07pm-4904 Building Strategic and Operational Partnerships for Sustained Growth
| budget |
€ 103.032,97 |
status |
execution |
| start date |
01-01-2007 |
date end |
31-12-2007 |
| location |
|
country |
philippines |
| financer |
Agriterra |
| executor |
Partnership Mutual Benefit Association |
intervention level |
national |
| Programmes |
| work area 08: Banking and Credit sector (including Insurance) | IFAP 08: Ensure secure access to resources | |
| description |
The Pakisama Mutual Benefit Association (PMBA) was founded in 2002 with the objective to offer microinsurance products to members of Pakisama, the National Confederation of Peasant Organisation. The PMBA operates as a stand-alone microinsurance company, and as such officially registered with the Securities and Exchange Commission (SEC) and duly licensed (...more...) |
| description |
The Pakisama Mutual Benefit Association (PMBA) was founded in 2002 with the objective to offer microinsurance products to members of Pakisama, the National Confederation of Peasant Organisation. The PMBA operates as a stand-alone microinsurance company, and as such officially registered with the Securities and Exchange Commission (SEC) and duly licensed by the Insurance Commission (IC) as a mutual benefit organisation.
After initial slow but steady growth in the period 2002-2005 (4,500 policies), membership declined to about 3,200 in August 2006. After reviewing policies for non-payment of premiums and cancellation of policies due to non-payment, the actual membership was estimated at 500 by the end of December 2006. These disappointing results can be attributed to both external and internal factors. PMBA was hit by the problems within the membership of Pakisama that was originally constituting the natural membership base. While financial and administrative systems were up-to-date, the marketing efforts through the sales agents failed to translate into increased sales policies and hence, premium income to cover the costs of operations. This has eventually led to a rethinking in 2006 of both the marketing model, products, partnerships and the functional mode of operations.
Agriterra has supported PMBA since its foundation in 2002 through funding and advisory services (MIAN/Gerard Pierik). Interpolis Re provides a reinsurance facility, and thus sharing the risk in case of exceptional loses. Ad Arma has provided technical assistance for the development of a financial administration system (OASE), including management of portfolio. (...less...) |
| results & observations |
In 2007 some major changes took place in the PMBA: there was a re-orientation of business strategies. An important initiative was the move towards collaborating with Partners in establishing Community-based Savings-Lending-Insurance Services in their areas of operation. Through this initiative, it is expected in the long-term to reach a (...more...) |
| final results & observations |
In 2007 some major changes took place in the PMBA: there was a re-orientation of business strategies. An important initiative was the move towards collaborating with Partners in establishing Community-based Savings-Lending-Insurance Services in their areas of operation. Through this initiative, it is expected in the long-term to reach a stable and sustainable membership of PMBA. By the end of 2006, PMBA collaborated with 7 organisation and by the end of 2007, collaboration increased to 21 partner organisations.
Total number of policyholders at the end of the year is lower than expected. However, PMBA managed to deliver on the total premium collection target. Total premiums collected are 98% of the total target for the year as committed to Agriterra.
An important realisation of the PMBA Board is that micro-insurance alone is an inadequate financial service for their rural and urban poor target market. Kapamilya will have to be bundled with savings and credit products of community-based cooperatives and/or ROSCAs (rotating savings and credits associations) in order to ensure a sustainable and stable membership for the PMBA.
The challenge for PMBA is to be able to identify and respond to the needs of medium and large lending organizations, this way they can get them to join PMBA. At the moment, discussions of reinsurance as a basis for partnership are being explored.
From a rights-based perspective, the people, especially the marginalized, need to be provided with adequate social insurance by the government. Especially local governments are a potent channel for micro-insurance products. It is a challenge for the PMBA to create opportunities for the marginalized to receive subsidies for insurance from their local governments or local political leaders.
(...less...) |
| specialisms |
| Banking and credit sector (incl. insurance) | |
PROPOSAL
| Agri-agency | Own contribution executor | Other parties | Total requested budget |
|---|
| Agriterra | PMBA | | |
| € 0,00 + € 0,00 | € 0,00 | € 0,00 | € 62.302,00 |
The submitted proposal concerns a four-years period (2007 – 2010). During this period, PMBA will continue to offer two main insurance products, namely family-health and credit-life. It will also further explore group-insurance packages. Based on experiences of the last years, the marketing strategy will focus on building strategic and operational partnerships with cooperatives, women organisations and local governments. This strategy will solve two main problems associated with the poor performance in the past as (1) it will not depend directly on the membership of Pakisama, and (2) it will not depend on the performance of individual sales agents.
The proposal clearly states the ambition to attain a self-sustaining status by 2010. Related performance indicators are:
1. Net-growth of policies by around 9,000 to around 43,00 by 2010
2. Costs will increase less than handled volume
3. Increased capacity for self-financing (Agritterra-contribution as part of total expenditures falls from 83% (2007) to 8% (2010)). |
GOALS
• To provide financial security to policyholders, dependents and their beneficiaries upon the occurrence of covered contingencies;
• To promote and advance the various interests of its members and their dependents and beneficiaries which will enhance their social and economic well-being;
• To develop insurance and savings consciousness among its members through education and other forms of information strategies;and
• To recruit policyholders/members and establish or recruit chapters throughout the country. |
