Climate change is still ignored in corporate analysis and planning according to a new survey by the Institute of Management Accountants (IMA). The new survey in which more than 500 respondents working in corporate finance were included, revealed that 32% of the respondents believe that their organization does not consider climate change in their enterprise risk management. Only 7% said their company has a dedicated climate risk management process, while 15% said their in-house enterprise risk management includes climate risks among a wider range of ESG risks. According to the survey findings finance was identified as one of the least likely departments to be involved in climate risk management. More than one-quarter of respondents said finance and accounting staff only occasionally take part in climate risk management, while 18% said their finance team doesn’t participate in climate risk management at all. In addition, chief finance officers and CEOs were found to have a shorter-term focus on risk analysis than their lenders and investors. The IMA says this mismatch poses a “significant challenge that requires attention to implementing strategies and reporting around climate issues.” While many large companies release sustainability reports, small businesses — which make up 99% of registered US businesses — are lagging behind. This may put them at a disadvantage when it comes to attracting fresh capital. Just over half of all respondents said they are not using sustainable business information in their decision-making at all. Only 26% said this information is used to identify and assess risks. The respondents skewed towards private companies. About three-quarters of the respondents come from private firms, and 64% come from entities that don’t have to produce public reports. Source: asiainsurancereview.com

By Herminia S. Jacinto THERE is a remarkable although guarded optimism as we enter the second semester of the year. More and more vaccines have arrived, and more are expected. General Galvez is more confident now that we may achieve herd immunity by the Christmas season. Our horizon seems to be brighter now. Roads, bridges, Skyway and LRT extensions are now open and ready to service our commuters. The much-awaited economic recovery is starting to happen, which will reopen businesses and create more jobs for our people. The insurance industry is very sensitive to the movement in the economy. As factories, stores and other business establishments operate, there are more to be covered by insurance. In an earlier column, this writer mentioned insurance companies were ready to serve clients not long after lockdowns started. It was "business as usual" with some changes, but the insurance industry was ready to serve the needs of its clients immediately. One positive change is operations are more efficient because of digitalization. But there are still problems to be addressed. Source: manilatimes.net

By Herminia S. Jacinto PROTECTION has been the operative word for everyone for over a year now, protecting oneself, family members, co-workers and friends from the harsh and sometimes fatal effect of the pandemic. Consciousness for protection of lives and property is first and foremost in our minds as we traverse the difficult year that was. A previous column in this paper discussed the performance of the life insurance companies in providing their insured with the right products and services in the time of the pandemic. What about the nonlife insurance industry? How did they react and provide protection to the insured? Nonlife insurance refers to insurance of property (residences, commercial buildings, factories, etc.), motor vehicles, airplanes, ships and cargo and personal accident, among others. Based on the data provided by the Insurance Commission (IC) website, the gross premiums written of the nonlife companies for 2020 decreased by only nine percent compared to the 2019 figures in spite of the difficulties experienced during the year. We had expected the reduction could be a lot more considering offices were closed for business for some time. The IC made representations to include insurance among the businesses exempted from quarantine in order that companies could operate even with a skeleton force to service the requirements of the insuring public. The companies relaxed some of their requirements on premium payments and claims servicing; thus, allowing for longer grace periods in paying the policies and simplifying claims filing procedures. Source: manilatimes.net

By Herminia S. Jacinto OUR lives have changed over the past 14 months, counting from the first lockdown in 2020. We had to learn numerous new ways of conducting our daily activities. Children had their classes at home as their parents were also working from home. The internet providers and sellers of laptops, cellphones and other devices experienced a sudden surge in sales — more than the average sales for the last five years. Online sales were the way to go. Anything and everything could be bought online, including insurance. Insurance companies had to set up or improve its websites, databases, portals and everything that has to do with selling its products online. Traditional selling practices continued but were greatly hampered by the lockdowns and imposition of strict safety protocols. Agents and other intermediaries had to reinvent themselves to cope with the new way of selling. We have a very active and robust agency force both in the life and nonlife sectors. They represent the various insurance companies and have to pass the qualifying examinations given by the Insurance Commission. These intermediaries are either the insurance agents or insurance brokers as defined in Title 1, Chapter 4 of Republic Act 10607 otherwise known as the Insurance Code of the Philippines. Source: manilatimes.net

