A SOLON has filed a resolution seeking to investigate an increase in insurance premium rates for catastrophes like earthquakes, floods, and typhoons that will take effect by Jan. 1, and asked the Insurance Commission (IC) to suspend its approval of the hike.
AGRI Party List Rep. Wilbert T. Lee, who filed House Resolution 632 on Dec. 12, said the “abrupt, unreasonable, and untimely increase” of catastrophe insurance rates will cascade to prices of basic commodities.
“This is going to be a domino effect. Food prices will increase because insurance premium increase affects production, storage, machinery, transportation to distribution center, until retail,” he said in a statement on Sunday.
“(This is why) we regulate the insurance industry, to ensure that insurance companies are fair and not abusive. But why weren’t end-users consulted on the insurance premium hike?” Mr. Lee said, noting that the IC has yet to respond to a letter of inquiry he sent on the issue.
Beginning 2023, the adjusted rates “will result to a sudden huge increase in insurance premiums ranging from 40% to as high as 400%,” according to the lawmaker.
Minimum catastrophe rates vary according to the type of disaster (earthquake or typhoon/flood) as well as the type of occupancy of the structure (commercial, industrial, warehouse, residential).
Mr. Lee also said that the agriculture sector and efforts to achieve food security will be affected by the insurance rate increase.
“Even the Philippine Crop Insurance Corporation (PCIC) is affected and will also increase insurance premium. If agricultural workers will be placed at a disadvantage, then we may not achieve food security,” he said. — Beatriz Marie D. Cruz