CHAPTER VI

COMPULSORY MOTOR VEHICLE

LIABILITY INSURANCE
SEC. 386. For purposes of this chapter:
(a) Motor Vehicle is any vehicle as defined in Section 3, paragraph (a) of Republic Act No !"3#, other$ise %no$n as the
&'and (ransportation and (raffic )ode*
(b) Passenger is any fare paying person being transported and conveyed in and by a +otor vehicle for transportation of
passengers for co+pensation, including persons e,pressly authori-ed by la$ or by the vehicle*s operator or his agents to ride
$ithout fare
(c) Third party is any person other than a passenger as defined in this section and shall also e,clude a +e+ber of the
household, or a +e+ber of the fa+ily $ithin the second degree of consanguinity or affinity, of a +otor vehicle o$ner or land
transportation operator, as li%e$ise defined herein, or his e+ployee in respect of death, bodily in.ury, or da+age to property
arising out of and in the course of e+ploy+ent
(d) Owner or motor vehicle owner +eans the actual legal o$ner of a +otor vehicle, in $hose na+e such vehicle is duly
registered $ith the 'and (ransportation /ffice0
(e) Land transportation operator +eans the o$ner or o$ners of +otor vehicles for transportation of passengers for
co+pensation, including school buses
(f) Insurance policy or Policy refers to a contract of insurance against passenger and third1party liability for death or bodily
in.uries and da+age to property arising fro+ +otor vehicle accidents
SEC. 387. 2t shall be unla$ful for any land transportation operator or o$ner of a +otor vehicle to operate the sa+e in the
public high$ays unless there is in force in relation thereto a policy of insurance or guaranty in cash or surety bond issued in
accordance $ith the provisions of this chapter to inde+nify the death, bodily in.ury, and3or da+age to property of a third1
party or passenger, as the case +ay be, arising fro+ the use thereof
SEC. 388. (he )o++issioner shall furnish the 'and (ransportation /ffice $ith a list of insurance co+panies authori-ed to
issue the policy of insurance or surety bond re4uired by this chapter
SEC. 389 (he 'and (ransportation /ffice shall not allo$ the registration or rene$al of registration of any +otor vehicle
$ithout first re4uiring fro+ the land transportation operator or +otor vehicle o$ner concerned the presentation and filing of
a substantiating docu+entation in a for+ approved by the )o++issioner evidencing that the policy of insurance or guaranty
in cash or surety bond re4uired by this chapter is in effect
SEC. 390. 5very land transportation operator and every o$ner of a +otor vehicle shall, before applying for the registration
or rene$al of registration of any +otor vehicle, at his option, either secure an insurance policy or surety bond issued by any
insurance co+pany authori-ed by the )o++issioner or +a%e a cash deposit in such a+ount as herein re4uired as li+it of
liability for purposes specified in Section 367
(a) 2n the case of a land transportation operator, the insurance guaranty in cash or surety bond shall cover liability for death
or bodily in.uries of third1parties and3or passengers arising out of the use of such vehicle in the a+ount not less than ($elve
thousand pesos (8"9,:::::) per passenger or third1party and an a+ount, for each of such categories, in any one accident
of not less than that set forth in the follo$ing scale:
(") ;otor vehicles $ith an authori-ed capacity of t$enty1si, (9#) or +ore passengers: Fifty thousand pesos (8<:,:::::)0
(9) ;otor vehicles $ith an authori-ed capacity of fro+ t$elve ("9) to t$enty1five (9<) passengers: Forty thousand pesos
(8!:,:::::)0
(3) ;otor vehicles $ith an authori-ed capacity of fro+ si, (#) to eleven ("") passengers: (hirty thousand pesos
(83:,:::::)0
(!) ;otor vehicles $ith an authori-ed capacity of five (<) or less passengers: Five thousand pesos (8<,:::::) +ultiplied by
the authori-ed capacity
Provided, however, (hat such cash deposit +ade to, or surety bond posted $ith, the )o++issioner shall be resorted to by
hi+ in cases of accidents the inde+nities for $hich to third1parties and3or passengers are not settled accordingly by the land
transportation operator and, in that event, the said cash deposit shall be replenished or such surety bond shall be restored
$ithin si,ty (#:) days after i+pair+ent or e,piry, as the case +ay be, by such land transportation operator, other$ise, he
shall secure the insurance policy re4uired by this chapter (he aforesaid cash deposit +ay be invested by the )o++issioner
in readily +ar%etable govern+ent bonds, and3or securities
(b) 2n the case of an o$ner of a +otor vehicle, the insurance or guaranty in cash or surety bond shall cover liability for
death or in.ury to third1parties in an a+ount not less than that set forth in the follo$ing scale in any one accident:
(") 8rivate )ars
(i) =anta+: ($enty thousand pesos (89:,:::::)0
(ii) 'ight: ($enty thousand pesos (89:,:::::)0 and
(iii) >eavy: (hirty thousand pesos (83:,:::::)
(9) /ther 8rivate ?ehicles
(i) (ricycles, +otorcycles and scooters: ($elve thousand pesos (8"9,:::::)0
(ii) ?ehicles $ith an unladen $eight of 9,#:: %ilos or less: ($enty thousand pesos (89:,:::::)0
(iii) ?ehicles $ith an unladen $eight of bet$een 9,#:" %ilos and 3,@3: %ilos: (hirty thousand pesos (83:,:::::)0 and
(iv) ?ehicles $ith an unladen $eight over 3,@3: %ilos: Fifty thousand pesos (8<:,:::::)
(he )o++issioner +ay, if $arranted, set forth schedule of inde+nities for the pay+ent of clai+s for death or bodily in.uries
$ith the coverages set forth herein
SEC. 391 Any clai+ for death or in.ury to any passenger or third1party pursuant to the provisions of this chapter shall be
paid $ithout the necessity of proving fault or negligence of any %ind: Provided, (hat for purposes of this section:
(a) (he total inde+nity in respect of any person shall not be less than Fifteen thousand pesos (8"<,:::::)0
(b) (he follo$ing proofs of loss, $hen sub+itted under oath, shall be sufficient evidence to substantiate the clai+:
(") 8olice report of accident0 and
(9) Aeath certificate and evidence sufficient to establish the proper payee0 or
(3) ;edical report and evidence of +edical or hospital disburse+ent in respect of $hich refund is clai+ed0
(c) )lai+ +ay be +ade against one +otor vehicle only 2n the case of an occupant of a vehicle, clai+, shall lie against the
insurer of the vehicle in $hich the occupant is riding, +ounting or dis+ounting fro+ 2n any other case, clai+ shall lie against
