The Microinsurance MBA Association of the Philippines Inc. (MiMAP), also known as RIMANSI, held the 2019 Management Forum titled “Managing Regulatory, Performance and Systems Risks” in Quezon City from July 22 to 24, participated by a total of 72 participants from 16 microinsurance mutual benefit associations (Mi-MBAs).
The management forum is an annual gathering of Mi-MBA board, managers, senior staff, and association’s partners and stakeholders. Unlike other regular training programs offered by MiMAP, this forum is hosted by different Mi-MBAs each year. The host Mi-MBA showcase to forum participants the institutional background, programs and services, partners and stakeholders of their MBA, including the culture of the place where they belong, among others. This is in addition to the purpose of the forum at large, such as updating of industry developments, sharing of best practices, and tackling to address relevant program and policy concerns.
For 2019, Kasagana-Ka MBA (KMBA) is the host of the forum. They welcomed the forum participants with a dinner on July 21 where talents not only of the KMBA’s board, management and staff were showcased, but also that of the participants from other Mi-MBAs.
On the succeeding day, Silvida Antiquera, KMBA General Manager and MiMAP President, formally started the three-day learning event with her welcoming remarks. She said, “We will deal on ‘Managing Regulatory, Performance and Systems Risks.’ As the theme implies, our sessions discussions will focus on the various risks that may affect our sector and identify measures to manage or minimize effects of these risks in terms of regulations, performance and systems of Mi-MBAs.”
Insurance Commissioner Dennis Funa also came to the event as keynote speaker. He provided an update on the status of the microinsurance sector, the possible implementation of IFRS 17 and TRAIN 4. He cites that, again, the MBA sector continues to lead the sector in terms of microinsurance coverage by more than half of the market share. Also, he shared that the Commission is welcome for any discussion regarding the position of the association on IFRS 17 implementation. Subsequently, President and CEO Maricris Valte from the Kasagana-Ka Development Center, Inc. (KDCI) began the discussion proper for the first day. She shared the Disaster Risk Reduction Framework utilized by Kasagana-ka Synergizing Organizations (KSOs) which allows for a multifaceted approach in providing comprehensive and systematic social protection and coverage to members. This method is used especially during and after periods of weather hazards and calamity risks.
comprehensive disaster risk reduction approach through the KSOs
Then, Dr. Epifanio Maniebo, RIMANSI Mutual Solutions and Insurance Agency Inc. (RMSI) President, proceeded to discuss the new products and services of RMSI. These products are meant to complement the products offered by the Mi-MBAs.
To end the morning, MiMAP Executive Director Jun Jay Perez conducted a workshop on pooled products. This workshop aimed to inventory microinsurance products and services offered by Mi-MBAs and partner-MFIs. This workshop also sought to identify pooled microinsurance products and services that could be best offered at the network/association level.
Following the morning discussions, MiMAP and KMBA brought the forum participants to Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) Office in Quezon City to learn the natural hazards and possible risks these may bring to Mi-MBAs and the community, as well as some mitigating measures that may be adopted. This was done in observance of the National Disaster Resilience Month.
Specifically, Assistant Weather Services Chief Sharron Arruejo of PAGASA and Civil Defense Officer Pebbles Lluz Serrano of the Office of Civil Defense (OCD) introduced to Mi-MBAs the basics of weather forecasting and the weather advisories disseminated to the public. They also touched on how PAGASA and National Disaster Risk Reduction and Management Council (NDRRMC) led by the OCD, cooperate in sending information to the general public. Part of the visit was also a tour of PAGASA facilities such as the weather and forecasting center, the observatory and the planetarium.
Moving on to the second day, the focus was placed on realigning internal operations towards regulatory risk protection. To start off was a panel on improving the Mi-MBA performance in the ASEAN Corporate Governance Scorecard (ACGS). Roberto Bascon Jr., Director-CG Analytics at the Institute of Corporate Directors (ICD), introduced the CG scorecard and how the Mi-MBA sector can improve their ACGS scores. Also included in the panel were KMBA’s General Manager Antiquera and CARD MBA CEO May Dawat, who shared how their respective MBAs—both top scorers in the ACGS in 2017 and 2018, respectively—have managed to secure and maintain high CG scores. A workshop was then conducted so that each Mi-MBAs can identify areas for improvement and consideration regarding their operations.
The next panel focused on revisiting the Mi-MBA’s application for tax exemption. MiMAP invited key representatives from the Bureau of Internal Revenue (BIR), National Tax Research Center (NTRC), Insurance Commission (IC) including notable tax lawyers from private sector, to act as panelists. Specifically, Dr. Karla Velas from BIR RDO 43, and Atty. Brianna Kay Delos Santos and Atty. Raymund Ipio from the Law and Legislative Division were the representatives of BIR; OIC Executive Director Donaldo Boo of NTRC; Supervising Insurance Specialist Michael Jerome Inoncillo of IC; Atty. Hardy Aquende, Founding Partner of Aquende Yebra Aniag Loon & Associates (AYALA) Law; and Camilo Casals of MiMAP were the discussants of the session.
