THE government is racing to recover insurance claims tied to flood control projects found to be ‘ghosts’ before the year ends.
The Insurance Commission (IC) and the Department of Public Works and Highways (DPWH) have begun coordinating to expedite the processing of surety bond claims from contractors and insurance firms involved in unfinished projects now under investigation.
‘We are fast-tracking the process and have instructed the involved contractors and companies to file their claims ahead,’ IC Commissioner Reynaldo Regalado said in a press briefing at the agency’s main office in Manila on October 15.
Up to 30 percent of a project’s contract value may be reclaimed by the government.
Regalado clarified that a court order would only be needed if an insurance company refuses to pay. In such cases, proceedings would be filed before the Regional Trial Court.
‘We are studying what specific cases may be filed,’ he added.
For his part, DPWH Secretary Vince Dizon said the filing of criminal cases before the Ombudsman or Sandiganbayan would not delay the recovery of the insurance claims.
‘Once we have filed the cases before the Ombudsman and the IC, we can already start the process of collecting the government’s claims,’ Dizon said in Filipino during the same event.
The DPWH chief added that the agency is still consolidating the total number of contracts to be covered by the claims, given the volume of projects under probe.
The IC and DPWH have also begun contacting insurance firms linked to the first batch of cases filed before the Ombudsman.
In Bulacan, Dizon said, the DPWH has written to Liberty Insurance Corp., Travelers Insurance, and Sterling Insurance Company Inc. to claim 30 percent of the contract value for all flood control projects included in the first Ombudsman case from the province’s first district.
The documents have already been submitted to the IC.
According to a Philippine Center for Investigative Journalism report, Bulacan ranks sixth among the country’s most flood-prone areas, with 668 projects amounting to about P43.75 billion.
Meanwhile, the IC is also looking into the possibility of ‘ghost insurance’ policies issued for non-existent or unimplemented projects.
‘We are checking this daily, but so far, there are no claims without corresponding contracts filed with us. Still, we are not discounting that possibility,’ Regalado said.
Insurance firms found to have issued irregular policies or failed to pay valid claims could face sanctions ranging from fines and suspension to revocation of license, Regalado added.
For insurance providers, Dizon hopes that they will cooperate without the need for litigation.
‘We hope they return what is due to the people without prolonging the legal process,’ he said.
The DPWH and IC formalized their partnership through a signed agreement at the IC’s main office, committing to jointly fast-track the recovery of insurance claims and strengthen their probe into irregularities in public works projects.