Philamlife starts first-ever commercial microinsurance

The Philippine American Life and General Insurance Corp. (Philamlife) will be launching this week the first-ever commercial microinsurance product in the country in response to calls by the Insurance Commission (IC) to increase the insured population to over 20 percent of the population.

Philamlife official said that the new product product is affordable, accessible and specifically tailored for the broad market, which accounts for over 80 percent of the population.

It was designed to meet the premium amount set by the Commission, which should not exceed 10 percent of the minimum daily wage of Metro Manila workers.

Industry players said that Philamlife may be introducing microinsurance in the form of cards, or a cross between celphone or Internet cards, credit and debit cards.

Microinsurance has long been in the market albeit not in commercial form. Principal proponents of microinsurance are non-government organizations (NGOs), microfinance institutions (MFIs), and cooperatives. Their members are the main market for their products.

Insurance Commissioner Evangeline Escobillo called on insurance companies to develop products to complement the government’s newly-launched microfinance program, which aims to provide minimum wage earners access to credit and insurance products.

"Insurance providers are encouraged to provide the poor with access to affordable insurance with policies that are easier to understand. I commend Philamlife for being the first commercial life insurance company to come up with a groundbreaking product that offers accessibility and affordability like no other insurance product in the world. I hope that this paves the way for other industry players to develop low-cost insurance for the masses," Escobillo commented.

Studies show that less than 20 percent of the country’s populatin has at least one form of insurance.

It further indicates that between five to seven percent of the population are holders of private sector-initiated insurance policies.

The rest of the insured public are covered by government pension funds such as the Social Security System (SSS), and the Government Servcice Insurance System (GSIS).