insuring the poor · •only 3.1 million people have microinsurance . end of 2012 • 35 insurance...

INSURING

Supporting the development of microinsurance: An industry perspective

THE POOR

By Emmanuel R. Que Chairman, Philippine Insurers

and Reinsurers Association

ABOUT PIRA

• Philippine Insurers and Reinsurers Association

• 72 companies

• Rating organization

• Voice of the non-life insurance industry

ABOUT

PIRA

VISION: STRONG, UNIFIED,

INFLUENTIAL & COHESIVE NON-LIFE

INDUSTRY

RIGHTS & INTEREST

STRENGTH

GROWTH

SOCIO-ECONOMIC

DEVELOPMENT

FORUMS & DIALOGUES

UNITY, GOODWILL &

COOPERATION

ALLIANCES

• More than 100

years old

• P54.57 billion in

Gross Premiums

(2013)

• 4.4% growth rate

(2013)

• GPW = 1.42% of

GDP

NON-LIFE INSURANCE IN PH

SINGAPORE 6.1 %

MALAYSIA 4.8 %

THAILAND 4.3 %

VIETNAM 1.55 %

PHILIPPINES 1.42%

INDONESIA 1.3 %

INSURANCE PENETRATION

• 25 million live below poverty line

• 50% of population say they are poor

SAD REALITY IN PH

• 100 million people (2013)

• Environment risks: Accidents, crimes,

natural calamities

• Typical solution: Loan sharks

SAD REALITY IN PH

• Health risks: Sickness, injury, death

LONG TERM SOLUTION

MICROINSURANCE

TIMELINE

1997

Planting

of seeds

2004

Intro with

micro

finance

2006

Policy

and

regulation

launch

2010

National

Strategy

launch

PIRA TECHNICAL SUB-COMMITTEE ON MICROINSURANCE

Fulfill PIRA’s role in the National Microinsurance Initiatives (Inter-agency Projects)

• Technical Working Groups

• Partnership with LGUs

• Microinsurance Conferences

• IIAP Seminars on Microinsurance

National Strategy

Regulatory Framework

Financial Literacy

Alternative Dispute

Resolution Framework

WHAT PIRA HAS DONE

BEFORE 2009

• Only MBA's have microinsurance

• No microinsurance agent category

• Only 3.1 million people have

microinsurance

END OF 2012

• 35 insurance companies have

microinsurance

• IC has approved 80 microinsurance

products

• 17 new MBA's licensed to offer

microinsurance

• IC has licensed 124 microinsurance agents,

34 of which are rural banks • More than 12 million people

have microinsurance

SUCCESS STORY

YOLANDA EXPERIENCE

300 kph winds, 6 landfalls

Affected people: 17 milion

people in 9 regions

Deaths: 6,300

Missing: 1,061

Injured: 28,689

DAMAGE: P39 BILLION

YOLANDA DEATH TOLL

SOURCE: NDRRMC

YOLANDA DAMAGES

SOURCE: NDRRMC

INSURED LOSSES

$500 million (P21 billion)

In PHP

Agriculture 19,559,379,136.11

Infrastructure 20,262,118,716.06

Total damages 39,821,497,852.17

WHAT MICROINSURANCE DID

• Used satellite imaging and crisis

maps to assess claims.

• Participated in “Agarang Proseso,

Benepisyong Sigurado” remote

claims office in Tacloban.

• Paid out P500 million worth of claims

within 10 days after Yolanda struck

WHAT MICROINSURANCE DID

OPPORTUNITIES

• More Filipinos are now conscious of

risks and the importance of being

insured.

• IC has relaxed requirements for

microinsurance companies, agents,

and products.

• IC has set up alternative dispute

resolutions for microinsurance.

CHALLENGES

• Climate change is getting worse

every year.

• Majority of Filipinos still rely on luck

and view insurance negatively.

• Insurance companies suffered badly

from Yolanda.

• High administrative costs hinder

development of new products.

CHALLENGES

Community-based &

Highly-clustered

Community-based &

Highly-clustered

Insurance Awareness

↓

SAVINGS & CREDIT

Simple & Transparent

Products Calamities

Technology

↓

Simplification & Cost-efficiency

WHAT WE WANT TO DO

Community-based &

Highly-clustered

Encourage more participation

from members

Continuous support to

Microinsurance Projects and

PPPs

Align support resources to

PIRA Technical Sub-Committee

on Microinsurance

PIRA Online Microinsurance

Library

Microinsurance seminars &

Financial Literacy Roadshows

PARTING SHOT

Microinsurance is a weapon against

poverty. The government and

private sector must work together to

develop it further.