BSP allows sale of microinsurance products in Philippines

Microfinance Focus, Feb 18, 2010: The Monetry Board of Bangko Sentral ng Pilipinas (BSP) early this month approved the marketing, sale and servicing of micro-insurance products by rural, cooperative and thrift banks.

This approval allows the network of nearly 3,500 rural, cooperative and thrift banking offices to serve as distribution points for authorized micro-insurance products offered by licensed insurance providers.

Recent events like the super typhoons have brought to fore the importance of adequate protection against death, injury, loss of property and other contingent events, BSP said.

“This move by is an important response to this urgent need for micro-insurance especially for the poor who are more vulnerable to various risks,” BSP said.

Microfinance and micro-insurance are highly complementary financial products that address the needs of the low-income sector. “Since many of these banks already have existing relationships with microfinance clients, they can more readily deliver a full range of financial services needed by their clients,” it said in a statement.

“This can only translate into better delivered products as well as lower transaction costs, ultimately benefiting the poor clients,” the central bank added.

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