Tired party liability | Inquirer Business

Tired party liability

OUR REMARKABLE courts recently stopped what could very well be the one and only faultless project of the Land Transportation Office (LTO) under our leader Benigno Simeon, aka BS.

Reports said a Makati court issued a “permanent injunction” against the project with this crazy long name—reformed compulsory third party liability (RCTPL). From what I gathered, the case simply enjoyed the rich backing of dubious insurance companies that specialized in the TPL business with the LTO.

That would be the “third party liability” insurance coverage, which the law mandated, as against “comprehensive” insurance. Because the TPL was obligatory, it became an ugly twisted business ruled by some fly-by-night companies through “fixers” masquerading as agents.


From what I gathered, a group of insurance companies cornered at least 60 percent of the TPL business, estimated to reach some P6 to P7 billion a year. To many hapless motorists, unfortunately, the TPL was a racket, just another useless expense courtesy of their beloved government.


As the tired old TPL racket already victimized us for decades, we came to regard it as just another incurable disease in the government, much like corruption in the courts.

Well, not to the LTO, at least not to its chief Roberto Cabrera III.

Sick and tired of the overpricing done by the TPL syndicates in LTO, Cabrera focused on the RCTPL in his short stint with the agency.

Anyway, based on rules of the Insurance Commission (IC), the TPL must only cost P640 for private vehicles and utility vehicles, P689 for medium vehicles and light trucks, P1,280 for heavy vehicles, and surprise—P330 for motorcycles. Those prices also included taxes and authentication fees.

With the help of fixers, i.e. fake agents, legions of so-called insurance companies pitching tents at the LTO could charge up to P1,800 for the freaking TPL.

Cabrera figured, and correctly so, that the only way to curb this practice would be for the LTO to introduce a centralized system, the one called RCTPL. The idea was to publish uniform rates for the TPL. All insurance companies in the Philippines—again, all—could join in implementing the RCTPL and two administrators would then manage the pool.


Cabrera figured that, aside from solving the problem of overpricing, the system could also stop the issuance of fake TPL certificates. Because they never declared those TPLs to the IC, the public always had trouble in validating accident claims against the firms.

Under the centralized system for TPL, the administrators could assure the public that—one, the TPL would be authentic and, two, payment of claims would be faster.

For insurance claims under the RCTPL, the insurance firms would need the police report only if the accident involved death. Just imagine the relief we could get from severe traffic caused by minor accidents on the road!

Reward for Cusi

Another businessman would be joining the Cabinet of incoming President Rodrigo Duterte, aka Duterte Harley but not Dirty Harry. His name is Alfonso Cusi, designated as Energy Secretary, but who also happened to be the vice chair of PDP-Laban, the party that sponsored the candidacy of Duterte Harley.

And so word went around that, having figured prominently in the campaign, Cusi got a position in the Cabinet as a … well, “reward.” Cusi actually boasts of an impressive record in various positions in the government under the cute administration of Gloriaetta.

What would be the policy thrust of the administration of Duterte Harley in energy? Certainly, the new administration would have to work on steady supply of energy in the country, covering even the exploration and development of domestic sources such as oil, gas and coal, plus building renewable energy sources such as solar and hydro.

But then Cusi would also have to do some drastic changes in the rules of the energy game, at least to fight the corruption that has beset supply contracts between the government and private power plants in the past. Take a bow, Tokyo power!

Now, Cusi would be no stranger to some clean up jobs in the government, having served as general manager of the Manila International Airport Authority and head of the Philippine Ports Authority.

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This man could dream big. Methinks that this country could use the likes of him.

TAGS: Business, economy, Insurance, Land Transportation Office, News

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