Napocor saves P50-M in insurance premiums

The National Power Corp. (Napocor) announced yesterday that it has saved some P50 million by bidding out its insurance requirements for 2004-2005 through the inter-agency Joint Bidding Committee.

Napocor senior vice president for corporate services Roland S. Quilala said bulk of the savings were realized from the state-owned power firm’s Industrial All-Risks (IAR) insurance policy, which cost $14.1 million this year.

The Napocor official said this was considerably lower than the $14.7-million premium Napocor paid for its IAR in 2003.

The Government Service Insurance System (GSIS) had assumed 50 percent of Napocor’s IAR insurance policy.

The other 50 percent was assumed by leading Filipino insurance company Malayan Insurance Co. Inc. of the Yuchengco group.

Quilala, who is an alternate member of the four-man JBC, said Napocor was able to negotiate a lower price for its IAR after the committee sought tenders for its insurance requirements.

"As a rule, our IAR costs go up every year, because this policy covers Napocor assets (the power plants, the substations, various buildings, and machinery and equipment) which naturally depreciate every year. But through the JBC, we were able to get a very competitive price for our IAR insurance policy this year," he said.

On top of the lower price, Napocor was able to secure three additional insurance covers that were not included in last year’s IAR policy.

These new modules, Quilala said, pertain to sabotage and terrorism; submarine cables; and marine hull for power barges.

The JBC is made up of the Department of Finance, Napocor, GSIS and the Department of Energy. The panel is chaired by Finance Secretary Juanita Amatong, with Finance Undersecretary Inocencio P. Ferrer Jr. as alternate chairman.