the insurer of the directly offending vehicle 2n all cases, the right of the party paying the clai+ to recover against the o$ner
of the vehicle responsible for the accident shall be +aintained
SEC. 392. No land transportation operator or o$ner of +otor vehicle shall be unreasonably denied the policy of insurance
or surety bond re4uired by this chapter by the insurance co+panies authori-ed to issue the sa+e, other$ise, the 'and
(ransportation /ffice shall re4uire fro+ said land transportation operator or o$ner of the vehicle, in lieu of a policy of
insurance or surety bond, a certificate that a cash deposit has been +ade $ith the )o++issioner in such a+ount re4uired as
li+its of inde+nity in Section 3@: to ans$er for the passenger and3or third1party liability of such land transportation operator
or o$ner of the vehicle
No insurance co+pany +ay issue the policy of insurance or surety bond re4uired under this chapter unless so authori-ed
under e,isting la$s
(he authority to engage in the casualty and3or surety lines of business of an insurance co+pany that refuses to issue or
rene$, $ithout .ust cause, the insurance policy or surety bond therein re4uired shall be $ithdra$n i++ediately
SEC. 393. No cancellation of the policy shall be valid unless $ritten notice thereof is given to the land transportation
operator or o$ner of the vehicle and to the 'and (ransportation /ffice at least fifteen ("<) days prior to the intended
effective date thereof Bpon receipt of such notice, the 'and (ransportation /ffice, unless it receives evidence of a ne$ valid
insurance or guaranty in cash or surety bond as prescribed in this chapter, or an endorse+ent of revival of the cancelled one,
shall order the i++ediate confiscation of the plates of the +otor vehicle covered by such cancelled policy (he sa+e +ay be
reissued only upon presentation of a ne$ insurance policy or that a guaranty in cash or surety bond has been +ade or posted
$ith the )o++issioner and $hich +eets the re4uire+ents of this chapter, or an endorse+ent or revival of the cancelled one
SEC. 394 2f the cancellation of the policy or surety bond is conte+plated by the land transportation operator or o$ner of
the vehicle, he shall, before the policy or surety bond ceases to be effective, secure a si+ilar policy of insurance or surety
bond to replace the policy or surety bond to be cancelled or +a%e a cash deposit in sufficient a+ount $ith the )o++issioner,
and $ithout any gap, file the re4uired docu+entation $ith the 'and (ransportation /ffice, and notify the insurance co+pany
concerned of the cancellation of its policy or surety bond
SEC. 395 2n case of change of o$ner ship of a +otor vehicle, or change of the engine of an insured vehicle, there shall be
no need of issuing a ne$ policy until the ne,t date of registration or rene$al of registration of such vehicle, and: Provided,
(hat the insurance co+pany shall agree to continue the policy, such change of o$nership or such change of the engine shall
be indicated in a corresponding endorse+ent by the insurance co+pany concerned, and a signed duplicate of such
endorse+ent shall, $ithin a reasonable ti+e, be filed $ith the 'and (ransportation /ffice
SEC. 396. 2n the settle+ent and pay+ent of clai+s, the inde+nity shall not be availed of by any accident victi+ or clai+ant
as an instru+ent of enrich+ent by reason of an accident, but as an assistance or restitution insofar as can fairly be
ascertained
SEC. 397. Any person having any clai+ upon the policy issued pursuant to this chapter shall, $ithout any unnecessary
delay, present to the insurance co+pany concerned a $ritten notice of clai+ setting forth the nature, e,tent and duration of
the in.uries sustained as certified by a duly licensed physician Notice of clai+ +ust be filed $ithin si, (#) +onths fro+ the
date of accident, other$ise, the clai+ shall be dee+ed $aived Action or suit for recovery of da+age due to loss or in.ury
+ust be brought, in proper cases, $ith the )o++issioner or the courts $ithin one (") year fro+ denial of the clai+,
other$ise, the clai+ant*s right of action shall prescribe
SEC. 398 (he insurance co+pany concerned shall forth$ith ascertain the truth and e,tent of the clai+ and +a%e pay+ent
$ithin five (<) $or%ing days after reaching an agree+ent 2f no agree+ent is reached, the insurance co+pany shall pay only
the no1fault inde+nity provided in Section 3@" $ithout pre.udice to the clai+ant fro+ pursuing his clai+ further, in $hich
case, he shall not be re4uired or co+pelled by the insurance co+pany to e,ecute any 4uit clai+ or docu+ent releasing it
fro+ liability under the policy of insurance or surety bond issued
2n case of any dispute in the enforce+ent of the provisions of any policy issued pursuant to this chapter, the ad.udication of
such dispute shall be $ithin the original and e,clusive .urisdiction of the )o++issioner, sub.ect to the li+itations provided in
Section !3@
SEC. 399 2t shall be unla$ful for a land transportation operator or o$ner of +otor vehicle to re4uire his or its drivers or
other e+ployees to contribute in the pay+ent of pre+iu+s
SEC. 400. No govern+ent office or agency having the duty of i+ple+enting the provisions of this chapter nor any official or
e+ployee thereof shall act as agent in procuring the insurance policy or surety bond provided for herein (he co++ission of
an agent procuring the said policy or bond shall in no case e,ceed ten percent (":C) of the a+ount of the pre+iu+s
therefor
SEC. 401. Any land transportation operator or o$ner of +otor vehicle or any other person violating any of the provisions of
the preceding sections shall be punished by a fine of not less than Five hundred pesos (8<::::) and3or i+prison+ent for not
+ore than si, (#) +onths (he violation of Section 3@: by a land transportation operator shall be a sufficient cause for the
revocation of the certificate of public convenience issued by the 'and (ransportation Franchising and Regulatory =oard
covering the vehicle concerned
SEC. 402 Dhenever any violation of the provisions of this chapter is co++itted by a corporation or association, or by a
govern+ent office or entity, the e,ecutive officer or officers of said corporation, association or govern+ent office or entity
$ho shall have %no$ingly per+itted, or failed to prevent, said violation shall be held liable as principals
CHAPTER VII
MUTUAL BENEFIT ASSOCIATIONS AN
TRUSTS FOR CHARITABLE USES
TITLE !
