Question & AnswerQ&A (PRESIDENTIAL DECREE NO. 1814)
The main purpose of Presidential Decree No. 1814 is to amend certain sections of Presidential Decree No. 1460, also known as the Insurance Code, to ensure the execution and performance of insurance contracts for the sound development of the national economy and to assure reasonable insurance services for policyholders and the public.
Grounds include willful violation of the Insurance Code, intentional material misstatements in the license application, obtaining the license by fraud or misrepresentation, fraudulent or dishonest practices, misappropriation or illegal withholding of fiduciary moneys, failure to demonstrate trustworthiness and competence, material misrepresentation of policy terms, and failure to pass the required written examination.
Third Party excludes a passenger, members of the household or family within the second degree of consanguinity or affinity of the vehicle owner or operator, and the owner's employee in relation to death or bodily injury arising out of employment.
An 'Insurance Policy' or 'Policy' refers to a contract of insurance against passenger and third-party liability for death or bodily injuries arising from motor vehicle accidents.
They must have in force a policy of insurance, cash guaranty, or surety bond to indemnify third-party or passenger death or bodily injury arising from the use of the vehicle, as required under Section 374.
Coverage must be at least twelve thousand pesos per passenger or third party, with scale amounts per accident based on vehicle capacity, ranging from five thousand pesos multiplied by capacity for vehicles with five or fewer passengers to fifty thousand pesos for vehicles with 26 or more passengers.
Coverage ranges from twelve thousand pesos for tricycles and motorcycles, twenty thousand to thirty thousand pesos depending on the vehicle's unladen weight or classification, with specific amounts for Bantam, Light and Heavy private cars, and up to fifty thousand pesos for vehicles over 3,930 kilos.
The Land Transportation Commission may require the operator or owner to make a cash deposit with the Commissioner as a substitute for an insurance policy or surety bond, ensuring indemnity coverage is met.
A written notice of claim must be filed within six months from the date of the accident, and action or suit to recover damages must be brought within one year from the date of the accident, otherwise the claim or right of action is waived or prescribed.