The heads of the top 25 non-life insurance companies in the Philippines are joining hands to ensure the industry’s stability in case an earthquake of catastrophic proportions hits the country.
In a historic meeting called by the Insurance Commission at the Casino Espanol in Manila last Monday, April 5, Insurance Commissioner Santiago Javier Ranada and Deputy Commissioner Vida Chiong together with the presidents and CEO’s of major insurance firms all agreed to be pro-active in their approach to facing natural perils like earthquakes and floods.
One of the things they have resolved is to stop undercharging premiums for property insurance and strictly follow the tariff to ensure that adequate funds are available if and when natural disasters strike. A task force was then formed to hammer out an agreement and lay down a roadmap for the industry going forward, and was given three weeks to complete it.
Michael Rellosa, chairman of the Philippine Insurers and Reinsurers Association (PIRA), the umbrella organization of all non-life insurance firms in the country, said the meeting of the minds of these industry leaders is very timely given the spate of earthquakes occurring almost one after in Haiti, Chile, and just the other day in Mexico and California.
“A major earthquake is always a possibility in the Philippines since our country lies smack on the Pacific Ring of Fire. All of us in the insurance industry truly need to make sure we have enough resources to cover for losses,” he said.
The industry paid more than P11 billion to those affected by the historic floods from tropical storm Ondoy which hit the country in September last year.
The last devastating quake experienced by Philippine insurance companies happened in 1990, leaving hundreds of casualties when major structures including an international hotel in Baguio City and a school in Central Luzon collapsed.
Rellosa added that majority of Filipinos do not have insurance for their homes, and many of those with property insurance only have the basic fire coverage. He advises the public to get in touch with their insurers and review their policies to make sure they are covered for earthquakes.
On March 25, an earthquake was felt in Metro Manila and neighboring towns and cities, sending office workers in the business districts scampering out of their buildings.
Early that month, a 6.1 magnitude quake also rocked northern Philippines but no damages were reported.
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