Developing Principles for the Regulation of Microinsurance: Philippine Case Study

This study seeks to provide a better understanding of the microinsurance market in the Philippines. It describes how policies, legal, regulatory and supervisory framework governing insurance have shaped the development of the market and vice versa.

The demand for microinsurance products is growing in the Philippines in view of continuing risks to household welfare and the apparent inability of the government to address this issue. The study reveals that:

• Insurance Commission has adopted regulatory forbearance that shows its understanding of the challenges in this emerging market;
• Safeguards such as enforcement of performance standards and good corporate governance are necessary to protect customers and maintain the stability of institutions providing microinsurance.

Finally, the study identifies regulatory and non-regulatory drivers for the microinsurance market and deduces some principles for microinsurance regulation motivated by the Philippine experience.