By Rommer M. Balaba
Reporter
PHILIPPINE American Life and General Insurance Co. (Philamlife) on Thursday introduced the country’s first prepaid microinsurance product geared particularly for individuals who cannot afford regular insurance coverage.
“This is a breakthrough product, in time with [the Insurance Commission’s] challenge that the life insurance industry thinks about low income groups. Anyway we have been working on this product even before such call, to have products that the society needs and not just profitable products,” Jose L. Cuisia Jr., Philamlife president and chief executive officer, said during the product’s introduction to reporters.
“Aksitext” is a prepaid insurance package similar to prepaid cellular phone load cards that can be activated through the short messaging system (SMS) using the P10 cards sold in retail outlets including sari-sari stores, convenient stores and gasoline stations.
An initial P25 million worth of prepaid cards have been distributed nationwide.
Individuals between ages 18 and 65 years old can be assured of a 15-day insurance coverage worth P10,000 in case of accidental death, regardless whether the insured person is engaged in risky employment or not.
An individual can load as many prepaid insurance cards but their effectivity would be queued based on the last effective date of the previously SMS-registered card.
“This in a way would also help us generate more awareness on insurance. . . Aksitext is more like an introductory product for those who cannot afford traditional insurance products,” Cuisia said.
He added this should boost the government’s effort to increase insurance coverage in the Philippines to 20 percent next year, even by using bite-size insurance packages.
Insurance penetration in the Philippines remains low at 15 percent because of considerable costs that go along in obtaining it particularly for poorer people who must prioritize their basic needs over family protection.
“This is an insurance product which is cheaper than what most Filipinos spend for a day’s texting [SMS sending]. . . on a pure commercial sense it is not an attractive product [for Philamlife] but it is a product worth supporting,” Lizanne C. Uychaco, Philamlife’s senior vice-president and chief marketing officer, said.
And although results on Aksitext’s test market still have to come in, Uychaco noted Philamlife is now even considering expanding the product’s coverage.
“We are in the process of probably lowering age coverage to as low as three years old,” she said.
Business Mirror
November 10,2006
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