Insurance Commission issues license to PPSTA

Insurance Commissioner Emmanuel F. Dooc has announced the issuance of a Certificate of Authority in favor of the Philippine Public School Teachers Associations, Inc., (PPSTA), a mutual benefit association of public school teachers placed under conservatorship by the Insurance Commission (IC).
In what is considered historical in the insurance industry in the country, Dooc said PPSTA was issued a license to act as a mutual benefit association after it emerged from its nine years of financial distress.
Dooc said the nature and successful rehabilitation of PPSTA should be heralded as a landmark achievement for the IC as it is the first company among those under the supervision and regulation by the IC to be successfully rehabilitated after experiencing financial distress, although the IC will continue to have effective control of management until competent and trustworthy Board and Management have been firmly established.
Dooc said the IC decided to issue PPSTA’s license based on its strong financial performance which is indicative that PPSTA will soon be able to manage its business on its own.
From a high negative of P1.8 billion in 2005, PPSTA is now at a positive P128.31 million in terms capital which means that the total assets of the association is higher than its total liabilities. It was during the end of the second quarter of 2014 that PPSTA first posted a positive equity of P.601 million. In terms of assets, PPSTA posted a 8.4% increase in terms of assets from P4 billion in 2013 to P4.4 billion last year.
Commissioner Dooc said “The successful rehabilitation of PPSTA can serve as a model for all other companies under the jurisdiction of the IC which are currently facing financial distress. What we did to PPSTA can be replicated to other companies for their eventual rehabilitation and for them to be able to continue their business as a going concern.”
Commissioner Dooc said, “The IC decided to grant PPSTA its license to operate as a mutual benefit association which is vital in continuing the normal operation of its business and in sustaining its strong financial performance.
“This success was due to IC’s close supervision and monitoring of PPSTA’s financial and business operations, enforcement of effective corporate strategy and the filing of appropriate court cases against erring former officials of the association” said Commissioner Dooc.
This significant improvement in PPSTA’s financial condition was brought about by several factors including the implementation of programs and policies aimed at building up its reserves and towards the reduction of its administrative expenses.
Commissioner Dooc commended the performance of the IC appointed conservator for PPSTA Atty. Moises A. Balon and PPSTA’s Board of Trustees, headed by Dr. Kahar H. Macasayon, for their effective management of PPSTA’s business operations. He likewise commended PPSTA’s former conservators Mr. Daniel A. Gomez, Atty. Francis X. Perez, Mr. Francisco E. Josef, Atty. John A. Apatan and Mr. Carlos H. Yturzaeta.
Commissioner Dooc mentioned that IC’s commitment to instill good corporate governance in the organization, including the appointment of professional managers or conservators and of independent directors are key factors in the rehabilitation process.
The rehabilitation of PPSTA started in 2005 when the IC placed PPSTA under conservatorship in order to address its reserve deficiency and to preserve its assets.
PPSTA’s members include administrators, supervisors, classroom teachers, non-teaching support personnel all over the Philippines and under the employ of the Department of Education. It serves as a financial security provider through its retirement, life insurance and loans programs.