The Insurance Commission
August 6, 2007 
The Insurance Commission (IC) is one of the attached agencies of the Department of Finance. It is mandated to regulate and supervise the operations of life and non-life companies, mutual benefit associations, and trusts for charitable uses in accordance with the provisions of the Insurance Code in order to:
- Ensure that adequate insurance protection is available to the public at a fair and reasonable cost; and,
- Assure the financial stability of the insurance industry so that all legitimate claims of the insuring public are met promptly and equitably.
The commission is headed by the "Insurance Commissioner". The incumbent Insurance Commissioner is Ms. Evangeline Crisostomo - Escobillo
The Insurance Code of the Philippines mentioned the term "Commissioner", which refers to the "Insurance Commissioner", 393 times. The last chapter (no. VIII) discussed the Administrative and Adjudicatory Powers of the Insurance Commissioner.
The commission has the authority to issue licenses to insurance agents, general agents, resident agents, underwriters, brokers, adjusters and actuaries, as well as, suspend or revoke such licenses.
It also has the power adjudicate insurance claims and complaints involving any loss, damage or liability where the amount involved does not exceed P100,000.00 for any single claim. Decisions or orders of the Insurance Commission are appealable to the Appelate Courts.
Pre-need companies offering products similar to insurance are not under the jurisdiction of the Insurance Commission.
The Office of the Commission is located at:
1071 United Nations Avenue,
Ermita, Manila, Philippines
Tele/Fax (+632) 5238461-70
Its website is www.insurance.gov.ph
Its Mission / Vision:
- Promote growth and financial stability of insurance companies
- To professionalize insurance services
- Establish a sound national insurance market
- Develop insurance consciousness among the general populace
- Build a strong professional Insurance Commission
Its objectives are:
- To promote growth and financial stability of insurance companies
- To professionalize insurance services and develop insurance consciousness among the general populace
- To establish a sound national insurance market, and
- To safeguard the rights and interest of the insuring people
The Seal:
The suspended “salakot” or native hat in yellow gold symbolizes the protective value of insurance for life and property whether in air, over land specifically in the three major islands of the country: Luzon, Visayas and Mindanao as represented by the three stars – as well as in marine waters represented by the blue waves. The yellow gold color is for abundance while blue stands for peace and tranquility.
As is common in the coat of arms of the various government agencies, two sea lions also appear symbolizing vigilance and alertness in carrying out the mandated objectives. Just like other agencies of government, therefore, the Insurance Commission is also committed to pursue with relentless efforts its policies, programs and projects to ensure the growth of the insurance industry for national economic development.
Historical Background
The Insurance Commission was formerly referred to as the Office of the Insurance Commissioner. The law that created the Office of the Insurance Commissioner as an Independent office was Republic Act No. 275, which took effect upon the formal opening of the Central Bank of the Philippines on January 3, 1949 and which, in effect superseded the provisions of Executive Order No. 54, dated April 21, 1947 and Section 169 of Act No. 2427, otherwise known as the Insurance Act.
Under Act No. 2427, which took effect on July 1, 1915, The Insular Treasurer, in addition to his official title, was designated Insurance Commissioner ex-officio. The government agency which supervised insurance business in this country was, therefore, until December 31, 1941, or for period of over 26 years only a division, called the Insurance Division of the Bureau of Treasury.
During the war, the Insurance Division was separated from the Bureau of Treasury and attached to the Bureau of Banking. After the war, the Division returned to the Bureau of Treasury. In 1947, it was detached once more from the latter and then re-merged with the Bureau of Banking.
In 1949, through Republic Act No. 275, the Office of the Insurance Commissioner came into being with the Insurance Division as its nucleus.
On November 20, 1972, Presidential Decree No. 63 was promulgated amending certain sections of the Insurance Act. Among other things, it provided that the Office of the Insurance Commissioner be known as the Insurance Commission.
Insurers versus DOTC
August 1, 2007Philippine Insurers and Reinsurers Association, Inc. (PIRA) has filed a petition with a Makati court for certiorari and prohibition. The respondents are the Department of Transportations and Communications (DOTC), the Land Trasportation Office (LTO), and the Insurance Commission (IC).
The petition is in connection with the DOTC's Department Order no. 2007-28, issued last July 5, regarding the Compulsory Third Party Liability (CTPL) Insurance.
Click here for the full story by Mr. Honesto General in his Questions of Policies Column of August 1, 2007 in the Inquirer.Net.
The Insurance Code of the Philippines
July 30, 2007
The insurance in the Philippines is governed by the Insurance Code of 1978, as amended.
The first insurance code in the Philippines was ordained and instituted under Presidential Decree (PD) no. 612 on December 18, 1974 by then President Ferdinand E. Marcos.
The forerunner of this code was the Insurance Act which took effect on July 1, 1915, and which was copied almost verbatim from the California Insurance Act, with the exception of a few provisions which were adopted from the New York Law.
Since its promulgation, the code had undergone several amendments. Substantial number of provisions had been rendered obsolete by subsequent issuances of amendatory laws, decrees and executive orders. Likewise, there were certain provisions which were impractical in application, thus, necessitating revision in order to infuse flexibility, keep pace with the changing needs and demands of industries in line with new risks and arising out of new international developments.
For these reasons, it was imperative to consolidate, codify and integrate such amendatory laws, decrees and executive orders to harmonize their provisions for the proper guidance of the public and efficient administration thereof;
On June 11, 1978, then President Ferdinand E. Marcos signed PD no. 1460, otherwise known as the Insurance Code of 1978, consolidating and codifying all the insurance laws of the Philippines.
