Policy vs fake car insurance readied

The interagency committee tasked to resolve the proliferation of fake insurance policies for motor vehicles is expected to make the recommendations on how to address the unpaid claims and non remittance of taxes to the national coffers in the next quarter. Finance Secretary Margarito Teves said in a speech during the launching of the official Web site of the Insurance Commission that the committee would finally submit recommendations after reviewing various proposals submitted by different groups. Teves said the proliferation of fake insurance policies or compulsory third party liability (CTPL) policies has resulted to foregone revenues on the part of the government in the form of unpaid taxes as well as unpaid insurance claims on the part of motor vehicle owners. A CTPL policy is a mandatory vehicle insurance that guarantees a certain amount of benefit for victims of car accidents. The committee is composed of representatives from the Department of Finance, Department of Transportation and Communications, Land Transportation Office, Land Transport Franchising and regulatory Board (LTFRB) and IC. The committee is evaluating proposals from the Philippine Insurers and Reinsurers Association Inc. (Pira), the state-run Government Service Insurance System (GSIS), the DTech Management Inc. (DTECH) and Road Accident Managed Services Inc. (Ramsi). IC Commissioner Evangeline Escobillo told reporters the establishment of the CTPL central processing center (CPC) was the ultimate solution to the problem in which only half of the CTPL policies worth P2.5 billion are genuine while the other half are spurious. “This solution is a system to solve the anomalies. The system is to have a CTPL processing center which is also going to pass through the insurance clearing center to ensure that no insurance company with no license can issue a policy. The system will ensure also that all the taxes are properly remitted,” Escobillo added. She said the CPC would have to be linked up with the LTO database managed by Stradcom, banks where motor vehicle owners would pay through the express payment system or the Internet, and the Bureau of Internal Revenue (BIR) that would collected the taxes. She said the solution to be recommended by the committee would have to be approved by Teves and DoTC Secretary Leandro Mendoza. It is looking for a win-win solution to prevent the closure of 95 life insurance companies and the lay off of up to 130,000 direct employees and insurance agents. source : www.manilastandardtoday.com