Insurance Code Chapter IV

CHAPTER IV — SALES AGENCIES AND TECHNICAL SERVICES

Title I INSURANCE AGENTS AND INSURANCE BROKERS

SECTION 299. No insurance company doing business in the Philippines, nor any agent thereof, shall pay any commission or other compensation to any person for services in obtaining insurance, unless such person shall have first procured fr. the Commissioner a license to act as an insurance agent of such company or as an insurance broker as hereinafter provided.

No person shall act as an insurance agent or as an insurance broker in the solicitation or procurement of applications for insurance, or receive for services in obtaining insurance, any commission or other compensation fr. any insurance company doing business in the Philippines, or any agent thereof, without first procuring a license to act fr. the Commissioner, w/c must be renewed annually on the first day of January, or within six months thereafter. Such license shall be issued by the Commissioner only upon the written application of the person desiring it, such application if for a license to act as insurance agent, being approved & countersigned by the company such person desires to represent, & shall be upon a form prescribed by the Commissioner giving such information as he may require, & upon payment of the corresponding fee hereinafter prescribed. The Commissioner shall satisfy himself as to competence & trustworthiness of the applicant & shall have the right to refuse to issue or renew & to suspend or revoke any such license in his discretion. No such license shall be valid after the thirtieth day of June of the year following its issuance unless it is renewed. (As amended by Presidential Decree No. 1455)

SECTION 300. Any person who for compensation solicits or obtains insurance on behalf of any insurance company or transmits for a person other than himself an application for a policy or contract of insurance to or fr. such company or offers or assumes to act in the negotiating of such insurance shall be an insurance agent within the intent of this section & shall thereby become liable to all the duties, requirements, liabilities & penalties to w/c an insurance agent is subject.

SECTION 301. Any person who for any compensation, commission or other thing of value acts or aids in any manner in soliciting, negotiating or procuring the making of any insurance contract or in placing risk or taking out insurance, on behalf of an insured other than himself, shall be an insurance broker within the intent of this Code, & shall thereby become liable to all the duties, requirements, liabilities & penalties to w/c an insurance broker is subject.

SECTION 302. Every applicant for an insurance broker’s license shall file w/ the application & shall thereafter maintain in force while so licensed, a bond in favor of the people of the Republic of the Philippines executed by a company authorized to become surety upon official recognizances, stipulations, bonds & undertakings. The bond shall be in such amount as may be fixed by the Commissioner, but in no case less than one hundred thousand pesos, & shall be conditioned upon full accounting & due payment to the person entitled thereto of funds coming into the broker’s possession through insurance transactions under license. The bond shall remain in force until released by the Commissioner, or until cancelled by the surety. Without prejudice to any liability previously incurred thereunder, the surety may cancel the bond on thirty days advance written notice to both the broker & the Commissioner.

Upon approval of the application, the applicant must also file two errors & omissions (professional liability or professional indemnity) policies issued separately by two insurance companies authorized to do business in the Philippines, satisfactory to the Commissioner to indemnify the applicant against any claim or claims for breach of duty as insurance broker w/c may be made against him by reason of any negligent act, error or omission, whenever or wherever committed or alleged to have been committed, on the part of the applicant or any person who has been, is now, or may hereafter during the subsistence of the policies be employed by the said applicant in his capacity as insurance broker, provided that the filing of any claim or claims under one of such policies shall preclude the filing of the said claim or claims under the other policy. The said policies shall be in such amounts as may be prescribed by the Insurance Commissioner, depending upon the size or amount of the broking business of the applicant, but in no case shall the amount of each of such policies be less than five hundred thousand pesos. (As amended by Presidential Decree No. 1455)

SECTION 303. The Commissioner shall, in order to determine the competence of every applicant to have the kind of license applied for, require such applicant to submit to a written examination & to pass the same to the satisfaction of the Commissioner. Such examination shall be held at such times & places as the Commissioner shall fr. time to time determine.

SECTION 304. An applicant for the written examination mentioned in the preceding section must be of good moral character & must not have been convicted of any crime involving moral turpitude. He must satisfactorily show to the Commissioner that he has been trained in the kind of insurance contemplated in the license applied for.

Such examination may be waived if it is shown to the satisfaction of the Commissioner that the applicant has undergone extensive education &/or training in insurance.

