Asia Insurance Review Vol I Issue 184
The Philippines, Indonesia and India offer the biggest market opportunities for microinsurance because of their regulatory frameworks, strong cooperative systems and potential risks from extreme weather and disasters such as earthquakes and volcano eruptions, reports Reuters citing Mr Craig Churchill, head of the global Microinsurance Network and team leader of the International Labour Office's Microinsurance Innovation Facility.
He was speaking in conjunction with the three-day 6th International Microinsurance Conference in Manila that began on Tuesday. Around 500 participants are attending the event to discuss the solutions and challenges in microinsurance. The conference is organised by the Munich Re Foundation, Microinsurance Network, the Philippines' Department of Finance, and Georgia State University's Center for the Economic Analysis of Risk.
At present, over 140 million people, mostly in Africa and Asia, are covered by affordable insurance premiums, and studies showed the potential market is up to 3 billion, says the Munich Re Foundation and International Labour Organisation. More than half of microinsurance products are focused on life and health, while less than 10% cover farms.
"We're still at the experimental stage in offering products that could cover agriculture," said Mr Churchill, adding that there is huge potential growth for such products, citing the impact of typhoons Ketsana and Parma in the northern Philippines in late 2009.
Last month, German reinsurer Munich Re said that it would launch a reinsurance project in the Philippines to cover cooperative companies against extreme weather events. That will be the first microinsurance product in the country to offer farmers some protection against typhoons and flooding problems, to which the Philippines is prone.
Mr Joselito S Almario, a director of the Department of Finance, said that microinsurance has a potential Philippine market of nearly 35 million people willing to pay a premium of PHP20-30 (US$0.46-0.69) a week for coverage of up to PHP120,000 (US$2,771) in life and non-life benefits. At present, 14% of the Philippines' 96 million people have insurance, including 2.9 million people covered by microinsurance, mostly as members of cooperatives.
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