Law Summary
Two Management Group: Odd-Even System
- PPAIP adopts a two-management group system consisting of PAMI and SAMI.
- Each group may rotate its lead company every 6-12 months with prior Board approval.
- Assignment based on the middle digit of LTO-issued license plates: EVEN to PAMI, ODD to SAMI.
- LTFRB confirmation required prior to LTO registration.
- Odd-Even scheme subject to interchange mid-contract period upon Board approval for equitable client distribution.
Package Benefits
- Mandatory "All Risk-No Fault" passenger personal accident insurance for all public utility vehicles (PUVs).
- Death benefits vary by vehicle type and passenger capacity, with caps ranging from P180,000 (trucks-for-hire) to P3,360,000 (buses/mini buses).
- Medical benefits with maximum coverage provided per vehicle type, with automatic minimum benefit for injuries without receipts.
- Detailed compensation scale for various injuries and losses (e.g., death, dismemberment, loss of sight or limbs, hearing loss).
- Bail bond assistance up to P10,000 for drivers in litigation related to covered accidents.
- Free compulsory defensive driving seminars to be conducted by the management groups.
Coverage and Policy Conditions
- Coverage regardless of driver's authorization status, intoxication, drug use, or route violations.
- Inclusion of incidents involving homicide, murder, assault, holdup, and kidnapping.
- Coverage extends to non-paying passengers and persons boarding or disembarking from the vehicle.
- Insurance valid despite change of vehicle ownership if LTFRB authorization remains.
- Coverage continues until expiry or reversion to private status without automatic termination.
- Protection includes terrorist attacks.
Key Conditionalities and Enforcement
- Prohibition of predatory pricing, commissions, rebates, or discounts.
- Recognition of only authorized branch offices and representatives by LTFRB.
- Claims payment within five working days following validated accidents.
- Issuance of Certificates of Cover with security markings and standard forms approved by LTFRB and IC.
- Maintenance of a Common Claims Fund of at least PhP 10 million by each management group.
- Separate accounting books maintained for tax and financial reporting.
- Buy-back of insurance policies issued during the transitional period by PAMI or SAMI.
- Validity of insurance policies issued prior to March 2004 until expiration.
- Establishment of a nationwide, real-time computer database accessible via LTFRB website.
- Creation of a passenger accident monitoring system to assist emergency medical services and claims processing.
- Sanctions for violations include fines and potential contract termination, subject to Board discretion.
- Authority of LTFRB to issue cease and desist orders in the public interest.
Effectivity and Applicability
- All prior inconsistent issuances are amended, revised, or revoked.
- Memorandum Circular effective immediately upon issuance.
- Signed and adopted by the Chairperson and Board Members on March 15, 2004.