THE Department of Finance (DoF) said it launched a World Bank-financed insurance fund for disaster-prone provinces to help fast track disbursements for affected areas.

The fund, known as the Parametric Insurance Pilot project, involves P1 billion in insurance coverage for 25 typhoon and earthquake-prone provinces.

“Unlike the traditional indemnity insurance that takes a long time to assess and process, this Parametric Insurance Pilot will have quick-disbursing payouts whose amounts will depend on the estimated loss triggers determined through the Philippines’ Catastrophic Risk Model developed by the DoF in 2014,” Finance Assistant Secretary and spokesperson Paola Sherina A. Alvarez was quoted as saying in a statement.

“Since the Bureau of Treasury is the policyholder, the funds will be mobilized faster to the first responders, namely, the national government and the LGUs (local government units),” added Ms. Alvarez.

The fund will be split equally into disaster-specific and province-specific funds.

Some 79.2% of the P500 million disaster-specific premiums will be allocated to typhoon cover while the remaining 20.8% will go to earthquake cover.

The other P500 million for province-specific premiums on the other hand will be divided equally, with P20 million going to each of the 25 provinces.

These 25 provinces are Albay, Aurora, Batanes, Cagayan, Camarines Norte, Camarines Sur, Catanduanes, Cebu, Davao del Sur, Davao Oriental, Dinagat Islands, Eastern Samar, Ilocos Norte, Ilocos Sur, Isabela, Laguna, Leyte, Northern Samar, Pampanga, Quezon, Rizal, Sorsogon, Surigao del Norte, Surigao del Sur and Zambales.

The insurance program is effective for one year, running from July 28. The project is one of the expected outcomes of the National Disaster Risk Reduction and Management Plan 2011-2028.

“Our disaster risk financing strategy provides a comprehensive framework for the implementation of financial protection solutions against natural disasters at the national, local government and individual levels,” said Ms. Alvarez.

“This is one of the many efforts of the Duterte administration in making the country disaster-resilient and sustainable,” she added.

On top of the existing insurance program, the DoF is also currently preparing a P1 billion fund for the rehabilitation of the 6.5-magnitude earthquake that hit Ormoc Ciy last month. — Elijah Joseph C. Tubayan

RELATED ARTICLESMORE FROM AUTHOR