Auto insurers ordered to align coverage with registration date

THE INSURANCE Commission has ordered car insurers to sell coverage that aligns with the automobile’s registration date, in order to make registration transactions more streamlined.

Insurance Commissioner Dennis B. Funa issued Circular Letter No. 2021-54 on Sept. 16 laying out the rules for synchronizing registration dates with the start of coverage periods.

The circular requires insurers to align the coverage period of all motor car insurance policies containing compulsory third-party liability insurance (CTPL) cover with the month the car’s registration. The rule applies for both stand-alone CTPL or comprehensive motor car insurance with CTPL provisions. “The circular aims to ensure efficiency in the registration or renewal of registration of motor vehicles, as well as to avoid redundancy in the coverage of motor car insurance policies,” Mr. Funa was quoted as saying.

CPTL is a prerequisite for registering a vehicle with the Land Transportation Office. Comprehensive insurance is not mandatory but offers more options for car protection.

Mr. Funa said the new guidelines were drafted in response to the concerns raised by the Anti-Red Tape Authority, which noted the possibility of a car covered with a comprehensive policy having to be covered with a CTPL if coverage periods are not aligned.