The Philippine Crop Insurance Corporation (PCIC), as the main crop insurance provider, signed a Memorandum of Understanding (MoU) with the German Technical Cooperation (GTZ) along with the Department of Agriculture (DA) and National Irrigation Authority (NIA) on October 12, 2010.
The MoU with GTZ formally marked the start of design and implementation for Area Based Yield Crop Insurance (ARBY) in the 17 rice farming municipalities being serviced by seven national irrigation systems in Leyte and Southern Leyte.
ARBY is a type of parametric crop insurance which compares the current rice yield of an entire irrigation system with its average rice yield in the past 15 years. The ARBY will mobilize Irrigators Association in Leyte and Southern Leyte to undertake ARBY advocacy, enrollment of farmers, collection and facilitation of insurance payments when yields are below average. This system will help bridge the gap between farmers and PCIC. Through ARBY, insured farmers receive payments from PCIC once the current rice yield of their irrigation system is lower than its average yield in 15 years.