The Philippines’ Insurance Commission (IC) has announced that the Armed Forces and Police General Insurance Corp. (AFPGen) has ceased its insurance selling operations due to financial unviability.
AFPGen, which was established in 1977 to provide non-life insurance services to the Philippine armed forces and police, voluntarily surrendered its licence to do full insurance business, and, instead, will take on a servicing licence, BusinessWorld reported.
This means that all policies issued by AFPGen remain in force and valid, but the company’s operations will be limited to servicing existing policies, and no new business will be added. An official has been appointed by the IC to oversee the company’s compliance in meeting its liabilities.
“While the company’s net worth as of end-2018 is compliant with the existing PHP550 million (US$10.65 million) net worth requirement, the company said that it is no longer viable to maintain its insurance business, considering that its financial health continuously eroded in the last six years,” Insurance Commissioner Dennis Funa said in a statement.
Only when the company has settled all its obligations to policyholders and creditors will it be allowed by the IC to fully shut down its business.
AFPGen initially did business only with military- and police-related clients. But in 2002, it began offering its products to the general public, according to its website. Prior to the announcement that it would no longer sell new policies, it offered fire, motor, licenced firearms liability, engineering, and aviation insurance products, among others.
