Editor's note: In lieu of his column this week, Michael F. Rellosa shares this piece by Erickson H. Balmes. HACKED! This six-letter word is enough to unleash beads of perspiration on the forehead of any business owner or head of an organization. Definitely, any uninvited intrusion into an entity's repository of its most cherished secrets is a very potent cause of sleeplessness for its top management. Since many consider data as the new oil, its extraction and exploitation, albeit without permission, has become a lucrative endeavor for some unscrupulous persons. The number of reported hacking incidents and data leakages is truly a cause of concern. For the last quarter of 2024 alone, the Philippines recorded more than 700,000 leaked accounts. To address the current cybersecurity challenges, companies have exerted considerable effort and resources to fortify its cybersecurity posture. Passwords and firewalls have ingrained themselves in the psyche of any self-respecting computer user. Owing to its established reputation as a viable risk transfer mechanism, insurance is an essential part of any diligent company's toolkit to deal with any cybersecurity issues that may arise. The formula is simple. Getting insurance shifts the financial risk of an event like a data breach to an insurance company. In this way, the insured company "manages" the risk. After all, the inconvenient truth is data breaches will happen and what can be done after the breach is to manage its impact. In the Philippines, available cyber insurance policies cover a wide range of events like data breaches, business interruptions, systems recovery and restoration, content liability and even cyber-extortion. The foregoing notwithstanding, a lot remains to be done. Due to its aleatory characteristic, insurance is a post-event response. While some insurance companies require their prospective insured to comply with certain cybersecurity practices before insurance coverages are provided, the quest for a better cybersecurity milieu requires an army of dedicated cyber warriors. There is a need to raise a phalanx of cyber defenders akin to the Night's Watch of "Game of Thrones" fame to stand watch on every firewall and slay any digital white walkers. Enter the academe. In September 2022, the Washington SyCip Graduate School of Business of the Asian Institute of Management (AIM) welcomed the first batch of 39 students to its then newest offering, the Master of Cybersecurity (MCS) program. The clarion call to be the program's pioneers was answered by a budding air cargo business mogul, a retired policeman, an active Philippine Army officer, an Air Force employee, a registered nurse, some information technology people, a Super Mario, certified public accountants, a Starlink believer, a cola lover, a telco data protection officer, members of the Philippine cybersecurity workforce and several lawyers. Over an 18-month period, this very diverse cohort consumed voluminous reading materials and case studies on such topics as data privacy, network security, ransomware, encryption, ethical hacking, digital marketing, digital autopsy, and ethics and the law. AIM's MCS program was designed to answer the need for developing a cybersecurity workforce with exemplary leadership and management skills in view of the prevailing global cybersecurity challenges. As the human race seeks to digitize more of its activities and attempts to create a digital version of the world we live in, the more we are exposed to the threats brought about by our growing online interactions. Evidently, there is a need to create an army of cybersecurity experts who can form a global shield against all forms of cyberthreats. And the current need is considerable. Toward the end of 2022, the global cybersecurity workforce was short of 3.4 million employees. MCS is a part-time master's program that runs for 18 months. It is designed for mid-level managers in the private sector, the government and those in the military or law enforcement who need to effectively comprehend cybersecurity risks. The MCS program follows the Association of Information Systems Model Curriculum for Cybersecurity, and it is delivered via the hybrid learning mode, i.e., students have the option to attend classes on-site at the AIM campus in Makati City or via its digital version in Zoom. The program is considerate of working students who wish to develop their cybersecurity skills. The graduates of the MCS program are envisioned to be information security management professionals who will be able to create and support cybersecurity management plans and programs that greatly contribute to an organization's business continuity, resilience and financial viability. The future alumni of the MCS program are