By Herminia S. Jacinto A FRIEND called me up the other day asking if she should still renew the comprehensive covers on her vehicles. Her family members have six vehicles between them, and the insurance premiums amount to quite a sum. She thinks that since they hardly go out and travel anyway, the chances of meeting with an accident is very minimal. I could not believe her saying that, but I immediately launched into a long explanation why she should continue insuring her vehicles. The risk is always present, and one cannot predict where and when it will occur. Just watch the TV news every day, and chances are, there is one or two accidents caused by motorcycle riders who deliver food and other essentials since people movement is restricted. Who would think that a mansion in a first-class subdivision will burn? Fires can occur anywhere as long as there are combustible materials. Since last year, many business establishments have closed shop, and the buildings or factories are not operating. The premises gather soot and dust and become prone to fire and damage, which can easily trigger combustion. The lockdown situation has also created risks of overheating of appliances and gadgets. Since almost 100 percent attention is focused on Covid-19, we might miss the point that climate change continues to threaten our country, and typhoons and flooding might still occur during the rainy season. The cost of insurance is not exactly cheap, but the benefit that one derives from the occurrence of the event being insured for is many times over the cost. Plus, the peace of mind that it gives the insured that he or she can start his or her business operations again after the pandemic. Employers have to review and if possible, improve the insurance coverages and health maintenance programs of their employees, which will not be easy, considering the slackening of business operations. But it is now when the medical assistance is most needed. Source: manilatimes.net

By Herminia S. Jacinto INSURANCE is sold, not bought! I do not know where I read or heard this statement; neither did I get the meaning until I worked in an insurance company. The buyers of insurance do not go to the insurance company like one would go to the shops or groceries to buy food and clothing. People who are trained to explain the insurance products and the benefits of buying insurance are the agents and of later vintage, the brokers. Agents represent the insurance company whereas the brokers represent the insured. Both are licensed and subject to the jurisdiction of the Insurance Commission. They undergo training and are licensed by the Insurance Commission. As the finance head, I get to meet our insurance agents, our “producers,” up close when they collect their commissions and follow up claims payable to their clients. I would always wonder how they were able to convince their clients to have their lives and properties insured. It must require a special talent and charm to talk to a person about death and other calamities and convince him to buy insurance. Before the coronavirus pandemic, selling insurance was done face to face where the parties, agent and prospective buyer could meet in a nice and cozy place over a cup of coffee to talk about the product. The prospect could ask all the questions and be answered satisfactorily by the agent. The facial expressions and the body language are very good indicators whether the sale is proceeding well and the client is convinced to buy insurance. Some insurance companies or agencies would gather a number of prospective clients to introduce their products complete with video presentation. Source: manilatimes.net

By Herminia S. Jacinto DEFINE seniors! In this article, I am referring to the definition of the Inter-Agency Task Force for the Management of Emerging Infectious Diseases of “seniors,” which refer to individuals above the age of 65. I believe that compared to kids below 15, the seniors are the ones most affected by the current situation. Due to the restrictions in the movement of people, seniors are not allowed to go out except to get treatment, medicines and other “essentials.” No matter if they are allowed to go out to buy food and medicines, there is a lot of anxiety about catching the virus from these places. Drugstores such as Mercury and groceries offer online ordering and delivery services, but this takes some adjusting to. It is difficult to read the doctor’s prescription and repeat them to the drugstore attendant. Choosing the items they want to purchase in the grocery is a task which seniors do not want to delegate to others. They prefer to choose their own fruits, vegetables, snacks and chocolates! At age 65 and above, they are retired from full-time jobs and maybe living independently from children who may have families of their own already. In their places of work or even at home when the young ones were still around, there was always someone to handle the computers, check bank balances, order medicines online and other tasks requiring technology. Now they have to do all of this and learn all the tricky processes. How does one use QR codes or pay using GCash? Can he withdraw his Social Security System pension without falling on line in the bank? Many pensioners prefer to still have a passbook where they can track their balances. They are quite insecure about using the ATM cards. We hope that the banks can have someone ready to assist seniors with their problems. Young people are very adept with computers, cellphones and other gadgets. I hope they can offer their assistance to senior neighbors on how to do things online. The seniors too should not be shy to ask for assistance and exert efforts to learn the technology. It is never too late. Keep on learning! Source: manilatimes.net