MUTUAL BENEFIT ASSOCIATIONS
SEC. 403. Any society, association or corporation, $ithout capital stoc%, for+ed or organi-ed not for profit but +ainly for
the purpose of paying sic% benefits to +e+bers, or of furnishing financial support to +e+bers $hile out of e+ploy+ent, or of
paying to relatives of deceased +e+bers of fi,ed or any su+ of +oney, irrespective of $hether such ai+ or purpose is
carried out by +eans of fi,ed dues or assess+ents collected regularly fro+ the +e+bers, or of providing, by the issuance of
certificates of insurance, pay+ent of its +e+bers of accident or life insurance benefits out of such fi,ed and regular dues or
assess+ents, but in no case shall include any society, association, or corporation $ith such +utual benefit features and $hich
shall be carried out purely fro+ voluntary contributions collected not regularly and3or no fi,ed a+ount fro+ $ho+soever
+ay contribute, shall be %no$n as a +utual benefit association $ithin the intent of this )ode
Any society, association, or corporation principally organi-ed as a labor union shall be governed by the 'abor )ode
not$ithstanding any +utual benefit feature provisions in its charter as incident to its organi-ation
2n no case shall a +utual benefit association be organi-ed and authori-ed to transact business as a charitable or benevolent
organi-ation, and $henever it has this feature as incident to its e,istence, the corresponding charter provision shall be
revised to confor+ $ith the provision of this section ;utual benefit association, already licensed to transact business as such
on the date this )ode beco+es effective, having charitable or benevolent feature shall abandon such incidental purpose upon
effectivity of this )ode if they desire to continue operating as such +utual benefit associations
SEC. 404. A +utual benefit association, before it +ay transact as such, +ust first secure a license fro+ the )o++issioner
(he application for such license shall be filed $ith the )o++issioner together $ith certified true copies of the articles of
incorporation or the constitution and byla$s of the association, and all a+end+ents thereto, and such other docu+ents or
testi+onies as the )o++issioner +ay re4uire
No license shall be granted to a +utual benefit association until the )o++issioner shall have been satisfied by such
e,a+ination as he +ay +a%e and such evidence as he +ay re4uire that the association is 4ualified under e,isting la$s to
operate and transact business as such (he )o++issioner +ay refuse to issue a license to any +utual benefit association if,
in his .udg+ent, such refusal $ill best pro+ote the interest of the +e+bers of such association and of the people of this
country Any license issued shall e,pire on the last day of Aece+ber of the third year follo$ing its issuance and, upon proper
application, +ay be rene$ed if the association is continuing to co+ply $ith e,isting la$s, rules and regulations, orders,
instructions, rulings and decisions of the )o++issioner 5very association receiving any such license shall be sub.ect to the
supervision of the )o++issioner: Provided, (hat no such license shall be granted to any such association if such association
has no actuary
SEC. 405. No +utual benefit association shall be issued a license to operate as such unless it has constituted and
established a Euaranty Fund by depositing $ith the )o++issioner an initial +ini+u+ a+ount of Five +illion pesos
(8<,:::,:::::) in cash, or in govern+ent securities $ith a total value e4ual to such a+ount, to ans$er for any valid benefit
clai+ of any of its +e+bers
All +oneys received by the )o++issioner for this purpose +ust be deposited by hi+ in interest1bearing deposits $ith any
ban% or ban%s authori-ed to transact business in the 8hilippines for the account of the particular association constituting the
Euaranty Fund
Any accrual to such fund, be it interest earned or dividend additions on +oneys or securities so deposited, +ay, $ith the
prior approval of the )o++issioner, be $ithdra$n by the association if there is no pending benefit clai+ against it, including
interest thereon or dividend additions thereto
(he )o++issioner, prior to or after licensing a +utual benefit association, +ay re4uire such association to increase its
Euaranty Fund fro+ the initial +ini+u+ a+ount re4uired to an a+ount e4ual to the capital invest+ent re4uired of an
e,isting do+estic insurance co+pany under Section 9:@ of this )ode
SEC. 406 5very +utual benefit association licensed to do business as such shall issue +e+bership certificates to its
+e+bers specifying the benefits to $hich such +e+bers are entitled
Such certificates, together $ith the articles of incorporation of the association or its constitution and byla$s, and all e,isting
la$s as +ay be pertinent shall constitute the agree+ent, as of the date of its issuance, bet$een the association and the
+e+ber (he +e+bership certificate shall be in a for+ previously approved by the )o++issioner
SEC. 407. A +utual benefit association +ay, by reinsurance agree+ent, cede in $hole or in part any individual ris% or ris%s
under certificates of insurance issued by it, only to a life insurance co+pany authori-ed to transact business or to a
professional reinsurer authori-ed to accept life ris%s in the 8hilippines: Provided, (hat a copy of the draft of such reinsurance
agree+ent shall be sub+itted to the )o++issioner for his approval (he association +ay ta%e credit for the reserves on such
ceded ris%s to the e,tent reinsured
SEC. 408. (he constitution or byla$s of a +utual benefit association +ust distinctly state the purpose for $hich dues
and3or assess+ents are +ade and collected and the portion thereof $hich +ay be used for e,penses
Aeath benefit and other relief funds shall be created and used e,clusively for paying benefits due the +e+bers under their
respective +e+bership certificates A general fund shall li%e$ise be created and used for e,penses of ad+inistration of the
association
A +utual benefit association shall only +aintain free and unassigned surplus of not +ore than t$enty percent (9:C) of its
total liabilities as verified by the )o++issioner Any a+ount in e,cess shall be returned to the +e+bers by $ay of dividends,
enhancing the e4uity value or providing benefits in %ind and other relevant services 2n addition, sub.ect to the approval of
the )o++issioner, a +utual benefit association +ay allocate a portion for capacity building and research and develop+ent
such as developing ne$ products and services, upgrading and i+proving operating syste+s and e4uip+ent and continuing
+e+ber education
SEC. 409 5very outstanding +e+bership certificate +ust have an e4uity value e4uivalent to at least fifty percent (<:C) of
the total contributions collected thereon (he e4uity value only applies to basic life insurance product and e,cludes optional
products
SEC. 410 5very +utual benefit association +ust accu+ulate and +aintain, out of the periodic dues collected fro+ its
+e+bers, sufficient reserves for the pay+ent of clai+s or obligations for $hich it shall hold funds in securities satisfactory to
the )o++issioner consisting of bonds of the Eovern+ent of the 8hilippines, or any of its political subdivisions and
instru+entalities, or in such other good securities as +ay be approved by the )o++issioner
(he reserve liability shall be established in accordance $ith actuarial procedures and shall be approved by the
)o++issioner
(he articles of incorporation or the constitution and byla$s of a +utual benefit association +ust provide that if its reserve as
to all or any class of certificates beco+es i+paired, its board of directors or trustees +ay re4uire that there shall be paid by
the +e+bers to the association the a+ount of the +e+bers* e4uitable proportion of such deficiency as ascertained by said
