Microinsurance premiums up 19.6% in Q3 2023, says IC
MANILA, Philippines —Total premiums collected under microinsurance plans grew 19.6 percent in the third quarter of 2023 compared with the previous year, with the Insurance Commission (IC) highlighting the growing importance of affordable protection plans amid the threats of climate change.
Figures released on Tuesday showed premium collections by mutual benefit associations (MBAs) and life and nonlife insurance companies amounted to P10.16 billion in the July-September period.
That was bigger than the P8.49 billion generated in the same period in 2022.
IC said premium collection increased “across the board” as the number of those who availed themselves of microinsurance policies likewise went up.
READ: Microinsurance premiums up 14% in 2022, says regulator
Microinsurance products offer financial protection to the low-income earners against various risks such as death, injury and damage to livelihood or property. Under this plan, premiums collection can be purchased for not more than 7.5 percent of the minimum wage in Metro Manila.
In a speech during the Microinsurance Forum in Manila on Tuesday, IC Commissioner Rey Regalado said financial instruments like microinsurance play a crucial role in improving Filipinos’ resilience against natural disasters.
“As we begin to experience the effects of climate change, it is important for us to have mechanisms and services that will help secure the financial stability and resiliency of our people—especially those who are among the marginalized sectors of our society whose livelihood depends on climate-sensitive resources,” Regalado said.
More players eyed
Dissecting IC’s report, premiums collected by MBAs grew 10.21 percent in the third quarter of last year to P5.1 billion while the amount generated by life insurance firms increased by 16.02 percent to P2.4 billion.
Premiums paid to nonlife insurance companies fattened by 71.96 percent to P1.1 billion, figures showed.
READ: Pre-need industry returns to profitability
In terms of the number of lives insured, a total of 56.29 million individuals are currently protected by microinsurance policies, up 2.34 percent year-on-year.
Regalado said IC was targeting to increase the number of microinsurance providers. As of the third quarter last year, there were 49 microinsurance companies in the Philippines. Those companies contributed to the P518 million that IC collected from registration and supervision fees in 2023, up by 3.83 percent.
“Our strategic direction points toward the promotion of financial literacy and to increase the insurance awareness of Filipinos, more importantly the low-income sector,” he said. INQ
