelihoods and income sources are threatened when calamities strike. When such losses occur, the ability of an individual to bounce back from a calamity is severely affected, thus also affecting the productivity of their segment in the broader economy.

Delivery channels like the rural banks, cooperatives and other microfinance institutions should respond to these needs by providing access to a product that will provide security over losses at an affordable rate. Support and development institutions like industry associations, donors and other development-oriented agencies, on the other hand, should do their part by providing assistance in building the capabilities of various delivery channels to provide quality microinsurance services to the low-income sector.

For its part, the Rural Bankers Association of the Philippines is continuously providing training and licensing and other forms of technical assistance to its member banks. To date, a total of 223 rural banks and over 500 staff have already undergone microinsurance training provided by the RBAP’s training arm, the Rural Bankers Research and Development Association.

Bank staff who completed the course are qualified to act as their institution’s soliciting agent, which is part of the program to empower institutions as access points for clients to avail of microinsurance.

With continuous partnership between the private and the public sector, microinsurance will soon emerge to be a vital component of disaster risk management, benefiting more Filipino lives in the coming years.

 

Duterte visits parents’ tomb

PRESIDENT Rodrigo Duterte visited the tomb of his parents in Davao City on Wednesday night. He was accompanied by Sen. Christopher Lawrence "Bong" Go based...

Beermen escape Bolts, 89-82

THE defending champions San Miguel Beermen pulled off a huge comeback en route to an 89-82 win over the Meralco Bolts in the PBA...

Esperon backs ‘red-tagging’ officials

NATIONAL Security Adviser Hermogenes Esperon Jr. on Wednesday expressed support for two officials, under fire for "red-tagging" personalities, for their crusade against progressive groups...

Another DepEd module slammed

THE Department of Education (DepEd) on Wednesday clarified that the modules with “hugot lines” slammed by a film director did not come from the...

Death toll from ‘Quinta’ up to 14 — OCD

THE death toll in the aftermath of typhoon "Quinta" (international name: Molave) rose to 14, with 21 injured and seven persons missing, disaster authorities...

Weather

Today's Front Page

TRY OUR DIGITAL EDITION
FREE FOR 30 DAYS

ALREADY A SUBSCRIBER?