board and that if the pay+ent be not +ade it shall stand as an indebtedness against the +e+bership certificates of the
defaulting +e+bers and dra$ interest not to e,ceed five percent (<C) per annu+ co+pounded annually
SEC. 411 A +utual benefit association +ay invest such portion of its funds as shall not be re4uired to +eet pending clai+s
and other obligations in any of the classes of invest+ents or types of securities in $hich life insurance co+panies doing
business in the 8hilippines +ay invest
2t +ay also grant loans to +e+bers on the security of a pledge or chattel +ortgage of personal properties of the borro$ers,
or in the absence thereof, on the security of the +e+bership certificate of the borro$ing +e+bers, in $hich event such loan
shall beco+e a first lien on the proceeds thereof
SEC. 412 (he )o++issioner or any of his duly designated representatives, shall have the po$er of visitation, audit and
e,a+ination into the affairs, financial condition, and +ethods of doing business of all +utual benefit associations, and he
shall cause such e,a+ination to be +ade at least once every t$o (9) years or $henever it +ay be dee+ed proper and
necessary Free access to the boo%s, records and docu+ents of the association shall be accorded to the )o++issioner, or to
his representatives, in such +anner that the )o++issioner or his representatives +ay readily verify or deter+ine the true
affairs, financial condition, and +ethod of doing business of such association 2n the course of such e,a+ination, the
)o++issioner or his duly designated representatives shall have authority to ad+inister oaths and ta%e testi+ony or other
evidence on any +atter relating to the affairs of the association
All +inutes of the proceedings of the board of directors or trustees of the association, and those of the regular or special
+eetings of the +e+bers, shall be ta%en, and a copy thereof, in 5nglish or in 8ilipino, shall be sub+itted to the
)o++issioner*s representatives or e,a+iners in the course of such e,a+ination
A copy of the findings of such e,a+ination, together $ith the reco++endations of the )o++issioner, shall be furnished the
association for its infor+ation and co+pliance, and the sa+e shall be ta%en up i++ediately in the +eetings of the board of
directors or trustees and of the +e+bers of the association
SEC. 413 5very +utual benefit association shall, annually on or before the thirtieth day of April of each year, render to the
)o++issioner an annual state+ent in such for+ and detail as +ay be prescribed by the )o++issioner, signed and s$orn to
by the president, secretary, treasurer, and actuary of the association, sho$ing the e,act condition of its affairs on the
preceding thirty1first day of Aece+ber
SEC. 414 No +oney, aid or benefit to be paid, provided or tendered by any +utual benefit association, shall be liable to
attach+ent, garnish+ent, or other process, or be sei-ed, ta%en, appropriated, or applied by any legal or e4uitable process to
pay any debt or liability of a +e+ber or beneficiary, or any other person $ho +ay have a right thereunder, either before or
after pay+ent
SEC. 415 Any +e+ber of a +utual benefit association shall have the right at all ti+es to change the beneficiary or
beneficiaries or add another beneficiary or other beneficiaries in accordance $ith the rules and regulations of the association
unless he has e,pressly $aived this right in the +e+bership certificate 5very association +ay, under such rules as it +ay
adopt, li+it the scope of beneficiaries and provide that no beneficiary shall have or obtain any vested interest in the proceeds
of any certificate until the certificate has beco+e due and payable under the ter+s of the +e+bership certificate
SEC. 416 Any chapter affiliate independently licensed as a +utual benefit association +ay consolidate or +erge $ith any
other si+ilar chapter affiliate or $ith the +other association
SEC. 417 Any +utual benefit association +ay be converted into and licensed as a +utual life insurance co+pany by
co+plying $ith the re4uire+ents of the pertinent provisions of this )ode and sub+itting the specific plan for such conversion
to the )o++issioner for his approval Such plan, as approved, shall then be sub+itted to the +e+bers either in the regular
+eeting or in a special +eeting called for the purpose for their adoption (he affir+ative vote of at least t$o1thirds (933) of
all the +e+bers shall be necessary in order to consider such plan as adopted
No such conversion shall ta%e effect unless and until approved by the )o++issioner
SEC. 418 No +utual benefit association shall be dissolved $ithout first notifying the )o++issioner and furnishing hi+ $ith
a certified copy of the resolution authori-ing the dissolution, duly adopted by the affir+ative vote of t$o1thirds (933) of the
+e+bers at a +eeting called for that purpose, the financial state+ents as of the date of the resolution, and such other
papers or docu+ents as +ay be re4uired by the )o++issioner
No dissolution shall proceed until and unless approved by the )o++issioner and all proceedings in connection there$ith
shall be $itnessed and attested by his duly designated representative
No +utual benefit association shall be officially declared as dissolved until after the )o++issioner so certifies that all
outstanding clai+s against the association have been duly settled and li4uidated
SEC. 419 (he )o++issioner shall, after notice and hearing, have the po$er either to suspend or revo%e the license issued
to a +utual benefit association if he finds that the association has:
(a) Failed to co+ply $ith any provision of this )ode0
(b) Failed to co+ply $ith any other la$ or regulation obligatory upon it0
(c) Failed to co+ply $ith any order, ruling, instruction, re4uire+ent or reco++endation of the )o++issioner0
(d) 5,ceeded its po$er to the pre.udice of its +e+bers0
(e) )onducted its business fraudulently or ha-ardously0
(f) Rendered its affairs and condition to one of insolvency0 or
(g) Failed to carry out its ai+s and purposes for $hich it $as organi-ed due to any cause
After receipt of the order fro+ the )o++issioner suspending or revo%ing the license, the association +ust i++ediately
e,ert efforts to re+ove such cause or causes $hich brought about the order and, upon proper sho$ing, +ay apply $ith the
)o++issioner for the lifting of the order and restoration or revival of the license so revo%ed or suspended
SEC. 420 For failure to re+ove such cause or causes $hich brought about the suspension or revocation of the license of a
+utual benefit association, the )o++issioner shall apply under this )ode for an order fro+ the proper court to li4uidate such
association
(he provisions of (itles "! and "<, )hapter 222, pertaining to the appoint+ent of a conservator and proceedings upon
insolvency of an insurance co+pany shall, insofar as practicable, apply to +utual benefit associations
SEC. 421 (o secure the enforce+ent of any provision under this title, the )o++issioner +ay issue such rules, rulings,
instructions, orders and circulars
SEC. 422 (he violation of any provision of this title shall sub.ect the person violating or the officer of the association
responsible therefor to a fine of not less than (en thousand pesos (8":,:::::), or i+prison+ent of not e,ceeding three (3)
years, or both such fine and i+prison+ent, at the discretion of the court
SEC. 423 All provisions of this )ode governing life insurance co+panies and such other provisions $henever practicable
and necessary, shall be applicable to +utual benefit associations
TITLE 2
TRUSTS FOR CHARITABLE USES
SEC. 424 (he ter+ trust for charitable uses, $ithin the intent of this )ode, shall include, all the real or personal properties
or funds, as $ell as those ac4uired $ith the fruits or inco+e therefro+ or in e,change or substitution thereof, given to or
received by any person, corporation, association, foundation, or entity, e,cept the National Eovern+ent, its instru+entalities
