HOPES RISE THAT PHILIPPINES MOTOR INSURANCE ROW MAY BE SOLVED

An ongoing dispute between the Philippines Government Service Insurance System (GSIS) and the private insurance sector, relating to how the country’s mandatory motor insurance sector should operate, looked closer to resolution yesterday after the government stated that it was shelving an order that would have permitted the state pension fund to gain effective control over the country’s third-party motor insurance sector. The dispute arose amidst a consensus that the increasing number of fake motor insurance documents in the country needed to be reduced, with the private sector arguing that the governmental “solution” amounted to a nationalisation of the mandatory third-party cover sector. The government has now backed down from its previous edict, which would have linked all policies to the Land Transportation Office and tied the issuance to the GSIS. Instead it has issued an interim order under which the issuance of third-party policies remains with private insurers, while the clearing house for the authentication of these policies will be operated by Stradcom — the main IT provider for the Land Transportation Office. Finance Secretary Margarito Teves called the temporary solution “a status quo” which would allow the differing parties time to come up with a more permanent compromise.