SECTION 305. An application for the issuance or renewal of a license to act as an insurance agent or insurance broker may be refused, or such license, if already issued or renewed, shall be suspended or revoked if the Commissioner finds that the applicant for, or holder of, such license:

(a) has willfully violated any provision of this Code; or

(b) has intentionally made a material misstatement in the application to qualify for such license; or

(c) has obtained or attempted to obtain a license by fraud or misrepresentation; or

(d) has been guilty of fraudulent or dishonest practices; or

(e) has misappropriated or converted to his own use or illegally withheld moneys required to be held in a fiduciary capacity;

(f) has not demonstrated trustworthiness & competence to transact business as an insurance agent or insurance broker in such manner as to safeguard the public; or

(g) has materially misrepresented the terms & conditions of policies or contracts of insurance w/c he seeks to sell or has sold; or

(h) has failed to pass the written examination prescribed, if not otherwise exempt fr. taking the same.

In addition to the foregoing causes, no license to act as insurance agent or insurance broker shall be renewed if the holder thereof has not been actively engaged as such agent or broker in accordance w/ such rules as the Commissioner may prescribe. (As amended by Presidential Decree No. 1814)

SECTION 306. The premium, or any portion thereof, w/c an insurance agent or insurance broker collects fr. an insured & w/c is to be paid to an insurance company because of the assumption of liability through the issuance of policies or contracts of insurance, shall be held by the agent or broker in a fiduciary capacity & shall not be misappropriated or converted to his own use or illegally withheld by the agent or broker.

Any insurance company w/c delivers to an insurance agent or insurance broker a policy or contract of insurance shall be deemed to have authorized such agent or broker to receive on its behalf payment of any premium w/c is due on such policy or contract of insurance at the time of its issuance or delivery or w/c becomes due thereon.

SECTION 307. Any provision of existing laws to the contrary notwithstanding, no person shall, within the Philippines, sell or offer for sale a variable contract or do or perform any act or thing in the sale, negotiation, making or consummating of any variable contract other than for himself unless such person shall have a valid & current license fr. the Commissioner authorizing such person to act as a variable contract agent. No such license shall be issued unless & until the Commissioner is satisfied, after examination that such person is by training, knowledge, ability & character qualified to act as such agent. Any such license may be withdrawn & cancelled by the Commissioner after notice & hearing, if he shall find that the holder thereof does not then have the qualifications required for the issuance of such license.

SECTION 308. It shall be unlawful for any person, company or corporation in the Philippines to act as general agent of any insurance company unless he is empowered by a written power of attorney duly executed by such insurance company, & registered w/ the Commissioner to receive notices, summons & legal processes for & in behalf of the insurance company concerned in connection w/ actions or other legal proceedings against said insurance company. It shall be the duty of said general agent to notify the Commissioner of his post office address in the Philippines, or any change thereof. Notices, summons, or processes of any kind sent by registered mail to the last registered address of such general agent of the company concerned or to the Commissioner shall be sufficient service & deemed as if served on the insurance company itself.

SECTION 309. Except as otherwise provided by law or treaty, it shall be unlawful for any person, partnership, association or corporation in the Philippines, for himself or itself, or for some other person, partnership, association or corporation, either to procure, receive or forward applications of insurance in, or to issue or to deliver or accept policies or contracts of insurance of or for, any insurance company or companies not authorized to transact business in the Philippines, covering risks, life or nonlife, situated in the Philippines; & any such person, partnership, association or corporation violating the provisions of this section shall be deemed guilty of a penal offense, & upon conviction thereof, shall for each such offense be punished by a fine of ten thousand pesos, or imprisonment of six months, or both at the discretion of the court; Provided, That the provisions of this section shall not apply to reinsurance.

Title II REINSURANCE BROKERS

SECTION 310. Except as provided in the next succeeding title, no person shall act as reinsurance broker in the Philippines unless he is authorized as such by the Commissioner.

A reinsurance broker is one who, for compensation, not being a duly authorized agent, employee or officer of an insurer in w/c any reinsurance is effected, act or aids in any manner in negotiating contracts of reinsurance, or placing risks of effecting reinsurance, for any insurance company authorized to do business in the Philippines.