or political subdivisions, for charitable, benevolent, educational, pious, religious, or other uses for the benefit of the public at
large or a particular portion thereof or for the benefit of an indefinite nu+ber of persons
SEC. 425 (he ter+ trustee shall include any individual, corporation, association, foundation, or entity, e,cept the National
Eovern+ent, its instru+entalities or political subdivisions, in charge of, or acting for, or concerned $ith the ad+inistration of,
the trust referred to in the section i++ediately preceding and $ith the proper application of trust property
SEC. 426 (he ter+ trust property shall include all real or personal properties or funds pertaining to the trust as $ell as
those ac4uired $ith the fruits or inco+e therefro+ or in e,change or substitution thereof
SEC. 427 All trustees shall, before entering in the perfor+ance of the duties of their trust, obtain a certificate of
registration fro+ the )o++issioner (he registration shall e,pire on Aece+ber 3" of the third year follo$ing its issuance
unless it is rene$ed
All provisions of this )ode governing +utual benefit associations and such other provisions herein, $henever practicable and
necessary, shall be applicable to trusts for charitable uses
SEC. 428 (he treasurer of a charitable trust shall file a fidelity bond in the a+ount co++ensurate $ith the value of the
trust property in his custody, as +ay be deter+ined by the )o++issioner
CHAPTER VIII
TRUST BUSINESS IN "ENERAL
SEC. 429 An insurance co+pany +ay engage in li+ited trust business, consisting of +anaging funds pertaining only to
retire+ent and pre1need plans, provided it has secured a license to do so fro+ the =ang%o Sentral ng 8ilipinas (his trust
business shall be separate and distinct fro+ the general business of the insurance co+pany and shall be sub.ect to rules and
regulations as +ay be pro+ulgated by the =ang%o Sentral ng 8ilipinas in consultation $ith the )o++issioner
CHAPTER I#
RE"ISTRATION$ RESPONSIBILITIES AN
OVERSI"HT OF SELF%RE"ULATORY
OR"ANI&ATIONS
SEC 430 (he )o++issioner shall have the po$er to register as a self1regulatory organi-ation, or other$ise grant licenses,
and to regulate, supervise, e,a+ine, suspend or other$ise discontinue, as a condition for the operation of organi-ations
$hose operations are related to or connected $ith the insurance +ar%et such as, but not li+ited to, associations of insurance
co+panies, $hether life or non1life, reinsurers, actuaries, agents, bro%ers, dealers, +utual benefit associations, trusts, rating
agencies, and other persons regulated by the )o++issioner, $hich are engaged in the business regulated by this )ode
(he )o++issioner +ay prescribe rules and regulations $hich are necessary or appropriate in the public interest or for the
protection of investors to govern self1regulatory organi-ations and other organi-ations licensed or regulated pursuant to the
authority granted hereunder including, but not li+ited to, the re4uire+ent of cooperation $ithin and a+ong all participants in
the insurance +ar%et to ensure transparency and facilitate e,change of infor+ation
SEC. 431 An association cannot be registered as a self1regulatory organi-ation unless the )o++issioner deter+ines that:
(a) (he association is so organi-ed and has the capacity to be able to carry out the purposes of this )ode and to co+ply
$ith, and to enforce co+pliance by its +e+bers and persons associated $ith its +e+bers, $ith the provisions of this )ode,
the rules and regulations thereunder, and the rules of the association
(b) (he rules of the association, not$ithstanding anything in the )orporation )ode to the contrary, provide the follo$ing:
(") Fualifications and the dis4ualifications on +e+bership of the association0
(9) A fair representation of its +e+bers to serve on the board of directors of the association and the ad+inistration of its
affairs, and that any natural person associated $ith a .uridical entity that is a +e+ber shall also be dee+ed to be a +e+ber
for this purpose0
(3) (he president of the association and at least t$o (9) independent directors as +e+bers of the board of directors of the
association0
(!) 54uitable allocation of reasonable dues, fees, and other charges a+ong +e+bers and other persons using any facility or
syste+ $hich the association operates or controls0
(<) (he prevention of fraudulent and +anipulative acts and practices to protect the insuring public and the pro+otion of .ust
and e4uitable principles of business0
(#) ;e+bers and persons associated $ith its +e+bers sub.ect to discipline for violation of any provision of this )ode, the
rules or regulations thereunder, or the rules of the association0
(7) Fair procedure for the disciplining of +e+bers and persons associated $ith +e+bers0 and
(6) (he prohibition or li+itation of access to services offered by the association or a +e+ber thereof
SEC. 432 A self1regulatory organi-ation +ay e,a+ine and verify the 4ualifications of an applicant to beco+e a +e+ber in
accordance $ith procedures established by the rules of the association
A self1regulatory organi-ation shall deny +e+bership or condition the +e+bership of an entity, if it does not +eet the
standards of financial responsibility, operational capability, training, e,perience, or co+petence that are prescribed by the
rules of the association0 or has engaged, and there is a reasonable li%elihood it $ill again engage, in acts or practices
inconsistent $ith .ust and e4uitable principles of fair trade
A self1regulatory organi-ation +ay deny +e+bership to an entity not engaged in a type of business in $hich the rules of the
association re4uire +e+bers to be engaged
SEC. 433 Bpon the filing of an application for registration as a self1regulatory organi-ation under this title, the
)o++issioner shall have ninety (@:) days $ithin $hich to either grant registration or institute a proceeding to deter+ine
$hether registration should be denied 2n the event proceedings are instituted, the )o++issioner shall have t$o hundred
seventy (97:) days $ithin $hich to conclude such proceedings at $hich ti+e he shall, by order, grant or deny such
registration
SEC. 434 5very self1regulatory organi-ation shall co+ply $ith the provisions of this )ode, the rules and regulations
thereunder, and its o$n rules, and enforce co+pliance there$ith by its +e+bers, persons associated $ith its +e+bers or its
participants, not$ithstanding any provision of the )orporation )ode to the contrary
SEC. 435 5ach self1regulatory organi-ation shall sub+it to the )o++issioner for prior approval any proposed rule or
a+end+ent thereto, together $ith a concise state+ent of the reason and effect of the proposed a+end+ent
Dithin si,ty (#:) days after sub+ission of a proposed a+end+ent, the )o++issioner shall, by order, approve the proposed
a+end+ent /ther$ise, the sa+e +ay be +ade effective by the self1regulatory organi-ation
2n the event of an e+ergency re4uiring action for the protection of the insuring public, a self1regulatory organi-ation +ay
put a proposed a+end+ent into effect su++arily: Provided, however, (hat a copy of the sa+e shall be i++ediately
sub+itted to the )o++issioner
(he )o++issioner is further authori-ed, if after +a%ing appropriate re4uest in $riting to a self1regulatory organi-ation that
such organi-ation effect on its o$n behalf specified changes in its rules and practices and, after due notice and hearing, it
deter+ines that such changes have not been effected, and that such changes are necessary, by rule or regulation or by
order, +ay alter, abrogate or supple+ent the rules of such self1regulatory organi-ation insofar as necessary or appropriate to
effect such changes in respect of such +atters as:
(a) Safeguards in respect of the financial responsibility of +e+bers and ade4uate provision against the evasion of financial
