Asia Insurance Review
Operators of public utility vehicles will soon pay cheaper insurance premiums for passenger insurance coverage while there will also be an increase in insurance benefits accorded to dependents of victims of fatal road accidents.
These measures follow a decision by the Quezon City regional trial court to uphold the Department of Transportation and Communications’ (DoTC) initiative to institute reforms in the Passengers Personal Accident Insurance Programme of the Land Transportation Franchising and Regulatory Board (LTFRB).
The court dismissed a petition for a temporary restraining order against LTFRB’s move to open up accreditation for providers of passenger insurance service from two to five insurers. Prior to the decision, the industry was dominated by only two players— PAMI for those registering odd-numbered plates and by UNITRANS, even-numbered plates.
LTFRB chairman, Mr Jaime Jacob, will now move forward to open up insurance coverage. He has been talking with eight insurance companies who are willing to compete for the right to provide cover. He says that the new insurance terms will require the five accredited insurance players to offer an “all risk, no fault” insurance policy. This policy ensures that any passenger who meets with an accident will be paid by a PUV operator regardless of who is at fault in an accident.
“We have set a maximum premium and minimum benefit for the accreditation process. Those applying for accreditation will now compete in order to bring down the premium and raise the benefit,” says Mr Jacob.
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