AFTER 17 years, financial security provider Philippine Public School Teachers Association (PPSTA) has finally exited conservatorship.
In a statement last Thursday, the Insurance Commission (IC) announced it had lifted the conservatorship status of PPSTA following its compliance with the Minimum Guaranty Fund and Risk-Based Capital (RBC) ratio requirements.
The regulator said the PPSTA has complied with the Minimum Guaranty Fund requirement of P12.5 million as provided in Insurance Memorandum Circular (IMC) 2006-002 dated April 24, 2006, based on the results of the verification of its annual statement as of end-2020.
Likewise, its RBC ratio of 402 percent as of 2020 was also more than triple the required ratio of 125 percent required under IMC 11-2006 dated December 8, 2006. This was also a significant improvement from a negative-24 percent RBC ratio as of 2013.
Moreover, the total members’ equity as of 2020 amounted to P2.57 billion, a reversal from negative-P115.77 million as of 2013.
“Notwithstanding the lifting of the conservatorship status of PPSTA, it remains subject to continuing compliance with the statutory and regulatory requirements of this Commission for mutual benefit associations [MBAs],” Insurance Commissioner Dennis B. Funa said.
“Upon its exit from conservatorship, this Commission will be monitoring PPSTA’s observance of the Code of Corporate Governance for Insurance Commission Regulated Companies [CCG-ICRC] and the implementation of its digitalization program and its rationalization plan,” Funa added.
Under its digitalization program, PPSTA aims to improve its operational efficiency through acquiring new information technology (IT) equipment, systems migration, strengthening IT security and training its personnel. Meanwhile, it also aims to boost the efficiency of its services to its teacher-members by eliminating operational redundancies and overlaps and improving its systems and procedures.
To recall, the professional association of public school teachers was placed under conservatorship in April 2005 due to its insurance reserve deficiencies.
In 2018, lawyer Nasser A. Marohomsalic was appointed as the association’s present conservator.
Established on April 5, 1947, the PPSTA is the biggest and foremost professional association of public school teachers in the Philippines with more than 200,000 teacher-members under the employ of the Department of Education, including administrators, supervisors, classroom teachers and non-teaching support personnel. PPSTA serves as a financial security provider for Filipino public school teachers through its retirement, life insurance and loan programs.