Preamble
WHEREAS, while the achievements of the on-going supervised rice production credit program has been substantial, the financial burden on the part of the farmers and the lending institutions in terms of uncompensated losses arising from destruction of standing crops wrought by floods, typhoons, heavy rains, drought and other natural calamities has not only tended to keep the farmers in perpetual indebtedness but has also considerably constricted the loaning capabilities of lending institutions and their willingness to extend loans to rice farmers; WHEREAS, as a result of the recurrent natural disasters our farmers suffer heavy losses due to the destruction of their standing crops resulting in loss of income and the consequent loss of their credit standing through no fault of their own, which in turn seriously affects the finances of lending institutions participating in the supervised credit program; WHEREAS, implementing a crop insurance scheme can serve to provide relief to out rice producers from the heavy burdens and loss caused by such disasters as well as to stabilize the finances of lending institutions; WHEREAS, crop insurance can serve as a strong incentive to the intensification of the Government food production program as well as minimize the erosion of the financial capability, and the willingness of lending institutions to provide financial support to rice production program; WHEREAS, a study conducted by an Inter-Agency Committee sponsored by the Land Bank of the Philippines (LBP) disclosed the feasibility of providing crop insurance protection to rice farmers covered by the supervised credit program, as well as to self-financed farmers who place themselves under the supervision of duly accredited technicians; WHEREAS, because of its important role, the crop insurance scheme requires inter-agency operational linkages and support to insure the successful and economical attainment of its laudable objectives; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the Philippines, by virtue of the powers vested in me by the Constitution, do hereby decree and order: