JICA and GSIS launch partnership for better insurance coverage against disasters in PH

The Japan International Cooperation Agency (JICA) and the Government Service Insurance System (GSIS) starts working in tandem to improve public insurance in the Philippines as a vital move to boost the country’s financial resilience against disasters. JICA signed the Records of Discussion for “the Project for Strengthening Financial Resilience of Public Assets to Natural Disasters by Improvement of Public Insurance” with the GSIS in Pasay City on 22 November.

It is said that about USD 3.5 Billion in asset losses are expected to be incurred by the Philippines each year due to typhoons and earthquakes according to a World Bank report. Further, the Philippines ranks first among 193 countries in the 2023 World Risk Report, signifying the highest disaster risk globally. It received a score of 46.82 out of 100, marked as “very high” ratings across indicators such as exposure, vulnerability, susceptibility, lack of coping capacities, and lack of adaptive capacities.

The new Technical Cooperation is part of JICA’s Official Development Assistance (ODA) to the Philippines that combines sharing Japanese expertise with building resilient infrastructure. It will pilot several public assets and come up with a prototype system to appropriately calculate risk-based insurance premium for a sound financial management. It can be also expected to promote further prior investment in disaster risk reduction.

“As natural disasters become more frequent and severe due to climate change, improving disaster cover on Philippines’ public assets has become imperative. Obviously, it is a vital move for the Philippine government to consider increasing the financial resilience of its public assets. We are excited to share with our counterparts how Japan is preparing to the disaster risk in building back better approach,” said JICA Chief Representative SAKAMOTO Takema. He added that the new cooperation adheres to the Sendai Framework for Disaster Risk Reduction (2015 - 2030), a global agreement adopted by UN member states to prevent new and reduce existing disaster risks through implementing these four priorities, such as: understanding risk, strengthening governance, investing in risk reduction and enhancing preparedness.

GSIS President Jose Arnulfo Veloso said, “This capacity-building project will be a big boost to GSIS. For one, this project will enhance our Insurance Group’s capability to calculate ‘replacement cost’ and help us come up with the correct insurance premium.” He added that the project will also enhance GSIS's underwriting capabilities, loss control, and management, while also developing an effective Information and Education Campaign strategy that raises public awareness about the importance of insurance.

The Project supports investment on disaster resilience particularly in protecting assets and capitals not only for a more secure and stable economic growth but also for human lives.

With natural disasters occurring more frequently due to climate change, the cooperation on strengthening the financial resilience in the Philippines through insurance is a welcome development.