January 16, 1981, PD 1814 amending certain sections of PD 1460 was signed. The reasons for the amendments were:
- To ensure the due execution and performance of insurance contracts in the interests of the sound development of the national economy due to the prevailing economic conditions library
- To further assure reasonable insurance services for the protection of the interests of the policy holders and the public.
Please click here for the full text of the code from the Insurance Commission.
Note: The image is the Insurance Code of the Philippines, 2003 Edition book of Renato R. Pasimio, which was published by National Book Store.
Interim vehicle insurance system takes effect tomorrow
July 24, 2007While the concerned government agencies (DOTC/LTO and DOF/IC) are still discussing about the new and controversial CTPL insurance scheme, an interim vehicle insurance system would be implemented effective tomorrow.
To avoid confusions, please read the Breaking News from Business/Money Section of Inquirer.net.
Also, read the letter to the editor of Ms. Josefina L. Valera, Senior Vice President, General Insurance Group, Government Service Insurance System (GSIS) from Opinion Section of Inquirer.net
New motor vehicle insurance system on hold
July 19, 2007LATEST NEWS!
From Business Section of Inquirer. net
New motor vehicle insurance system on hold
By Michelle Remo
Inquirer
Last updated 06:46am (Mla time) 07/19/2007
Please read the story here.
GSIS: The CTPL monopoly
July 18, 2007LATEST OPINION!
From Business Section of Inquirer.net
QUESTIONS OF POLICIES
GSIS: The CTPL monopoly
By Honesto General
Inquirer
Last updated 05:07am (Mla time) 07/18/2007
Please read the opinion here.
Compulsory third party liability (CTPL) insurance
July 17, 2007Since the compulsory third party liability (CTPL) insurance was the issue in the news "Non-life insurance firms raise howl over DOTC order", I think we better discuss it.
First, let’s dissect the phrase. Three (3) elements are involved:
Compulsory means mandatory or required.
Third party. In insurance, the first party is the "insurer"; and the second party is the "insured". Do you remember them? Click here. Therefore, the third party is any party other than the insurer or insured.
Liability. It’s a pecuniary obligation for death or bodily injury or harm done to a third party.
In short, it is a mandatory insurance for a possible liability to a third party.
Who or what requires it?
The LAW (Chapter VI of the Insurance Code of the Philippines - ICP) requires a vehicle owner to secure a third party liability (TPL) insurance as a prerequisite to the registration of a motor vehicle with the Land Transportation Office (LTO)
Who really is a third party?
It was earlier discussed that any person other than the insurer and insured is a "third party". But wait! The motor car insurance policy qualifies other parties that do not fall within the ambit of a third party.
Pursuant to Section 373 (c), Chapter VI of the ICP, the motor car policy defined third party;
THIRD PARTY shall refer to any person other than a PASSENGER as defined in the law and shall also exclude a member of the household, or a member of the family within the second degree of consanguinity or affinity of the vehicle owner, or his employee in respect of death, bodily injury, or damage to property arising out of and in the course of employment.
Are your friends or other persons, who are not your relatives, riding in your car considered third parties or passengers?
Answer: They are considered third parties and not passengers. In the definition of a third party, it didn't mention where the third party should be. Whether they are inside or outside your car, they are third parties.
Passenger, on the other hand, is defined in (Section 373 (c) Chapter VI of ICP):
"Passenger" is any fare paying person being transported and conveyed in and by a motor vehicle for transportation of passengers for compensation, including persons expressly authorized by law or by the vehicle's operator or his agents to ride without fare.
In the definition, a person to be considered as passenger, it must be:
- Paying a fare, and
- On board a public utility vehicle.
Here, it mentioned where the passenger should be - on board the PUV. Once the passenger arrived in its destination and got off the PUV, it became a third party.
Person on board a private vehicle is not a passenger.
What liability is covered?
It covers the liability of the insured in respect of the bodily injury and/or death of any THIRD PARTY in an accident caused or arising out of the use of the insured vehicle. As such, the insurer will pay, subject to the limits of liability, all sums necessary to discharge the insured from liability. Liability for loss or damage to property is not covered.
It is primarily intended to provide compensation for the death or bodily injury suffered by an innocent third party as a result of the operation and use of motor vehicle. It assures the victim and or his/her dependent/s of immediate financial assistance, regardless of the financial capacity of the motor vehicle owner.
How much is the insurance coverage?
The current CTPL coverage is P100,000.00. Previously, the coverage was for P50,000.00 only and the increase took effect last year. Despite the 100% increase in coverage, the premium rates remain the same in view of the good loss experience of the industry.
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Should you need further clarifications, have question/s, find an error, disagreed with the views and opinions, and/or wish to give a suggestion, kindly don't hesitate to leave comments or email at insurance@i.ph or insurance.i.ph@gmail.com
Non-life insurance firms achieve higher risk-based capital ratios
July 16, 2007LATEST NEWS!
From Business Section of www.philstar.com on Monday, July 16, 2007
Please read the news here.
Non-life insurance firms raise howl over DOTC order
July 13, 2007LATEST NEWS!
From Business Section of www.philstar.com on Friday, July 13, 2007
Please read the news here.
GSIS extends insurance coverage to private properties of members
July 10, 2007LATEST NEWS!
From: Philippine Information Agency (PIA)
Please read the news here.
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This is a welcome development to all GSIS members, active or retired. A member could save at least 20% from his/her insurance expenses.
Insurance Blog
July 3, 2007I'd been contemplating of developing a blog about insurance since I started blogging last May. It's now a reality.
It's aimed to educate the public and make them aware and conscious on the benefits of insurance.
This blog shall be updated weekly and new article/s published every Monday.
