The Insurance Commission (IC) has granted Maxicare Healthcare Corp a license to operate as a life insurance company in the Philippines. The new insurer has a capitalization of PHP2bn ($36.1m), higher than the PHP1bn required by the insurance law for new domestic life insurers," Insurance Commissioner Dennis Funa said in a statement. MaxiLife is established as a new entity by JE Holdings, Pin-An Holdings Corp, and Maxicare Health Corp. In May, investment firm JE Holdings purchased 42.31% of the common shares of health maintenance organization (HMO) provider Maxicare Healthcare Corp. MaxiLife will be offering insurance coverage to the current Maxicare members, who are afforded treatment, prevention and wellness benefits through their HMO agreements with Maxicare. MaxiLife's license follows one approved in May by the IC for life insurer AIA Philippines Life and General Insurance Company (AIA Philippines), following a merger with Philam Equitable Life Assurance Company (Pelac). Constituent companies to a merger are required to surrender their respective licenses and apply for a new license with the IC after the SEC’s approval of the merger, according to regulatory guidelines. PELAC, a 100% subsidiary of the Philippine American Life and General Insurance (PhilamLife), and a member of the AIA Group, was an inactive company as of 2020 although it was licensed with the IC and compliant with statutory net worth requirements. Source: asiainsurancereview.com

Most companies and governments are 'woefully unprepared' for the knock-on effects of climate change and are creating 'risk blindspots' according to a new report. The new research report by Verisk Maplecroft is the first-of-its-kind study, which looks at risks that will be impacted by climate change – such as civil unrest, political instability, mass migration, economic fragility, resource security, worsening human rights and conflict. Such risks are to increase in prevalence as the severity of climate-related events intensifies. Verisk Maplecroft’s head of climate risk and resilience Will Nichols said, “Organizations and governments have extensive risk mitigation plans for physical climate threats, yet the lack of investment in assessing secondary risks means most are woefully unprepared to deal with the political, economic and developmental impacts of a warming planet.” He said, “It is not just governments that have a blind spot to these threats. The majority of businesses are not currently factoring the cascading climate impacts into scenario analysis and risk management approaches – that need to change if they are going to build resilience in the face of an uncertain future.” The research concludes that most organizations and governments have plans in place to address physical threats and transition risks, but they are “yet to scratch the surface of the wider political, economic and social impacts of climate change, leaving populations, economies and investments highly exposed”. The research, which assesses the susceptibility of 196 countries to these cascading risks, finds the world split into three near-even groups of ‘insulated’, ‘precarious’ and ‘vulnerable’ nations. The insulated group predominantly includes the world’s wealthier countries, while the vulnerable group is generally characterized by those with lower incomes. Africa and Asia’s developing economies, including India, Indonesia and South Africa, are in the vulnerable group that will bear the brunt of these secondary climate risks, finds Verisk Maplecroft. But other geostrategic nations, such as Brazil, Mexico, Russia, Saudi Arabia and Vietnam, are in the precarious grouping and could experience significant instability from secondary climate risks, it adds. Even China could find itself under pressure should its economic strength or tight grip over its society start to slip, the study says. Source: asiainsurancereview.com