By Herminia S. Jacinto SUDDENLY it is 2021! What happened to 2020? Did it pass swiftly because we enjoyed the year or because we just wanted it to be over? There was such anticipation for the coming of 2021 and the positive developments that it will bring. I cannot blame us — we need some good news and we wanted to be part of making that good news! The numbers for the coronavirus disease 2019 (Covid-19) have become better and better in the last few months. Deaths resulting from this much dreaded disease were not as many as in the first few months that it affected our population. The good news is that our medical experts have found the effective way of treating it but not before many trials and a lot of disappointments. We are praying that this will continue until we finally find the light at the end of the tunnel. The economy is gradually recovering from the slump that was felt during the series of lockdowns which affected production of goods, mobility of people, especially workers, and procurement of food and others staples. The government, minus the many lapses we all know by now, and the private sector were one in imposing and following the much needed protocols, which is slowly bringing us back to normal. There are so many lessons learned and still being learned during this one-year period. The year 2020 was a blockbuster; a record year for these events — the Taal Volcano eruption, the pandemic and the several typhoons and flooding which happened in the last quarter of the year. Early December last year, we thought that there would be no Christmas! We survived the “annus horribilis”! Very difficult and with much prayer and effort. We cannot even claim success yet. We are not back to normal, not even the new normal! But we are getting there — slowly but surely! How did we do it? What are we doing to achieve this modicum of success that we are currently enjoying? Mainly because we followed the rules on how to protect ourselves and our properties and belongings. The operative word therefore is protection. It has become a mantra for survival but I have a different take on the word. Let us make it our business — the business of taking care of ourselves, our family and friends and our properties too! Protection is following the protocols. Wearing the masks and the face shields and observing strictly the physical distancing guidelines. Protection is not going to the Quiapo Church no matter how fervent is our devotion to the Mahal na Poon! He is omnipresent and can hear our prayers and petitions wherever we are! Protection is safeguarding our health and strengthening our immune systems to fight Mr. Covid! Protection is taking care of oneself by avoiding partying with strangers even if they were introduced by well-meaning “friends.” My dear father used to tell me: “Do not court danger; you might marry it.” Protection is getting the much awaited vaccine as soon as possible to create the “herd immunity” that will protect the rest of the population of our country. Protection is covering ourselves and our properties with insurance which will bring us back to where we were before the happening of the event insured against. The Philippine insurance industry is more than ready to provide the right protection that we need. Insurance policies are being reviewed with the intention of covering events like the pandemic which heretofore was not part of the risks covered. Let us pray that they find the right formula and support for this change in policy conditions. The insurance companies have made a lot of changes to improve their service to the people. Protection is seeking the advice of professionals like insurance agents, brokers and financial advisors on the kind of coverages needed by your family. Protection is trusting our insurance industry. Wishing our readers a kinder and better year 2021. And may I repeat. Let us make protection our personal and business mantra for the year. The author is president of the Insurance Institute for Asia and the Pacific. Source: manilatimes.net

By Herminia S. Jacinto THIS is the time of the year, albeit quite late already, for companies to prepare their budgets and plans for the coming year/years. Shall we just skip 2021 and plan for 2022? How do we plan for a year that seems to be full of uncertainties? Coming from a negative GDP growth ranging from minus 6 percent to -9 percent, how do we look at 2021? Dr. Cielito Habito, the well-known economist, wrote in his column in the Philippine Daily Inquirer that the reason for the shrinking economy is that those who are supposed to spend money are not doing that. Government should have been the biggest spender as it implements its various projects under the Build, Build, Build program. Funds could have been spent on preventing the spread of the much-feared Covid-19 virus! Instead of spending on preventive measures like testing and contact tracing, they resorted to strict lockdowns. The forced lockdowns caused a lot of disruption in the business sector. For some time, factories and business establishments had to stop operating to counter the spread of the virus. Tourism, which is a major source of revenues, came to a halt due to travel restrictions. Can you imagine how much was lost on plane fares, hotel bookings, dining in restaurants, etc? Our dear OFWs, on whom many families depend for livelihood and other benefits, were also grounded and sent home by the countries where they had been working. To top it all, we had to deal with the increasing number of people affected or even dying from the virus. It looked so dismal at one point that there was a general feeling of hopelessness. Is there some good news at all now that we are almost ending the year? Will there be Christmas? Government is slowly lifting some restrictions to allow people to go back to work and other commitments. Transportation is almost back to normal — traffic too! Vaccines have been developed by various medical experts overseas, and we are in line to get a supply from some vaccine makers. I just hope that they choose the right provider and assure the population of availability for all. We need this confidence to be able to look forward to 2021 with a degree of optimism. How does the insurance industry see 2021? Are they seeing economic growth and recovery? Will insurance companies stay and be strong enough to service the needs of the insuring public? Will there be buyers of insurance? Will it be considered an “essential” like food and medicine? The good news is that your insurance industry is as strong as ever. The minimum net worth requirement was required to be increased to P900 million which made them even stronger and financially viable. The insurance companies are looking at 2021 with a positive outlook and are definitely firm in their commitment to serve the insuring public. Our inherent attitude toward protecting our families, especially our children, became even stronger in the light of the adverse effects of the pandemic. I sincerely think that the insured will keep their policies in force and put their insurance premiums in their “must pay” list as they prepare their budgets for the next year. Insurance companies are coming up with easier payment terms and sometimes provide loan facilities to assist their insured’s financial condition in the near term. The last two strong typhoons resulted in a substantial destruction to lives, property and crops. Those who have insurance can recover with their coverages, and have funds to rebuild or start over their business operations. Planes are flying again. They can’t fly without insurance. Vehicles are back on our roads, and they need insurance to protect them just in case accidents occur. Factories are running again, maybe on a limited capacity. Malls and other shopping centers have reopened with the necessary protocols, but to insurers this simply means more inventory to protect with marine and property insurance. Insurance is a necessary partner of our economic recovery. It would double the confidence that we are hoping to get with the coming of the vaccine and the efforts to fight the virus! Trust your favorite insurer, broker or insurance agent (they also go by the title financial advisers). We are with you in your journey to recovery and success! Merry Christmas and a toast to the New 2021! Source: manilatimes.net

