GSIS says its CTPL proposal based on merit

The Government Service Insurance System (GSIS) said yesterday its proposal to provide compulsory third party liability (CTPL) insurance cover for all motor vehicles is based on merit.

GSIS president and general manager Winston Garcia said their CTPL proposal is very simple, practical and beneficial to the government and the general public compared with the proposals from private insurers.

The proposal is pending before the Department of Transportation and Communications (DOTC).

"We firmly believe that our proposal is the superior plan, and that the DOTC will decide based on the merits," Garcia said, adding "we do not need to resort to personal attacks and dirty propaganda to clinch this deal."

The GSIS chief said he hopes that Insurance Commissioner Evangeline Escobillo, being an insurance industry regulator, will not take sides on the CTPL issue.

Under the GSIS proposal, motor vehicle owners will no longer be required to acquire CTPL coverage from third party vendors who are currently proliferating in the vicinity of the various Land Transportation Offices nationwide. The registrants only need to pay the CTPL premium directly to LTO counter as part of the registration process.

"This is a lot easier than going out of your way to get a CTPL policy elsewhere, or going to the bank to pay for the premium. Under the proposal, the CTPL payment will be reflected in the same receipt as the vehicle registration fee," Garcia said.

According to Garcia, it came up with its CTPL proposal to eliminate the proliferation of fake CTPL policies that have long been the subject of complaints by motorists who could not claim from the supposed policy issuers after their vehicles figure in accidents.

"The fake policies also cost the government billions of pesos in revenues since the premiums paid on them are never reported for tax purposes," Garcia said.

It is estimated that government loses some P300 million in revenues annually die to fake CTPL policies.

The proposal of the Private Insurers and Reinsurers Association, on the other hand, calls for the creation of a so-called Compulsory Insurance Processing Center Corp. (CIPCC) that will act as a clearinghouse to determine the authenticity of CTPL policies.

The registrants will then pay for their policies in designated banks and present their receipts to the LTO before their vehicles are registered. This would further lengthen to red tape in registering vehicles, critics say.