THE Armed Forces and Police General Insurance Corp. (AFPGen) surrendered its license to regulators on Tuesday, saying it could no longer raise the required net worth by the end of 2019.
In a statement, Insurance Commissioner Dennis B. Funa said the nonlife insurance firm voluntarily stopped its operations. “The AFPGen was unable to meet the minimum net worth requirement mandated by the Insurance Code by the end of the year,” the statement read.
He added that despite AFPGen’s compliance with the minimum requirement of P500 million by the end of 2018, it is no longer viable to maintain its insurance business considering that its financial health was continuously eroded in the last six years. “AFPGen is now prohibited from entering into new insurance contracts,” said Funa.
Funa further explained that the AFPGen’s operations are now limited to servicing its existing policyholders.
Under the Amended Insurance Code, the capital requirement for insurance firms will increase every three years until 2022. The mandated increase in insurers’ minimum net worth is P900 million by the end of 2019.
Launched in 1979, the AFPGen is a whollyowned subsidiary of the AFP-Mutual Benefit Association Inc. which was initially created to service the insurance needs of the country’s military and police organizations.