projected to be ethically responsible in managing risks, threats and vulnerabilities by way of effective communication and interaction with stakeholders. Each MCS graduate can be expected to support and enhance the governance, risk, control and financial management frameworks of their respective organizations. During their 18-month academic sojourn at AIM, Cohort One of the MCS program walked the talk on their commitment to work for a more cyber-secured Philippines. For their initial corporate social responsibility project, batch members spearheaded a lecture to the faculty members of one of the campuses of Batangas State University on such topics as cybersecurity and data privacy as organizers, facilitators and lecturers. In January 2024, Cohort One also conducted a seminar on cybersecurity for all the government officials and employees of the Municipality of Agoncillo in Batangas province. Having been awarded the enviable degree of Master in Cybersecurity last July 2024, the members of Cohort One continue to strive to live up to the AIM ethos of Leading, Inspiring and Transforming! Onward to a more cyber-secured and cyber-resilient Philippines. *** This article is dedicated to all the members of the AIM MCS Class of 2024 as we celebrate the first year of our completion of our program. Truly what a journey it has been. Snappy salute to all! Special mention to Prof. Philip Kwa, CA, PMP, CISM, SID, MCS academics program director for nurturing the program through a lot of birthing pains. Credits also to Felipe Calderon, CPA, CMA and the school head of AIM's Washington Sycip Graduate School of Business for planting the seeds of sustainability and ESG in all of us! Salamuch Cohort 1, First of its Name, the Few and the Brave! AMDG! If you are interested to join the next versions of the few and the brave, send a query to mcs@aim.edu . Erickson H. Balmes is a lawyer and former deputy commissioner of the Insurance Commission. He finished his Master in Cybersecurity in 2024 and Executive Master in Disaster Risk and Crisis Management in 2020 from the Asian Institute of Management. Source: manilatimes.net

Worsening climate change could drive up the cost of insuring personal assets, creating a domino effect from rising reinsurance costs, according to the Philippine Insurance and Reinsurers Association (PIRA). In a briefing on Wednesday, March 5, former PIRA chairperson Eden R. Tesoro said the most recent wildfires that ravaged California could increase non-life insurance premiums’ costs. Tesoro, also the chief operating officer of Malayan Insurance, said that the market should expect price adjustments if their reinsurers happen to be among those affected by wildfires. Reinsurers—insurance firms providing financial protection to insurance companies—will adjust pricing to ensure their stability, Tesoro said. “As a rule, when you have this significant rise in reinsurance costs, then generally, the product will have to increase in price,” Tesoro noted. As a result, insurers will also pass on higher reinsurance costs to policyholders through increased premiums, as maintaining current pricing would be unsustainable. According to Tesoro, non-life insurance premiums rose by about 10 to 15 percent in 2023 and 2024. PIRA Executive Director Michael F. Rellosa said non-life insurers cannot just raise premiums without the Insurance Commission’s (IC) approval. Despite this, Tesoro noted that non-life insurers have various reinsurance sources. To date, the National Reinsurance Corporation (NatRe) remains the only professional reinsurer in the Philippines. As per Jose Augurio N. De Vera Jr., NatRe’s non-life reinsurance head, reinsurance costs surged in 2024 due to a “hard market.” Concerning risks, PIRA said that besides intensified climate-related events, the industry might also feel the impact of global politics. Rellosa warned of record temperatures before summer, which could lead to heavy rainfall. “We’re going to be hitting record temperatures and we haven’t even started our summer. If there’s record-high heat, it usually translates to record-high rainfall,” Rellosa said. Meanwhile, Tesoro said US politics may not directly affect Philippine non-life insurers but could influence their investments in the country. Further, the looming trade war between the world’s largest traders could spill over locally, impacting the insurance industry. “Anything that affects the economy, we feel that in the insurance industry, either we insure less goods or the cost for example of preparing stuff locally would be more expensive because we import. So an increase in tariffs should also increase in prices,” Rellosa said. Source: mb.com.ph

