FREQUENTLY ASKED QUESTIONS

What is the role of Insurance Commission?

The Insurance Commission is a government agency under the Department of Finance. The
Commission supervises and regulates the operations of life and non-life companies, mutual benefit
associations, and trusts for charitable uses. It issues licenses to insurance agents, general agents,
resident agents, underwriters, brokers, adjusters and actuaries. It has also the authority to
suspend or revoke such licenses.
Why does the Government supervise the operations of insurance
companies and their representatives?
Insurance business exists to serve the public. It is therefore charged with public
interest
What is the address of the Insurance Commission?
The Insurance Commission is located at 1071 United Nations Avenue, Ermita, Manila, with Tel. #
523-84-61 up to 70 (Trunk Line), 525-20-15 (Office of the Insurance Commissioner), 524-47-84
(Office of the Deputy Commissioner), Fax # 522-14-34, and E-mail ocom@insurance.gov.ph.
Who heads the Insurance Commission?
Insurance Commissioner Atty. Emmanuel F. Dooc
Does the Commission have the power to adjudicate insurance claims and
complaints involving any loss, damage or liability?
Yes. The Insurance Code, as amended, empowers the Commission to adjudicate insurance claims
and complaints involving any loss, damage or liability where the amount involved does not exceed
P 100,000.00 for any single claim. Decisions or orders of the Insurance Commission may be
appealed to the Appelate Courts.
What other complaints can be filed with the Commission?
Informal and administrative complaints against malpractices of insurance companies or agents
may also be filed with the Commission. The Commission is ready at all times to render assistance
in settling any controversy between an insurance company and a policyholder relating to
insurance.
Are pre-need companies offering memorial service plans, educational
plans and pension plans fall under the jurisdiction of the Insurance
Commission?
Yes, pre-need companies offering products similar to insurance are now under the jurisdiction of
the Insurance Commission by virtue of Republic Act No. 9829 known as the Pre-Need Code of the
Philippines as approved on December 3, 2009.
What are the minimum qualifications required of applicants for insurance
agents examination?
They must be of good moral character and must not have been convicted of any crime involving
moral turpitude and also have been trained in the kind of insurance presently contemplated in the
license applied for.
Who may be exempted from taking the agents examination?
+ One who holds a valid and subsisting certificate of authority issued by the Commissioner
+ One who has successfully completed an academic course and/or training program satisfactory
to the Insurance Commissioner, in the kind or kinds of insurance contemplated in the license
applied
for
+ One who, because of his previous connection with any insurance company, or with any office or
firm handling insurance matters is found by the Insurance Commissioner to be trustworthy and
competent to transact the business contemplated in the license applied for.
Who may be insured?
Anyone except a public enemy may be insured

What may be an insurable interest in life insurance consist of?

