REVISED IMPLEMENTING GUIDELINES ON THE UTILIZATION OF GOVERNMENT PREMIUM SUBSIDY (GPS) TO THE PHILIPPINE CROP INSURANCE CORPORATION UNDER FY 2017 GENERAL APPROPRIATIONS ACT, RA 10924
Pursuant to FY 2017 General Appropriations Act, “The amount of Two Billion Five Hundred Million Pesos (
P2,500,000,000) appropriated herein shall be used for the full insurance premiums of subsistence farmers and fisherfolks to cover crop, livestock, fisheries, or non-crop agricultural asset. The PCIC shall ensure that the beneficiaries identified are registered under the Registry System for Basic Sectors in Agriculture and are not insured for the same types of insurance, with priority given to those in localities declared as critical geo-hazard areas or no build zones identified by the Mines and Geo-Sciences Bureau.
Release of funds shall be subject to the submission of the list of subsistence farmers and fisherfolks duly endorsed by the Department of Agriculture (DA).
The PCIC shall submit to the DBM, the Speaker of the House of Representative and the President of the Senate of the Philippines, either in printed form or by way of electronic document, quarterly reports on the utilization of funds, including the list of subsistence farmers and fisherfolks and type of insurance coverage. The Administrator of PCIC and the Corporation’s Web Administrator or his/her equivalent shall be responsible for insuring that said reports are likewise posted on the PCIC website.”
2. Registry System for Basic Sectors in Agriculture (RSBSA)
Based on the two (2) lists of farmers and fisherfolk furnished to PCIC by the DBM, the total number of farmers and fisherfolk under RSBSA as of
December 31, 2016 is 13,516,337 , computed as follows:
1. Total Farmers and Fisherfolk: 9,670,900
Source: Department of Budget and Management (DBM)
Version 1.1. Total Farmers and Fisherfolk: 3,845,437
Source: Department of Budget and Management (DBM)
Grand Total Farmers and Fisherfolk: 13,516,337
RSBSA List of Farmers and Fisherfolk
No. of Farmers & Fisherfolk
ANALYSIS OF FARMERS AND FISHERFOLK LISTED UNDER RSBSA
The two (2) lists described above have been reviewed and analyzed by the PMIO-IT Team using the PCIC Automated Business Systems (PABS). Based on PABS generated report, after adjusting the lists due to names of farmers which were included in the lists twice, the number of RSBSA farmers and fisherfolk was reduced to 10,915,180, consisting of 5,481,428 farmers, 1,364,319 fisherfolk and 4,069,433 laborers.
II. ALLOCATION OF P2.5 BILLION GPS
Considering the large number of subsistence farmers and fisherfolk listed under RSBSA and the limited amount of GPS available for FY 2017, there is a need to issue guidelines that will maximize the utilization of the limited GPS in the provision of insurance protection to the target sectors. The P2.5 billion GPS shall be utilized in accordance with the approved Regional Production Targets for FY 2017.
The following are the guidelines:
A. UNDERWRITING POLICIES
1. Total GPS Fund Appropriated – The amount of GPS under the FY 2017 GAA is P2,500,000,000.00
2. Types of Insurance Lines Eligible for GPS
- Rice Crop
- Corn Crop
- High-Value Crop
- Non-Crop Agricultural Asset
3. Percentage (%) of GPS allowed in the Premium Cost – The percentage (%) of GPS in the premium cost is 100% (full premium subsidy).
4. Premium Rates
- Rice and Corn Crops – standard premium rate of 10.00% (PCIC Board Resolution No. 2016-066, Series of 2016)
- High-Value Crops – standard premium rate of 3.00%
- Livestock – existing premium rates
- Non-Crop Agricultural Assets – existing premium rates
- Fisheries/Aquaculture – in accordance with the existing guidelines and procedures in determining the applicable premium rates.
5. Amount of Cover (AC)
- Rice and Corn
a. Borrowing farmer – amount of loan, subject to cover ceiling per hectare per PCIC rules and regulations.
b. Self-financed farmer – maximum of P20,000 per hectare
- Other insurance lines, such as: High-Value Crop, Livestock, Non-Crop Agricultural Asset and Fisheries/Aquaculture – follow existing guidelines and procedures in determining the amount of cover, subject to the limitations specified under guidelines no.6. Other Conditions, letter d.
