Microfinance Gateway>Philippines: Central Bank Allows Smaller Banks to Sell Microinsurance

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Home » News & Opinion » Philippines: Central Bank Allows Smaller Banks to Sell Microinsurance

Philippines: Central Bank Allows Smaller Banks to Sell Microinsurance
Aquino, N.

Rural, cooperative, and thrift banks may now sell microinsurance products following Central Bank approval of a new policy that seeks to lower transaction costs to benefit poor clients. In a statement, the Bangko Sentral ng Pilipinas (BSP) said recent typhoons have highlighted the need for adequate protection against death, injury, property loss and other disasters. The BSP said allowing the nationwide network of 3,500 rural, cooperative and thrift banks to act as distribution points will improve the delivery of authorized microinsurance products.

BSP added that banks are ideal distribution channels as they are trusted in the countryside and have a deeper understanding of the low-income market. According to the statement, the amount of premium, contribution, fees and charges for a microinsurance product must not exceed 5% of the current daily minimum wage. Guaranteed benefits must also not exceed 500 times the current daily minimum wage.

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Posted: 16 Feb 2010
Source: GMA News
Originally Published: 14 Feb 2010