Recto backs insurance for OFWs
The availability of insurance products should extend to overseas Filipino workers (OFWs), according to Finance Secretary Ralph Recto – indicating the possible lifting of restrictions in the current framework.
During the 75th anniversary of the Insurance Commission (IC), Recto said the agency must strive to further boost the sector and improve social protection in the country.
Along this line, he said the IC should strengthen financial literacy among Filipinos.
“We should intensify nationwide financial literacy initiatives, covering a broad spectrum of insurance products available in the Philippine market and extending beyond reach to our overseas Filipinos,” Recto said.
While Recto has yet to go into specifics, he could be signaling a possible review of existing regulations on selling insurance policies to OFWs while they are working abroad.
The review is already being done by the IC and is supported by various insurance companies.
Current regulations require OFWs to be physically present in the country to complete a purchase of life protection products from local-based companies.
There are close to 12 million OFWs abroad, contributing $135 billion in remittances or roughly 10 percent of the overall economy.
However, a huge chunk of them do not have social protection, which was highlighted during the COVID-19 pandemic.
Insurance firms earlier said tapping OFWs would improve insurance penetration, which is currently at less than two percent of gross domestic product.
Recto also called on the IC to strengthen the implementation of the Financial Products and Services Consumer Protection Act, to empower Filipinos by providing them with confidence in accessing financial products and services within a secure environment.
The finance chief also urged the IC to collaborate with schools and universities in fostering financial education among students, to cultivate a generation of financially literate people capable of making prudent financial choices.
“A financially literate population is crucial for the development of a robust capital market and a globally competitive Philippine economy,” Recto said.
He noted that the IC must continuously institute regulatory measures and enforcement mechanisms to ensure the financial stability of its regulated entities and protect the insuring public.
“A credible insurance industry encourages more people to avail themselves of financial protection. That is important to strengthening our people’s financial resilience in the face of so many uncertainties,” Recto said.