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By Ben O. de Vera

To avoid cov­er­age du­pli­ca­tion, the In­sur­ance Com­mis­sion (IC) has or­dered mo­tor ve­hi­cle in­sur­ers to make in­sur­ance poli­cies coter­mi­nous with the month of reg­is­tra­tion of cov­ered ve­hi­cles.

In­sur­ance Com­mis­sioner Den­nis Funa is­sued cir­cu­lar let­ter (CL) no. 2021-54 lay­ing down the guide­lines to syn­chro­nize the pe­riod cov­ered by com­pre­hen­sive mo­tor car in­sur­ance poli­cies with the reg­is­tra­tion dates of those ve­hi­cles.

“This CL aims to ad­dress the con­cern of the Anti-Red Tape Author­ity (Arta) as re­gards the per­ceived re­dun­dancy of the re­quire­ment of get­ting com­pul­sory third-party li­a­bil­ity in­sur­ance (CTPL) when a mo­tor ve­hi­cle is al­ready cov­ered by a com­pre­hen­sive mo­tor car in­sur­ance pol­icy,”

Den­nis Funa, In­sur­ance Com­mis­sioner

Syn­chro­niza­tion

A CTPL in­sur­ance pol­icy is re­quired when reg­is­ter­ing a mo­tor ve­hi­cle with the Land Trans­porta­tion Of­fice (LTO), whether for com­mer­cial or per­sonal use. It is meant to pro­vide pro­tec­tion to the rid­ing pub­lic.

Funa said that un­der CL 2021-54, “mo­tor car in­sur­ers are now re­quired to en­sure that the pe­riod of cov­er­age of all mo­tor car in­sur­ance poli­cies is­sued con­tain­ing CTPL cover shall be coter­mi­nous with the month of the reg­is­tra­tion of the in­sured ve­hi­cle … re­gard­less of whether such poli­cies are stand-alone CTPL poli­cies or com­pre­hen­sive mo­tor car in­sur­ance poli­cies with CTPL pro­vi­sions.”

In par­tic­u­lar, Funa said in­sur­ers must “al­low for the ex­ten­sion of the pe­riod of cov­er­age of com­pre­hen­sive mo­tor car poli­cies with CTPL cover to syn­chro­nize the pe­riod of cov­er­age with the month of the reg­is­tra­tion of the in­sured ve­hi­cle, as in­di­cated by the last digit of said ve­hi­cle’s plate num­ber.”

Avoid­ing re­dun­dancy

“In­sur­ers and their agents are also obliged to in­form the in­sured that the re­spec­tive pe­ri­ods of their com­pre­hen­sive mo­tor car poli­cies with CTPL cover may be ex­tended at the lat­ter’s op­tion, as well as the terms of such ex­ten­sion,” the chief added.

So the pub­lic can eas­ily trans­act with the LTO, Funa said in­sur­ers is­su­ing mo­tor car poli­cies must en­sure that the gov­ern­ment agency could au­then­ti­cate in real-time the con­fir­ma­tion of cover it pro­vided, both for com­pre­hen­sive mo­tor car poli­cies with CTPL pro­vi­sions as well as stand-alone CTPL poli­cies.

“[This] aims to en­sure ef­fi­ciency in the reg­is­tra­tion or re­newal of reg­is­tra­tion of mo­tor ve­hi­cles, as well as to avoid re­dun­dancy in the cov­er­age of mo­tor car in­sur­ance poli­cies,” Funa said.

Funa said CL 2021-54 had un­der­gone con­sul­ta­tions with the Arta, the LTO and the non­life in­dus­try group Philip­pine In­sur­ers and Rein­sur­ers As­so­ci­a­tion prior to its is­suance.

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