Manulife to sell micro insurance to rural Pinoys

Business Mirror
Wednesday, 23 February 2011 19:09
Jun Vallecera / Reporter

THE Manufacturers Life Insurance Co., which earlier partnered with local lender China Banking Corp., plans the sale of micro insurance to rural Filipinos on a scale that is not only sustainable, but commercially viable as well.

It is part of the insurer’s multiyear plan to make the Philippines the center of its microinsurance business in the region.

David Wong, senior vice president and regional executive at Manulife Financial operations within the Association of South East Asian Nations or Asean, said they are about to undertake the pilot testing of the project on the island of Mindanao down the country’s south.

Wong noted that most microinsurance programs tend to focus on urban-based middle classes no matter that in Asia some two billion of the population live below the poverty line and have no cover for the various risks they face on a daily basis.

“A large population in rural Asia has no risk cover and this sector is ignored thus far. We need to go to this segment of the population,” Wong said.

He also noted that while microinsurance programs exist in most countries in the region, only the Philippines and India took the trouble to support them with legislative measures that ensure continued viability and growth.

In the Philippines, Wong said some two to three million benefit directly from microfinance programs extended by such carriers as nongovernment organizations, mutual benefit associations and others looking out for the financial welfare of the less financially endowed.

“We are looking at this market and pilot test a program in one or two provinces in the Philippine south,” Wong said of Mindanao where the poverty incidence is relatively higher than in most parts of the country.

What Manulife learns from the project in the months ahead should be instructive as to the size and scope of the microinsurance program they have in mind, Wong explained.

He ruled out risk protection for farmer crops that some insurers are also pilot testing on Leyte island, saying they are thinking along the lines of health and wellness cover.

This means offering rural Filipinos cover for their hospital bills at premium prices that even the poor can afford to pay.

Wong was not too specific but insurance executives said earlier that an affordable health cover typically involves premium payments of around P300 a year