(NAR) VOL. 29 NO. 1/ JANUARY - MARCH 18
“Section 202. In any determination of the financial condition of any insurance company doing business in the Philippines, there shall be allowed and admitted as assets only such assets legally or beneficially owned by the insurance company concerned as determined by the Commissioner which consist of:NOW, THEREFORE, pursuant to the power of the Insurance Commissioner under Section 437 (d) of the same Code to “x x x issue such rulings, instructions, circulars, orders and decisions as may be deemed necessary to secure the enforcement of the provisions of this Code, to ensure the efficient regulation of the insurance industry in accordance with global best practices and to protect the insuring public,” the following rules and regulations in the infusion of real estate assets to cover capital impairment and net worth deficiencies of insurance companies doing business in the Philippines are hereby promulgated:x x x
(b) Investments in securities, including money market instruments, and in real property acquired or held in accordance with and subject to the applicable provisions of this Code and the income realized therefrom or accrued thereon.x x x
(k) Other assets, not inconsistent with the provisions of paragraphs (a) to (j) hereof, which are deemed by the Commissioner to be readily realizable and available for the payment of losses and claims at values to be determined by him in a circular, rule or regulation.” [Emphasis supplied.]
a. The real property infused by the life or non-life insurance company in exchange for equity shall be utilized in accordance with Section 206 (b) (1) of the Amended Insurance Code; or3. Required Documentation. - Together with documents evidencing the infusion, the company shall also submit the following documents to this Commission:
b. lf the infused real property is or shall be used for housing projects and/or as an investment for the production of income:i. For life insurance companies: The infusion shall be governed by the provisions of Section 208 (a) and (b) of the same Code, whereby the aggregate book value of said class of investment shall not exceed twenty-five percent (25%) of the total admitted assets of the concerned life insurance company as shown in the latest financial statement approved by the Insurance Commissioner; orHowever, in the event that said infusion shall adversely affect the liquidity of the company, the real property infused shall be disposed of in accordance with Section 5 of this Circular Letter.
ii. For non-life insurance companies: The infusion shall be governed by this Commission’s Circular Letter No. 2017-43 dated 22 August 2017, except that the concerned company shall not be required to comply with the condition under Section 1 thereof. The aggregate book value of said class of investment shall not exceed twenty percent (20%) of the net worth of the concerned non-life insurance company as shown in the latest financial statement approved by the Insurance Commissioner.
a. Appraisal Report/s by an appraisal company that is duly accredited by the Securities and Exchange Commission (SEC);4. Quarterly Reports. - In cases where real property is invested for the production of income, the concerned insurance company shall submit quarterly reports to the Investment Services Division (ISD) of this Commission as regards the income generated by said real property, which reports shall be duly certified by the company's internal auditor
b. Photocopy/ies of the Transfer Certificate/s of Title and/or Condominium
Certificate/s of Title covering the subject property;
c. A copy of the duly notarized Deed of Assignment executed between the concerned shareholder and the insurance company, if the title of the subject property is not in the name of the insurance company; and
d. Copies of the Board Resolution and Secretary’s Certificate allowing the infusion of the subject real property.