PCIC rolls out parametric insurance scheme – BusinessWorld Online
THE Philippine Crop Insurance Corp. (PCIC) said on Thursday that it will roll out a parametric insurance program to facilitate the settlement of claims by rice farmers affected by weather disruptions.
The program will tap remote sensing technology to automatically trigger payouts based on measurable conditions — such as wind velocity during typhoons — rather than relying on field inspections, PCIC President Jovy Bernabe said in a statement.
Parametric insurance schemes pay out pre-determined amounts when a condition, or trigger event, is met.
“This innovation will usher in a faster and more objective claims settlement system that not only protects farmers during climate-related calamities but also strengthens the resilience and sustainability of our agricultural sector for years to come,” she said.
Under the new system, the PCIC will tap satellite imagery to verify crop conditions after planting. Weather data on typhoon paths and wind intensity are then used to determine affected areas.
Using pre-established damage and indemnity factors, the system computes compensation within three to five days once a typhoon exits.
Parametric insurance complements, rather than replaces, traditional indemnity-based systems, the PCIC noted.
“This hybrid approach enhances transparency, reduces delays, and offers a more efficient disaster response framework,” it said.
A pilot test of the parametric insurance product is now being readied for the 2025 wet season cropping. — Kyle Aristophere T. Atienza