Saturday, September 7, 2013

SOME PROVISIONS ON MUTUAL BENEFITS ASSOCIATIONS OF R.A. 10607 (AMENDED INSURANCE CODE)





It may interest mutual benefit associations (MBAs) to know what are some provisions about them under the newly-enacted R.A. 10607 ("An Act To Strengthen the Insurance Industry").

We are quoting some interesting excerpts from Chapter VII, Title 1 of the law:

* - "..In no case shall a mutual benefit association be organized and authorized to transact business as a charitable or benevolent organization and whenever it has this feature as incident to its existence, the corresponding charter provision shall be revised..."

* - "Mutual benefit association, already licensed to transact business business as such on the date this Code becomes effective, having such charitable or benevolent feature, shall abandon such such incidental purpose upon effectivity of this Code...

* -  "..Provided that  no such license shall be granted to any such association if such association has no actuary...

* -  "..No mutual benefit association shall be issued a license to operate ...unless it has constituted and established a Guaranty Fund...an initial minimum amount of five million pesos...

* -  ".. Every mutual benefit association licensed to do business as such shall issue membership certificates to its members 

 

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