Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies
Insurance Circular Letter No. 2019-50 establishes guidelines for pre-need companies in the Philippines regarding compliance with statutory minimum unimpaired paid-up capital requirements, as outlined in the Pre-Need Code (Republic Act No. 9829). The minimum capital requirements are set at P100 million for companies offering three types of plans, P75 million for two types, and P50 million for one type. Additionally, companies with servicing licenses or those not selling any plans must maintain a minimum capital of P50 million. The circular also clarifies that no withdrawals from trust funds are permitted for discontinued plan types, except in specific instances. This circular took effect immediately upon issuance.
Quick Answers
- What is Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies about?
- Insurance Circular Letter No. 2019-50 establishes guidelines for pre-need companies in the Philippines regarding compliance with statutory minimum unimpaired paid-up capital requirements, as outlined in the Pre-Need Code (Republic Act No. 9829). The minimum capital requirements are set at P100 million for companies offering three types of plans, P75 million for two types, and P50 million for one type. Additionally, companies with servicing licenses or those not selling any plans must maintain a minimum capital of P50 million. The circular also clarifies that no withdrawals from trust funds are permitted for discontinued plan types, except in specific instances. This circular took effect immediately upon issuance.
- What type of law is Insurance Circular Letter No. 2019-50?
- Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies (Insurance Circular Letter No. 2019-50) is a Philippine Other Rules and Procedures enacted by the Congress of the Philippines.
- When was Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies enacted?
- Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies (Insurance Circular Letter No. 2019-50) was enacted on Sep 16, 2019.
- What is the citation for Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies?
- Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies, Insurance Circular Letter No. 2019-50, Sep 16, 2019 (Philippines)
Law Information
- Reference Number
- Insurance Circular Letter No. 2019-50
- Date Enacted
- Category
- Other Rules and Procedures
- Subcategory
- Insurance
- Jurisdiction
- Philippines
- Enacting Body
- Congress of the Philippines
Full Law Text
September 16, 2019
INSURANCE CIRCULAR LETTER NO. 2019-50
Supersedes: NONE
| TO | : | All Pre-Need Companies Doing Business in the Philippines |
| SUBJECT | : | Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies |
WHEREAS, Section 9 of Republic Act No. 9829, otherwise known as the Pre-Need Code of the Philippines, provides that existing pre-need companies shall comply with the following minimum unimpaired paid-up capital: (a) One Hundred Million Pesos (P100,000,000.00) for companies selling at least three (3) types of plan; (b) Seventy-Five Million Pesos (P75,000,000.00) for companies selling two (2) types of plan; and (c) Fifty Million Pesos (P50,000,000.00) for companies selling a single type of plan; AIDSTE
WHEREAS, pursuant to said provision of the Pre-Need Code of the Philippines, the maintenance of a prescribed minimum unimpaired paid-up capital is dependent upon the number of types of plans a pre-need company "sells";
WHEREAS, consequently, the threshold amount of said minimum statutory unimpaired paid-up capital shall be determined based on the number of types of plans a particular pre-need company actually offers for sale in the market;
WHEREAS, for the avoidance of confusion, this Commission likewise finds the need to prescribe minimum unimpaired paid-up capital requirements for pre-need companies with servicing licenses and/or those that are not offering any type of plan for sale in the market;
NOW, THEREFORE, pursuant to the power granted to this Commission to "[p]repare, approve, amend or repeal rules, regulations and orders x x x" under Section 6 (k) of the same Code, the following Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies are hereby promulgated and adopted, to wit:
1. Determination of Required Minimum Unimpaired Paid-Up Capital. — For the purposes of determining a pre-need company's compliance with statutory minimum unimpaired paid-up capital requirements for a given calendar year, the threshold amount of said minimum capital shall be based on the number of pre-need plans such company actually offered for sale in the market during said calendar year as confirmed by this Commission's examination into said company's affairs, financial condition and methods of doing business.
2. Required Minimum Unimpaired Paid-Up Capital for Pre-Need Companies with Servicing Licenses and/or Those That are Not Selling Any Type of Plans. — Pre-need companies with servicing licenses and/or those that are not offering any type of plan for sale in the market shall be required to maintain a minimum unimpaired paid-up capital of Fifty Million Pesos (Php50,000,000.00).
3. Withdrawal from Trust Funds of Type of Plants Discontinued for Sale. — Notwithstanding the reduction of the required minimum unimpaired paid-up capital resulting from the confirmed actual cession of sale of one (1) or more types of pre-need plans from a given calendar year to succeeding calendar year/s, no withdrawal shall be made from the respective trust funds of the type/s of plans that were discontinued for sale except for the instances mentioned in Section 30 of the Pre-Need Code of the Philippines.
4. Effectivity. — This Circular Letter shall take effect immediately.
(SGD.) DENNIS B. FUNAInsurance Commissioner
Cite This Law
Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies, Insurance Circular Letter No. 2019-50, Sep 16, 2019 (Philippines)
Guidelines for the Determination of Compliance with Statutory Minimum Unimpaired Paid-Up Capital Requirements for Pre-Need Companies, Insurance Circular Letter No. 2019-50 (Phil. 2019)
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