Scope and Purpose
- The regulation was issued following the observation that illegally obtained vehicles (e.g., carnapped vehicles) have their identification numbers replaced by those from totally wrecked motor vehicles sold by insurance companies.
- Its primary purpose is to stop the legitimization of illegally obtained vehicles through such practices.
Coordinating Agencies
- The Insurance Commission (IC) worked in consultation with the following entities:
- National Law Enforcement Coordinating Committee (NALECC)
- Land Transportation Office (LTO)
- Insurance and Surety Association of the Philippines (ISAP)
Information Submission Requirements for Insurance Companies
Insurance companies are required to provide the IC with descriptions and documents regarding:
All motor vehicles that have been paid for as total loss claims by the insurance companies.
Motor vehicles acquired after paying a total loss claim that have been sold "as is" or in parts. This submission must be accompanied by:
- A copy of the deed of sale.
- Proof of cancellation of registration by the LTO, if applicable.
Motor vehicles no longer serviceable or considered totally wrecked or junked, along with:
- Proof that the registration has been cancelled by the LTO.
Procedures for Registration Papers and Vehicle Parts
- For vehicles sold only in parts, insurance companies must retain the original registration papers.
- These registration documents must be submitted to the LTO for cancellation to prevent misuse.
Compliance and Documentation
- Sample forms for compliance and reporting have been provided and attached.
- All insurance companies and relevant stakeholders must adhere to these guidelines.
Legal Authority
- The directive was officially adopted on December 8, 1999, by the Insurance Commissioner Eduardo T. Malinis.
- It serves as a regulatory tool to enhance transparency and legal compliance in the handling of total loss vehicles by insurance companies.