SECTION 311. Upon application & payment of the corresponding fee hereinafter prescribed, & the filing of two errors & omissions (professional liability or professional indemnity) policies hereinafter described, a person may, if found qualified, be issued a license to act as reinsurance broker by the Commissioner. No such license shall be valid after the thirtieth day of June of the year following its issuance unless it is renewed. (As amended by Presidential Decree No. 1455)

The errors & omissions (professional liability or professional indemnity) policies mentioned above shall indemnify the applicant against any claim or claims for breach of duty as reinsurance broker w/c may be made against him by reason of any negligent act, error or omission, whenever or wherever committed or alleged to have been committed, on the part of the applicant or any person who has been, is now, or may hereafter during the subsistence of the policies be employed by the said applicant in his capacity as reinsurance broker; Provided, That the filing of any claim or claims under one of such policies shall preclude the filing of the said claim or claims under the other policy. The said policies shall be issued separately by two insurance companies authorized to do business in the Philippines & shall be in such amounts as may be prescribed by the Insurance Commissioner, depending upon the size or amount of the broking business of the applicant, but in no case shall the amount of each of such policies be less than five hundred thousand pesos. (As amended by Presidential Decree No. 1455)

SECTION 312. The Commissioner may recall, suspend or revoke the license granted to a reinsurance broker for violation of any existing law, rule & regulation, or any provision of this Code after due notice & hearing.

Title III RESIDENT AGENTS

SECTION 313. No person shall act as resident agent, as hereinafter defined, unless he is registered as such w/ the Commissioner.

SECTION 314. The term “resident agent”, as used in this title, is one duly appointed by a foreign insurer or broker not authorized to do business in the Philippines to receive in its behalf notices, summons & legal processes in connection w/ actions or other legal proceedings against such foreign insurer or broker.

SECTION 315. The application for a certificate of registration as resident agent filed w/ the Commissioner must be accompanied w/: (a) a copy of the power of attorney, duly notarized & authenticated by the Philippine Consul in the place where such foreign insurer or broker is domiciled, empowering the applicant to act as resident agent & to receive notices, summons & legal processes for & in behalf of such foreign insurer or broker in connection w/ any action or legal proceeding against such foreign insurer or broker; & (b) a copy of the corresponding certificate issued by the Board of Investments as required under Section 4 of Republic Act No. 5455, if such foreign insurer or broker is not otherwise exempt fr. such requirement.

SECTION 316. It shall be the duty of such resident agent to notify immediately the Commissioner of any change of his office address.

SECTION 317. A certificate of registration issued to a resident agent shall expire on the thirtieth day of June of the year following its issuance unless it is renewed.

The Commissioner may, after due notice & hearing, recall or cancel the certificate of registration issued to a resident agent for violation of any existing law, rule or regulation, or any provision of this Code. (As amended by Presidential Decree No. 1455).

Title IV NON‑LIFE COMPANY UNDERWRITER

SECTION 318. No person shall act, & no company shall employ any person, as non‑life company underwriter, whose duty & responsibility it shall be to select, evaluate & accept risks for, & to determine the terms & conditions, including those pertaining to amounts of retentions, under w/c such risks are to be accepted by the company, unless such underwriter is registered as such w/ the Commissioner.

SECTION 319. Every non‑life insurance company doing business in the Philippines must maintain at all times a register of risks accepted & a claims register for each line of risks engaged in by such non‑life insurance company w/ such entries therein as are now or as may hereafter be required by the Commissioner, & it shall be the responsibility of the underwriter on the particular line or risk involved to see to it that the said registers are well maintained & kept, & that all entries therein are properly & correctly recorded. Such registers shall be open to inspection & examination of duly authorized representative of the Commissioner at all times during business hours.

SECTION 320. No person shall be registered w/ the Commissioner, unless such person shall be at least twenty‑one years of age on the date of such registration; a resident of the Philippines; of good moral character & w/ no conviction of any crime involving moral turpitude; has had at the time such registration is made at least two years of underwriting work in the particular line or risk involved; & has passed such qualifying written examination that the Commissioner shall conduct at such time & in such place as he may decide to hold for applicants desiring to act as underwriters.

