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Thursday, March 28, 2024

Cebuana Lhuillier, Axa team up for microinsurance

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Gone  are the days when insurance privileges are enjoyed only by people who can afford high premiums. Axa Charter Ping An and Cebuana Lhuillier Insurance Solutions teamed up to offer a comprehensive micro disaster risk insurance for Philippine micro, small and medium enterprises.

“We hope to be able to arrange with our insurer a very comprehensive coverage for MSMEs, not only for personal accident, disablement or dismemberment of the micro entrepreneurs themselves but also coverage for their properties from fire and natural disaster for their livelihood. If they have micro loans, we also want to bundle credit life to that, and hopefully come up with a viable microinsurance product with Axa,” said PJ Lhuillier Group of Companies first vice president and group head Jonathan Batangan.

CLIS is the Philippines’ leading and largest non-bank financial services provider specializing in pawning, remittance and microinsurance.

Batangan said the company’s dominance in microinsurance can be attributed to innovation, a robust network of local and international partners and commitment to serve the growing clientele.

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Development cooperation agency GIZ Philippines teams up with Cebuana Lhuillier Insurance Solutions, Axa Charter Ping An and the Department of Trade and Industry to provide a micro disaster risk insurance product that could protect micro, small, and medium enterprises against natural calamities.  Shown are (from left) GIZ senior adviser Jimmy Loro, PJ Lhuillier Group of Companies first vice president and group head Jonathan Batangan, PJ Lhuillier Group of Companies president and chief executive Jean Henri Lhuillier, GIZ RFPI Asia II program director Dr. Antonis Malagardis, Trade Undersecretary Zenaida Maglaya, Insurance Commission deputy commissioner Dorothy Calimag and Axa Charter Ping An emerging customers director Marc Gorospe.

Axa Charter Ping An emerging customers director Marc Gorospe said the company’s presence across 60 economies provided the volume of experience from very big accounts to personal coverages to handle the unique case of insuring Philippine MSMEs.

“We have large experience in handling large scale of capacity in terms of insurance. We believe the Philippines is a high potential country. We have experts analyze satellite images flood typhoon, therefore we are capable to design and translate data into real products,” he said.

The MicroDRI product under development will be formally launched and introduced to MSMEs through the assistance of the Trade Department.

Axa will design the micro SME insurance product and will serve as insurer of the product, which will then be made available to the public through Cebuana Lhuillier’s wide network.

The microDRI program was initiated by GIZ Philippines in cooperation with the Trade Department to help MSMEs improve their financial literacy and develop financial resiliency in the wake of disasters and calamities.

MSMEs make up more than 99 percent of all industries in the Philippines, accounting for 65 percent of the labor force, and are a major source of government income through taxes with an economic value of 35.7 percent, of which small industries make up 20.5 percent of all goods and services produced.

The Philippines is usually visited by 26 to 30 typhoons yearly, a host to active volcanoes and falls prey to earthquakes and flood, as well as large-scale fire incidents.  MSMEs are at risk of losing their livelihood and without financial support in case of these incidents.

A latest GIZ study shows that 25 percent of MSMEs do not reopen once hit by a major disaster. In 2009, following typhoons Ondoy and Pepeng, damages cost MSMEs a total of $4.4 billion, or about 2.7 percent of that year’s GDP.

GIZ Philippines has been at the forefront of implementing economic, ecological and social development in the Philippines since 1970, through the assistance provided by the German government.

Serving as the gateway to reach across MSMEs is Cebuana Lhuillier, currently the country’s leading microinsurance distribution channel.

The company is leveraging on the network of Cebuana Lhuillier’s network of 2,300 branches nationwide and 4,000 partners.

“When we sell this product nationwide, we make sure we reach the maximum number of MSMEs. We make use of our networks to settle claims. In the next few years, hopefully, we’ll be adding more partners including sari- sari stores as remittance agents whereby they can sell this product to their fellow MSMEs,” Batangan said.

The product will be opened to an initial batch of 10,000 MSMEs by mid-year after a series of stakeholder consultations.

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