MANILA, Philippines - The microinsurance initiative of the Rural Bankers Association of the Philippines-Microenterprise Access to Banking Services (RBAP-MABS) program has introduced a simplified licensing process.
Called the TRACS process, the process will simplify the microinsurance licensing applications of rural bank to the Bangko Sentral ng Pilipinas (BSP) and the Insurance Commission (IC).
The United States Agency for International Development (USAID)-supported MABS developed the turn-key system to assist participating rural banks in expanding their services to include microfinance product in order for microinsurance to reach low-income groups.
The TRACS Process actually stands for: Train in microinsurance basic and product mastery; Request for a no objection notice from the BSP; Assemble microinsurance core team; Choose the bank’s partner-insurance provider; and, Submit complete requirements to the Rural Bankers Research and Development Foundation Inc. (RBRDFI).
The process was introduced in a two-day microinsurance basic course covers the fundamental concepts and principles of microinsurance. It also imparts practical knowledge and skills to participants on microinsurance sales and servicing.
After completion of the training, the participating rural banks must submit its No Objection Notice to the BSP.
This document signifies the bank’s compliance to the regulations and intent to pursue the distribution of regulated microinsurance products.
Participating banks are encouraged to designate members of its microinsurance team with expertise in marketing, operations and the management information system (MIS) of the bank.
In addition, the team supervisor must have completed the trainings on microinsurance basics and product mastery conducted by RBAP-RBRDFI and the bank’s partner-insurance provider, respectively. Only licensed insurance companies and their authorized microinsurance products are endorsed to the member rural banks.
These steps and the training provided help to ensure the success of banks in properly selling, marketing and servicing microinsurance services to their low-income clients.
RBAP-RBRDFI, with support from the International Labor Organization’s microinsurance innovation facility successfully trained 145 rural banks since its launched in January 2011 and assisted more than 40 rural banks with their microinsurance license applications.