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SOURCE: Press and Public Affairs Bureau

House approves proposed insurance for farmers & fisherfolk
04 February 2018 02:25:18 PM

The House of Representatives approved on third and final reading House Bill 6923 seeking to expand the coverage of the Philippine Crop Insurance Corporation (PCIC) to insure qualified farmers and fisherfolk.

All 197 House members present during the voting favored the bill which aims to protect fisherfolk and farmers against losses arising from natural calamities, fortuitous events, fish and crop diseases, and pest infestations.

The bill mandates the PCIC to provide insurance coverage for palay and corn crops, high-value commercial crops, livestock, aquaculture and fishery products, and others. Coverage shall extend to non-crop agricultural assets such as machineries, equipment, transport facilities, and infrastructures as well. Lastly, those qualified shall enjoy life and accident term insurance coverage.

Excluded from the insurance coverage are losses arising from avoidable risks emanating from or due to negligence or fraud committed by the insured or any member of the immediate farm household or employee, or the failure of the insured to follow proven farm practices.

Participation in the insurance for palay and other crops essential for food security, as determined by the Department of Agriculture (DA), shall be compulsory for all farmers.

For other crops, participation shall be compulsory upon all farmers obtaining production loans under the supervised credit program, and optional on the part of self-financed farmers provided they agree to place themselves under the supervision of agricultural production technicians.

The rate of premium, as well as the allocated sharing of farmers, fisherfolk, lending institutions, the government, and other parties shall be determined by the Board of Directors of the PCIC. This is provided that the government’s share in the premium cost in the form of premium subsidy shall be limited to the subsistence farmers and fisherfolk.

The bill adds that each of these subsistence farmers is cultivating no more than seven hectares of farmlands each; and each fisherfolk is cultivating no more than five hectares of fishpond, seaweed, oyster, or mussel farm by themselves or with the help of either hired labor or the labor of their household members.

Moreover, the authorized capital stock of the PCIC shall be P10 billion pesos divided into P75 million common shares with a par value of P100 each share which shall be fully subscribed by the government, and P25 million preferred shares with a par value of P100.

The common capital stock of P1.5 billion having been fully paid to the PCIC, the balance of P6 billion subscribed by the government shall be appropriated annually by Congress unless provided otherwise.

Further, at least P500 million of preferred shares shall be subscribed and paid for by the Land Bank of the Philippines. The balance of the preferred shares may be available for sale or to subscription by the general public.

A state reserve fund for catastrophic losses in the amount of P500 million shall be created to answer for the proportion of all losses in excess risk premium under the PCIC’s program for small farmers and fisherfolk. / CMBE