Such examination shall not be required of any person who has served as non‑life company underwriter for a period of at least five years, if the Commissioner is satisfied of the applicant’s competence as shown by the results of his underwriting work in the non‑life insurance company or companies that employed him in that capacity. The minimum underwriting experience herein required may be reduced or waived if it is shown to the satisfaction of the Commissioner that the non‑life company underwriter has undergone extensive education &/or training in insurance.

SECTION 321. Any applicant who misrepresents or omits any material fact in his application for registration as a non‑life company underwriter, or commits any dishonest act in taking or in connection w/ the qualifying written examination for underwriters, shall be barred fr. being registered as such non‑life company underwriter &, if already registered, his registration shall be cancelled & the certificate of registration issued in his favor shall be recalled immediately by the Commissioner.

In the event that the certificate of authority of a non‑life insurance company to transact business is suspended or revoked due to business failure arising largely fr. the imprudent & injudicious acceptance of risks by the underwriter concerned, the registration of such underwriter shall likewise be cancelled & his certificate of registration shall be recalled by the Commissioner, & no similar certificate shall thereafter be issued in his favor.

SECTION 322. No certificate of registration issued to an underwriter shall be valid after the thirtieth day of June of the year following its issuance unless it is renewed.

The Commissioner may, after due notice & hearing, also suspend or cancel such certificate for violation of existing laws, rules & regulations or of any provisions of this Code. (As amended by Presidential Decree No. 1455)

Title V ADJUSTERS

SECTION 323. No person, partnership, association, or corporation shall act as an adjuster, as hereinafter defined, unless authorized so to act by virtue of a license issued or renewed by the Commissioner pursuant to the provisions of this Code; Provided, That in the case of a natural person, he must be a Filipino citizen & in the case of a partnership, association or corporation, at least sixty per centum of its capital must be owned by citizens of the Philippines.

SECTION 324. An adjuster may be an independent adjuster or a public adjuster.

The term “independent adjuster” means any person, partnership, association or corporation w/c, for money, commission or any other thing of value, acts for or on behalf of an insurer in the adjusting of claims arising under insurance contracts or policies issued by such insurer.

The term “public adjuster” means any person, partnership, association or corporation w/c, for money, commission or any other thing of value, acts on behalf of an insured in negotiating for, or effecting, the settlement of a claim or claims of the said insured arising under insurance contracts or policies, or w/c advertises for or solicits employment as an adjuster of such claims.

SECTION 325. For every line of insurance claim adjustment, adjusters shall be licensed either as independent adjusters or as public adjusters. No adjuster shall act on behalf of an insurer unless said adjuster is licensed as an independent adjuster; & no adjuster shall act on behalf of an insured unless said adjuster is licensed as a public adjuster: Provided, however, That when a firm or person has been licensed as public adjuster, he shall not be granted another license as independent adjuster & vice versa.

No license, however, shall be required of any company adjuster who is a salaried employee of an insurance company for the adjustment of claims filed under policies issued by such insurance company.

SECTION 326. Such license or any renewal thereof may be issued by the Commissioner upon written application filed by the person interested on the form or forms prescribed by the Commissioner, w/c shall contain such information as he may require, & upon payment of the corresponding fee hereinafter prescribed.

SECTION 327. The Commissioner shall conduct, at such times, & in such places as he may decide to hold, written examinations to determine the competence & ability of applicants desiring to act as adjuster of insurance claims.

SECTION 328. Every adjuster’s license issued hereunder shall be valid until after the thirtieth day of June of the year following the issuance of such license unless it is renewed. (As amended by Presidential Decree No. 1455)

SECTION 329. Nothing contained in this title shall apply to any duly licensed attorney‑at‑law who acts or aids in adjusting insurance claims as an incident to the practice of his profession & who does not advertise himself as an adjuster.

SECTION 330. The Commissioner may suspend or revoke any adjuster’s license if, after giving notice & hearing to the adjuster concerned, the Commissioner finds that the said adjuster (1) has violated any provision of this Code & of the circulars, rulings & instructions of the Commissioner or has violated any law in the course of his dealings as an adjuster; or (2) has made a material misstatement in the application for such license; or (3) has been guilty of fraudulent or dishonest practices; or (4) has demonstrated his incompetence or untrustworthiness to act as adjuster; or (5) has made patently unjust valuation of loss; or (6) has failed to make a report of the adjustment he proposed within sixty days fr. the date of the filing of the claim by the insured w/ the insurer, unless prevented so to do by reasons beyond his control; or has refused to allow an examination into his affairs or method of doing business as hereinafter provided.

