February 10, 2012
DISASTER INSURANCE FOR PUBLIC INFRASTRUCTURES NEEDED - CHIZ
Government infrastructure assets should be insured against disasters to make sure there is money for their immediate rehabilitation or repair when destroyed by natural calamities, Senator Chiz Escudero said.
Escudero, chairman of the Senate Committee on environment and natural resources, said actual losses left by environmental disasters send local government units (LGUs) scrambling for funds to rebuild and rehabilitate public infrastructures.
"When tragedy strikes and local infrastructure assets are down, immediate restoration and rebuilding are needed to restore normalcy and recovery in the community. But this is a costly undertaking for most LGUs that operate on scarce resources. Relief and rehabilitation costs always surpass the stand-by disaster mitigation fund," Escudero said.
Last year, the senator had closely worked with the Government Service Insurance System (GSIS) to craft an insurance scheme for school buildings, particularly those located in the country's northeastern seaboard where weather disturbances naturally take their paths.
With the recent spate of natural disasters in different parts of the country, Escudero has now expanded his proposal to include assets for which the government is responsible like roads, bridges, dams and local government buildings.
In the proposed scheme, the GSIS will serve as the government's underwriter. The former in turn will take out the insurance on private insurers. The insurance should cover assets against typhoon and flood; fire and lightning; earthquake, fire and shock; extended coverage such as volcanic eruption, tsunami, landslide, riot and civil commotion; and aircraft and vehicle impact.
"Our largest infrastructure assets which directly benefit the community are the roads. Disaster risks and adverse impacts on these suspend community life. Even immediate relief is unrealistic to send, just like what unfortunately happened in Cagayan de Oro and the recent earthquake tragedy in Negros Oriental," the senator explained.
Escudero said the government can start working with the GSIS to draw up a proposal on the valuation of the assets where coverage of the policy is based on a replacement value estimated by the underwriter on a no-fault, outright payment clause.
"LGUs especially in the disaster-prone areas will highly-benefit from this. It may sound as an additional cost to their annual budget, but I believe they would rather have a projected cost to put in the budget than incur emergency spending from disaster-related events which are unpredictable and very costly," he added.
Wednesday, May 27