Insurance Code strengthens insurers in time for integration: commissioner-A A +A
By Mia A. Aznar
Tuesday, March 11, 2014
WITH the new Insurance Code enacted into law, Insurance Commissioner Emmanuel Dooc expects the financial conditions of insurance players are strengthened to become more competitive with its counterparts in the Southeast Asian region.
Dooc, who was in Cebu last week to induct the officers trustees of the Cebu Insurers Club Inc. (CICI), said the integration of services in 2015 among members of the Association of Southeast Asian Nations (Asean) is likely to affect the insurance market.
One of the amendments to the Insurance Code increases the capitalization of insurance players from P175 million to up to P1.3 billion by 2020. He assured local insurance companies will have enough time to prepare for the required increase in capital because the build-up will be done gradually.
Asked if the action came a bit late, since its implementation will be completed five years after integration takes effect, Dooc does not believe this will be the case. “As long as we take the right decision. If we don’t take the right course of action, we can’t catch up.”
The amended code took effect in September last year.
The new code also opens up investment opportunities to insurance companies.
It also gives additional powers to the commission as principal regulator of the industry as it increased the jurisdictional authority to adjudicate claims cases up to P5 million, from just P100,000.
The new code also ensures tenure for the head of the Office of the Insurance Commission, giving him a fixed term of six years without reappointment. He said his four immediate predecessors had an average of 15 months in office. He said that before this development, the commissioner was changed at the discretion of whoever had the appointing power.
The problem with short terms, he said, is the uncertainty. “If you don’t know how long you will occupy the position, it is difficult to draw up long-term plans,” he told Sun.Star Cebu. He said having a fixed term allows the commissioner to set policies and better serve the interest of the industry and the public.
Dooc said he submitted his resignation to President Benigno Aquino III after the new law was passed to give him a free hand to appoint a new head. He was reappointed and will be the first commissioner to have a full six-year term. He will be commissioner until 2019.
Dooc said the insurance industry has grown in recent years, owing it to the better economic conditions of the country.
He noted “phenomenal growth” in life insurance, posting a premium income of P198 billion last year.
What he hopes companies will do is develop more products that address the needs of the poor, rather than just limit themselves to the upscale market.
He said micro insurance helped many poor beneficiaries in the wake of super typhoon Yolanda, paying out P400 million in claims to victims of the calamity.
He hopes companies will come up with medical insurance for the poor, saying it is one of the needs this sector needs with high medical costs in the country. He added that Philhealth cannot address it alone.
There are also suggestions that jurisdiction over HMOs be turned over to the IC instead of the Department of Health. Dooc said that if this happens, it will give them the opportunity to think of ways to provide comprehensive medical care that is more affordable.
Dooc encouraged officers of the CICI to promote insurance protection and security among the people of Cebu and its neighboring areas.
He assured that the IC is on top of the industry, monitoring the performance of industry players by instituting regulations that will serve the industry and the public.
The CICI elected Rolando Torrepalma of Alpha Insurance and Surety Co. as its president. His officers include Elma Masiglat of Riskwise Insurance Agency as vice president for education, Neil Ceniza of Mapfre Insular Insurance Corp. as vice president for membership, Rosario Gejon of Cebuana Lhuillier Insurance Solutions, Inc. as secretary, Rachel Lacuesta of the Visayan Surety and Insurance Corp. as treasurer, Eduardo Sayo of Manila Adjusters and Surveyors Co, as auditor and Ma. Fe Celerinos of Commonwealth Insurance Company as press relations officer. Elected as board of trustees were Jacqueline Wenceslao of Philippine Insurance Brokers and Managers Inc., Arnold Mendiola of PNB General Insurers Co., Lean Jean Uytengsu of Oriental Insurance Corp. and Beinvenido Falcon Jr. of Pioneer Insurance and Surety Corp.
Published in the Sun.Star Cebu newspaper on March 12, 2014.