The House of Representatives on Tuesday approved on third and final reading a measure that seeks to expand the services of the Philippine Crop Insurance Corp. (PCIC) to all agricultural commodities while encouraging private sector participation in agricultural insurance.
With 268 affirmative votes without a negative vote, lawmakers approved House Bill (HB) 7387, which seeks to further revise Presidential Decree (PD) No.1467, creating the PCIC, as amended.
The bill will be transmitted to the Senate for its own deliberations and approval.
The measure seeks to ensure that more Filipino farmers are protected from financial losses arising from natural calamities, plant diseases, and pest infestations, through the PCIC.
It also seeks to direct resources of private sector entities, including cooperatives and farmer’s organizations, to invest in agricultural insurance.
The bill mandates the expansion of the insurance services of the PCIC to all agricultural commodities from the traditional palay crops to now include livestock, fisheries and aquaculture, agroforestry projects and forest plantations and non-crop agricultural assets such as machinery, equipment, transport facilities and other related infrastructures.
It also authorizes the PCIC to offer reinsurance services to private entities, including agricultural cooperatives and farmers’ associations that will engage in agricultural insurance.
However, such insurance protection excludes losses arising from avoidable risks emanating from or due to the negligence, malfeasance, or fraud committed by the insured or any member of his immediate farm household or employee.
In addition, PCIC will also offer reinsurance services for entities willing to offer agricultural insurance.
Under the bill, the powers of the PCIC will be vested in and exercised by its board of directors, composed of eight members with the Secretary of Finance as ex-officio chairperson and the President of the PCIC as ex-officio vice chairperson.
Other members of the Board include the following: the President of the Landbank; Secretary of the Department of Agriculture (DA); a representative from the private insurance industry to be nominated by the Secretary of Finance; and three representatives from the subsistence farmers’ sector, preferably representing agrarian reform beneficiaries, cooperatives, or associations coming from Luzon, Visayas, and Mindanao, who will be selected and nominated by the different farmers’ organizations or cooperatives.
The bill provides that any insured farmer who has not filed any claim during the immediately preceding three crop seasons, or any insured fishpond or fish cage operator who has not filed any claim during the immediately preceding three harvest seasons, will be entitled to a no-claim benefit of at least 10 percent of his premium share paid for said crop seasons to be deposited in a trust fund and to be managed by the corporation.
Such a trust fund may be used to finance premium rebate or premium credit applicable to the immediately following crop seasons as determined by the board of directors.
To support and promote its operations, PCIC may call upon government and private entities engaged in the supervised credit program to farmers and fisherfolks to act as cooperating agencies. As such, these entities would be required to design their policies and rules to attune and synchronize them with the objectives of the corporation.