MICROINSURANCE: POLICY AND REGULATORY REFORM INITIATIVES -THE PHILIPPINES
BUILDING TRUST, BUILDING BRIDGES
“MUTUAL MICROINSURANCE: WHY? & HOW? FROM A REGULATORY PERSPECTIVE”ICMIF-AOA DEVELOPMENT NETWORK SEMINAR ‘ IMPROVING ACCESS TO INSURANCE’18-20 SEPTEMBER 2013, MAKATI CITY
JOSELITO ALMARIODEPARTMENT OF FINANCE, PHILIPPINES
WHERE ARE WE BEFORE
ABSENCE OF POLICY AND REGULATORY
FRAMEWORK
• Vague government policy direction
• Unclear regulations and guidelines on microinsurance
• Hesitant providers
INAPPROPRIATE PRODUCTS
• Not tailor-fitted• Unaffordable• Complex and
complicated contracts
• Cumbersome requirements
LACK OF AWARENESS
• Distrust of insurance providers
• “Leave it to destiny” mentality
• No immediate benefits
• Additional financial burden
THE BEGINNINGS - 2006• Microinsurance driven by
successes in the microfinance sector
• MFIs form informal insurance schemes, some MBAs, to meet insurance needs of their clients
• Government responds by issuing guidelines for MBAs to deliver microinsurance
• Policy adopts principle of proportionality
THE EXPANSION - 2009
GOVERNMENT SECTO
R
PRIVATE
SECTOR
TECHNICAL WORKING GROUPS
POLICY/ REGULATORY BODIES
INSURANCE PROVIDERS (LIFE/NONLIFE - COMMERCIAL, COOPS, MUTUALS)INTERMEDIARIESMICROFINANCE INSTITUTIONS
PUBLIC CONSULTATIONS
WHAT WERE COVERED
Market ConductProduct
Innovation and Development
Financial Literacy and
Advocacy
Consumer Value and Protection
POLICY AND REGULATORY
ENVIRONMENT
WHAT WERE DONE
2010
2011
2012
• Microinsurance Defined• Microinsurance Providers
Identified• Branding and Slogan Conceived• Formalization Process Clarified• Microinsurance Agents/Brokers
Created (CBOs included)• Prototype Product Developed• Contracts Simplified• Performance Standards
Formulated• Reporting Standards Established• MBA Chart of Accounts Revised• Trainings on MI Advocacy and
Seminars • Alternative Dispute Resolution
Mechanism Established
July 2013
WHERE ARE WE NOWCOMMERCIAL PROVIDERS• 2008 - 2• 2012 – 35 (Life – 17, Non-life - 18)
MUTUAL BENEFIT ASSOCIATIONS• 2008 - 6• 2009 - 19
PRODUCTS APPROVED• 2008 – 7• 2012 – 89 (Life – 38, Non-life – 25, MBAs – 26)
INDIVIDUALS COVERED• 2008 – About 3 million (mostly credit life including
informal insurance)• 2012 – 12 million
WHERE ARE WE HEADED
Agriculture/Catastrophic Microinsuran
ce
Parametric/ Index-based
Products
POS/ Technology –
based Delivery Platforms
WHAT ARE THE LESSONS LEARNED
Clear rules and regulations provide
better understanding and transparency
Consistency of implementation
results in predictability –
branding can help
Financial literacy is educating, not
marketingAdvocacy is
convincing, not selling
Localized and simple alternative
redress mechanisms
promote effective after-sales service
A CONDUCIVE AND ENABLING POLICY AND REGULATORY ENVIRONMENT –
BUILDS TRUST, BUILDS BRIDGES
www.microinsurancephil.blogspot.com
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