Tips for OFWs on protecting their family at home

October 14, 2021

The majority of stories concerning Filipino employees abroad are a mix of positive and unhappy experiences. Working overseas, on the one hand, is a lucrative vocation due to the high pay. Furthermore, there are several job prospects for Filipinos. This allows you to more easily meet the financial necessities of your family back home.

The expense of being apart from your loved ones, on the other hand, isn’t difficult to overlook. Even on significant or exceptional events, you can’t always be with your family. You also won’t be able to see your children grow up since you’ll have to make the sacrifice of being away from them.

According to a recent survey, OFWs would require at least 18 years to get their family savings to an optimal level, even if they were saving P14,000 more or less each month. This means that OFWs no longer need to work abroad and may instead live happily with their families at home.

Around 2.3 million OFWs work in other countries, with 3.8 percent working without a contract. Construction workers and industrial employees, for example, employ one out of every three workers in elementary jobs, which entail everyday tasks requiring the use of hand-held instruments and physical exertion.

According to the 2018 Survey on Overseas Filipinos, OFWs sent a total of PhP 235.9 billion in remittances from April to September 2018. Many Filipino families rely on these remittances to make ends meet.

The following suggestions will help you and your family avoid facing the same financial difficulties. The idea is for you to work just long enough to save money, return home with your savings, be closer to your family, and live a better life with them.

Tip #1

Purchase an insurance policy that includes both you and your partner (or a loved one)

It’s unfortunate, but it’s not uncommon for OFWs to become unwell and suffer from serious illnesses. There are a variety of reasons for this, including a lack of time to prepare healthy meals, a failure to exercise, or an inability to overcome the loneliness of being away from home. It doesn’t help that OFWs will put in long hours even if they aren’t feeling well. Many OFWs prioritize their family’s needs over their own.

In the event of illness, your life insurance will be able to relieve some of your financial stress by ensuring that you won’t have to dive into your funds to cover hospitalization costs or prescription costs. At the same time, life insurance can safeguard your partner or dependents by allowing them to utilize the proceeds from your policy to meet other family obligations. If the worst happens, the death benefits from your life insurance policy will allow your loved ones to maintain a decent standard of living despite your death.

Tip #2

Choose a non-life insurance policy that allows you to leave a legacy for your loved ones

Many Filipinos are inspired to work in foreign nations in order to enhance their family’s lives or to provide their family with opportunities that they themselves could not afford as children or adults. It may be a dream automobile, home, or business for them.

It is possible to provide your family with a home that they can call their own with general insurance. You’re giving your family a significant legacy that they’ll be able to keep for the rest of their lives as you build your estate.

The loved ones could use the insurance benefits you purchased to cover your estate taxes and keep your hard-earned investments from going to waste if you pass away. Most importantly, your family could continue to live the life you’ve always intended to offer them while giving them the impression that you’re still alive.

Tip #3

Consider purchasing life insurance that has an investment component to help you develop your retirement savings

No one likes to be separated from their loved ones for an extended period of time. However, because financial security may take time, you can invest your earnings from working overseas in financial products that serve as both life insurance and wealth builders. So to speak, hit two birds with one stone.

With a life insurance policy that includes an investment option, you may start building and expanding your retirement fund with your investment returns. Having the assurance that you have enough money saved for retirement can make it easier to make the decision to return home and spend time with your family to make up for the time you couldn’t be with them.

A Mandatory Insurance for OFWs

The government has implemented provisions to ensure that OFWs are adequately protected in the event of an accident, illness, or death. The Agency-Hired OFW Compulsory Insurance Act of 1995 mandates that all agency-hired workers be covered by mandatory insurance coverage (AHOCI).

The AHOCI “is an insurance mechanism made available by legislation to provide insurance protection for OFWs,” according to the Insurance Commission.

For agency-hired OFWs or migrant workers who “availed the services of a recruitment/manning agency duly authorized by the Department of Labor and Employment (DOLE) through the Philippine Overseas Employment Administration (POEA),” the policy is in effect and mandatory for the duration of their employment contract.

