RP insurance industry supports GSIS’ CTPL
Majority of the biggest names in the Philippine insurance industry yesterday expressed overwhelming support for the Integrated Insurance Registration System to be implemented by the Land Transportation Office (LTO) in registering all motor vehicles.
Led by the National Reinsurance Corp. of the Philippines, the insurance firms also made known their intention to participate in the system adopted from the Compulsory Third Party Liability (CTPL) model of the GSIS.
The system was approved by the Department of Transportation and Communication (DoTC) under 2007-28 issued July 5, 2007. The overhauling of the CTPL system is a joint undertaking of the DoTC with the Insurance Commission, LTO, GSIS, and Stradcom.
“We take note of the adoption of the GSIS CTPL Reform Program by the Insurance Commission as reflected in the memorandum of agreement dated July 1, 2008, which the IC signed with the DoTC, LTO, GSIS, and Stradcom,” said the insurance firms in a joint statement.
“This expression of solidarity is in line with our goal to provide the public only the best insurance products for their needs. Likewise, the time has come to put an end to the long-festering problem of the proliferation of fake CTPLs.”
The CTPL is an insurance policy providing up to P100,000 in coverage to third parties killed or injured in accidents involving insured vehicles. Securing CTPL is mandatory before a vehicle can be registered with the LTO.
DoTC Assistant Secretary Robert Suansing disclosed that the guidelines for the new CTPL system are now being drawn by the concerned agencies for immediate implementation.
Under the GSIS CTPL scheme, the GSIS will farm out the provision of CTPL policies to accredited insurance and reinsurance firms at much lower prices than the old CTPL system.
The set up shoots down claims that the new system will lead to any one body monopolizing the CTPL business, as well as allegations that it will result to massive job losses in the insurance industry.
“There’d be no job losses among the ranks of legitimate insurance brokers, only among those who had been duping the public for decades now selling fake CTPLs. We say good riddance to them,” said an insurance agent.
While providing vehicles owners big savings of up to P425 per policy, the Integrated Insurance Registration System will also ensure that motor vehicle owners will be provided only geniuine CTPL policies and be spared from the rampant “CoC or certificates of cover-switching in which CTPLs for tricycles are passed off as CTPLs for cars and other vehicles.
The present CTPL system has been the subject of numerous complaints due to the long-standing problem of as many as two-thirds of CTPLs sold under it to be fake. The government also lost billions of pesos because of fake CTPLs for whom documentary stamps and other taxes were not paid. From 2000 to 2007, the government had lost at least P2 billion in revenues due to fake CTPLs.
When implemented, the Integrated Insurance Registration System will ensure against fake CTPLs, make the registration and CTPL-procurement process hassle free, and ensure that the government gets all incomes due it from CTPL premiums paid. — The Daily Tribune, July 16.
Source: GSIS Layunin, Vol. 5 Issue 7, July 2008