Spotlight Interviews with Co-operators

CLIMBS: Extending mutual protection and building resilience in the Philippines

“Spotlight Interviews with Co-operators” is a series of interviews with co-operators from around the world with whom ILO officials have crossed paths during the course of their work on cooperatives and social and solidarity economy (SSE). On this occasion, ILO interviewed Mr Noel Raboy, President and CEO in CLIMBS, a composite insurance cooperative owned by 4,000 member cooperatives from around the Philippines.

Article | 26 February 2019

How and why have you started working in CLIMBS?

Mr Raboy, President and CEO of CLIMBS
With an educational background on behavioural sciences, I have been interested in how cooperatives work, particularly for community development, poverty alleviation and sustainable development. I joined CLIMBS Life and General Insurance Cooperative in 2002 after working at a private life insurance company. At that time, CLIMBS still had limited reach in sales and marketing and had to enhance its human resources, products and services. I was tasked in heading Marketing in the Visayas region, one of the three major geographical divisions in the country. Having recorded growth between 2006 and 2010, we launched the Coop Life Insurance and Financial Services Agency (CLIFSA) to provide non-life insurance and bundle our products and services.

What is CLIMBS? Who are the members and what are the key businesses?

CLIMBS is an insurance cooperative established in 1971 in the Philippines by the Southern Philippines Educational Cooperative (SPECC) and the Misamis Oriental-Bukidnon-Camiguin Federation of Cooperatives (MBC). It started by offering affordable mutual protection services to its members, mostly among the marginalized poor and the not-so-poor people, as an alternative to insurance products offered by big traditional companies. CLIMBS was registered with the Cooperative Development Authority in 1992 and was later licensed as a Mutual Benefit Association (MBA) by the Insurance Commission in 1994.

Today, CLIMBS provides multiple insurance services (e.g. life, non-life, and pre-need) to its member cooperatives and their individual members. Spanning from the three major island groups of Luzon, Visayas and Mindanao, it reaches out even to areas where big insurance companies are not inclined to operate. It has approximately 4,000 member cooperatives nationwide, with assets worth 3.4 billion pesos (approximately 65.3 million US dollars), life insurance of 8.6 million policies and non-life insurance of 43,000 policies. The number of life insurance policies issued to date reached 60 million, starting from only two million in the early years.

Aside from insurance, CLIMBS also serves different needs of its user members through its subsidiaries: CLIMBS Institute for Financial Literacy (CIFL) for continuous education and capacity-building of cooperative leaders; CLIMBS Investment and Management Advisory Corporation (CIMAC); CLIMBS Share Capital Equity Investment Fund Corporation; and Cosmopolitan CLIMBS Life Plan, Inc. It is a member of National Confederation of Cooperatives (NATCCO) in the Philippines and a member of the International Cooperative and Mutual Insurance Federation (ICMIF).

What do you think makes CLIMBS different from traditional insurance companies?

As a member-owned cooperative enterprise CLIMBS should espouse the global cooperative values and principles while meeting protection needs of its members. This has been a shared vision of our cooperative leaders. Our past President and CEO, currently the Director Emeritus of CLIMBS, Mr. Fermin Gonzales always reminds us that we need to innovate to remain relevant and that the brains in cooperatives are co-operators themselves, unlike in big corporations where decisions are controlled by the few. One of the early innovations in CLIMBS is the unique distribution channels called the Cooperative Assurance Centres (CACs) where partner cooperatives extend CLIMBS products and services to its own members, according to demographic profiles and needs specific to each community.

Catering to the needs of local community groups including the most vulnerable is also unique to us. For instance, CLIMBS provides microinsurance to 1.7 million people, i.e. 22 per cent of people covered by microinsurance in the country. This way, we get to serve wider communities and stay close to the realities of our partners, members and stakeholders. I believe this inclusive approach is what differentiates us from other private sector providers that are not owned by user members.

How do you see the prospects for CLIMBS? What are the challenges and opportunities for it and its member credit cooperatives given the technological, environmental or demographical changes?

CLIMBS has been a forerunner in grassroots insurance provision in the Philippines. Current technological innovation and disruption are challenges, but they also provide us with an opportunity to learn new things, adapt to changes and render better products and services. We are also fully aware of an emerging millennial market and hope to extend our products and services to that segment by engaging with young people. In fact, the theme for our 2019 General Assembly is digital financial solutions for inclusive growth.

On the other hand, our country faces about 20 typhoons every year. We are helping our member cooperatives build stronger and more resilient communities by providing training on business continuity planning, particularly through our education arm CIFL. In addressing environmental disasters caused by climate change, CLIMBS also pioneered a weather-index insurance to protect the vulnerable sectors in the country (e.g. agriculture). By 2011, 50 municipalities were already covered by weather index insurance, but massive disasters like the typhoons Washi and Haiyan posed us with viability concerns. Currently, we are revisiting the past experiences and partnering with other organizations to improve the product.

Recently we also signed a partnership agreement with the ILO on a recent project aimed at developing risk managing financial services. With technical support from the ILO and in partnership with selected partner savings and credit cooperatives, we plan to develop an integrated risk-management solution. There is still a lot of work to do. I hope CLIMBS stays relevant and continues growing, through the success of the members, their families and staff.

Spotlight interviews with cooperators is a series of interviews with cooperative leaders around the world, whom ILO officials have encountered in the course of their work with cooperatives. This article does not constitute an endorsement by the ILO.