Microinsurance Premiums up 14% in 2022

From P10.12 billion in 2021 to P11.53 billion in 2022, premiums collected by microinsurance businesses increased by 14%.

The Insurance Commission (IC) estimates that from 53.65 million insured lives in 2021 to 57.75 million in 2022, the number of lives covered by micro-insurance products increased proportionally by 7.5 percent.

“The increases in collected premiums and the number of insured lives [were attributed] to the increasing public awareness of the necessity of having affordable insurance products,” the IC stated in a statement.

Micro-insurance is a term used to describe insurance products that can be bought for modest premiums, which shouldn’t be more than 7.5 percent of the current Metro Manila daily minimum wage.

Micro preneed goods fall under this category, along with micro-memorial, micro-educational, micro-pension, micro-life, micro-health, and micro-agricultural insurance.

The IC actively encourages low-income individuals to get micro-insurance as a means of preparing for events that could deplete resources, such as fatalities, injuries, and damage to property or sources of livelihood.

According to the IC, many people who purchase microinsurance are daily wage earners like drivers, street sellers, and factory workers.

The commission had advised all industry participants to use new technology to improve Filipinos’ access to insurance.

According to Insurance Commissioner Reynaldo Regalado, climate change is to blame for the rise in the frequency and power of natural disasters like typhoons.

These natural disasters cause thousands of injuries and fatalities as well as billions of pesos in property and livelihood loss in the Philippines.

According to Regalado, “Insurance plays a critical role in improving our resilience against extreme weather events and other natural calamities that are getting worse due to climate change. Insurance is a proven risk and loss transfer mechanism.”

Regalado invited summit participants to talk about how new technologies might be used to increase insurance coverage among Filipinos in light of the government’s aim for digitalization and financial inclusion.

According to the IC’s analysis of data from the Bangko Sentral ng Pilipinas’ 2021 Financial Inclusion Survey, only 48% of adult Filipinos have access to insurance.