GSIS ready to implement new CTPL system - Garcia

Winston Garcia, president and general manager of the Government Service Insurance System (GSIS), said the government is ready to implement the new compulsory third party liability (CTPL) system for motor vehicles.

“We are proceeding with this. We are already pilot-testing in Metro Manila and we will implement this by January,” Garcia told reporters.

The Court of Appeals issued last July a temporary restraining order (TRO) against the implementation of the new CTPL system for motor vehicles. The TRO expired last month.

The CTPL insurance is a mandatory insurance for all owners of motor vehicles. It carries a P100,000 cover for death or injuries that may result from vehicular accidents. Costing P560 for private cars, a CTPL may be a small sum but since there are 5.5 million vehicles in the country today, the business reaches more than P3.5 billion every year.

In an order issued last year, the Department of Transportation and Communications (DOTC) required the automatic issuance of CTPL insurance policies by LTO District Offices.

Under the plan, GSIS, through publicly listed insurance firm National Reinsurance Corp. of the Philippines, would provide the insurance coverage. GSIS has a stake in National Reinsurance Corp. The new system effectively removes the CTPL business from private insurance companies.

The GSIS had planned to start its integrated CTPL system at the LTO on Aug. 1.

Garcia noted that while there are 5.5 million registered vehicles, there are only 1.8 million vehicles with CTPL.

He said the rest of the registered vehicles have fake CTPLs.

The Philippine Insurers and Reinsurers Association (PIRA), a group of roughly 90 insurance companies are opposed to the proposed new CTPL system.

They said the scheme would allow GSIS to monopolize the CTPL insurance of 5.5 million motor vehicles, a business which generates more than P3.5 billion yearly.