Worsening climate conditions and external uncertainties could prompt insurers to hike premiums, an industry group said on Wednesday. Philippine Insurers and Reinsurers Association Executive Director Michael Rellosa told reporters that "massive events" such as natural disasters, geopolitical tensions and other economic uncertainties could pose risks to insurers, prompting them to hike premiums — the amount that clients pay regularly to keep a policy in force. "The Philippines is also now the most vulnerable country to natural calamities ... we've had that dubious title for three years in a row," he noted. The recent wildfires in California, for example, were said to have led to insurers hiking premiums or refusing to renew policies. Jose de Vera, nonlife head at National Reinsurance Corp. of the Philippines, said that an "accumulation" of events and the possible impact on the Philippines would be contributing factors in decisions to adjust premiums. As for reinsurers — firms that provide financial protection to insurers — Malayan Insurance Co. Inc. Chief Operating Officer Denden Tesoro said that disasters such as the California wildfires would also be considered in a decision to raise prices. "Currently, the cost of reinsurance is still expensive, but it has kind of plateaued around 2023. There are signs that it's going down, but it's nowhere near where it was before," Tesoro said. "While we can cautiously hope that the market will soften," she added, prices will not be sustainable "if insurers will continue to price at the same level even though the cost of reinsurance is already very high." Insurers, however, cannot simply raise prices without regulatory approval, Relloso said. Market conditions will also have to be factored in, he added. With motor insurance making up over 50 percent of the industry's portfolio in the Philippines, Relloso said that insurers now have to assess the risks attendant to rising consumer interest in electric vehicles. The trade wars started by US President Donald Trump will also have an impact, as these will affect trade and consequently the economy. "Anything that affects the economy, we feel in the insurance industry. Either we insure less goods or the cost, for example, of preparing stuff locally would be more expensive because we import all this stuff, so an increase in tariffs should also lead to an increase in prices," he added. The nonlife insurance industry saw net income decline by 2.63 percent to P8.89 billion last year from P9.13 billion in 2023, Insurance Commission data showed. Total losses rose to P29.09 billion, up 10.15 percent from P26.41 billion. Source: manilatimes.net

The costs of insuring personal assets against accidental losses could rise due to the increased reinsurance costs as climate change intensifies, according to the umbrella organization of non-life insurers. In a press briefing on Wednesday, Philippine Insurance and Reinsurers Association (PIRA) former chairperson Eden R. Tesoro said that the wildfires in California could add up to the costs of non-life insurance premiums. “If your reinsurer is one of those affected by those fires, then you can expect that they will adjust their pricing,” Tesoro said, who also serves as the chief operating officer of Malayan Insurance. A reinsurer is an insurance company providing financial protection to other insurance companies. Tesoro said that for reinsurers to stay afloat, they will push back the pricing to companies that they reinsure. This would then translate to higher premiums charged to policyholders as it is not sustainable for insurers to price at the same level as the cost of reinsurance is already “very high,” Tesoro said. However, Tesoro said reinsurance sources of non-life insurers vary, with the National Reinsurance Corporation (NatRe) as the only domestic professional reinsurance company in the Philippines. “As a rule, when you have this significant rise in reinsurance costs, then generally, the product will have to increase in price,” Tesoro added. This was observed in 2023 and 2024, when there was an increase of about 10 to 15 percent in non-life insurance premiums, according to Tesoro. Non-life insurers, however, cannot just increase premiums as these need to be approved by the regulator, PIRA Executive Director Michael F. Rellosa said. NatRe’s Head of Non-Life Reinsurance Division Jose Augurio N. De Vera Jr. said reinsurance costs significantly increased in 2024, as a “hard market” has resulted in increases in reinsurance. The California wildfire, De Vera said, was an accumulation of all the disasters that happened elsewhere. “[It] is just one factor that might increase the overall prices.” Tesoro said reinsurance costs could be anywhere from 50 percent to nearly double. “Even if you could afford it, which many companies struggle with, it wasn’t always