MANILA, Philippines - The Insurance Commission (IC) has warned National Life Insurance Co. (NLIC) to revert to its rehabilitation proceedings or face liquidation.
It is presently under an IC-appointed conservator.
It was issued a certificate of authority (CA) to operate but was disallowed to sell new policies due to its failure to meet the standard margin of solvency as well as address its nagging capital impairment.
NLIC has over P800-million worth of outstanding debts to BDO Unibank Inc., Philippine Business Bank, and three non-bank business entities.
It has liabilities worth over P3.2 billion and assets valued at P2.2 billion.
Last month, the IC cracked the whip on troubled pre-need company Prudential Plans Inc. (PPI), ordering its liquidation when it failed to inject fresh capital to its depleted trust funds during its state of rehabilitation.
The IC is the government agency tasked to oversee both the insurance and pre-need industries. The commission, in turn, falls under the direct supervision of the Department of Finance (DOF).
IC Commissioner Emmanuel V. Dooc said that after dozens of meetings with NLIC officials, it was agreed that they would infuse fresh capital to meet the standard margin of solvency as well as bring in an investor or buyer.
“Now I want them to fulfill their promise. I want to see them infuse fresh capital, and I want them to give the Commission and the DOF specific information in writing on how they will rehabilitate the company and name the alleged new investor,” Dooc said.
NLIC was suppose to infuse P100 million last October, based on a previous approved rehabilitation plan. It was to be followed by P100 million every year until it would meet the required minimum paid-up capital as mandated by the finance department.
As of presstime, they have not shown proof of infused capital, nor have NLIC been successful in luring in investors.
The besieged insurance company earlier asserted that it was in talks with BDO.
Yet NLIC officials, led by its president and chief executive officer Benjamin L. de Leon and vice president for sales Gerardo J. Cornejo, later admitted to the IC that BDO has withdrawn interest.
De Leon, however, claimed that they were in talks with another prospective investor.
In a formal letter last Nov. 6, De Leon asked for another 90-day extension to fulfill their promises.
But the IC was wondering what they could achieve during the 90-day extension period.
“Who can they lure as an investor if BDO, with all its money and aggressive nature, withdrew interest? Over the years, several groups had already taken a look at NLIC including the STI group,” private sector sources said.