SSS eyes private sector to cover risks on fund

State-run Social Security System (SSS) is planning to tap a consortium of private insurance firms to insure some of the pension fund’s risks amid rising expenditure.

In an interview, SSS president and chief executive officer Emmanuel Dooc said the agency is now seeking the help of the private sector to cover some of the state fund’s risks after the Government Service Insurance System (GSIS) declined to provide help.

“They (the GSIS) answered us formally and they declined. It’s not within their mandate to cover private assets and nongovernment employees or workers,” Dooc said.

“The plan B will be to go to the private sector,” he added.

However, in tapping the private sector, Dooc said the concern would be whether there are players capable or covering the SSS’ risks, and which of its liabilities they are willing to cover.

“My concern is, right now, which among our risks are they willing to cover, because we have the pension (benefit) which is the greatest in terms of amount every month,” Dooc said, noting the SSS disburses over P100 billion annually to pay pension benefits.

He also cited additional disbursements covered by the pension fund, including the death, disability and maternity benefits, among others.

“The risk is very substantial, so the issue there is will it be a viable business proposition to the insurer?” Dooc said.

As such, the SSS chief said the proposal is to tap a consortium, or to urge private insurance firms to pool their funds together.

“It should be a consortium or a pooling, because we need a huge capacity for the insurer. The current capitalization of insurance firms now is P550 million per company, how many lives can that cover?” he said.

According to Dooc, the SSS is now in talks with the Actuarial Society of the Philippines, which will study the proposition and assess its viability.

“The ASP is already studying it, we have one informal and one formal meeting. They will revive their social security committee,” Dooc said.