PCIC, CARD Pioneer ink risk-sharing scheme

MANILA, Philippines — The Philippine Crop Insurance Corp. (PCIC) has partnered with CARD Pioneer Microinsurance (CPMI) in a risk-sharing program that would benefit the agriculture sector by insulating them from risks such as natural calamities.

This marked the first time a private insurance firm has taken the cudgels for risk sharing in the agriculture sector and is seen to bridge the insurance gap and contribute to the sustainable development of agricultural insurance in the country.

CPMI is a joint venture between CARD MRI, the country’s largest microfinance provider, and Pioneer, one of the country’s leading insurance groups.

Supported by the Asian Development Bank (ADB) under its Financial Inclusion Framework Strengthening technical assistance project, this initiative marks the first public-private partnership in the Philippines aimed at helping the smallholder farms recover losses associated with natural calamities such as typhoons.

Under a memorandum of agreement the two companies signed, PCIC, a government agency that insures smallholder farmers against losses from natural calamities, plant diseases and pest infestations, and CPMI will share risks underwritten for each smallholder farmer insurance policy with the latter as the lead insurer.

This co-insurance partnership will initially focus on insuring high-value crops in selected regions where the current penetration of PCIC’s agriculture insurance products is limited. PCIC will provide capacity-building support to CPMI on various aspects of agriculture insurance, such as underwriting, policy administration, actuarial matters and claims management.

“Almost 24 percent, or roughly over 25 million of the Philippines population are engaged in agriculture – proof that that we have no shortage of natural resources suitable for agriculture. But we also know that exposure to natural calamities is a constant threat that continues to cause devastating damage to their livelihood,” said Pioneer Inc. president and CEO Lorenzo Chan Jr.

“Our initiative with PCIC aims to address that by helping smallholder farmers restart as typhoons, pests and plant diseases ravage their crops. We are honored by the trust extended to us to be part of the solution in addressing the needs of the industry that provides food for our table and dare I say – contributes to peace in our society. We hope this initiative will spur more synergies between the public and the private sectors in sustainably providing effective affordable insurance products to all farmers and ultimately help them manage the risks they face.”

In 2021, CPMI achieved over 11 million enrollments from its microinsurance programs. It seeks to offer relevant needs-based insurance solutions to help underserved and unserved Filipinos recover, rebuild and restart after life’s setbacks.