Belgica: TPL unnecessary for cars already insured

The Anti Red Tape Authority (ARTA) seems to be focusing quite a bit of attention on the Land Transportation Office (LTO). Recently, there have been statements by the ARTA that concern the LTO over the age-old issue of fixers at LTO locations.

But now there's something new, and it concerns a somewhat controversial requirement for every vehicle being renewed for registration: compulsory third-party liability insurance, otherwise known as CTPL or just TPL.

ARTA's Director-General, Atty. Jeremiah Belgica, released a statement via ARTA recommending that the LTO remove TPL as a requirement for registration. Belgica said that TPL is “inflicting additional expense to the public” and should be removed.

ARTA chief to LTO: remove TPL requirement if car insured image

“As we seek to eliminate overregulation and unnecessary requirements, this would reduce the burden on the transacting public, streamline the vehicle registration process, and promote good regulatory principles,” said Belgica.

Now before motor vehicle owners jump for joy, there are some things that need to be made clear. The first is that the ARTA is just making the recommendation to the LTO; in the end, it may be the Department of Transportation (DOTr) that has to decide whether to act on it or not. And even so, the legislative branch will likely have to get involved and start the process of making it a law.

The other is that the ARTA chief stated that TPL should be removed if the vehicle is already covered under a comprehensive insurance policy.

What Director-General Belgica is saying is that to have both a TPL and comprehensive insurance is redundant. He is not recommending that TPL be removed if a vehicle isn't covered under any insurance policy; what he is saying is that the LTO should “reconsider waiving the requirement provided that the vehicle owner can show proof of comprehensive insurance”.

ARTA chief to LTO: remove TPL requirement if car insured image

For newly released vehicles or fairly new vehicles, that will be beneficial as models bought under financing plans have to have a comprehensive policy as well as a TPL; that is the redundant part that the ARTA chief may be referring to. For vehicles that are still deemed insurable by insurance companies under their guidelines (typically 10 years old or newer) under comprehensive policies, then that would be beneficial too.

For much older vehicles that are no longer viable for insurance companies to cover under a comprehensive policy, that means TPL will likely be required.

The ARTA is intensifying its drive against fixers when it comes to vehicle registration and is working with the DOTr and other stakeholders on the matter.

“I would like to thank the DOTr for their assistance in ARTA’s anti-fixing campaign, as well as for responding quickly to our request to issue an advisory to PETCs and MVECTs about the extent of services they are allowed to provide and their strict adherence to that limitation,” said Belgica.

“On the other hand, we have already written a letter to the Insurance Commission and LTO about this issue, but have yet to receive a response.”