The Philippines is keen on the idea of joining a regional insurance pool to hedge against disasters in ASEAN.
Insurance Commissioner Dennis B Funa said there is a possibility for the country to enter into the Southeast Asia Disaster Risk Insurance Facility (SEADRIF), which is aimed at providing climate and disaster risk-financing and insurance solutions to ASEAN member countries, according to a report by Business Mirror.
However, Mr Funa has misgivings that the Philippines might use more of the funds provided by the facility than its neighbours, since the country is more exposed to natural calamities.
SEADRIF is a regional catastrophe risk pool having similarities to a reinsurance-based disaster liquidity facility, designed to provide participating countries in Southeast Asia affected by natural disasters with immediate rapid response financing.
Finance ministers from Cambodia, Japan, Laos, Myanmar and Singapore jointly agreed to establish and implement SEADRIF this year to strengthen financial resilience among member-countries against climate and disaster risks in the region.
“We look forward to the official establishment of SEADRIF by the end of this year and to continue working with our colleagues in ASEAN,” Singapore Finance Minister Heng Swee Keat said during a forum at the 51st Asian Development Bank (ADB) Annual Meeting last week in Manila.
At the same time last week, the Ministry of Economy and Finance in Cambodia, Ministry of Finance in Laos, Ministry of Planning and Finance in Myanmar, and Ministry of Finance in Japan signed a Memorandum of Understanding (MoU) on the establishment of a country-led Regional Technical Working Group on Disaster Risk Finance and Insurance. This new Working Group will work toward developing SEADRIF.
Japanese Finance Minister Taro Aso pointed out that the joint agreement to establish SEADRIF is the first of its kind in Asia, and is a step closer to getting the facility working. Mr Aso said, “Our next goal is to actually establish and launch the facility.”