Accidental death, natural death, total permanent disability, repatriation costs, sustenance allowance, money claims, compassionate visit, medical evacuation, and medical repatriation are all covered by the AHOCI. Employees are not needed to pay anything because the recruitment firm covers the insurance.

The advantages of purchasing life insurance on your own

Unfortunately, OFWs cannot rely solely on the AHOCI. While the policy covers the essentials, it is only valid for the duration of the OFW’s employment.

Aside from that, the AHOCI only applies to agency-hired employees, not to direct-hired or name-hired employees. This means that employees hired directly by foreign businesses are not entitled to the same benefits unless they specifically request them.

Furthermore, many OFWs work in low-wage jobs that put them at risk. A manufacturing worker, for example, may be exposed to a variety of risks that will eventually harm their health.

OFWs support their families by working as breadwinners. If something happens to them and they become unemployed, their families will lose their primary source of income. Hospitalization as a result of an injury or illness might have an impact on their pay and remittances. For OFWs and their families, life insurance provides a safety net.

Furthermore, life insurance might assist OFWs in accumulating funds over time. Investing-linked insurance policies can protect a person’s assets while also allowing them to expand their money through an investment component. OFWs may have enough money to retire and ensure their family’s future.

OFWs must invest more wisely. They must consider their long-term demands in addition to their monthly expenses. At first sight, life insurance may appear to be an unnecessary expense, but if you consider how it might have a huge impact on your family’s future, you’ll see why it’s a wise investment.

Government Laws for OFWs

The Insurance Commission, the Overseas Employees Welfare Administration (OWWA), and the Philippine Overseas Employment Administration (POEA) are teaming up to raise public awareness about the coverage and benefits of compulsory insurance for agency-hired overseas Filipino workers (OFWs).

A sub-module on the agency-hired overseas Filipino worker compulsory insurance benefits will be incorporated in the Pre-Employment Orientation Seminar (PEOS) and Pre-Departure Orientation Seminar (PDOS) provided by the POEA and OWWA, respectively, according to an agreement signed by OWWA Administrator Hans Leo J. Cacdac, POEA Officer-In-Charge Dominador R. Say, and Insurance Commissioner Dennis B. Funa.

“Because of its advocacy component, this memorandum of agreement is quite essential. Many people are still unaware that there is an insurance package or benefit available for overseas employees, particularly newly employed OFWs. As a result, POEA, OWWA, and the Insurance Commission have teamed up to create a large public awareness campaign,” said OWWA Administrator Cacdac.

According to the Compulsory Insurance Coverage for Agency-Hired Workers, each migrant worker employed by a recruiting or manning agency must be protected by a mandatory insurance policy that is provided at no cost to the worker.

This is in accordance with Section 37–A of Republic Act No. 8042, as amended by Republic Act No. 10022, or the Migrant Workers and Overseas Filipinos Act of 1995.

The insurance coverage must cover, at a minimum, accidental death, natural death, permanent total disablement, repatriation costs, sustenance allowance, money claims, compassionate visit, medical evacuation, and medical repatriation for the duration of the migrant worker’s employment contract.

The PEOS and PDOS must include information on the aforementioned mandatory insurance.

The PEOS provides general information on the advantages and disadvantages of working abroad; guidelines, legal procedures, and documentary requirements for applying for an overseas job; overseas job opportunities and restricted jobs; tips to avoid illegal recruitment; advisories and warnings to OFWs; health and security issues; and government services available to overseas job applicants and hired workers.

The PDOS, on the other hand, is given to OFWs prior to their departure and aims to prepare them for living and working in a foreign country, as well as to inform them of their rights and responsibilities and to provide them with necessary information to facilitate travel to and adjustment within the worksite and host country.

The memorandum of understanding was signed at the Insurance Commission Grounds, UN Avenue, Manila, during the 68th Anniversary Celebration of the Insurance Commission.

Are You Prepared for Your Return?

The sacrifices you make as an OFW are immeasurable to your family. They, too, are looking forward to the day when you’ll return home and dwell with them permanently.

Prepare for this historic occasion by getting your financial affairs in order. You can optimize your earnings and guarantee your family’s future sooner rather than later with the correct financial strategy and life insurance solutions.

Find the best insurance for the sake of your family’s safety.