SC: DOF case versus injunction on insurers’ capital hike now moot
The Supreme Court (SC) has dismissed as moot and academic the Department of Finance’s (DOF) petition contesting an injunction against its orders requiring insurance firms to increase their paid-up capital by 2012.
In a recent 6-page decision, the SC 2nd Division said the 2013 enactment of the Republic Act Number 10607, or the Amended Insurance Code, already supervened the issue hounding the DOF’s Department Orders (DOs) Number 27-06 and 15-2012. .
Section 194 of the 2013 law required life and non-life insurance companies to have a paid-up capital of at least P1 billion for new ones.
The 2013 law required existing companies to increase their paid-up capital on a staggered basis to P250 million by mid-2013, P550 million by end-2016, P900 million by end-2019, and P1.3 billion by end-2022.
The passage of the said law meant there was no more need to resolve the issue regarding the DOs, which members of the Philippine Insurers and Reinsurers Association, Inc. (PIRAI) questioned for violating the doctrine of non-delegation of legislative powers.
“This Court, deems it proper to abstain from ruling on the merits of the case,” read the decision penned by Associate Justice Jose Reyes, Jr.
The DOF had questioned the December 5, 2012 injunction issued against the DOs by the Quezon City Regional Trial Court (RTC) