The Philippine government wants microinsurance coverage among Filipinos to jump to 50 million by 2022 by making these already cheap insurance products more available to farmers and those living in disaster-prone areas, Finance Undersecretary Gil Beltran said.

During a meeting organised by the German development agency Deutsche Gesellschaft fur Internationale Zusammenarbeit (GIZ) GmbH, Beltran noted that the number of Filipinos covered by microinsurance increased to 38.9 million from less than three million in 2009.

The regulator Insurance Commission (IC) had attributed the 18.8 per cent increase in microinsurance penetration last year to higher sales of more mutual benefit associations as well as life and nonlife insurers selling these cheaper but short-term insurance policies.

“Since 1997, the DOF [Department of Finance], together with the National Credit Council, began to develop policies on financial inclusion through the National Strategy for Microfinance. Through this, the Philippine government has set the stage for market-driven provision of both microfinance and microinsurance – leaving itself with an enabling, supporting role through policy, regulation and capacity-building,” Beltran noted.

Beltran, who is also the DOF’s chief economist, likewise highlighted how microinsurance coverage helped when natural disasters, like Supertyphoon “Yolanda” (international name – Haiyan) that flattened central Philippines in 2013, strike.

“In the aftermath of Yolanda, those covered with microinsurance claimed an estimated 500 million pesos [$11.5 billion in November 2013] almost immediately. Claims were made mostly from nonbanking institutions like pawnshops and remittance centres – both of which cater and are more accessible to those in the lower classes. These claims have been vital in the rehabilitation of survivors,” Beltran said.

This shows that beyond accomplishing the goal of financial inclusion, microinsurance also took on the role of social safety net for vulnerable segments of the population, he added.

Beltran told reporters that one way to jack up microinsurance penetration was by introducing products for farmers.

In 2016, the IC came out with microinsurance frameworks for agriculture, health and preneed products, making the Philippines widely regarded as a microinsurance model in the region.

However, Beltran said the government did not intend to make microinsurance coverage mandatory as had been proposed for products aimed at covering disaster risks.

“We don’t want to do that – we are like forcing people to eat something they might not want. Sometimes the market develops by itself – no country has tried to impose” microinsurance coverage, Beltran said. PHILIPPINE DAILY INQUIRER/ASIA NEWS NETWORK