THE insurance adjustment industry in the country could now expect to attract foreign partners following the lifting of the foreign investment ban.
The newly passed Republic Act 10881 has abolished the restriction prevailing under Section 332 of the Insurance Code which stipulated that an adjustment company may only be owned by a Filipino citizen or at least 60 percent of its capital must be owned by Filipino citizens, in case of a partnership, association or corporation.
The new law now allows foreign national and 100 percent foreign ownership, in case of partnership, association and corporation, in adjustment companies.
Welcoming the policy shift, the Insurance Commissionere Emmanuel Dooc said on Monday:
“With the passage of the law, we are expecting that this will make the insurance adjustment industry in our country attractive to foreign investors.”
Dooc said the liberalization of foreign ownership in adjustment companies would also encourage best practices in the insurance loss adjustment in the Philippines.
“Another positive effect is that it will compel local players to shape up considering the competitive business climate which will ultimately inure to the benefit of the insuring public,” he added.
Adjustment of claims is the process of ascertaining the liability of the insurer arising under an insurance contract or policy and the amount or indemnity which the insured is entitled to receive under the said contract or policy.
In the adjustment of claims, the services of adjusters or adjustment companies are employed which may either be an independent adjuster or public adjuster.
Under Section 333 of the Insurance Code, an independent adjuster is any person, partnership, association or corporation that, for money, commission or any other thing of value, acts for or on behalf of an insurer in the adjusting of claims.
A public adjuster, on the other hand, means any person, partnership, association or corporation which, for money, commission or any other thing of value, acts on behalf of an insured in negotiating for, or effecting, the settlement of a claim, or which advertises for or solicits employment as an adjuster.
“During the deliberations before both houses of the 16th Congress, the Insurance Commission expressed its full support to the lifting of foreign equity restriction with respect to adjustment companies as part of the country’s compliance with our commitments to the Asean [Association of Southeast Asian Nations] Economic Community to open certain sectors of the economy,” Dooc said.