available.” PHL riskiest With various natural catastrophes occurring all over the world, the Philippines stands as the most vulnerable, ranking first in the World Risk Index. “We’re gonna be hitting record temperatures and we haven’t even started our summer. If there’s record-high heat, it usually translates to record-high rainfall,” Rellosa said. “It looks like there’s a perfect storm brewing and we wanted to be ready for that,” Rellosa added. Moreover, while United States politics may not directly hit non-life insurers in the Philippines, it could impact their investments, according to Tesoro. “The politics, not only America’s but the whole world, there seems to be a full-blown trade war happening already, tit for tat,” Rellosa said, adding that geopolitics is a “big issue.” As the US imposes tariffs, the companies and countries that are affected will also impose counter-tariffs that will affect trade. “Anything that affects the economy, we feel that in the insurance industry, either we insure less goods or the cost for example of preparing stuff locally would be more expensive because we import. So an increase in tariffs should also increase in prices,” Rellosa said. Source: businessmirror.com.ph

Represents the private insurance sector were ED Mitch Rellosa; Allan Santos, NatRe; Geric Laude, Pioneer; Arlene Calimag, Malayan; Atty. Paolo Somera, Cocogen; Sandy Reyes of AJ Gallagher, who shared their insights and viewpoints at the roundtable spearheaded by the World Bank in collaboration with the Department of Agriculture.

Malayan Insurance chief operating officer Denden Tesoro (lady in black suit) and Philippine Insurers and Reinsurers Association executive director Michael Rellosa (gentleman in gray suit) discuss outlook for the non-life insurance industry on 5 March 2025 at BPI-Philam Life Tower in Makati City. Non-life insurance professionals are seeing possible higher prices of products, following stronger local and global natural disasters in recent months, including over five storms in the Philippines last year, the California wildfires and the Florida floods. In a media briefing on Wednesday in Makati City, Malayan Insurance chief operating officer Denden Tesoro said there was a price increase of 10 to 15 percent in non-life insurance products in recent years. Meanwhile, she said the price of reinsurance to non-life insurers has stabilized since 2023, after hitting a 50 percent growth. Reinsurers cover the service costs of other various insurance firms so they can continue delivering claims to individual and corporate clients. Insurance faces inflation, too However, Philippine Insurers and Reinsurers Association executive director Michael Rellosa said further natural disasters due to climate change could force insurers to raise product prices. “Philippine insurers deal only with top-notch global reinsurers and these reinsurers price their protection based on what’s happening around the globe, not just what’s happening here in the Philippines,” he said. Tesoro shared that some insurers in the United States already closed shop as requests and amounts for claims surged due to property damage brought by hurricanes in Florida last year and wildfires in California in January. Extra expenses threaten She said insurers spend on claim adjusters who analyze whether the loss is indeed covered under the policy and how much. “So those are extra expenses that insurance companies have to pay,” Tesoro said. Due to the massive impact of two Florida hurricanes last year, the former administration under US President Joe Biden announced it allocated at least $94 million to recovery efforts for the victims. On the California wildfires, BBC reported a land area spanning over 23,000 acres was burned and more than 400 families evacuated. Environmentalists worry that dry and wet weather conditions might intensify as the European Commission reported an increase of 1.48 degrees Celsius in global temperature in 2023 or near the 1.5 limit set by state signatories to the United Nations’ Paris Agreement on Climate Change. However, Rellosa stressed that the disasters in the US have not yet affected the prices of non-life insurance in the Philippines. Tesoro added that putting a number for a price increase forecast in the non-life insurance industry is difficult as insurers work with different reinsurers and ways of analyzing risks. “So there could be some differentiation in terms of price, even if you say they’re generally expensive, and companies also have different underwriting views,” she said. Rellosa said adjustments to reinsurance rates will be announced in April and July. Source: tribune.net.ph

