|
THE Philippine Insurers and Reinsurers Association (PIRA) has asked
a local court to reconsider its earlier ruling allowing state-run
Government Service Insurance System (GSIS) to handle the country’s
compulsory third-party liability (CTPL) insurance program.
The group of non-life insurers filed its motion
for reconsideration before the Makati Regional Trial Court last
Friday.
The case arose from the Department of
Communication and Transportation Order 2007-28, which mandates that
the state-run pension fund be the sole provider of CTPL insurance to
vehicle owners.
PIRA said the department has no power to impose
such an order, as it will result in a monopoly which is against the
constitution. The court had dismissed the insurance group’s
petition, citing technicalities.
“The order paves the way for a monopoly of the
CTPL business. Aside from being patently unconstitutional, a
monopoly is always detrimental to public welfare because it robs the
consumer of their freedom to choose,” Fortunato Peralta, PIRA
deputy general manager said.
PIRA argued the order violates the Insurance
Code and the Constitution as only one entity could monopolize the
P3-billion motor vehicle insurance business.
On July 5, 2007, Transport Secretary Leandro
Mendoza laid down the rules on the issuance and payment of CTPL
insurance with the Land Transportation Office Information Technology
(LTO-IT) project’s system and database.
Under the new setup, the issuance of CTPL
insurance policies would be integrated with the LTO-IT project’s
Motor Vehicle Registration System and revenue collection system. A
CTPL policy is a mandatory vehicle insurance that guarantees a
certain amount of benefit for victims of car accidents. Winston
Garcia, GSIS pre-sident and general manager earlier said the pension
fund is preparing for the implementation of the order.
-- Chino S. Leyco
|