SECTION 331. Every adjuster shall submit to the Commissioner a quarterly report of all losses w/c are the subject of adjustment effected by him during each month in the form prescribed by the Commissioner. The report shall be filed within one month after the end of each quarter.

SECTION 332. Every adjuster shall keep his or its books, records, reports, accounts, & vouchers in such manner that the Commissioner or his duly authorized representatives may readily verify the quarterly reports of the said adjuster & ascertain whether the said adjuster has complied w/ the provisions of law or regulations obligatory upon him or whether the method of doing business of the said adjuster has been fair, just & honest.

SECTION 333. The Commissioner shall, at least once a year & whenever he considers the public interest so demands, cause an examination to be made into the affairs & method of doing business of every adjuster.

SECTION 334. Any violation of any provision of this title shall be punished by a fine of not more than ten thousand pesos, or by imprisonment in the discretion of the court; Provided, That, in case of a partnership, association or corporation, the said penalty shall be imposed upon the partner, president, manager, managing director, director or person in charge of its business or responsible for the violation.

Title VI ACTUARIES

SECTION 335. No life insurance company shall be licensed to do business in the Philippines nor shall any life insurance company doing business in the Philippines be allowed to continue doing such business unless they shall engage the services of an actuary duly accredited w/ the Commissioner who shall, during his tenure of office, be directly responsible for the direction & supervision of all actuarial work connected w/ or that may be involved in the business of the insurance company.

SECTION 336. Any person may be officially accredited by the Commissioner to act as any actuary in any life insurance company or in any mutual benefit association authorized to do business in the Philippines upon application therefor & the payment of the corresponding fee hereinafter prescribed, Provided that: (1) he is a fellow of good standing of the Acturial Society of the Philippines at the time of his appointment & remains in such good standing during the tenure of his engagement; or (2) in the case of one who is not a fellow of the Acturial Society of the Philippines, he meets all the requirements of the said Society for accreditation as a fellow of the Society, & has been given permission by the pertinent government authorities in the Philippines to render services in the Philippines, in the event that he is not a citizen of the Philippines.

No certificate of registration issued under this title shall be valid after the thirtieth day of June of the year following its issuance unless it is renewed. (As amended by Presidential Decree No. 1455)

SECTION 337. The following documents, w/c are fr. time to time submitted to the Commissioner by a life insurance company authorized to do business in the Philippines, shall be duly certified by an accredited actuary employed by such company:

1. Policy reserves & net due & deferred premiums.

2. Statements of bases & net premiums, loading for gross premiums, & on non‑forfeiture values & reserves, when applying for approval of gross premiums, reserves & non‑forfeiture values.

3. Policies of insurance under any plan submitted to the Commissioner as required by law.

4. Annual statements & valuation reports submitted to the Commissioner as required by law.

5. Financial projection showing the probable income & outgo & reserve requirements, enumerating the acturial assumptions & bases of projections.

6. Valuation of annuity funds or retirement plans.

Any life insurance company authorized to do business in the Philippines may employ any person who is not officially accredited under either of the qualifications for any kind of acturial work, provided that he shall not, at any time, have the authority to certify to the correctness of the foregoing documents.

SECTION 338. No accredited actuary shall serve more than one client or employer at the same time. However, one already in the employ of an insurance company may be allowed by the Commissioner to serve a mutual benefit association or any other insurance company, provided the following conditions are first complied w/: (a) that the request to engage his services by the other employer is in writing; (b) that his present employer acquiesced to it in writing; & (c) that he furnishes the Commissioner w/ copies of said request & acquiescence.

Title VII RATING ORGANIZATION AND RATE MAKING

SECTION 339. Every organization w/c now exists or w/c may hereafter be formed for the purpose of making rates to be used by more than one insurance company authorized to do business in the Philippines shall be known as a “rating organization.” The term “rate” as used in this title shall generally mean the ratio of the premium to the amount insured & shall include, as the context may require, either the consideration to be paid or charged for insurance contracts, including surety bonds, or the elements & factors forming the basis for the determination or application of the same, or both.