responsibility through the use of corporate for+s or special partnerships0
(b) (he supervision of +ar%et practices0
(c) (he +anner, +ethod and place of soliciting business0
(d) (he fi,ing of reasonable rates of fees, interest, listing and other charges, but not rates of co++ission0 and self1
regulatory organi-ation0 and
(e) (he supervision, auditing and disciplining of +e+bers
2n addition to the general po$ers of the )o++issioner over the entities under supervision, the )o++issioner, after due
notice and hearing, is authori-ed, in the public interest and to protect the insuring public:
(") (o suspend for a period not e,ceeding t$elve ("9) +onths or to revo%e the registration of a self1regulatory organi-ation,
or to censure or i+pose li+itations on the activities, functions and operations of such self1regulatory organi-ation, if the
)o++ission finds that such a self1regulatory organi-ation has $illfully violated or is unable to co+ply $ith any provision of
this )ode or of the rules and regulations thereunder, or its o$n rules, or has failed to enforce co+pliance there$ith by a
+e+ber of, person associated $ith a +e+ber, or a participant in such self1regulatory organi-ation0
(9) (o e,pel fro+ a self1regulatory organi-ation any +e+ber thereof or any participant therein $ho is found to have $illfully
violated any provision of this )ode or suspend for a period not e,ceeding t$elve ("9) +onths for violation of any provision of
this )ode or any other la$ ad+inistered by the )o++ission, or the rules and regulations thereunder, or effected, directly or
indirectly, any transaction for any person $ho, such +e+ber or participant had reason to believe, $as violating in respect of
such transaction any of such provisions0 and
(3) (o re+ove fro+ office or censure any officer or director of a self1regulatory organi-ation if it finds that such officer or
director has violated any provision of this )ode, any other la$ ad+inistered by the )o++issioner, the rules or regulations
thereunder and the rules of such self1regulatory organi-ation, or has abused his authority, or $ithout reasonable .ustification
or e,cuse has failed to enforce co+pliance $ith any of such provisions
SEC. 436 (a) A self1regulatory organi-ation is authori-ed to discipline a +e+ber of or participant in such self1regulatory
organi-ation, or any person associated $ith a +e+ber, including suspending or e,pelling such +e+ber or participant, or
suspending or barring such person fro+ being associated $ith a +e+ber, if engaged in acts or practices inconsistent $ith
.ust and e4uitable principles of fairness or in $illful violation of any provision of this )ode, any other la$ ad+inistered by the
)o++ission, the rules or regulations thereunder, or the rules of the self1regulatory organi-ation 2n any disciplinary
proceeding by a self1regulatory organi-ation (other than a su++ary proceeding pursuant to paragraph (b) of this section)
the self1regulatory organi-ation shall bring specific charges, provide notice to the person charged, afford the person charged
$ith an opportunity to defend against the charges, and %eep a record of the proceedings A deter+ination to i+pose a
disciplinary sanction shall be supported by a $ritten state+ent of the offense, a su++ary of the evidence presented and a
state+ent of the sanction i+posed
(b) A self1regulatory organi-ation +ay su++arily:
(") Suspend a +e+ber, participant or person associated $ith a +e+ber $ho has been or is e,pelled or suspended fro+ any
other self1regulatory organi-ation0 or
(9) Suspend a +e+ber $ho the self1regulatory organi-ation finds to be in such financial or operating difficulty that the
+e+ber or participant cannot be per+itted to continue to do business as a +e+ber $ith safety to investors, creditors, other
+e+bers, participants or the self1regulatory organi-ation: Provided, (hat the self1regulatory organi-ation i++ediately
notifies the )o++ission of the action ta%en Any person aggrieved by a su++ary action pursuant to this paragraph shall be
pro+ptly afforded an opportunity for a hearing by the association in accordance $ith the preceding paragraph (he
)o++issioner, by order, +ay stay a su++ary action on his o$n or upon application by any person aggrieved thereby, if the
)o++issioner deter+ines su++arily or after due notice and hearing ($hich hearing +ay consist solely of the sub+ission of
affidavits or presentation of oral argu+ents), that a stay is consistent $ith the public interest and the protection of the
insuring public
(c) A self1regulatory organi-ation shall pro+ptly notify the )o++ission of any disciplinary sanction on any +e+ber thereof
or participant therein, any denial of +e+bership or participation in such organi-ation, or the i+position of any disciplinary
sanction on a person associated $ith a +e+ber or a bar of such person fro+ beco+ing so associated Dithin thirty (3:) days
after such notice, any aggrieved person +ay appeal to the )o++issioner fro+, or the )o++issioner on its o$n +otion
$ithin such period, +ay institute revie$ of, the decision of the self1regulatory organi-ation, at the conclusion of $hich, after
due notice and hearing ($hich +ay consist solely of revie$ of the record before the self1regulatory organi-ation), the
)o++issioner shall affir+, +odify or set aside the sanction 2n such proceeding, the )o++issioner shall deter+ine $hether
the aggrieved person has engaged or o+itted to engage in the acts and practices as found by the self1regulatory
organi-ation, $hether such acts and practices constitute $illful violations of this )ode, any other la$ ad+inistered by the
)o++ission, the rules or regulations thereunder, or the rules of the self1regulatory organi-ation as specified by such
organi-ation, $hether such provisions $ere applied in a +anner consistent $ith the purposes of this )ode, and $hether, $ith
due regard for the public interest and the protection of investors, the sanction is e,cessive or oppressive
CHAPTER #
THE INSURANCE COMMISSIONER
TITLE !
AMINISTRATIVE AN A'UICATORY PO(ERS
SEC. 437 (he 2nsurance )o++issioner shall be appointed by the 8resident of the Republic of the 8hilippines for a ter+ of
si, (#) years $ithout reappoint+ent and $ho shall serve as such until the successor shall have been appointed and 4ualified
2f the 2nsurance )o++issioner is re+oved before the e,piration of his ter+ of office, the reason for the re+oval +ust be
published
(he 2nsurance )o++issioner shall have the duty to see that all la$s relating to insurance, insurance co+panies and other
insurance +atters, +utual benefit associations, and trusts for charitable uses are faithfully e,ecuted and to perfor+ the
duties i+posed upon hi+ by this )ode, and shall, not$ithstanding any e,isting la$s to the contrary, have sole and e,clusive
authority to regulate the issuance and sale of variable contracts as defined in Section 936 hereof and to provide for the
licensing of persons selling such contracts, and to issue such reasonable rules and regulations governing the sa+e
(he )o++issioner +ay issue such rulings, instructions, circulars, orders and decisions as +ay be dee+ed necessary to
secure the enforce+ent of the provisions of this )ode, to ensure the efficient regulation of the insurance industry in
accordance $ith global best practices and to protect the insuring public 5,cept as other$ise specified, decisions +ade by the
)o++issioner shall be appealable to the Secretary of Finance
2n addition to the foregoing, the )o++issioner shall have the follo$ing po$ers and functions:
(a) For+ulate policies and reco++endations on issues concerning the insurance industry, advise )ongress and other
govern+ent agencies on all aspects of the insurance industry and propose legislation and a+end+ents thereto0
(b) Approve, re.ect, suspend or revo%e licenses or certificates of registration provided for by this )ode0