Over the past five years, fire and explosion, natural catastrophes and faulty workmanship or maintenance have been the major causes of loss by value of insurance claims according to the Global Claims Review 2022 published by Allianz Global Corporate & Specialty (AGCS). The new report identifies the top causes of loss for companies from more than 530,000 insurance claims in over 200 countries and territories that it has been involved with between 2017 and 2021. These claims have an approximate value of EUR88.7bn ($90.6bn), which means that the insurance companies involved have paid out – on average – over EUR48m every day for five years to cover the losses. AGCS chief claims officer and board member Thomas Sepp said, “Insurance claims from companies have become more severe over the past five years due to factors such as higher property and asset values, more complex supply chains and the growing concentration of exposures in one location, such as in natural catastrophe-prone areas. “The future does not look brighter anytime soon. Companies and their insurers have shown resilience to weather the loss impact of the pandemic, but the ongoing war in Ukraine, a spike in the cost and frequency of business interruption losses and the sustained elevated level of cyber claims are creating new challenges.” Mr Sapp said, “At the same time, the top two causes of claims, fires and natural hazards, remain significant loss drivers for companies. Last but not least, the impact of soaring inflation around the world will bring further pressure on claims costs.” The analysis shows that almost 75% of financial losses arise from the top 10 causes of loss, while the top three causes account for close to half (45%) of the value. Despite improvements in risk management and fire prevention, fire/explosion (excluding wildfires) is the largest single identified cause of corporate insurance losses, accounting for 21% of the value of all claims. Natural catastrophes (15%) rank as the second top cause of loss globally by value of claims. Collectively, the top five causes (based on more than 20,000 claims around the world) – hurricanes/tornados (29%); storm (19%); flood (14%); frost/ice/snow (9%) and earthquake/tsunami (6%) account for 77% of the value of all disaster claims. Faulty workmanship/maintenance incidents are the third top cause of loss overall (accounting for 9% by value) and are also the second most frequent driver of claims (accounting for 7% by number, ranking only behind damaged goods with 11%). Costly incidents can include collapse of building/structure/subsidence from faulty work, faulty manufacturing of products/components or incorrect design. Source: asiainsurancereview.com

Norman R. Cajucom, former Senior Vice President of the Philippine Crop Insurance Corporation, shares his paper entitled “Agricultural Insurance in the Philippines: Innovative Product Development and Scale-Up Amid Climate Risks and Other Hazards” which was commissioned by the National Academy of Science and Technology Philippines (NAST PHL) Task Force on Climate Change. Completed in July 2018, the paper is filled with extensive information on agricultural insurance, some of which were derived from discussions with various colleagues and friends from the industry. To read the paper, please click here.

As you may be aware, the SRA had announced in April that this year’s 18th Singapore International Reinsurance Conference (SIRC) will be held as a hybrid (in-person + virtual) event, the details of which are summarized below: The theme for this year’s conference is “Re-Connecting … Re-shaping the Future!”, which reflects the positive sentiment of the industry following two years of COVID-19 induced restrictions and disruptions, and also focuses on the challenges that global economies and the (re)insurance industry are facing today, with looming inflation, economic disruptions, geopolitical tensions being thrown into the mix as the industry seeks to re-shape itself amidst the global movement towards net zero sustainability and climate resilience. While the details of the conference programme are still being finalized, many of the ‘hot button’ issues such as the rise of anti-globalization; implications of rising inflation; transition to net zero; sustainability, resilience and climate-related issues; would likely feature prominently. In this regard, the SRA is pleased to attach the Press Release announcing the launch of the 18th SIRC website, on which interested practitioners can register for the event; or download details of the Partnership and Meeting Facilities packages, as well as make guestroom reservations at the iconic Marina Bay Sands at special contracted rates for 18th SIRC delegates and participating companies. PIRA member-companies will enjoy a special 20% discount off the applicable registration fee by applying the discount code: 18D-PIRA-20 when registering at: www.sirc.com.sg

In celebration of its 60th Diamond Anniversary, the East Asian Insurance Congress (EAIC) is holding a virtual conference on Sep 21 and 22 (two half days). As founding cities of EAIC, Tokyo and Manila are taking the lead in organizing the event. Attached for your ready reference is the program outline. Registration is free to all EAIC corporate members, including PIRA and PLIA. Registration is already open and can be accessed through the link below. Early sign ups are encouraged to ensure slots. https://www.asiainsurancereview.com/Events/Register/Asia/VirtualEAIC2022

Are you ready to join this year’s idea-filled Innovation Summit? KPMG in the Philippines (R.G. Manabat & Co.) hosts an annual, virtual, Innovation Summit for you to connect with subject matter experts, broaden your knowledge, and stay current on emerging technologies and trends. In this year's Innovation Summit, Tech Talk: Stories of Innovation, real-world business transformation stories will be highlighted and discussed. A dynamic business environment necessitates generating and operationalizing new and bold ideas to help companies adapt and thrive. Am I eligible to attend this summit? Any professional or enthusiast is more than welcome to join. Please feel free to invite your colleagues, friends and network. Registration is free of charge.

