LGUs urged to push insurance awareness

CEBU, Philippines - The Philippine government, through the Insurance Commission (IC), and the Department of Finance-National Credit Council (DOF-NCC) has urged the Local Government Units (LGUs) across the country, to promote the awareness of micro-insurance to their respective constituents.

This is to help the mainstream community to embrace the culture of savings, and protection in times of calamities, and unexpected happenings.

 “The LGUs are the potent force to promote micro-insurance. Now, that we have provided the instrument for affordable insurance products, it is high-time for the LGU leaders to make this known to their residents,” said DOF-NCC director Joselito Almario.

Unlike in other countries, the Philippines has one of the lowest rate in terms of insurance premiums. Over the years, the percentage has only settled between 11 percent to 14 percent of the total population.

This means, that only a few has enjoyed or has taken serious interest in saving or protecting their future, through getting an insurance premium.

Because of the micro-insurance roll-out recently introduced by the government, in cooperation with different international funding agencies, like the Asian Development Bank-Japan Fund for Poverty Reduction, and the German International Cooperation, Almario said the goal of hitting 20 percent of the total population insurance coverage by 2020 is seen to fast track.

LGUs are urged to make programs, and awareness campaigns to inform and educate their respective communities on the importance of insurance, as part of their basic necessity.

Because the micro-insurance roll out, is meant to attract to grass roots, requirements for getting a premium is also being relaxed. A farmer for instance, can already get an insurance premium only by presenting a barangay clearance.

For as low as P20 a day, an ordinary Filipino can already get an insurance premium for as much as P200,000.

The LGUs participation on this campaign, is also equally important, as leaders can avoid providing dole-outs to calamity affected residents, if majority is insured.

“We have to educate our constituents to protect themselves,” Almario said adding that the culture of depending on the help and dole-out from politicians and the government in times of calamities can be minimized.

Almario added that LGUs could also start encouraging their cooperatives, and people’s organization to partner with micro-insurance companies on this program.

Because of this campaign, there are now about 27 insurance providers that have partnered with different cooperatives, and community organizations to offer insurance premiums to the mainstream market.

As of January this year, there are already 3.5 million approved policies in the micro-insurance category, in both life and non-life insurance products.

Micro-insurance is considered to contribute to national poverty alleviation strategy.

Of the total 94 million population in the Philippines, about 25 million of whom are in the poverty line or 26.5 percent. Only 2.9 million of the 25 million population in the poverty line are maintaining some kind of risk protection or covered by insurance products, mostly are the informal insurance schemes offered by cooperatives, or organizations in the communities.  (FREEMAN)