The research covers the records of 1,015 floods in high mountains of Asia and has been published in the latest issue of Science Bulletin. It confirms a significant rise in the frequency of floods since 2000 and that temperature rise is driving the increase. Science Bulletin is an international journal sponsored by the Chinese Academy of Sciences and the National Natural Science Foundation of China. The research Flood complexity and rising exposure risk in High Mountain Asia under climate change was jointly conducted by Peking University, The International Centre for Integrated Mountain Development (ICIMOD) and University of Colorado. It studies a new inventory of the types, patterns and causes of floods in the region stretching back to 1950. The research confirms that flood frequency has risen but a major additional finding is a rise in the unpredictability in the timing of floods: while most events continue to occur during monsoon, there is a marked rise in the number of floods happening outside these times. The study confirms that planetary heating from the burning of oil, coal, and gas is driving the rise in all four of the main types of floods seen in the region. The two most common are driven by rain and snowmelt. Less common, but more sudden and highly destructive are those that caused by glacial lake outbursts (GLOFs) and landslide-dammed lake outburst floods (LLOFs). While population rises and expansion of infrastructure is increasing exposure to risk, temperature rise is the main factor in the rise in the number of floods. “The rules of floods are changing and the window for adaptation is closing,” warned Sonam Wangchuk, one of the report’s authors and a cryosphere specialist of ICIMOD. Mr Wangchuk said, “A single monsoon cloudburst or glacial collapse can trigger cascading disasters, overwhelming unprepared regions. We should prioritise real-time monitoring of floods in vulnerable valleys, restrict infrastructure projects in high-risk zones, and strengthen data-sharing agreements between high mountain Asia nations to address transboundary threats.” Authors emphasise that while climate change is aggravating the risks of all types of floods, there are complex dynamics at play in each type. Peking University principal investigator of the Cryosphere Dongfeng Li said, “While, pluvial and snowmelt floods result from extreme rainfall, snowmelt floods are driven by rising temperatures and increased soil moisture. In contrast GLOFs and LLOFs [are] shaped by complex interactions between climate, glaciers and topography.” Human activities also aggravate the risks from floods, especially urbanisation and land use changes, such as human settlements in flood plains, deforestation, and dams, can all increase vulnerability and reduce natural buffers. Source: asiainsurancereview.com

The Insurance Institute for Asia and the Pacific, Inc. (IIAP), in collaboration with the Philippine Insurers and Reinsurers Association (PIRA) ,  will be holding the Philippine Insurance Summit 2025  with the theme Shaping the Future of Insurance: A Collaborative Path to Sustainability. The Summit will be held on May 20, 2025 at Space at One Ayala, Makati City. The Summit aims to explore emerging trends, challenges, and opportunities shaping the future of insurance. Through keynote presentations, panel discussions, workshops, and networking sessions, participants will gain valuable insights, forge strategic partnerships, and collectively navigate the evolving landscape of insurance. On behalf of the Board of Trustees of both IIAP and PIRA, and the organizing committee of the Summit, may we cordially invite you to attend this unique event. You may register in the link provided below: Participant: cognitoforms.com/IIAP1/PhilippineInsuranceSummit2025Participant Sponsorship:   cognitoforms.com/IIAP1/PhilippineInsuranceSummit2025Sponsors

Philippine Non-Life insurers could increase their general minimum premium rates by 10% to 15% this year as natural catastrophes have affected the reinsurance market, resulting in losses, an industry group said. “Sometimes, we really have to adjust because as it is, it’s hard to write losses. It’s not sustainable if insurers will continue to price at the same level even though your cost of reinsurance is already very high,” Malayan Insurance Co., Inc. Chief Operating Officer and Philippine Insurers and Reinsurers Association (PIRA) Trustee Eden R. Tesoro said at a press briefing on Wednesday. PIRA Executive Director Michael L. Rellosa said the group has to inform the Insurance Commission (IC) that premiums will increase. “We can’t just increase our prices. It has to be approved by the regulators. And even if you can, of course, you have to balance with the market conditions,” he said. Based on seasonal renewals of reinsurance programs, which are usually in December, April, and July, PIRA could