Question & AnswerQ&A (IRR of Republic Act No. 11765)
The primary purpose of RA No. 11765 is to safeguard the rights and interests of consumers of financial products and services by ensuring mechanisms that promote transparency, fair market conduct, protection of consumer assets, data privacy, and effective handling of consumer complaints.
Financial consumers refer to persons or entities, or their duly appointed representatives, who purchase, receive, or are prospective purchasers or recipients of financial products or services regulated by the Insurance Commission, including those with current or prospective financial transactions related to such products or services.
The five key rights are: (a) Right to fair and equitable treatment; (b) Right to disclosure and transparency of financial products and services; (c) Right to protection of consumer assets against fraud and misuse; (d) Right to data privacy and protection; and (e) Right to timely handling and redress of complaints.
The cooling off or free-look period is a specified number of days from the receipt of the contract by the financial consumer during which the consumer can return or cancel the contract and receive a full refund if no claim has been made. The period varies depending on the contract duration: 15 days for contracts longer than six months, 5 days for contracts longer than 30 days up to six months, and no cooling-off for contracts 30 days or less.
ICREs must establish a Code of Conduct applicable to all staff and authorized agents, containing organizational values, standards of professional conduct, procedures to detect violations, and enforcement sanctions aligned with market conduct guidelines.
These Rules apply to all financial products or services regulated by the Insurance Commission aimed at protecting the rights of financial consumers as enumerated in the Rules.
CAMS must include mechanisms to receive, record, evaluate, resolve, monitor, and report consumer complaints and inquiries, capacity building for staff, a consumer assistance process and timeline, complaints database, feedback mechanisms, and regular reporting to the Board of Directors and Commission.
Actions or claims prescribe after five (5) years from the consummation of the financial transaction or from the discovery of deceit or non-disclosure of material facts, but in any event, they prescribe after ten (10) years from the commission of such violation. Insurance contracts follow the prescriptive period under the Insurance Code.
The Commission can impose restrictions on excessive fees, disqualify or suspend responsible personnel, impose fines and penalties, issue cease-and-desist orders without prior hearing in urgent cases, suspend operations of the provider for certain products, and order disgorgement of profits or losses avoided due to violations.
The Board of Directors is responsible for approving and overseeing the CPRMS, reviewing and approving the Code of Conduct, ensuring adequate resources and training, reviewing implementation periodically, and ensuring reporting on compliance and CAMS performance.
No, any contract provision that waives or deprives a financial consumer of their legal rights to sue, receive information, have complaints addressed, or protect client data is not lawful or enforceable.
ICREs must adopt and implement information security standards ensuring confidentiality, integrity, availability, authenticity, and non-repudiation of client information and financial transactions, consistent with the Data Privacy Act and related guidelines from the National Privacy Commission.