Creating The "Philippine Crop Insurance Corporation" Prescribing Its Powers And Activities, Providing For Its Capitalization And For The Required Government Premium Subsidy, And For Other P
Download as PDF
Download as Word
Collections
Create new Collection
Overview
Full Text
Details
Case
Agency Issuance Number
Published Date
Creating The "Philippine Crop Insurance Corporation" Prescribing Its Powers And Activities, Providing For Its Capitalization And For The Required Government Premium Subsidy, And For Other P
Presidential Decree No. 1467
June 11, 1978
Case Overview and Summary
Summary of Presidential Decree No. 1467Creation of the Philippine Crop Insurance Corporation (PCIC)
• Section 1 creates the PCIC as a body corporate to provide insurance protection to farmers against losses from natural disasters, plant diseases, and pest infestation, initially for palay crops and later for other crops.
• The insurance excludes losses from avoidable risks due to neglect, malfeasance, fraud, or failure to follow proven farm practices.
• The indemnity shall not exceed the cost borne by the insured farmer in crop production.
Powers and Activities of the PCIC
• Section 3 outlines the powers of the PCIC, including:
- Prescribing bylaws, policies, rules, and regulations for implementing the crop insurance scheme (3.1)
- Insuring rice production against losses from natural calamities, diseases, and pests (3.5)
- Acquiring and managing businesses related to its purpose (3.7, 3.8, 3.9)
- Establishing branches (3.10)
- Exercising general powers conferred by law upon corporations (3.11)
Compulsory and Optional Participation
• Section 4 states that participation in the palay crop insurance is compulsory for farmers obtaining production loans under the supervised credit program.
• It is optional for self-financed farmers who agree to be supervised by accredited agricultural production technicians.
Premium Rate and Sharing
• Section 5 states that the rate of premium and its allocated sharing among farmers, lending institutions, the government, and other parties shall be determined by the PCIC's Board of Directors and approved by the President of the Philippines.
Government Premium Subsidy
• Section 6 provides for a government premium subsidy:
- For the first year, the required subsidy shall be appropriated from the National Treasury and drawn based on the actual insurance underwritten by the PCIC (6.1).
- For subsequent years, yearly projections of the subsidy shall be included in the government budgetary appropriations (6.2).
Transfer of Agricultural Guarantee Funds and Abolition of the Agricultural Guarantee Fund Board
• Section 7 transfers the assets, liabilities, and administration of the Agricultural Guarantee Fund and the fund created under Section 13 of Republic Act 6390 to the PCIC as part of the government's contribution to its capital.
• The Agricultural Guarantee Fund Board is abolished.
Capital Stock
• Section 8 outlines the authorized capital stock of the PCIC:
- P750,000,000 divided into 5,000,000 common shares (P100 par value) fully subscribed by the government and 2,500,000 preferred shares (P100 par value) with specific features (8.1).
- The initial paid-in capital is P250,000,000, with P150,000,000 from the net assets of the transferred Agricultural Guarantee Funds and P100,000,000 from the National Treasury (8.2).
- The remaining P250,000,000 common capital stock shall be fully subscribed by the government and paid as needed (8.3).
- The preferred shares have specific features, including preference in dividends, priority in asset distribution, minimum 6% dividend, cumulative, participating, non-voting, tax-exempt dividends, redeemable after 5 years, and transferable (8.4).
- The preferred shares may be available for sale or subscription by the general public (8.5).
Board of Directors
• Section 9 establishes a 9-member Board of Directors composed of various government officials and a nominee representing the private insurance industry (9.1).
• The Chairman is appointed by the President of the Philippines, and the PCIC President is the ex-officio Vice Chairman (9.1).
• Members have alternates, and the Board meets regularly at least twice a month (9.2, 9.3).
• Board members receive a per diem of P300 per session, up to a maximum of P3,000 per month (9.4).
