Insurance Corporation

"Section 190. For purposes of this Code, the term insurer or insurance company shall include all partnerships,
associations, cooperatives or corporations, including government-owned or -controlled corporations or entities,
engaged as principals in the insurance business, excepting mutual benefit associations. Unless the context otherwise
requires, the term shall also include professional reinsurers defined in Section 288. Domestic companyshall include
companies formed, organized or existing under the laws of the Philippines. Foreign company when used without
limitation shall include companies formed, organized, or existing under any laws other than those of the Philippines.

"Section 254. If the Commissioner is of the opinion upon examination of other evidence that any domestic or
foreign insurance company is in an unsound condition, or that it has failed to comply with the provisions of law or
regulations obligatory upon it, or that its condition or method of business is such as to render its proceedings
hazardous to the public or to its policyholders, or that its net worth requirement, in the case of a domestic stock
company, or its available cash assets, in the case of a domestic mutual company, or its security deposits, in the case
of a foreign company, is impaired or deficient, or that the margin of solvency required of such company is deficient,
the Commissioner is authorized to suspend or revoke all certificates of authority granted to such insurance company,
its officers and agents, and no new business shall thereafter be done by such company or for such company by its
agent in the Philippines while such suspension, revocation or disability continues or until its authority to do business
is restored by the Commissioner. Before restoring such authority, the Commissioner shall require the company
concerned to submit to him a business plan showing the companys estimated receipts and disbursements, as well as
the basis therefor, for the next succeeding three (3) years.

Capitalization Requirement
"Section 194. Except as provided in Section 289, no new domestic life or non-life insurance company shall, in a
stock corporation, engage in business in the Philippines unless possessed of a paid-up capital equal to at least One
billion pesos (P1,000,000,000.00): Provided, That a domestic insurance company already doing business in the
Philippines shall have a net worth by June 30, 2013 of Two hundred fifty million pesos (P250,000,000.00).
Furthermore, said company must have by December 31, 2016, an additional Three hundred million pesos
(P300,000,000.00) in net worth; by December 31, 2019, an additional Three hundred fifty million pesos
(P350,000,000.00) in net worth; and by December 31, 2022, an additional Four hundred million pesos
(P400,000,000.00) in net worth.

Mutualization and demutualization

"Section 262. Upon approval or adoption of the agreement to merge or consolidate by the stockholders or members
of the constituent companies, the corresponding articles of merger or of consolidation shall be duly executed by the
presidents and attested by the corporate secretaries and shall bear the corporate seals of the merging or consolidating
companies setting forth:
"(a) The plan of merger or the plan of consolidation;
"(b) As to each corporation, the number of shares outstanding, or in case of mutual corporations, the number of
members; and
"(c) As to each corporation, the number of shares or members voted for and against such plan, respectively.
Thereafter, a certified copy of such articles of merger or consolidation, together with a certificate of approval or
adoption by the stockholders or members of such articles of merger or consolidation, verified by affidavits of such
officers and under the seal of the constituent companies, shall be submitted to the Commissioner, together with such
other papers or documents which the Commissioner may require, for his consideration.

"Section 268. Any domestic stock life insurance company doing business in the Philippines may convert itself into
an incorporated mutual life insurer. To that end it may provide and carry out a plan for the acquisition of the
outstanding shares of its capital stock for the benefit of its policyholders, or any class or classes of its policyholders,
by complying with the requirements of this chapter.

Claims Settlement
"Section 247. (a) No insurance company doing business in the Philippines shall refuse, without just cause, to pay or
settle claims arising under coverages provided by its policies, nor shall any such company engage in unfair claim
settlement practices. Any of the following acts by an insurance company, if committed without just cause and
performed with such frequency as to indicate a general business practice, shall constitute unfair claim settlement
practices:
"(1) Knowingly misrepresenting to claimants pertinent facts or policy provisions relating to coverage at issue;
"(2) Failing to acknowledge with reasonable promptness pertinent communications with respect to claims arising
under its policies;
"(3) Failing to adopt and implement reasonable standards for the prompt investigation of claims arising under its
policies;
"(4) Not attempting in good faith to effectuate prompt, fair and equitable settlement of claims submitted in which
liability has become reasonably clear; or
"(5) Compelling policyholders to institute suits to recover amounts due under its policies by offering without
justifiable reason substantially less than the amounts ultimately recovered in suits brought by them.

"(b) Evidence as to numbers and types of valid and justifiable complaints to the Commissioner against an insurance
company, and the Commissioners complaint experience with other insurance companies writing similar lines of
insurance shall be admissible in evidence in an administrative or judicial proceeding brought under this section.
"(c) If it is found, after notice and an opportunity to be heard, that an insurance company has violated this section,
each instance of noncompliance with paragraph (a) may be treated as a separate violation of this section and shall be
considered sufficient cause for the suspension or revocation of the companys certificate of authority.

"Section 248. The proceeds of a life insurance policy shall be paid immediately upon maturity of the policy, unless
such proceeds are made payable in installments or as an annuity, in which case the installments, or annuities shall be
paid as they become due: Provided, however, That in the case of a policy maturing by the death of the insured, the
proceeds thereof shall be paid within sixty (60) days after presentation of the claim and filing of the proof of death
of the insured. Refusal or failure to pay the claim within the time prescribed herein will entitle the beneficiary to
collect interest on the proceeds of the policy for the duration of the delay at the rate of twice the ceiling prescribed
by the Monetary Board, unless such failure or refusal to pay is based on the ground that the claim is fraudulent.
"The proceeds of the policy maturing by the death of the insured payable to the beneficiary shall include the
discounted value of all premiums paid in advance of their due dates, but are not due and payable at maturity.

"Section 249. The amount of any loss or damage for which an insurer may be liable, under any policy other than life
insurance policy, shall be paid within thirty (30) days after proof of loss is received by the insurer and ascertainment
of the loss or damage is made either by agreement between the insured and the insurer or by arbitration; but if such
ascertainment is not had or made within sixty (60) days after such receipt by the insurer of the proof of loss, then the
loss or damage shall be paid within ninety (90) days after such receipt. Refusal or failure to pay the loss or damage
within the time prescribed herein will entitle the assured to collect interest on the proceeds of the policy for the
duration of the delay at the rate of twice the ceiling prescribed by the Monetary Board, unless such failure or refusal
to pay is based on the ground that the claim is fraudulent.

"Section 250. In case of any litigation for the enforcement of any policy or contract of insurance, it shall be the duty
of the Commissioner or the Court, as the case may be, to make a finding as to whether the payment of the claim of
the insured has been unreasonably denied or withheld; and in the affirmative case, the insurance company shall be
adjudged to pay damages which shall consist of attorneys fees and other expenses incurred by the insured person by
reason of such unreasonable denial or withholding of payment plus interest of twice the ceiling prescribed by the
Monetary Board of the amount of the claim due the insured, from the date following the time prescribed in Section
248 or in Section 249, as the case may be, until the claim is fully satisfied: Provided, That failure to pay any such
claim within the time prescribed in said sections shall be considered prima facie evidence of unreasonable delay in
payment.

"Section 251. It is unlawful to:

"(a) Present or cause to be presented any fraudulent claim for the payment of a loss under a contract of insurance;
and
"(b) Fraudulently prepare, make or subscribe any writing with intent to present or use the same, or to allow it to be
presented in support of any such claim. Any person who violates this section shall be punished by a fine not
exceeding twice the amount claimed or imprisonment of two (2) years, or both, at the discretion of the court.