notify the IC about a rise in premium prices by next month, Mr. Rellosa added. Ms. Tesoro said premiums will likely continue to increase in the next few years but with “little dips,” depending on each company’s portfolio and risks. “Some companies are motor heavy, some companies are fire heavy, and some companies are the same. But what I can see is that perhaps the pricing will stay with small dips, generally speaking. Again, that may or may not be true for specific clients,” she said. “One of the reasons why we have to be cautiously hopeful is because of climate change, and while we say that even if globally the prices of reinsurance seem to plateau, ultimately it comes down to each particular company’s portfolio and how exposed you are. So, reinsurers will look at that,” Ms. Tesoro added. Meanwhile, investments of nonlife insurers could also be affected by US President Donald J. Trump’s administration’s trade policies, she said. Mr. Rellosa said this could also contribute to higher premium rates. “It’s going to affect trade, and if it affects trade, obviously, it’s going to affect the economy. Anything that affects the economy, we feel in the insurance industry. Either we insure less goods or [increase] the cost. For example, prepar-ing stuff locally would be more expensive because we import all this stuff. So, an increase in tariffs should also increase prices,” he said. The combined net premiums written of nonlife insurers grew by 10.49% year on year to P71.84 billion in 2024, latest IC data based on submissions of 55 out of 59 licensed firms showed. Source: bworldonline.com

The Southeast Asia Disaster Risk Insurance Facility (SEADRIF) and the Food and Agriculture Organisation (FAO) have partnered with six ASEAN countries to explore pathways for establishing a Southeast Asia Agricultural Risk Finance Facility (ARFF). On the sidelines of the 10th anniversary event of the ASEAN Climate Resilience Network (CRN) in January 2025, representatives from six ASEAN countries and regional stakeholders agreed to explore the development of the Southeast Asia ARFF as a potential sectoral mechanism under SEADRIF. The risk finance facility will have funding support from the Green Climate Fund (GCF). According to a media release by SEADRIF, climate shocks are increasingly threatening Southeast Asia's agrifood systems, where more than one-third of the workforce depends on farming for their livelihood and the sector contributes over 10% of regional GDP.  Despite the critical role of agriculture in ASEAN's economy and food security only 3% of global climate finance reaches this sector, which highlights an urgent need for transformation in managing climate risks. Southeast Asian countries have piloted innovative and practical agricultural solutions to mitigate climate impacts. However, common challenges impede the scaling-up of climate actions, particularly in expanding protection against climate shocks to effectively support underserved populations. Achieving this requires access to data, models, and specialised expertise to reduce transaction costs and streamline access to domestic and international insurance and reinsurance providers. Additionally, the affordability of premiums and the right cost-sharing between the insured and public support remain key concerns. Regional collaboration in scaling up agriculture risk finance can provide concrete benefits to participating countries. These would include reduced premium costs through a regional pool from regional diversification, economies of scale, and better negotiating power. Also, reduced transaction time and costs from a simplified go-to-market process for governments with improved products and conditions through centralised technical expertise in placement and market negotiations will be another noteworthy feature of the facility. With increased protection for difficult-to-insure exposures or perils, more innovative products through joint access to testing and implementing new technologies and products will be enabled. With increased budget and price stability from a member-owned facility will be able to help smooth insurance prices over market cycles. To support such areas, a regional facility will also provide access to world-leading knowledge, data, tools, and technical services and facilitate regional experience sharing. According to the media release in the coming months, SEADRIF and FAO will conduct a pre-feasibility assessment and work with countries to align on vision and objectives. The study will assess gaps, needs, and appropriate implementation arrangements and funding flows to unlock and inform climate finance investments into this critical area of strengthening the resilience of agriculture in the region. Source: asiainsurancereview.com