Every person has an insurable interest in the life and health:
+ Of himself, of his spouse and his children;
+ Of any person on whom he depends wholly or in part for education or support; or in whom he
has a pecuniary interest;
+ Of any person under legal obligation to him for the payment of money, or respecting property or
services, of which death or illness might delay or prevent performance; and
+ Of any person upon whose life any estate or interest vested in him depends.
What are the two (2) essential policy conditions which if violated will void
the entire policy?
a) Willful concealment or misrepresentation by the insured of any material fact or circumstance
concerning the subject thereof or the interest of the insured therein; and
b) Any fraud or false swearing by the insured relating thereto.
What is the difference between suretyship and insurance?
In suretyship, three persons or entities are involved: the surety, the principal and the obligee. In
insurance, there are only two: the insurer and the insured.
In insurance, there is a theoretical distribution of losses over a group or classification of risks, the
insurance company assuming the losses of the individual insured. In suretyship, no losses is
anticipated as the surety guarantees the obligation of the principal.
In property insurance, is the insured entitled to a return of premium if he
should decide to discontinue his policy?
Yes, to a proportionate amount corresponding to the unexpired term of the policy;
generally under the short period scale provided for in the policy.
May the insurance company cancel a policy? If so, how? May the insured
cancel a policy?
Yes, upon prior notice thereof to the insured. However, no notice of cancellation is effective unless
it is based on the occurrence, after the effective date of the policy, of one or more of the following:
+
Non-payment
of
premium;
+ Conviction of a crime arising out of acts increasing the hazard insured against;
+
discovery
of
fraud
or
material
misrepresentation;
+ discovery of willful or reckless act or omission increasing the hazard insured against;
+ physical changes in the property insured which result in the property becoming uninsurable; or
+ determination by the Commissioner that the continuation of the policy would place the insurer in
violation of this Code.
The insured may cancel a policy upon notice to the insurer under the terms of the policy.
How soon may the amount of any loss or damage for which an insurer may
be liable under a non-life policy be paid? If the insurer refuses or fails to;
pay the claim within the time prescribed by law, may the insured collect
interest for the duration of the delay?
The amount of any loss or damage shall be paid within 30 days after proof of loss is received by
the insurer and ascertainment of the loss or damage is made either by agreement between the
insured and the insurer or by arbitration; but if such ascertainment is not paid or made within 60
days after such receipt by the insurer of the proof of loss, then the loss or damage shall be paid
within 90 days after such receipt. Refusal or failure to pay the loss or damage will entitle the
assured to collect interest on the proceeds of the policy for the duration of the delay at the rate of
twice the ceiling prescribed by the Monetary Board, unless such failure or refusal to pay is based
on the ground the claim is fraudulent.
If the insured has any right of recovery against another party, may he be
required to assign such right to the insurance company?
Yes, the company may require from the insured an assignment of all rights of recovery
against any party for loss to the extent that payment therefore is made by the
company.
Once a property is insured, must the insured inform the company of any
change of the description, occupation or construction of the property
insured.
The insured must inform the company of any change thereto, otherwise, the company

would be relieved from liability unless the insured before the occurrence of any loss or
damage obtained the sanction of the company signified by an endorsement upon the
policy.
What is the basis of the value of the insured property at the time of loss?
The actual cash value at the time of loss, that is, what it would cost to replace the
property.
Is it the duty of an agent to determine the value of the property insured
and the amount of insurance to be carried? Explain.
No, the value of the property should be determined by the insured, rather than the
agent. However, the agent should guard as far as possible against over insurance and
should check the amount of insurance in relation to the actual value with the insured.
What are the effects of non-payment of premium?
Forfeiture of all rights under the policy.
What is Compulsory Motor Vehicle Liability Insurance?
The Insurance Code (as amended) requires this coverage for the registration of motor
vehicles. This insurance covers passengers or third parties who may be killed or
injured as a result of accidents arising from the use of operation of such vehicles. The
maximum amount of benefit under this policy is P100,000.00
What is the meaning of Authorized Driver in a motor vehicle policy?
An authorized driver within the meaning of the policy is any of the following:
+ The insured; or
+ Any person driving on the Insureds order or with his permission.
What is the purpose of the errors and omissions insurance policy
(professional liability or professional indemnity policy) required of insurance
or reinsurance broker before a license could be issued.
To indemnify the applicant against any claim for breach of duty as insurance broker or
reinsurance broker, as the case may be, which may be available against such
applicant by reason of any negligent act, error or omission.

What do you understand by the no fault claim?

An insurance company issuing the cover shall pay any claim for death or bodily
injuries sustained by a passenger or third party without the necessity of proving fault
or negligence of any kind. Immediate payment shall be made provided that the total
indemnity shall not exceed P10,000.00 upon presentation of the following proofs of
loss, namely:
1. police report of accident, and
2. death certificate and evidence sufficient to establish the proper payee, or medical
report and evidence of medical or hospital disbursement in respect of which refund is
being claimed.
Does the no fault claim apply to claims on property wherein the
insurance company is under obligation to make payment immediately?
No, because the no fault claim applies only to death or bodily injuries and does not
respond to claims for third party property damage.