QuestionsQuestions (IC INSURANCE MEMORANDUM CIRCULAR NO. 2-86)
An insurance agent is any person who for compensation solicits or obtains insurance on behalf of an insurance company, or transmits an application for a policy/contract of insurance to or from such company, or offers/assumes to act in negotiating such insurance.
A variable contract agent is any person who sells or offers for sale variable contracts, or performs acts in the sale/negotiation/making/consummating of such contracts, other than for himself.
An insurance broker is any person who for compensation/commission/other thing of value acts or aids in soliciting, negotiating, procuring an insurance contract, or placing risks/taking out insurance on behalf of an insured other than himself.
No insurance company doing business in the Philippines (or any agent thereof) shall pay any commission/compensation for obtaining or placing insurance or reinsurance unless the recipient has first procured a license from the Insurance Commissioner for the applicable category (agent/broker/etc.).
No. Section 2.2 states that no person shall act as an insurance agent, variable contract agent, general agent, insurance broker, or reinsurance broker in the Philippines without first procuring the corresponding license from the Insurance Commissioner.
No person shall be licensed to act as an insurance agent or general agent of more than one life insurance company. The circular also indicates limitations for non-life businesses (e.g., general agent of more than one non-life insurer and/or insurance agent of more than three non-life insurers), and those limitations also apply to the individual named in the license.
No. A person licensed as an insurance agent or general agent shall not be licensed as an insurance broker, and vice versa within the same kind of insurance business. The same limitation applies to the individuals named in licenses issued to partnerships/associations/corporations.
No official or employee of an insurance brokerage or an adjustment company and no individual adjuster shall be licensed to act as an insurance agent, variable contract agent, or general agent.
The applicant must be a resident of the Philippines, be trustworthy, and must pass the required written examination unless exempt.
A grade of 70% is necessary to pass. Exemptions apply to those who currently hold or previously held the same kind of license within the last 10 years (excluding temporary certificates), those who completed certain Insurance Institute/approved courses or academic training programs, or those deemed competent due to prior connections with an insurance company/insurance office.
The application must be on prescribed forms and include a copy of the applicant’s income tax return for the preceding year with corresponding receipt(s) showing payment of all income taxes due.
The application must include a copy of the general agency agreement with the insurance company, and a copy of the power of attorney duty executed by the insurer empowering the applicant to receive notices/summons/legal processes for actions against the insurer.
It means the license holder must have earned, during the year following the issuance of the license, commission or other compensation for services rendered amounting to at least P3,600.
Grounds include willful violation of the Insurance Code/circular/rules; intentional material misstatement; obtaining/attempting to obtain a license by fraud or misrepresentation; fraud/dishonest practices; misappropriation/illegal withholding of fiduciary funds; failure to demonstrate trustworthiness and competence to safeguard the public; material misrepresentation of policy terms/conditions; failure to pass the required examination if not exempt; or insolvency/bankruptcy.