By Herminia S. Jacinto OUR lives, especially those in the work force, have changed a lot in the past eight months after the first of several lockdowns was imposed. Work from home (WFH) is the new buzz word. Suddenly, we were not allowed to go out and go to our respective places of work. We thought it was a welcome respite from traffic, work and meetings! The happiness was short-lived. There was work to be done, but how? Movement of people was restricted and exceptions were limited. The insurance industry is expected to be present at all times, especially during calamities and events that cause a lot of stress and anxiety. We had to go back to work! Business had to be proactive and came up with various ways to continue the normal process of production, marketing, servicing and other business activities. Working from home was the best alternative as this has been institutionalized by Republic Act 11165, otherwise known as the “Telecommuting Act.” This law was principally authored by Sen. Emmanuel Joel Villanueva and signed into law on Dec. 20, 2018. The implementing rules and regulations (IRR) have been issued by the Department of Labor and Employment, which made it easy for business to implement the work process. With due respect to the purpose of the Telecommuting Act and the IRR, various types of business operations still had to evaluate if WFH was going to work for them. After eight months of WFH, I am curious if the practice is working and what are problems they have encountered. May I share with you the results of my interviews some of my friends from the insurance companies? The heads of the departments or units initially found it difficult to make the assignments as to who and how long people would work from home or in the office. There are jobs that are best done in the office but some employees still opt to work from home too! Employees who lived far from their offices are relieved from waking up very early to get rides and avoid traffic. They save money from eating snacks and lunch at home with the family. They can maximize their time working because they work by themselves without other people, including noisy office mates bothering them and they do not tire themselves from commuting. But, yes there is a but, maybe several buts! What equipment and tools will he need so he can work from home? He will need a strong internet connection. Who will pay for them? Where are the files, both hard and soft copies? Are they immediately accessible to the employee from his home? How about the employers? How do we address concerns like supervision, completion and measurement of work? How do they determine who will work overtime? Is there a need for it? Will management allow them to bring home files or access to confidential data bases? Are there privacy considerations? The list of hows and whys can go on and on but I guess companies have found the right answers to these questions and have made WFH a viable alternative of working during this period that we continue to fight the pandemic. Among industries, insurance is the most adaptable to the WFH procedure because our product of assurance and commitment is written in a document which can be transmitted electronically. Our industry is very much ahead in terms of computerization. We have had our data bases installed many years back. Our producers, agents, brokers and financial advisors are now comfortable with their gadgets in selling the insurance products. We hit the ground running. All we need now is to improve on these systems and upgrade the tools. I will end this article by sharing the concern of one of my former students in the institute. He said: “Ma’am, I don’t like working at home. I cannot concentrate because my mom keeps on sending me out on errands. In the middle of a sales talk, she goes, ‘Rico, bili ka nga ng kamatis!’” How do you solve a problem like Rico’s? Source: manilatimes.net