House leaders propose to amend Insurance Code

By Charissa Luci-Atienza

The leadership of the House of Representatives is proposing to amend certain sections of the country's Insurance Code to cover loss due to terrorist and rebellion attacks.

House Majority Leader and Ilocos Norte Rep. Rodolfo “Rudy” Fariñas (left), and Speaker Pantaleon “Bebot” Alvarez (MANILA BULLETIN) House Majority Leader and Ilocos Norte Rep. Rodolfo “Rudy” Fariñas (left), and Speaker Pantaleon “Bebot” Alvarez

Speaker Pantaleon Alvarez and House Majority Floor Leader Rodolfo Fariñas sought to amend Sections 101 (A) (1) and Section 169 of the Presidential Decree 612, otherwise known as the Insurance Code, as amended by Republic Act 10607.

They lament that uncertainty and risk negatively affect investments which create jobs for the people and improve their standards of living especially in Mindanao where four out of five poorest regions in the Philippines are located.

"The siege of Marawi City on May 23, 2017, for example, besides causing damage to infrastructure and agriculture estimated to cost P11.6 billion, came at a price of loss of opportunity estimated at P6.6 billion, " Alvarez said.

He noted in 2017 alone, the Armed Forces of the Philippines (AFP) recorded 56 cases of arson committed by the New People's Army in Mindanao, destroying property worth at least P224.6 million.

"Unsurprisingly, the investments in Mindanao in the first half of 2017 dropped by 63 percent to P6.87 billion from P18.42 billion the same period the previous year, " the House chief said.

The House leaders filed House Bill 7492 seeking to include acts of rebellion and terrorism as among the conditions which shall be covered by marine and fire insurance.

"This will provide a safety net that would reduce risk and create an atmosphere of greater certainty necessary for investments, economic growth and improved welfare for our people," they said.

Marine insurance includes insurance against loss or damage to vessels, craft, aircraft, vehicles, goods, freights, cargoes, merchandise, effects, disbursements, profits, moneys, securities, choses in action, instruments of debts, valuable papers, bottomry, and respondentia interests and all other kinds of property and interests therein, in respect to appertaining to or in connection with any and all risks or perils of navigation, transit or transportation, or while being assembled, packed, crafted, baled, compressed or similarly prepared for shipment or while awaiting shipment, or during any delays, storage, transshipment, or reshipment incident thereto, including war, rebellion and terrorism risks, marine builder's risks and all personal property floater risks, the bill said.

House Bill 7492 also provides that the term fire insurance shall include insurance against loss by fire, lightning, windstorm, tornado or earthquake, acts of rebellion or terrorism and other allied risks, when such risks are covered by extension to fire insurance policies or under separate policies.

"An increase of terrorist and rebellion activity results in a greater exposure of our countrymen to various forms of threats resulting in death, destruction of property, and disruption of livelihood. Therefore, steps must be taken in order to ensure the safety and security of our people and their interests, " Alvarez and Fariñas said.