QuestionsQuestions (IC CIRCULAR LETTER NO. 23-2005)
The guidelines apply to traditional life insurance products as well as variable life insurance products.
A standardized format ensures consistency, transparency, and fairness in illustrating projected values, which helps potential policyholders make informed decisions and prevents misleading sales presentations.
The guidelines took effect immediately upon issuance on August 3, 2005.
The full text is available at the Office of the National Administrative Register, U.P. Law Complex, Diliman, Quezon City.
It aimed to address the problem of differing interest rates used by various life insurance companies in their sales illustrations, which created inconsistency in projected values.
The circular acts as a regulatory guideline that life insurance companies must follow to comply with existing insurance laws and regulations, and non-compliance could lead to legal or administrative sanctions.
The circular itself does not specify penalties, but compliance is mandated and enforced by the Insurance Commission under existing regulatory authority.
They ensure that sales presentations use a common and transparent method for projecting benefits and values, reducing the chances of misrepresentation and protecting consumers.