Source: eDaily | 26 Nov 2013
Insurance schemes aimed at low earners could be part of future solutions to disaster risk management in the Philippines, even as government ministers say that the country is considering an insurance plan that will ease the burden of financing relief and reconstruction activities following calamities.
Mr Reto Schnarwiler, head of Global Partnerships for Swiss Re in the Americas, Europe and Africa, told the swissinfo.ch website, that to help recovery, a better solution than international aid, raising funds through issuing debt or switching budgets, is for governments and organisations to jointly work on increasing insurance penetration, or number of insurance policy holders.
In the Philippines, non-life insurance premiums made up less than 0.49 percent of GDP in 2012, according to Swiss Re Economic Research and Consulting. That is below Asia’s average of 1.64 percent and is relatively low, according to Mr Clarence Wong, the research centre’s chief economist for Asia.“Most insured properties are believed to concentrate in metropolitan areas. Earlier typhoons have consistently resulted in limited insurance pay-outs due to low penetration,” Mr Wong told swissinfo.ch.
Professor Martin Eling, who teaches insurance management at the University of St Gallen in Switzerland, says that micro insurance is being introduced with the help of non-governmental organisations on the ground in a number of different countries to see. ?He believes that it has a great deal of potential if combined with factors such as education, financial literacy and regulation, to increase the level of trust among people putting up their money.
Meanwhile, National Treasurer Rosalia de Leon has said that the government is tapping the assistance of the World Bank to develop a protection scheme against the financial drag of post-calamity recovery. “We are currently working with the World Bank in developing a catastrophe risk model. This model will enable the Philippine government to evaluate options for risk transfers and insurance that will reduce the fiscal burden of relief and reconstruction efforts,” the Philippine Daily Inquirer cited Ms De Leon.
She adds that the latest natural calamity, Super Typhoon Haiyan which slammed the central Philippines on 8 November, highlights the need for smart financial strategies that would help the country bounce back after disasters. “Initiatives are underway to mitigate risk exposure and strengthen fiscal resilience in times of calamities,” she said.
Separately, Finance Secretary Cesar V Purisima has proposed a multi-nation natural catastrophe risk pooled insurance facility for vulnerable nations in the Asia Pacific region, such as Indonesia, Thailand, Malaysia and Japan. “We’ve proposed to the World Bank that all countries be asked to be part of a mandatory insurance pool, and the insurance premium be based on each country’s share of the carbon footprint,” he said
Insurance schemes aimed at low earners could be part of future solutions to disaster risk management in the Philippines, even as government ministers say that the country is considering an insurance plan that will ease the burden of financing relief and reconstruction activities following calamities.
Mr Reto Schnarwiler, head of Global Partnerships for Swiss Re in the Americas, Europe and Africa, told the swissinfo.ch website, that to help recovery, a better solution than international aid, raising funds through issuing debt or switching budgets, is for governments and organisations to jointly work on increasing insurance penetration, or number of insurance policy holders.
In the Philippines, non-life insurance premiums made up less than 0.49 percent of GDP in 2012, according to Swiss Re Economic Research and Consulting. That is below Asia’s average of 1.64 percent and is relatively low, according to Mr Clarence Wong, the research centre’s chief economist for Asia.“Most insured properties are believed to concentrate in metropolitan areas. Earlier typhoons have consistently resulted in limited insurance pay-outs due to low penetration,” Mr Wong told swissinfo.ch.
Professor Martin Eling, who teaches insurance management at the University of St Gallen in Switzerland, says that micro insurance is being introduced with the help of non-governmental organisations on the ground in a number of different countries to see. ?He believes that it has a great deal of potential if combined with factors such as education, financial literacy and regulation, to increase the level of trust among people putting up their money.
Meanwhile, National Treasurer Rosalia de Leon has said that the government is tapping the assistance of the World Bank to develop a protection scheme against the financial drag of post-calamity recovery. “We are currently working with the World Bank in developing a catastrophe risk model. This model will enable the Philippine government to evaluate options for risk transfers and insurance that will reduce the fiscal burden of relief and reconstruction efforts,” the Philippine Daily Inquirer cited Ms De Leon.
She adds that the latest natural calamity, Super Typhoon Haiyan which slammed the central Philippines on 8 November, highlights the need for smart financial strategies that would help the country bounce back after disasters. “Initiatives are underway to mitigate risk exposure and strengthen fiscal resilience in times of calamities,” she said.
Separately, Finance Secretary Cesar V Purisima has proposed a multi-nation natural catastrophe risk pooled insurance facility for vulnerable nations in the Asia Pacific region, such as Indonesia, Thailand, Malaysia and Japan. “We’ve proposed to the World Bank that all countries be asked to be part of a mandatory insurance pool, and the insurance premium be based on each country’s share of the carbon footprint,” he said
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