Manila Times: Microinsurance education for Rural Bank clients

Access to protection is now open to those who need them most. And they just need to know it.

The number of families with microinsurance has grown since 2010, when the government, through the efforts of the Department of Finance (DOF), Insurance Commission (IC) and the Bangko Sentral ng Pilipinas (BSP), released regulations to promote microinsurance to microfinance-oriented institutions including rural banks.

Combined with strategic public-private partnerships, low-income individuals can now buy an insurance product at a price of not more than P20 a day with coverage and benefits provided to other household members. Requirements are simple and claims are paid in as fast as three to five days. Clients of microinsurance can attest to the benefits of the product.

Rural banks have long recognized the need of the low-income sector for protection. From the traditional credit life, products have evolved to increase coverage to protect the clients from the high costs of funeral, accident, hospitalization, property damage and natural calamities. The market for the product is also growing in the rural banking industry. In 2011, BSP expanded microfinance clients to include all existing clients of the bank classified as low-income or with annual household income of not more than 209,000. With this, clients of rural banks can now voluntarily purchase microinsurance by opening a deposit account for as low as P100.

The Microinsurance Initiative of the Rural Bankers Association of the Philippines (RBAP) and the Rural Bankers Research and Development Foundation Inc. (RBRDFI) has been assisting rural banks towards proper offering and servicing of microinsurance to their clients. With the assistance of the USAID-supported MABS program (Microenterprise Access to Banking Services), a total of 192 rural banks have completed the Basic Microinsurance Training Course to kick-off their application for licensing and accreditation.

There are now 30 licensed rural bank microinsurance agents and first quarter data indicated at least 400,000 individuals being covered with such protection. With the access and the growing awareness of low-income clients on the benefits of the product, rural banks are challenged to respond to clients who wish to purchase the product voluntarily.

To address the need of the rural banks to effectively market their microinsurance products to their targeted market, RBAP is launching a nationwide Microinsurance Literacy campaign to enhance the capacity of bank officers and staff to educate their clients on the benefits of microinsurance. With the assistance of a foreign-based marketing consultancy group, the microinsurance literacy toolkit has been developed and will be rolled out to rural banks offering microinsurance to their clients. Its primary aim is to make low-income individuals understand what microinsurance is and how they can avail of its services. The basic principle: the more people understand microinsurance, the more likely they will buy it.

The Toolkit is customizable and comes with a training guide to effectively assist the staff on the proper use of the materials. The Initiative will also conduct on-site trainings in Luzon, Visayas and Mindanao coupled with online training sessions with the Microinsurance Team.

The toolkit combines simple language and powerful images to convey the benefits of microinsurance. When a rural bank staff presents microinsurance with the tools provided by the RBAP, clients will certainly understand what the product is and what it offers.

Rural bank microinsurance agents are here to offer and service microinsurance products and clients only need to be educated on how to avail of them.

(If you wish to know more about the Microinsurance Literacy campaign, call 527-2972 or

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