Press Release
November 16, 2018


The insurance coverage of public utility vehicles (PUVs) will extend past its expiration on Nov. 18 for the protection of the riding public, Sen. Grace Poe said.

A few days before the insurance cover of buses and jeepneys lapsed, Poe said the Insurance Commission (IC) issued Circular Letter 2018-59 dated Nov. 15 that effectively implements a status quo on the Passenger Personal Accident Insurance (PPAI). This covers passengers, drivers and conductors of PUVs involved in vehicular accidents.

Poe's office sought the attention of the Insurance Commission after receiving reports on the matter from concerned transport groups.

"Kamakailan lang, idinulog sa aking tanggapan ang tungkol sa pagtatapos ng bisa ng accreditation ng mga insurance providers ng milyun-milyong pasahero. Fortunately, the Insurance Commission immediately acted by hearing out the concerns of the riding public and the transport sector. Isang malaking pasasalamat sa agarang pagtugon ng Insurance Commission sa isyung ito," Poe, chair of the committee on public services, said.

Without the IC circular, transport owners or operators would have to pay the passenger claims and damages in the event of an accident, Poe explained.

The existing insurance providers shall continue to provide insurance coverage on a hold-over capacity until after the IC issues the necessary regulation.

Under the circular signed by Insurance Commissioner Dennis Funa, insurance coverage is also doubled for victims of vehicular accidents. For example, death benefit has increased to P400,000 while total disability is now at P200,000. Other benefits covering passenger injuries and accidents have also been doubled.

New premium rates shall be: P5,120 (Metro Manila buses); P6,670 (provincial buses); P3,010 (AUV); P2,910 (jeep); P2,510 (sedan); and P1,655 (trucks).

The PPAI Program has been handled by the Land Transportation Franchising and Regulatory Board (LTFRB) since its inception in 1999.

A public consultation was held last Oct. 25, 2017 to discuss the clamor of transport groups to increase the benefits of the PPAI program. The IC, in its letter dated Nov. 27, 2017, endorsed the matter to the LTFRB as the government agency tasked with implementing the PPAI program.

The Department of Transportation, however, issued Department Order No. 2018-020 last August transferring the assessment, evaluation and accreditation of insurance companies under the "sole and exclusive authority" of the IC.

The IC said the "first time" it was informed about the Department Order was during a congressional hearing sometime September 2018.

"With the impending expiration of the accreditation of insurance providers with the LTFRB on Nov. 17, 2018…the IC is placed in a bind as to what system to put in place given the short period of time before the expiration of the existing program on Nov. 17, 2018. It is noted that there are conflicting proposals as to the manner in which this Commission should assess and evaluate the qualifications and requirements of insurance providers," the IC said in the circular.

Poe said: "Despite the unity of insurers and insured alike, as well as transport groups and commuters, on their desire to continue the PPAI system in place, and even increase the benefits of passengers for accidental death, permanent disability, among others, the LTFRB had ignored their concerns. LTFRB had not acted for almost a year until the accreditation of the insurers was supposed to expire on Nov. 17."

"Clearly, government authorities and agencies can never go wrong if they truly listen to the concerns of the affected stakeholders. Dahil sa agarang pagtugon ng Insurance Commission, wala nang matatanggalan ng proteksyon ng passenger insurance simula sa Linggo, Nov. 18," Poe added.

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