SECTION 340. Every rating organization w/c now exists or w/c may hereafter be formed shall be subject to the provisions of this title.

SECTION 341. No rating organization hereafter formed shall commence rate‑making operations until it shall have obtained a license fr. the Commissioner. Before obtaining such license, such rating organization shall file w/ the Commissioner a notice of its intention to commence rate‑making operations, a copy of its constitution, articles of agreement or association, or of incorporation, & its by‑laws, a list of insurance companies that have agreed to become members or subscribers, & such other information concerning such rating organization & its operations as may be required by the Commissioner. If the Commissioner finds that the organization has complied w/ the provisions of law & that it has a sufficient number of members or subscribers & is otherwise qualified to function as a rating organization, the Commissioner may issue a license to such rating organization authorizing it to make rates for the kinds of insurance or subdivisions thereof as may be specified in such license. No license issued to a rating organization shall be valid after the thirtieth day of June of the year following its issuance unless it is renewed. No rating organization w/c now exists & is not licensed pursuant to this section shall continue rate‑making operations until it shall have obtained fr. the Commissioner a license w/c he may issue if satisfied that such organization is complying w/ the provisions of this title. Every rating organization shall notify the Commissioner promptly of every change in (1) its constitution, its articles of agreement or association or its certificate of incorporation, & its by‑laws rules & regulations governing the conduct of its business, & (2) its list of members & subscribers.

A “member” means an insurer who participates in or is entitled to participate in the management of a rating organization.

A “subscriber” means an insurer w/c is furnished at its request w/ rates & rating manuals by a rating organization of w/c it is not a member. (As amended by Presidential Decree No. 1455)

SECTION 342. Each rating organization shall furnish its rating service without discrimination to all of its members & subscribers, & shall, subject to reasonable rules & regulations, permit any insurance company doing business in the Philippines, not admitted to membership, to become a subscriber to its rating services for any kind of insurance or subdivisions thereof. Notice of proposed changes in such rules & regulations shall be given to subscribers. The reasonableness of any rule or regulation in its application to subscribers, or the refusal of any rating organization to admit an insurance company as a subscriber, shall, at the request of any subscriber or any such insurance company, be reviewed by the Commissioner at a hearing held upon at least ten days’ written notice to such rating organization & to such subscriber or insurance company. The Commissioner may, after such hearing, issue an appropriate order.

SECTION 343. No rating organization or any other association shall refuse to do business w/, or prohibit or prevent the payment of commissions to, any person licensed as an insurance broker pursuant to the provisions of title one of this chapter.

SECTION 344. Rating organization shall be subject to examination by the Commissioner, as often as he may deem such examination expedient, pursuant to the provisions of this Code applicable to the examination of insurance companies. He shall cause such an examination of each rating organization to be made at least once in every five years.

SECTION 345. The Commissioner may suspend or revoke the license of any rating organization w/c fails to comply w/ his order within the time limited by such order, or any extension thereof w/c he may grant. The Commissioner may determine when a suspension of license shall become effective & it shall remain in effect for the period fixed by him, unless he modifies or rescinds such suspension.

SECTION 346. Any rating organization may subscribe for or purchase acturial, technical or other services, & such services shall be available to all members & subscribers without discrimination.

SECTION 347. Any rating organization may provide for the examination of policies, daily reports, binders, renewal certificates, endorsements or other evidences of insurance, or the cancellation thereof, & may make reasonable rules governing their submission. Such rules shall contain a provision that in the event an insurance company does not within sixty days furnish satisfactory evidence to the rating organization of the correction of any error or omission previously called to its attention by the rating organization, it shall be the duty of the rating organization to notify the Commissioner thereof. All information so submitted for examination shall be confidential.

SECTION 348. Cooperation among rating organizations or among rating organizations & insurers in rate making or in other matters within the scope of this title is hereby authorized, provided the filings resulting fr. such cooperation are subject to all provisions of this title w/c are applicable to filings generally. The Commissioner may review such cooperative activities & practices & if he finds that any such activity or practice is unfair or unreasonable or otherwise inconsistent w/ the provisions of this title, he may issue a written order specifying in what respects such activity or practice is unfair or unreasonable or otherwise inconsistent w/ the provisions of this title, & requiring the discontinuance of such activity or practice.

