President Rodrigo Duterte has initially earmarked P1 billion for the insurance of key pieces of property, assets and other insurable interests of the government.
The move came with issuance by the President of Administrative Order (AO) 4, which created an inter-agency committee to formulate the necessary policies, rules and regulations for the purpose of insuring government assets.
It is in accordance with the Property Insurance Law, which provides for a General Insurance Fund (GIF) for the
purpose of indemnifying or compensating the government for any damage to, or loss of, its insurable interests because of fire, earthquake, storm and other calamities.
The Property Insurance Law also provides that national government agencies and local government units, except those belonging to municipalities below first class, should insure with the GIF their pieces of property, assets and
other interests against any insurable risk.
“There is a need to prescribe the necessary policies to ensure that key [pieces of property], assets and other interests of the government, especially high risk items, are provided with comprehensive and adequate insurance coverage,” AO 4 read.
“Notwithstanding existing law, the Commission on Audit indicated in its reports that there are still agencies whose [pieces of property], assets, facilities and other insurable interests are currently not insured or substantially underinsured,” it said.
The inter-agency committee will be composed of representative from the Finance department as chairman, representative from the Office of the Executive Secretary as Co-Chairman, and contingent from the Department of Budget and Management, Insurance Commission and Government Service Insurance System (GSIS) as members.
In addition, the inter-agency committee is mandated to assess the utilization and management of the GIF being administered by the GSIS; evaluate the existing inventory of all government assets, facilities and other insurable interests that are actively insured; determine high-risk key government assets and other public facilities which should be insured annually; and propose appropriate legislative measures or executive issuances, as necessary, on insuring key government assets, facilities and other insurable interests.
The inter-agency committee will submit a terminal report to the President within one year after its convening.
The Finance department, through the Bureau of Treasury, will provide the necessary technical and administrative support services to the inter-agency committee.
The funds necessary for the implementation of the AO will be charged against the current appropriation of the members of the inter-agency committee and other appropriate funding sources, subject to existing budgeting, accounting and auditing laws, rules and regulations.