TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session JL -9 P5:24 NEX: SENATE S. No. Introduced by Senator JV Ejercito ESTABLISHING A MANDATORY CROP INSURANCE COVERAGE FOR SMALL FARMERS, PROVIDING FOR A NATIONAL GOVERNMENT SUBSIDY, AND FOR OTHER PURPOSES EXPLANATORY NOTE Agriculture is a critical sector that plays a vital role in the Philippines. It remains the backbone or rural economies in the country, contributing significantly to the nation's workforce and playing a crucial role in ensuring food security. As the Philippines is considered a typhoon-prone country, our agricultural production I always affected by disasters and calamities. Thus, it is important for the government to provide mechanisms to assist our farmers in order to manage losses in case of devastation brought about by calamities. Crop insurance is a form of protection that safeguards farmers against such losses. This ensures that farmers and their crops are protected from negative impacts of natural disasters, calamities, plant diseases and pest infestations, and other disasters, and thereby protecting crop production, ensuring food security and farmer's livelihood. The Philippine Crop Insurance Corporation (PCIC) is mandated to provide insurance protection to farmers against losses arising from natural calamities, plan diseases, and pest infestations of their palay and corn crops as well as other crops. It
reported a total insurance coverage of Php 105 billion across various programs in 2024. A significant part consists of insurance coverage for rice, and this coverage was extended to more than 3 million individuais, including farmers and fisherfolk. 1 Although the government have been providing subsidies to support the crop insurance program, this has not resulted to better outcome in terms of alleviating the financial burden of farmers. According to the Department of Agriculture, only 47% of farmers nationwide are covered with insurance. This proposed measure seeks to expand the coverage of the current subsidized crop insurance program of the government. Farmers owning 5 to 8 hectares will be automatically covered by the Crop Insurance Program for small farmers, as well as a subsidy of 50% of their insurance premiums. Moreover, this bill will provide a long- term protection for the country's most essential yet vulnerable sector. In view of the foregoing, the approval of this bill is earnestly sought. JV EJERCITO ' Philipppine Crop Insurance Corporation 2024 Report. https://acpc.gov.ph/wp-content/uploads/2024-Q3- PCICs-Performance-Report- 1.pdf#:~:text=The%20Philippine%20Crop%20Insurance%20Corporation%20(PCIC)%20reported,a%20total%2 Oinsured%20amount%200%20%2%82%B 128.20%20billion.
TWENTIETH CONGRESS OF THE REPUBLIC OF THE PHILIPPINES First Regular Session '25 JUL -9 P5:24 SENATE S. No. _ Introduced by Senator IV Ejercito ESTABLISHING A MANDATORY CROP INSURANCE COVERAGE FOR SMALL FARMERS, PROVIDING FOR A NATIONAL GOVERNMENT SUBSIDY, AND FOR OTHER PURPOSES Be it enacted by the Senate and the House of Representatives of the Philippines in Congress assembled:
Section 1. Short Title. - This Act shall be known as the "Crop Insurance Program
for Small Farmers Act of 2025."
Sec. 2. Declaration of Policy. - It Is the policy of the State to promote genuine
inclusive growth and alleviate poverty. It is likewise the policy of the State to promote s a just and dynamic social order that shall ensure prosperity, promote full employment, 6 a rising standard of living and an improved quality of life for all.
Sec. 3. Crop Insurance for Small Farmers Program. -
(a) The Department of Agriculture (DA) in coordination with the Philippine Crop Insurance Corporation (PCIC) shall develop a special Crop Insurance Program for Small Farmers, guided by the following objectives: a. Promotion of food security through palay and other crop production; b. Provision of immediate support and protection to farmers incurring crop losses due to extreme conditions; and C. Alleviate the financial burden of farmers due to uncompensated losses. (b) The Crop Insurance Program for Small Farmers shall operate under an insurance framework including, but not limited to, the following:
a. The Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) shall be the primary reference weather station from which observed weather parameter shall be obtained. Other reference weather stations may include other weather stations accredited by PAGASA; b. There shall be an Identified trigger or threshold reference point to serve as a basis of measurement wherein in case of an occurrence of a breach the PCIC is obligated to indemnify and pay the required payout to the insured; C. Phases of crop growth shall be covered by the insurance where a separate trigger and payout may be determined; d. The payout or the insurance payment shall be based on a pre16 determined schedule that takes into account the actual area planted; and e. Any breach of the threshold reference point shall be the basis of any payout. Declaration of a State of Calamity in a local government unit shall not be required to trigger he obligation of the PCIC to the insured farmers.