SECTION 349. Every rating organization & every insurance company w/c makes & files its own rates, shall make rates for all risks rated by such organization or insurance company in accordance w/ the following provisions:

(a) Basic classification, manual, minimum, class, or schedule rates or rating plans, shall be made & adopted for all such risks. Any departure fr. such rates shall be in accordance w/ schedules, rating plans & rules filed w/ the Commissioner; aisa dc

(b) Rates shall be reasonable & adequate for the class of risks to w/c they apply;

(c) No rate shall discriminate unfairly between risks involving essentially the same hazards & expense elements or between risks in the application of like charges & credits;

(d) Consideration shall be given to the past & prospective loss experience, including the conflagration & catastrophe hazards, if any, to all factors reasonably attributable to the class of risks, to a reasonable profit, to commissions paid during the most recent annual period & to past & prospective other expenses. In case of fire insurance rates, consideration shall be given to the experience of the fire insurance business during a period of not less than five years next preceding the year in w/c the review is made;

(e) Risk may be grouped by classifications for the establishment of rates & minimum premiums. Classification rates may be modified to produce rates for individual risks in accordance w/ rating plans w/c establish standards for measuring variations in hazards or expense provisions, or both. Such standards may measure any difference among risks that can be demonstrated to have a probable effect upon losses or expenses.

SECTION 350. No rating organization & no insurance company w/c makes & files its own rates shall make or promulgate any rate or schedule of rates w/c is to be applied to any fire risk on the condition that the whole amount of insurance on any risk or any specified part thereof shall be placed w/ the members of or subscribers to such rating organization or w/ such insurer.

SECTION 351. Every insurance company doing business in the Philippines shall annually file w/ the rating organization of w/c it is a member or subscriber, or w/ such other agency as the Commissioner may designate, a statistical report showing a classification schedule of its premiums & losses on all kinds or types of insurance business to w/c section three hundred forty‑nine is applicable, & such other information as the Commissioner may deem necessary or expedient for the administration of the provisions of this title.

SECTION 352. Every non‑life rating organization & every non‑life insurance company doing business in the Philippines shall file w/ the Commissioner, except as to risks w/c by general custom of the business are not written according to manual rates or rating plans, every rate manual, schedule of rates, classification of risks, rating plan, & every other rating rule & every modification of any of the foregoing w/c it proposes to use. An insurance company may satisfy its obligation to make such filings for any kind or type of insurance by becoming a member of or subscriber to a rating organization w/c makes such filings for such kind or type of insurance, & by authorizing the Commissioner to accept such filings of the rating organization on behalf of such insurance company.

SECTION 353. Every manual or schedule of rates & every rating plan filed as provided in the preceding section shall state or clearly indicate the character & extent of the coverage to w/c any such rate or any modification thereof will be applied.

SECTION 354. The Commissioner shall review filings as soon as reasonably possible after they have been made in order to determine whether they meet the requirements of this title. When a filing is not accompanied by the information upon w/c the insurance company supports such filing, & the Commissioner does not have sufficient information to determine whether such filing meets the requirements of this title, he shall require such insurance company to furnish the information upon w/c it supports such filing. The information furnished in support of a filing may include: (1) the experience or judgment of the insurance company or rating organization making the filing, (2) its interpretation of any statistical data it relies upon, (3) the experience of other insurance companies or rating organization, or (4) any other relevant factors.

SECTION 355. If the Commissioner finds that any rate filings theretofore filed w/ him do not comply w/ the provisions of this title or that they provide rates or rules w/c are inadequate, excessive, unfairly discriminatory or otherwise unreasonable, he may order the same withdrawn & at the expiration of sixty days thereafter the same shall be deemed no longer on file. Before making any such finding & order, the Commissioner shall give notice, not less than ten days in advance, & a hearing, to the rating organization, or to the insurer, w/c filed the same. Such order shall not affect any contract or policy made or issued prior to the expiration of such sixty day period.