Firstly, Mr. Casals provided for the position of the Mi-MBA regarding the tax exemption application of the MBAs. This was followed by Dr. Velas’ thorough presentation on the specific technicalities and procedures when it comes to BIR tax exemption for MBAs. Atty. Delos Santos and Atty. Ipio also provided information and advice on how Mi-MBAs should approach these issues. A key point that the BIR representatives mentioned is that, by law (particularly Section 30 of the National Internal Revenue Code (NIRC), Mi-MBAs can be exempt from income tax due to their status as non-stock, non-profit corporations. However, a point was made that MBAs need to meet certain organizational and operational criteria to gain this status. This entails an organizational and operational test wherein Mi-MBAs need to concur to both. The former requires Mi-MBAs to ensure that the constitutive and purposive documents and articles of the association are limited to their intended and primary purpose. The latter test requires that the MBAs need to make sure that their actual operations and regular activities do show that they are exclusively working towards the purposes under the NIRC. This matter also extends to matters on inurement as MBAs need to ensure that no form of inurement is provided to the trustees and officers of an association. To further clarify on the matter, the panel discussed specific activities and practices that could be considered as “inurements”.
Panelists from the regulatory sector—Mr. Boo and Mr. Inoncillo from the DOF-NTRC and IC, respectively—gave their own comments on the BIR tax exemption, particularly on overlapping areas between their own office’s regulatory provisions and BIR laws and memoranda. From the private sector, Atty. Aquende also gave his comment on how MiMAP should view and approach the issue on their tax exemption.
To cap off day two of the workshop, MiMAP Independent Trustee Wilfredo Llanto had a segment dedicated to strengthening the internal audit framework and toolkit of Mi-MBAs by explaining how it can help improve operations and processes of an organization.
The third and last day of the forum saw the return of lawyers from AYALA Law to assist Mi-MBAs in further understanding how Mi-MBAs can achieve tax exemption with reference to the panel on tax exemption conducted the previous day.
This is the focus of the workshop conducted by Atty. Aquende and associates, Atty. Kathrina Sheena Marie Que and Atty. Clarissa De Vera for Mi-MBAs to align their articles of incorporation and by-laws towards compliance to the tax exemption under the National Internal Revenue Code.
Afterward, a panel on the digitization of Mi-MBA governance, management and operations was spearheaded by MiMAP Deputy MIS Manager Robert Aspe Jr. and NSCC MBA Manager Ricky Tabuac. To begin this segment, Mr. Aspe talked about the e-MUTUALS system and how it can aid Mi-MBAs in managing their membership, collection processes, claims settlement and report generation. In general, the system delivers quality improvements to the systems of Mi-MBAs. NSCC MBA was the pilot MBA to adopt this system for that reason Mr. Tabuac shared NSCC MBA’s experiences, benefits and challenges with the newly developed system.
Further dealing with matters regarding digitization was Business Development Manager Mr. Joey Ramos from Filmetrics Corporation who discussed the IdentPro product as a tool that can be used to ascertain the identity of persons and clientele. Mr. Ramos shared the implications of biometric scanning particularly noting the dependability of one’s unique biodata in terms of security.
To cap off the event, several resource persons were brought in for the last panel to discuss the strengthening of networks through shared programs, services and risk pooling. To start, Russel Agustin, Life Treaty Officer from National Reinsurance Corporation of the Philippines (NATRE), introduced the concept of reinsurance to distribute and transfer risks to mitigate financial losses. He also shared the reinsurance treaty of NATRE with the Mi-MBAs. Following this, from the Network of Women’s World Banking, Executive Vice President Ade Ashaye flew into the country to deliver a presentation that reaffirms the importance of financial inclusion for women; he emphasizes this need being that women act as the primary financial managers in their families and their communities. As such Mr. Ashaye explains that Women’s World Banking pools resources into financial institutions that break down gender barriers and commit to women in low-income sectors.
The last to present was a team from BPI AMTC who introduced the BPI Bayanihan Balanced Fund during their time in the forum. More so, they talked about the status of the BPI Bayanihan Balanced Fund (BBBF) subscription of the participating Mi-MBAs. Lead presenter Ms. Mikaela Elzbette Neri indicated that there is expected long-term growth with respect to the fund despite rising inflation and GDP loss in the previous year. BPI AMTC Clients Segment Head Yvette Mari V. De Peralta also called for celebration because of the one-year subscription of the association to the BBBF.
MiMAP Founder and Chairman Emeritus Dr. Aristotle Alip concluded the forum by delivering the closing remarks wherein he highlighted key areas to work on in response to performance, regulatory and systems risks with particular performance in Mi-MBA’s benchmarked claims settlement performance, governance and the tax exemption.