Powers and Functions of the Board of Directors
• Section 10 outlines the powers and functions of the Board, including:
- Implementing the provisions and purposes of the Decree (10.1)
- Formulating policies, plans, rules, and regulations for the PCIC's management and operations, including limiting or expanding insurance coverage (10.2)
- Borrowing funds for financing programs and projects (10.3)
- Entering into contracts (10.4)
- Approving the budget and personnel compensation (10.5)
- Establishing employment policies and approving staffing patterns (10.6)
- Exercising general powers under the Corporation Law (10.7)
Management
• Section 11 vests the management of the PCIC in the President, who is appointed by the Board and has powers and duties such as:
- Executing and administering policies, plans, programs, rules, and regulations (11.1)
- Submitting policies, plans, and programs to the Board (11.2)
- Directing and supervising operations and internal administration (11.3)
- Recommending personnel actions to the Board (11.4)
- Exercising other powers and duties as directed by the Board (11.5)
Audit and Legal Counsel
• Section 12 states that the Commission on Audit shall be the ex-officio auditor of the PCIC.
• Section 13 provides for the PCIC to have its own Legal Department, with the Chief and members appointed by the Board.
Inter-Agency Linkages
• Section 14 directs various government departments, agencies, lending institutions, and other entities to act as cooperating agencies to the PCIC and design their policies, programs, rules, and regulations to attune and synchronize with the PCIC's objectives.
Utilization of Profits
• Section 15 states that the profits of the PCIC shall be determined on a calendar year basis, and the manner of distribution shall be determined by the Board.
Tax Exemption
• Section 16 exempts the PCIC from national, provincial, municipal, and city taxes and assessments to the extent allowed by national policy, provided that the exemption applies only to taxes and assessments for which the PCIC itself would otherwise be liable.
Repealing and Separability Clause
• Section 17 repeals or modifies conflicting decrees, charters, executive orders, administrative orders, proclamations, rules, and regulations.
Applicability of P.D. No. 612
• Section 18 states that the provisions of the Insurance Code shall apply to the PCIC insofar as they are not in conflict or inconsistent with this Decree.
Effectivity
• Section 19 states that the Decree shall take effect upon approval, and the PCIC shall commence business not later than 6 months from the appointment of the Chairman of its Board of Directors and payment of the initial capital contributions of the government.
Amends
n/a
Amended by
n/a
Tags
Executive Issuances
Presidential Decrees
crop insurance
Philippine Crop Insurance Corporation
rice production
natural calamities
premium subsidy
supervised credit program
agricultural guarantee fund
capital stock
board of directors
management
inter-agency linkages
tax exemption
Law
Creating The "Philippine Crop Insurance Corporation" Prescribing Its Powers And Activities, Providing For Its Capitalization And For The Required Government Premium Subsidy, And For Other P
Presidential Decree No. 1467
•June 11, 1978
MALACAÑANGM a n i l a
PRESIDENTIAL DECREE No. 1467
CREATING THE "PHILIPPINE CROP INSURANCE CORPORATION" PRESCRIBING ITS POWERS AND ACTIVITIES, PROVIDING FOR ITS CAPITALIZATION AND FOR THE REQUIRED GOVERNMENT PREMIUM SUBSIDY, AND FOR OTHER PURPOSES
WHEREAS, while the achievements of the on-going supervised rice production credit program has been substantial, the financial burden on the part of the farmers and the lending institutions in terms of uncompensated losses arising from destruction of standing crops wrought by floods, typhoons, heavy rains, drought and other natural calamities has not only tended to keep the farmers in perpetual indebtedness but has also considerably constricted the loaning capabilities of lending institutions and their willingness to extend loans to rice farmers;
WHEREAS, as a result of the recurrent natural disasters our farmers suffer heavy losses due to the destruction of their standing crops resulting in loss of income and the consequent loss of their credit standing through no fault of their own, which in turn seriously affects the finances of lending institutions participating in the supervised credit program;
WHEREAS,...
Login to see full content
Amends
n/a
Amended by
n/a