Micro insurance, BCP crucial to bolster MSMEs’ disaster resilience

Micro, small and medium enterprises (MSMEs) in the Philippines are being encouraged to get micro disaster risk insurance and develop a business continuity plan (BCP) to help see them through in times of disasters and calamities.

The call was made by Jerry T. Clavesillas, director of the Bureau of Small and Medium Enterprise Development (BSMED), an agency under the Department of Trade and Industry (DTI), during an e-forum held recently on raising MSME awareness of the need for BCPs.

Clavesillas said the micro disaster risk insurance is an intervention they have come up with to make MSMEs more resilient in times of disaster.

In partnership with GIZ and Cebuana Lhuillier, "we already have launched this so-called micro disaster risk insurance intended for the micro enterprises," said Clavesillas.

"This is a very soft amortization insurance that over a period of 12 months they can avail from Cebuana Lhuillier [and avail of] insurance coverage of up to P100,000, paying only so much per month. So this is very affordable to most of our enterprise owners particularly the micro entrepreneurs."

He added, "We encourage everyone now to avail themselves of even a small amount of insurance instead of relying on the social amelioration support from government, which is not really sufficient, [this is] something that we can resort to almost immediately [and] is very useful for us."


He cited as an example how those who availed of disaster risk insurance during the Supertyphoon Yolanda's onslaught "immediately I think after three days they were able to claim the money that they were entitled to."Risk financing for MSMEs is one of the outcome areas that BSMED is eyeing as part of a set of government strategies to help strengthen the disaster resilience of MSMEs in the face of disasters.


Clavesillas said they also plan to scale up initiatives on business continuity management and develop a standardized disaster risk reduction and management (DRRM) and BCP toolkit for both enablers and MSMEs.


Another plan is to improve policy reforms such as institutionalizing among government offices DRMM-specific guidelines for MSMEs.


There will also be efforts to address concerns related to establishing an MSME database and MSME risk profiles to better understand risks that can potentially affect MSME operations.


The executive added that they have been trying to raise awareness among MSMEs of the importance of having a BCP, and "in fact this is one of the requirements now in some of our programs. For them to participate, they have to have this business continuity plan."


Meanwhile, Rene Meily, president of the Philippine Disaster Resilience Foundation (PDRF), talked about their initiative called S.I.K.A.P. (Synergizing Recovery Initiatives, Knowledge, and Adaptation Practices for MSMEs).  The idea is to bring the various initiatives for MSMEs under one umbrella, said Meily.  He said S.I.K.A.P. is a one-stop shop and unified business recovery hub, and they hope to launch the S.I.K.A.P. website and app soon to aid in the recovery of MSMEs from the COVID-19 impact and "bounce forward to the 'new normal.'  The S.I.K.A.P. platform can be accessed from this link.

From the perspective of a large enterprise, Meralco Biz Partners Head Ms. Joy Mendoza presented their company's business resilience strategies and efforts during the pandemic.  She shared how Meralco implemented its BCP where it temporarily suspended a few of their primary services but remained active in assisting to the COVID-19 related-needs of their customers.  She also mentioned the various energy and beyond-the-meter services that Meralco offers through its subsidiaries that may serve useful especially for their commercial customers during and even after the pandemic.

Lastly, Philippine Chamber of Commerce and Industry - Tacloban Leyte (PCCI-TL) Vice President for External Affairs and SME Mr. Oliver Cam shared how a BCP is formed at a small enterprise level and encouraged all enterprises, especially MSMEs, to take time to craft their own BCP.  He emphasized that formulating a BCP is a participatory effort and must revolve around an enterprise's human, physical, and financial resources. He also reiterated that there is no universal format for a BCP as it can be started out of a simple checklist or road map of an enterprise's priorities in an event of a crisis.

The e-forum on institutionalizing BCPs for MSMEs is part of a series of webinars co-organized by the Philippine Exporters Confederation, Inc., PCCI, the Employers Confederation of the Philippines and PDRF.  The highlights of the discussions as well as the copies of the presentations of the abovementioned resource persons may be accessed from this link. --- Philexport News and Features



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