The Market Monitor Minding the Nation's Business
Interior Secretary Mel Senen S. Sarmiento recently reminded all local chief executives about their compliance with the Property Insurance Law.
This reminder came after the Government Service Insurance System (GSIS) provided the Department of the Interior and Local Government with an updated list of uninsured local governments as of March 2016, which shows that three provinces, nine first-class municipalities, and 53 other towns have not yet insured their property.
“Include in your 2017 budget the premiums for such insurance coverage with the GSIS, settle premium payments in a timely manner, and contact the GSIS Insurance Group for insurance requirements and related queries,” Sarmiento said.
He said that this is in compliance with Republic Act 656, also known as the Property Insurance Law.
Section 5 of the law reads: “Every government, except a municipal government below first class, is hereby required to insure its properties with the Fund against any insurable risk herein provided and pay the premiums thereon….Municipal governments below first class may upon application insure its properties in the Fund under such rules and regulations as the System may prescribe.”
“Local governments with budgetary constraints may also consider using the Local Disaster Risk Reduction and Management Fund [LDRRMF],” Sarmiento said.
Section 21 of RA 10121, also known as the Philippine Disaster Risk Reduction and Management Act, states: “Not less than five percent [5%] of the estimated revenue from regular sources shall be set aside as the LDRRMF to support disaster risk management activities such as, but not limited to, pre-disaster preparedness programs including…the payment of premiums on calamity insurance.”
Sarmiento directed all interior regional directors and the governor of the Autonomous Region in Muslim Mindanao (ARMM) to inform all local authorities and ensure active local government compliance.