(c) 2+pose sanctions for the violation of la$s and the rules, regulations and orders issued pursuant thereto0
(d) 8repare, approve, a+end or repeal rules, regulations and orders, and issue opinions and provide guidance on and
supervise co+pliance $ith such rules, regulations and orders0
(e) 5nlist the aid and support of, and3or deputi-e any and all enforce+ent agencies of the govern+ent in the
i+ple+entation of its po$ers and functions under this )ode0
(f) 2ssue cease and desist orders to prevent fraud or in.ury to the insuring public0
(g) 8unish for conte+pt of the )o++issioner, both direct and indirect, in accordance $ith the pertinent provisions of and
penalties prescribed by the Rules of )ourt0
(h) )o+pel the officers of any registered insurance corporation or association to call +eetings of stoc%holders or +e+bers
thereof under its supervision0
(i) 2ssue subpoena duces tecum and su++on $itnesses to appear in any proceeding of the )o++ission and, in appropriate
cases, order the e,a+ination, search and sei-ure of all docu+ents, papers, files and records, ta, returns, and boo%s of
accounts of any entity or person under investigation as +ay be necessary for the proper disposition of the cases before it,
sub.ect to the provisions of e,isting la$s0
(.) Suspend or revo%e, after proper notice and hearing, the license or certificate of authority of any entity or person under
its regulation, upon any of the grounds provided by la$0
(%) )onduct an e,a+ination to deter+ine co+pliance $ith la$s and regulations if the circu+stances so $arrant as
deter+ined by appropriate rules and regulations0
(l) 2nvestigate not oftener than once a year fro+ the last date of e,a+ination to deter+ine $hether an institution is
conducting its business on a safe and sound basis: Provided, (hat, the deficiencies3irregularities found by or discovered by an
audit shall be i++ediately addressed0
(+) 2n4uire into the solvency and li4uidity of the institutions under its supervision and enforce pro+pt corrective action0
(n) (o retain and utili-e, in addition to its annual budget, all fees, charges and other inco+e derived fro+ the regulation of
insurance co+panies and other supervised persons or entities0
(o) (o fi, and assess fees, charges and penalties as the )o++issioner +ay find reasonable in the e,ercise of regulation0 and
(p) 5,ercise such other po$ers as +ay be provided by la$ as $ell as those $hich +ay be i+plied fro+, or $hich are
necessary or incidental to the e,press po$ers granted the )o++ission to achieve the ob.ectives and purposes of this )ode
(he )o++ission shall inde+nify the )o++issioner, Aeputy )o++issioner, and other officials of the )o++ission, including
personnel perfor+ing supervision and e,a+ination functions, for all costs and e,penses reasonably incurred by such persons
in connection $ith any civil or cri+inal actions, suits or proceedings to $hich they +ay be +ade a party to by the reason of
the perfor+ance of their duties and functions, unless they are finally ad.udged in such actions, suits or proceedings to be
liable for negligence or +isconduct
2n the event of settle+ent or co+pro+ise, inde+nification shall be provided only in connection $ith such +atters covered
by the settle+ent as to $hich the )o++ission is advised by e,ternal counsel that the persons to be inde+nified did not
co++it any negligence or +isconduct:
(he costs and e,penses incurred in defending the afore+entioned action, suit or proceeding +ay be paid by the )o++ission
in advance of the final disposition of such action, suit or proceeding upon receipt of an underta%ing by or on behalf of the
)o++issioner, Aeputy )o++issioner, officer or e+ployee to repay the a+ount advanced should it ulti+ately be deter+ined
by the )o++ission that the person is not entitled to be inde+nified
SEC. 438 2n addition to the ad+inistrative sanctions provided else$here in this )ode, the 2nsurance )o++issioner is
hereby authori-ed, at his discretion, to i+pose upon insurance co+panies, their directors and3or officers and3or agents, for
any $illful failure or refusal to co+ply $ith, or violation of any provision of this )ode, or any order, instruction, regulation, or
ruling of the 2nsurance )o++issioner, or any co++ission or irregularities, and3or conducting business in an unsafe or
unsound +anner as +ay be deter+ined by the 2nsurance )o++issioner, the follo$ing:
(a) Fines not less than Five thousand pesos (8<,:::::) and not +ore than ($o hundred thousand pesos (89::,:::::)0
and
(b) Suspension, or after due hearing, re+oval of directors and3or officers and3or agents
SEC. 439 (he )o++issioner shall have the po$er to ad.udicate clai+s and co+plaints involving any loss, da+age or
liability for $hich an insurer +ay be ans$erable under any %ind of policy or contract of insurance, or for $hich such insurer
+ay be liable under a contract of suretyship, or for $hich a reinsurer +ay be sued under any contract of reinsurance it +ay
have entered into0 or for $hich a +utual benefit association +ay be held liable under the +e+bership certificates it has
issued to its +e+bers, $here the a+ount of any such loss, da+age or liability, e,cluding interest, cost and attorney*s fees,
being clai+ed or sued upon any %ind of insurance, bond, reinsurance contract, or +e+bership certificate does not e,ceed in
any single clai+ Five +illion pesos (8<,:::,:::::)
(he po$er of the )o++issioner does not cover the relationship bet$een the insurance co+pany and its agents3bro%ers but
is li+ited to ad.udicating clai+s and co+plaints filed by the insured against the insurance co+pany
(he )o++issioner +ay authori-e any officer or group of officers under hi+ to conduct investigation, in4uiry and3or hearing
and decide clai+s and he +ay issue rules governing the conduct of ad.udication and resolution of cases (he Rules of )ourt
shall have suppletory application
(he party filing an action pursuant to the provisions of this section thereby sub+its his person to the .urisdiction of the
)o++issioner (he )o++issioner shall ac4uire .urisdiction over the person of the i+pleaded party or parties in accordance
$ith and pursuant to the provisions of the Rules of )ourt
(he authority to ad.udicate granted to the )o++issioner under this section shall be concurrent $ith that of the civil courts,
but the filing of a co+plaint $ith the )o++issioner shall preclude the civil courts fro+ ta%ing cogni-ance of a suit involving
the sa+e sub.ect +atter
Any decision, order or ruling rendered by the )o++issioner after a hearing shall have the force and effect of a .udg+ent
Any party +ay appeal fro+ a final order, ruling or decision of the )o++issioner by filing $ith the )o++issioner $ithin thirty
(3:) days fro+ receipt of copy of such order, ruling or decision a notice of appeal to the )ourt of Appeals in the +anner
provided for in the Rules of )ourt for appeals fro+ the Regional (rial )ourt to the )ourt of Appeals
For the purpose of any proceeding under this section, the )o++issioner, or any officer thereof designated by hi+ is
e+po$ered to ad+inister oaths and affir+ation, subpoena $itnesses, co+pel their attendance, ta%e evidence, and re4uire
the production of any boo%s, papers, docu+ents, or contracts or other records $hich are relevant or +aterial to the in4uiry
A full and co+plete record shall be %ept of all proceedings had before the )o++issioner, or the officers thereof designated
by hi+, and all testi+ony shall be ta%en do$n and transcribed by a stenographer appointed by the )o++issioner
2n order to pro+ote party autono+y in the resolution of cases, the )o++issioner shall establish a syste+ for resolving
cases through the use of alternative dispute resolution
TITLE 2
FEES AN OTHER SOURCES OF FUNS
SEC. 440. (a) For the issuance or rene$al of certificates of authority, licenses and certificates of registration, pursuant to
