Hon. President Ferdinand R. Marcos, Jr. and Hon. Secretary Atty. Giovanni Z. Lopez,

We, CONCERNED TRANSPORT GROUPS & TRANSPORT OPERATORS, most respectfully call upon your Administration to REVIEW the Passenger Personal Accident Insurance (PPAI) Program, particularly its structure and implementation, to ABOLISH the Management Companies, and to DISSOLVE the Insurance Consortiums created by this Program.

The PPAI Program, established 25 years ago in 2001 by the LTFRB, provided for mandatory insurance coverage to afford Personal Accident (PA) insurance to Filipino commuters who ride Public Utility Vehicles (PUVs), such as buses, jeepneys, and taxis. The PPAI Program mandated the creation of Insurance Consortiums that consist of several Non-Life Insurance Companies. Each Consortium is administered by a Management Company, which handles the marketing, operations, and claims processing for the PPAI Program.

In its early years, the arrangement served its purpose. With each PUV operator paying insurance premiums ranging from P2,000 to P5,000 per year, the premiums generated on a yearly basis average to be P800 Million per year. So in its 25 years, BILLIONS of Pesos of Premiums have been collected by the Insurance Consortiums.

With the minimal loss experience, business is good for the PPAI Program. If so much money has been collected over the years, then the Filipino commuters deserve to ask a simple question.

Where did it all go?

Has the service improved? Have claims become faster? Has the system become easier for accident victims and their families? Many transport operators and commuters will say “No”.

The profit, instead, went to the perks of the executives of the Management Companies and the Insurance Consortiums, who enjoy yearly trips to Europe in Business Class, with pocket money. Their monthly meetings are held in the most expensive hotels and restaurants in Makati, with envelopes of cash handed in each meeting.

Meanwhile, the plight of Filipinos commuters has not improved, especially with the increase of fuel prices and daily costs of living. At times of accidents, the claims process remains to be slow. The insurance premiums continue to increase, and the operations of these Management Companies remain to be manual, not computerized.

The circumstances that existed 25 years ago, which justified the current structure of the PPAI Program, no longer exist today. The Philippine insurance industry has matured significantly, with insurance companies now with substantive financial capacity, at P1.3 Billion Pesos net worth each, as required by the Insurance Commission.

As such, we most respectfully urge your Administration to REVIEW the PPAI Program, particularly its structure and implementation, to ABOLISH the Management Companies, and to DISSOLVE the Insurance Consortiums created by this Program.

Mr. President, your Administration has consistently emphasized efficient government, fair competition, and the protection of ordinary Filipinos. We believe this is an opportunity to demonstrate those principles in action.

Respectfully,

CONCERNED TRANSPORT GROUPS & TRANSPORT OPERATORS

Represented by

ATTY. ANDRÉ R. DE JESUS, ATTORNEY-AT-LAW