6. Other Conditions
a. Farmers and fisherfolk are registered in the Registry System for Basic Sectors in Agriculture (RSBSA);
b. Prioritization of insurance coverage for farmers
Priority shall be given to the RSBSA farmers under the following conditions:
· Size of Landholdings:
The order of prioritization shall be based on the farmer’s landholdings size, as follows:
First – Farmers tilling an area of 1.50 hectares and below;
Second -Farmers tilling an area of more than 1.50 hectares up to 2.00 hectares;
Third – Farmers tilling an area of more than 2.00 hectares up to 3.00 hectares; and
Fourth – Farmers tilling an area of more than three (3) hectares, subject to the limitation that only 3.0 hectares shall be entitled to full (100%) premium subsidy. The areas in excess of 3.0 hectares may be insured at the option of the farmer, provided, that he/she shall pay the full cost of insurance premiums.
· SAAD Areas
Coverage must be intensive in the following provinces/areas listed under the Department of Agriculture’s Special Area for Agricultural Development (SAAD) Program:
- North Cotabato
- Western Samar
- Eastern Samar
- Lanao del Sur
- Northern Samar
- Zamboanga Del Norte
- Negros Oriental
c. The farm investments/properties of RSBSA farmers and fisherfolk are not insured for the same types of insurance;
d. Insurance covers/policies for RSBSA Program are subject to the following limitations:
· Rice, corn, high-value crop (HVC): maximum of three (3) hectares of farmland per household.
· Cattle, carabao, horse, swine, goat and sheep: the insurance coverage must be under the non-commercial mortality insurance cover category
· Poultry : Broiler – maximum of 5,000 heads/birds per rearing period; Pullets/layers – maximum of 1,000 heads/birds
· Fishpond – maximum of 1,000 square meters;
· Mariculture parks/off shore (fishcage/fishpen) – maximum of 400 square meters;
· Seaweed farm – maximum of 1,000 square meters.
- Non-Crop Agricultural Asset
· Fisheries – Maximum of three (3) units of fishing boats/equipment for fishing activities within the municipal water. The maximum gross tonnage for fishing boat is 3 tons ;
· For Fishing Boat: BoatR issued by BFAR to fisherfolk shall be the basis for eligibility for the insurance coverage of the fishing boat.
· For fishcage/fishpen/fishpond: facilities within the allowed area mentioned above
· Livestock – Poultry house/piggery house/stable used for housing of the allowed number of livestock and poultry heads mentioned above
· Farming – Maximum of three (3) agricultural equipment/machines used in farming operations
B. UNDERWRITING PROCEDURES
1. Farmers and fisherfolk in provinces with RSBSA under the Agriculture and Fisheries Financing Program (AFFP).
a. For LBP borrowers, the concerned PCIC RO shall coordinate directly with the LBP Lending Centers.
b. For clients of People’s Credit and Finance Corporation (PCFC), the PCIC ROs shall coordinate with PCFC’s accredited NGOs, RBs, Coops, Coopbanks and POs that lend the fund to eligible sub-borrowers (i.e., Non-Agrarian Reform Beneficiaries-small farmers and fisherfolk registered in the RSBSA and their households).
2. On other Credit Programs of Lending Institutions, Lending Conduits – the Regional Offices shall follow the existing underwriting procedures applicable.
3. On LGU’s Credit/ Insurance Programs – for farmers and fisherfolk under RSBSA who are not receiving any other subsidy for the foregoing types of insurance from the local government – if possible, insured under the group crop insurance scheme.
4. On other farmers and fisherfolk listed in the RSBSA who are not borrowing from formal lending institutions and not participating in the LGU’s Credit/Insurance Programs, the PCIC Regional Offices may seek assistance from the LGU and other organizations for the RSBSA identification and preparation of identified beneficiaries. If possible, they should be insured under the Group Crop Insurance Scheme.
C. SERVICE FEE
1. Service fee for underwriters in rice and corn crop insurance lines is 2% of the total amount of premiums.
2. Service fee for solicitors in livestock insurance lines is 2% of the total amount of premiums.
3. Service fee for solicitors for all other lines such as, rice, corn, high-value crop, fisheries and non-crop agricultural asset is 1% of the total amount of premiums.
D. PERIOD OF IMPLEMENTATION
The GPS shall be applied on insurance policies incepting from January 1, 2017 up to December 31, 2017.
ATTY. JOVY C. BERNABE