Sec. 4. Terms and Conditions. - Within ninety (90) days after the effectivity of
this Act, the Department of Agriculture (DA) in coordination with the Philippine Crop Insurance Corporation (PCIC), and in consultation with the Insurance Commission (IC) shall formulate the terms and conditions which shall govern a comprehensive insurance scheme for the benefit of the farmers. The terms and conditions shall be published in the Official Gazette or in a newspaper of general circulation in the Philippines.
Sec. 5. Insured Farmers under the Crop Insurance Program for Small Farmers
and Premium Subsidy. - (a) All farmers of palay and other crops owning or cultivating eight (8) hectares of farmland and below shall automatically be covered by the Crop Insurance Program for small farmers. Subsidy for insurance premiums shall be 2 determined by the following qualifications:
a. For farmers owning or cultivating five (5) hectares of farmland and below, the National Government shall fully subsidize their insurance premiums; b. For farmers owning or cultivating more than five (5) hectares but not exceeding eight (8) hectares of farmland, the National Government shall only cover and subsidize fifty percent(50%) of their insurance premiums. (b) The DA together with the Department of Agrarian Reform (DAR) and PCIC, in coordination with local government units, shall develop, maintain and annually update a database of farmers covered under this Program, and determine their qualifications as to the type of subsidy covered; (c) The DA and PCIC shall develop a system for the processing and payment of the fifty percent (50%) insurance premiums not covered by the National Government subsidy. Such premium may be paid in money or in a quantity of paddy the value of which shall be equal to the amount of the premium due to the farmer, such value being computed according to the current market price of the crop as determined by 19 DA. (d) All farmers covered under this Act shall be deemed to have entered into a contract of insurance with the National Government through the PCIC; (e) Small farmers who are currently covered by an existing crop insurance shall have an option to choose whether to remain under their existing crop insurance or be covered by the Crop Insurance Program for small farmers.
Sec. 6. Rate of Premium. - The rate of premium shall be determined by the
Board of the Philippine Crop Insurance Corporation (PCIC) subject to the approval by the President of the Philippines.
Sec. 7. Source of Funding. - In Accordance with Section 5(a) of this Act,
insurance premiums of small farmers shall be subsidized by the National Government. The funding for this Program shall be deemed appropriated from the funds of the Department of Agriculture. Initially, the premium subsidy for the first year of implementation shall be drawn on a month-to-month basis, depending on the actual amount of insurance underwritten by the PCIC. Subsequently, projections of the premium subsidy shall be
1 submitted by the PCIC to the President, and upon approval of the President shall be included in the National Expenditure Program.
Sec. 8. Claim to Indemnity. - In cases where the identified trigger or threshold
reference point has been breached, the insured person shall submit a written claim to 5 indemnity in respect of losses incurred to the municipal agriculturist. The municipal 6 agricuiturist shall then forward the written claim to indemnity to the PCIC. The 7 payment of the Indemnity shall be in accordance with the terms and conditions set forth by the DA and PCIC under Section 4 of this Act.
Sec. 9. Implementing Rules and Regulations. - The The Department of
10 Agriculture, and the Philippine Crop Insurance Corporation, in consultation with relevant government agencies and instrumentalities, shall provide the necessary implementing rules and regulations within sixty (60) days upon the approval of this Act. Such rules and regulations shall take effect after they have been made and shall be published in at least two (2) newspapers of general circulation
Sec. 13. Separability Clause. - If any part or provision of this Act shall be declared
unconstitutional or invalid, the other provisions hereof which are not affected thereby shall remain in full force and effect.
Sec. 14. Repealing Clause. - All laws, decrees, executive orders, memorandum
orders, memorandum circulars, administrative orders, ordinances or parts thereof which are inconsistent with the provisions of this Act are hereby deemed repealed or modified accordingly.
Sec. 15. Effectivity. - This Act shall take effect fifteen (15) days after its
publication in the Official Gazette or in a newspaper of national circulation. Approved,