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By Chino S. Leyco, Reporter
STATE-RUN Government Service Insurance System,
Insurance Commission and Land Transportation Office and the private
Philippine Insurers and Reinsurers Association will enter into a
compromise agreement on a case involving the compulsory third-party
liability (CTPL) an insurance policy covering car owners.
Finance Secretary Margarito Teves over the
weekend said he had talked with the heads of the three government
agencies and the insurers group, which all suggested that they
settle the issue through a compromise deal.
The case arose from an order of the Department
of Transportation and Communications that mandates the Government
Service Insurance System, or GSIS, to be the sole provider of CTPL
insurance to vehicle owners.
Teves said all concerned parties would meet with
him to come up with an agreement that would serve best the interests
of policyholders.
The insurers association earlier challenged the
order of the Transportation department before the Makati City
Regional Trial Court.
On July 25, the Regional Trial Court stopped the
GSIS from taking over the CTPL insurance for motor vehicles in the
country. Its ruling took off from a 20-day temporary restraining
order issued by Judge Carlos Valenzuela of Mandaluyong City
prohibiting not only the government pension fund but also the
Transportation department and other parties from implementing the
department’s order.
The CTPL is an insurance policy that shoulders
any possible damage resulting from a person’s use of his car.
The GSIS had planned to start its integrated
compulsory third-party liability insurance system at the Land
Transportation Office on August 1.
Winston Garcia, the GSIS president and general
manager, had said the pension fund wants to control the CTPL
insurance in the country to break up a group that is “not a
monopoly but an abusive cartel.”
Ten companies, according to Garcia, control
about 70 percent to 75 percent of the car insurance business in the
Philippines.
The insurers association, however, said it was
the GSIS that was trying to monopolize the country’s CTPL
insurance sector.
Garcia said 60 of the 83 registered insurance
companies in the Philippines have expressed support and intention to
participate in the CTPL system conceptualized by the GSIS.
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