Two separate bills have been filed at the Philippine legislature's lower house seeking to restructure the Insurance Commission and place it under the jurisdiction of the central bank Bangko Sentral ng Pilipinas (BSP).
If either bill is passed, it would make the BSP a "super regulator" similar to regional neighbours Monetary Authority of Singapore and Bank Negara Malaysia, according to a report by the Manila Bulletin.
At the moment the BSP jurisdiction is limited to banks and non-banks with quasi banking functions. However the amended charter gives them additional supervision powers to other financial institutions such as money service businesses, credit granting businesses and payment system operators.
Currently, the Insurance Commission is under the Department of Finance. Under the proposed changes, while the Insurance Commission as a BSP unit may issue rulings, circulars, orders, and instructions, all decisions "except otherwise specified" that were made by the insurance regulator "shall be appealable to the governor of the BSP." The BSP governor like IC officials, are all appointed by the country's president.
Representative Sharon Garin, the author of one of the bills, said that her proposal also seeks to transform the Insurance Commission into a collegial body, similar to the BSP, which has a monetary board composed of seven members. Currently, the Insurance Commission is headed by a single commissioner, Dennis Funa.
The Insurance Commission is facing opposition from life insurers who area against proposed legislation that will split the regulation of variable unit linked (VUL) products, or policies that offer permanent life insurance with built-in savings component and investment of their cash value.
Philippine Life Insurance Association (PLIA) president Benedict C. Sison said among the recent regulatory trends and court decisions that "may not be to the best interest of our clients and the industry" included the bill on collective income schemes (CIS).