Rural bankers train in microinsurance

Rural bankers train in microinsurance

PERSONNEL of 17 rural banks have undergone training with the Rural Bankers Association of the Philippines (RBAP) to become licensed microinsurance providers, while those of 11 insurance companies have agreed to join in as well.

"We have already conducted two batches of training this year and we are planning to launch more training modules," RBAP President Corazon L. Miller said in a phone interview yesterday.

RBAP, in cooperation with the Rural Bankers Research and Development Foundation, Inc. and the Microenterprise Access to Banking Services, has been helping rural banks become licensed to market, sell and service microinsurance products by giving their executives and staff the training required by the Insurance Commission (IC).
Last month, the IC exempted microinsurance agents from the required regular licensure examination for insurance agents, in a bid to get the products distributed by more people.

These agents will have to undergo only an approved and prescribed microinsurance training course and pass the qualifying examination at the end.

National Credit Council Deputy Executive Director Joselito S. Almario confirmed that the bank personnel who completed the RBAP training could now be licensed by the IC to become agents.

"RBAP has long been waiting for the IC circular on the licensing of microinsurance agents," he said. "They were always interested in becoming delivery channels to bring microinsurance to the provinces."

Ms. Miller said that microinsurance complements the products offered by rural banks because it provides risk protection for small borrowers. "If the bread winner dies in the family, the debt will be passed on to the other members. And even if it’s not the bread winner, the costs of burial are so expensive, that the family could default on its loans," she explained. "If they have life insurance, they could have a financial backup."

Microinsurance would also provide the low-income sector with an affordable means to get benefits for accidents and hospitalization, since premiums -- when computed on a daily basis -- cannot exceed 5% of the current daily minimum wage rate of non-agricultural workers in Metro Manila, Ms. Miller said.

The next step now is for the IC to release guidelines on how to become a microinsurance broker, Mr. Almario said. Agents are limited to representing one life insurance company and seven non-life companies.

But rural banks want to be able to offer many options to their customers, he added
RBAP raised the issue with the IC during the Microinsurance Roundtable Discussion last Tuesday, and Deputy Insurance Commissioner Vida T. Chiong said the regulator would try to release a circular on microinsurance brokers by next month, Mr. Almario said. -- Diane Claire J. Jiao

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