pertinent provisions of this )ode, the )o++issioner shall collect and receive fees $hich shall be not less than the follo$ing:
For each certificate of authority issued to an insurance co+pany doing business in the 8hilippines, ($o hundred pesos
(89::::)
For each special certificate of authority issued to a servicing insurance co+pany, /ne hundred pesos (8"::::)
For each license issued to a general agent of an insurance co+pany, Fifty pesos (8<:::)
For each license issued to an insurance agent, ($enty1five pesos (89<::)
For each license issued to an agent of variable contract policy, ($enty1five pesos (89<::)
For each license issued to an insurance bro%er, /ne hundred pesos (8"::::)
For each license issued to a reinsurance bro%er, /ne hundred pesos (8"::::)
For each license issued to an insurance ad.uster, /ne hundred pesos (8"::::)
For each certificate of registration issued to an actuary, Fifty pesos (8<:::)
For each certificate of registration issued to a resident agent, Fifty pesos (8<:::)
For each license issued to a rating organi-ation, /ne hundred pesos (8"::::)
For each certificate of registration issued to a non1life co+pany under$riter, Fifty pesos (8<:::)
For each license issued to a +utual benefit association, (en pesos (8":::)
For each certificate of registration issued to a trust for charitable uses, (en pesos (8":::)
All certificates of authority and all other licenses, as $ell as all certificates of registration, issued to any person, partnership,
association or corporation under the pertinent provisions of this )ode for $hich no e,piration date has been prescribed, shall
e,pire on the last day of Aece+ber of the third year fro+ its issuance and shall be rene$ed upon application therefor and
pay+ent of the corresponding fee, if the licensee or holder of such license or certificate is continuing to co+ply $ith all the
applicable provisions of e,isting la$s, and of rules, instructions, orders and decisions of the )o++issioner
(b) For the filing of the annual state+ent referred to in Section 99@, the )o++issioner shall collect and receive fro+ the
insurance co+pany so filing a fee of not less than Five hundred pesos (8<::::): Provided, (hat a fine of not less than /ne
hundred pesos (8"::::) shall be i+posed and collected by the )o++issioner for each $ee% of delay, or any fraction thereof,
in the filing of the annual state+ent
For the filing of annual state+ent referred to in Section !"3, the )o++issioner shall collect and receive fro+ the +utual
benefit association so filing a fee of not less than (en pesos (8":::): Provided, (hat a fine of not less than (en pesos
(8":::) shall be i+posed and collected by the )o++issioner for each $ee% of delay, or any fraction thereof, in the filing of
the annual state+ent
(c) For the e,a+ination prescribed in Section 9<3, the )o++issioner shall collect and receive fees according to the a+ount
of its total assets, in the case of a do+estic co+pany, or of its assets in the 8hilippines, in the case of a foreign co+pany, not
less than the a+ount as follo$s:
(") ($o +illion pesos or +ore but less than Four +illion pesos, Four hundred pesos (8!::::)0
(9) Four +illion pesos or +ore but less than Si, +illion pesos, 5ight hundred pesos (86::::)0
(3) Si, +illion pesos or +ore but less than 5ight +illion pesos, /ne thousand t$o hundred pesos (8",9::::)0
(!) 5ight +illion pesos or +ore but less than (en +illion pesos, /ne thousand si, hundred pesos (8",#::::)0
(<) (en +illion pesos or +ore, ($o thousand pesos (89,:::::)0
Provided, (hat if the said e,a+ination is +ade in places outside the ;etropolitan ;anila area, besides these fees, the
)o++issioner shall re4uire of the co+pany e,a+ined the pay+ent of the actual and necessary travelling and subsistence
e,penses of the e,a+iner or e,a+iners concerned
For the e,a+ination prescribed in Section !"9, the )o++issioner shall collect and receive a +ini+u+ fee of not less than
/ne hundred pesos (8"::::) fro+ the +utual benefit association e,a+ined: Provided, (hat if such association has total
assets of +ore than /ne hundred thousand pesos (8"::,:::::), an additional fee of not less than (en pesos (8":::) for
every Fifty thousand pesos (8<:,:::::) in e,cess thereof shall be i+posed:
(d) For the filing of an application to $ithdra$ fro+ the 8hilippines under (itle "6, the )o++issioner shall collect and receive
fro+ the foreign co+pany so $ithdra$ing a fee of not less than /ne thousand pesos (8",:::::)
(e) (he )o++issioner +ay fi, and collect fees or charges for docu+ents, transcripts, or other +aterials $hich +ay be
furnished by hi+ not in e,cess of reasonable cost
SEC. 441 (he )o++issioner, in accordance $ith the rules and regulations of the Aepart+ent of =udget and ;anage+ent
and other relevant regulatory agencies, shall source the salary, allo$ances and other e,penses fro+ the retained a+ount of
the fees, charges, penalties and other inco+e fro+ the regulation of insurance co+panies and other covered persons and
entities, and fro+ the 2nsurance Fund, $hich is created out of the proceeds of ta,es on insurance pre+iu+s +entioned in
Section 9<< of the National 2nternal Revenue )ode, as a+ended
MISCELLANEOUS PROVISIONS
SEC. 442 Any person, co+pany or corporation sub.ect to the supervision and control of the )o++issioner $ho violates any
provision of this )ode, for $hich no penalty is provided, shall be dee+ed guilty of a penal offense, and upon conviction be
punished by a fine not e,ceeding ($o hundred thousand pesos (89::,:::::) or i+prison+ent of si, (#) +onths, or both, at
the discretion of the court
2f the offense is co++itted by a co+pany or corporation, the officers, directors, or other persons responsible for its
operation, +anage+ent, or ad+inistration, unless it can be proved that they have ta%en no part in the co++ission of the
offense, shall li%e$ise be guilty of a penal offense, and upon conviction be punished by a fine not e,ceeding ($o hundred
thousand pesos (89::,:::::) or i+prison+ent of si, (#) +onths, or both, at the discretion of the court
SEC. 443 All cri+inal actions for the violation of any of the provisions of this )ode shall prescribe after three (3) years fro+
the discovery of such violation: Provided, (hat such actions shall in any event prescribe after ten (":) years fro+ the
co++ission of such violation
SEC. 444 Any person, partnership, association or corporation heretofore authori-ed, licensed or registered by the
)o++issioner shall be dee+ed to have been authori-ed, licensed or registered under the provisions of this )ode and shall be
governed by the provisions thereof: Provided, however, (hat $here any such person, partnership, association or corporation
is affected by the ne$ re4uire+ents of this )ode, said person, partnership, association or corporation shall, unless other$ise
herein provided, be given a period of one (") year fro+ the effectivity of this )ode $ithin $hich to co+ply $ith the sa+e
SEC. 445 Transitory Provision G Rene$al of e,isting licenses, certificates of authority or accreditation $hich $ill e,pire on
Hune 3:, 9:"3 shall be valid until Aece+ber 3", 9:"< (hereafter, rene$al shall be filed on the last day of Aece+ber every
third year follo$ing the date of e,piry of the license, certificate of authority or accreditation
SEC. 446 Repealing lause G 5,cept as e,pressly provided by this )ode, all la$s, decrees, orders, rules and regulations or
parts thereof, inconsistent $ith any provision of this )ode shall be dee+ed repealed, a+ended or +odified accordingly
SEC. 447 !eparability lause G 2f any provision of this )ode or any part hereof be declared invalid or unconstitutional, the
re+ainder of the la$ or other provisions not other$ise affected shall re+ain valid and subsisting
SEC. 448 (his )ode shall ta%e effect fifteen ("<) days follo$ing its publication in a ne$spaper of general circuationI