07pm-4904 - Building Strategic and Operational Partnerships for Sustained Growth
The Pakisama Mutual Benefit Association (PMBA) was founded in 2002 with the objective to offer microinsurance products to members of Pakisama, the National Confederation of Peasant Organisation. The PMBA operates as a stand-alone microinsurance company, and as such officially registered with the Securities and Exchange Commission (SEC) and duly licensed by the Insurance Commission (IC) as a mutual benefit organisation. After initial slow but steady growth in the period 2002-2005 (4,500 policies), membership declined to about 3,200 in August 2006. After reviewing policies for non-payment of premiums and cancellation of policies due to non-payment, the actual membership was estimated at 500 by the end of December 2006. These disappointing results can be attributed to both external and internal factors. PMBA was hit by the problems within the membership of Pakisama that was originally constituting the natural membership base. While financial and administrative systems were up-to-date, the marketing efforts through the sales agents failed to translate into increased sales policies and hence, premium income to cover the costs of operations. This has eventually led to a rethinking in 2006 of both the marketing model, products, partnerships and the functional mode of operations. Agriterra has supported PMBA since its foundation in 2002 through funding and advisory services (MIAN/Gerard Pierik). Interpolis Re provides a reinsurance facility, and thus sharing the risk in case of exceptional loses. Ad Arma has provided technical assistance for the development of a financial administration system (OASE), including management of portfolio.