The World Bank is lending $70 million to the Philippines for a co-insurance pool that would protect small farmers and fisherfolk from the effects of climate change, according to the Department of Agriculture (DA) on Sunday.

A co-insurance pool is a system where multiple insurance companies collectively share the risk of a single, large or complex policy for energy projects or natural catastrophes.

The loan will fund a climate-protection program in 2026, which will run for five years and benefit 750,000 small farmers and fisherfolk, the DA said.

“The World Bank plans to leverage its loan to mobilize between $300 million and $500 million in climate protection for farmers, fisherfolk, and agri-based micro, small and medium enterprises (MSMEs),” Agriculture Secretary Francisco Tiu Laurel Jr. said. “This will allow [the beneficiaries] to bounce back faster after climate shocks and resume production with minimal delay.”

The Department of Finance is the borrower in the loan program, with the DA as the project implementer.

The program will combine the Philippine Crop Insurance Corp.'s knowledge in agricultural insurance and the technical expertise of the National Reinsurance Corp. of the Philippines.

“A stronger insurance framework reduces the risk in agricultural lending,” Tiu Laurel said. “This encourages banks to provide more credit, helping farmers invest in technology, adopt climate-smart practices, and boost productivity.”

The DA noted that the co-insurance pool is also aligned with President Ferdinand Marcos Jr.'s vision of a modernized agriculture sector and a food-secure Philippines.

Source - https://www.msn.com