July 2022 kicked off with the annual National Disaster Resilience Month, with the theme “Sambayanang Pilipino, Nagkakaisa tungo sa Katatagan at Maunlad na Kinabukasan” with hashtags #NDRM2022 and #NagkakaisangSambayanan. In preparation for this, the National Disaster Risk Reduction and Management Council (NDRRMC) of the country released prior a memorandum which outlines “COVID-19 Preparedness Measurers for Rainy Season”. Per the website of the Office of Civil Defense (the implementing arm of the NDRRMC), the memo “stated measures such as activation of National Disaster Response Plan aligned with Inter-Agency Task Force for Emerging Infectious Diseases (IATF-EID) Resolutions and Guidelines and the DOH Guidelines on Risk Based Public Health Standards for COVID-19 Mitigation, the conduct of Pre-Disaster Risk Assessment and other related meetings via online, inventory of resources, checking of vital facilities, stockpiling of relief, and other essential logistical requirements, as well as implementation of health protocols during duty at the Emergency Operations Center.” LGUs were additionally given instructions to conduct thorough inventories of their specific list of evacuation centers which are not listed and used as quarantine facilities. Disaster Response Webinars were also launched by the Council, with series titled “Resilience Hours”. Together with the webinars are print and e-print materials launched, such as the #DRMPublicationSeries which includes the “Ready to Rebuild: Workbook and Training Manual”. The manual is mainly for the use of LGUs, which covers disaster rehabilitation steps and recovery activities and strategies to be implemented. The Publication Series was developed through the collaboration of the Council and the World Bank. Sources: https://ndrrmc.gov.ph/attachments/article/4180/NDRRMC_Memorandum_No_93_s_2022.pdf https://www.ocd.gov.ph/index.php/news/921-ndrrmc-gears-up-for-the-national-disaster-resilience-month-2022-observance https://www.facebook.com/NDRRMC https://www.facebook.com/civildefensePH

At around 4:30 in the afternoon 32 years ago, a magnitude 7.8 earthquake rocked Luzon. With a rumbling which lasted for around 45 seconds, an estimated casualty count of not less than 2,400 were recorded. According to the Philippine Institute of Volcanology and Seismology (PHIVOLCS), the quake’s trigger was an unprecedented movement in the northwest segment of the Philippine Fault Zone. Areas affected heavily spanned amongst the cities of Baguio, Agoo, and Dagupan. The city of Baguio was reduced to bubble, as it suffered tremendous damages to its tourist structures. These included the Nevada Hotel, the Baguio Hilltop Hotel, and Hyatt Terraces Plaza. Total cost of damage overall amounts to an estimated 369 Million US Dollars. Tara Lukasik, an editor for the International Code Council and the Building Safety Journal, wrote: “The earthquake left not just massive damage and casualties, but also lessons about disaster readiness. Philippine Institute of Volcanology and Seismology Director Dr. Renato Solidum said the 1990 earthquake left four valuable lessons: The public needs to respond properly during earthquakes. Hazards and their effects should be simulated. Building codes should be implemented properly. And land use should be carefully planned.” Sources: https://www.iccsafe.org/building-safety-journal/bsj-hits/remembering-the-1990-luzon-earthquake-that-wreaked-havoc-in-the-philippines/ https://www.phivolcs.dost.gov.ph/index.php/earthquake/destructive-earthquake-of-the-philippines/2-uncategorised/212-1990-july-16-ms7-9-luzon-earthquake