MANILA, Philippines - The Philippine Crop Insurance Corp. (PCIC) said it has paid out P41.3 million in crop insurance indemnities to farms ravaged by typhoons Ondoy and Pepeng after a directive from President Arroyo to fast-track the processing of the insurance payments.
The P41.3 million was paid to 3,602 farmers from Regions I to V and with a total tilled area of 6,673 hectares, PCIC president Jovy C. Bernabe said in a report to President Arroyo.
The PCIC reported to President Arroyo that the crop insurance payments wiped out the entire production loans that the beneficiary-farmers borrowed from cooperatives as well as from rural and cooperative banks but which went to naught due to Ondoy and Pepeng.
According to the report reaching President Arroyo, PCIC crop insurance indemnities to insured farmers now total P96.875 million for the period January-October 2009.
A plea for the urgent payment of the crop insurance of the ravaged farms was made by Butil Party-List Rep. Leonila V. Chavez to President Arroyo right after typhoon Ondoy moved out of the country’s area of responsibility. The President promised urgent PCIC action, said Chavez.
After Pepeng, which hit the country right after Ondoy, the PCIC started receiving and processing payments, based on the production loans of the affected farmers.
“The farmer-payees can now prepare for the planting season anew without worrying about an outstanding loan. This is the good thing about the crop insurance system,” said Chavez. Scores of Butil-affiliated farmers were among those with PCIC-insured palay and corn farms.
Under the PCIC insurance scheme, a farmer who borrows for crop production pays an insurance premium averaging 2.33 percent of amount of cover for rice. The amount is automatically deducted from the proceeds of the loan. The premium rate varies from region to region and whether it is rainy season or dry season.
The National Government provides a subsidy of about 5.9 percent of amount of cover for rice crop insurance premium of subsistence farmers to make the program affordable to them.
Chavez has been batting for a bigger PCIC budget to enable the agency to cover more farmers, particularly the agrarian reform beneficiaries.
“We have talked to President Arroyo about it and in due time she will positively act on this,” said Chavez.
A moderate increase in the capitalization of the PCIC will enable it to expand its insurance coverage that includes not only rice and corn crops but also high value crops, livestock and poultry, said Chavez.