Daily TribuneIt appears from our consultation, doubling or even quadrupling the insurance we pay can be increased, such as on the house, housing loans in Pag-IBIG, in GSIS, post-harvest facilities, agri machinery, fishing boats, dryers, storages, and also the Philippine Crop Insurance Corporation (non-crop insurance) is affected
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Increasing the catastrophe insurance premium rates may lead to a hike in commodity prices, a lawmaker warned as he prodded the House of Representatives to look into its extent and impact on consumers.
Filed on Monday, House Resolution 632 will prompt the appropriate committee in the lower chamber to revisit Insurance Commission's Circular Letter 2022-34, which adjusted the applicable minimum and maximum catastrophe rates nationwide.
In October, the IC said it was moving the implementation of a new rating structure and revised rates for nonlife insurers' catastrophe risk policies from 1 November to 1 January 2023.
Depending on factors like risk location and building material, the newly adjusted rates can result in a 40 percent to 400 percent spike in annual premiums.
However, given that the country is still recovering from the devastating effects of the Covid-19 pandemic, Agri Representative Wilber Lee, the proponent of the resolution, said it is incumbent on the government to respond to the critical needs.
The IC move, Lee said, would only add to the public's brunt of the burden, particularly those in the marginalized sectors.
"It appears from our consultation, doubling or even quadrupling the insurance we pay can be increased, such as on the house, housing loans in Pag-IBIG, in GSIS, post-harvest facilities, agri machinery,
fishing boats, dryers, storages, and also the Philippine Crop Insurance Corporation (non-crop insurance) is affected," he said in a press briefing on Monday.
Food security may get hit
Lee pointed out that not only will the farmers suffer, but also the food security that the President desires.
The Chief Executive, the concurrent head of the Department of Agriculture, has vowed that agriculture is one of his administration's top priorities, as he envisions a food-secure and resilient Philippines in the coming years.
He said that stabilizing food prices, particularly by assisting farmers and fishermen, will be critical to the country's growth.
The resolution, however, stated that IC's move would result in the high cost of catastrophe insurance premiums, which would undoubtedly have an impact on the country's unabated and record-high inflation and could contribute to further increases in basic commodity prices because the broad scope of catastrophe insurance covers buildings, warehouses, equipment, and residential properties.
"This increase has a domino effect. The manufacturing sector is affected, and distribution, retail and agriculture are also affected," Lee said.