SECTION 356. No member or subscriber of a rating organization, & no insurance company doing business in the Philippines, or agent, employee or other representative of such company, & no insurance broker shall charge or demand a rate or receive a premium w/c deviates fr. the rates, rating plans, classifications, schedules, rules & standards, made & last filed by a rating organization or by or on behalf of the insurance company, or shall issue or make any policy or contract involving violation of such rate filings.

SECTION 357. Notwithstanding any other provisions of this title, upon the written application of the insurer, stating his reasons therefor, filed w/ & approved by the Commissioner, a rate in excess of that provided by a filing otherwise applicable may be used on any specific risk.

SECTION 358. Whenever the Commissioner shall determine, after notice & a hearing, that the rates charged or filed on any class of risks are excessive, discriminatory, inadequate or unreasonable, he shall order that such rates be appropriately adjusted. For the purpose of applying the provisions of this section, the Commissioner may fr. time to time approve reasonable classifications of risks for any or all such classes, having due regard to the past & prospective loss experience, including conflagration or catastrophe hazards, if any, to all other relevant factors & to a reasonable profit.

SECTION 359. Nothing contained in this title shall be construed as requiring any insurer to become a member of or subscriber to any rating organization.

SECTION 360. Agreements may be made among insurance companies w/ respect to the equitable apportionment among them of insurance w/c may be afforded applicants who are in good faith entitled to but are unable to procure such insurance through ordinary methods & such insurance companies may agree among themselves on the use of reasonable rates & modifications for such insurance, such agreements & rate modifications to be subject to the approval of the Commissioner; Provided, however, That the provisions of this section shall not be deemed to apply to workmen’s compensation insurance.

SECTION 361. No insurance company doing business in the Philippines or any agent thereof, no insurance broker, & no employee or other representative of any such insurance company, agent, or broker, shall make, procure or negotiate any contract of insurance or agreement as to policy contract, other than is plainly expressed in the policy or other written contract issued or to be issued as evidence thereof, or shall directly or indirectly, by giving or sharing a commission or in any manner whatsoever, pay or allow or offer to pay or allow to the insured or to any employee of such insured, either as an inducement to the making of such insurance or after such insurance has been effected, any rebate fr. the premium w/c is specified in the policy, or any special favor or advantage in the dividends or other benefits to accrue thereon, or shall give or offer to give any valuable consideration or inducement of any kind, directly or indirectly, w/c is not specified in such policy or contract of insurance; nor shall any such company, or any agent thereof, as to any policy or contract of insurance issued, make any discrimination against any Filipino in the sense that he is given less advantageous rates, dividends or other policy conditions or privileges than are accorded to other nationals because of his race.

SECTION 362. No insurance company doing business in the Philippines, & no officer, director, or agent thereof, & no insurance broker or any other person, partnership or corporation shall issue or circulate or cause or permit to be issued or circulated any literature, illustration, circular or statement of any sort misrepresenting the terms of any policy issued by any insurance company of the benefits or advantages promised thereby, or any misleading estimate of the dividends or share of surplus to be received thereon, or shall use any name or title of any policy or class of policies misrepresenting the true nature thereof; nor shall any such company or agent thereof, or any other person, partnership or corporation make any misleading representation or incomplete comparison of policies to any person insured in such company for the purpose of inducing or tending to induce such person to lapse, forfeit, or surrender his said insurance.

SECTION 363. If the Commissioner, after notice & hearing, finds that any insurance company, rating organization, agent, broker or other person has violated any of the provisions of this title, it shall order the payment of a fine not to exceed five hundred pesos for each such offense, & shall immediately revoke the license issued to such insurance company, rating organization, agent, or broker. The issuance, procurement or negotiation of a single policy or contract of insurance shall be deemed a separate offense.

Title VIII PROVISION COMMON TO AGENTS, BROKERS, AND ADJUSTERS

SECTION 364. A license issued to a partnership, association or corporation to act as an insurance agent, general agent, insurance broker, reinsurance broker, or adjuster shall authorize only the individual named in the license who shall qualify therefor as though an individual licensee. The Commissioner shall charge, & the licensee shall pay, a full additional license fee as to each respective individual so named in such license in excess of one.

Licenses & certificates of registration issued under the provisions of this chapter may be renewed by the filing of notices of intention on forms to be prescribed by the Commissioner & payment of the fees therefor. (As amended by Presidential Decree No. 1455)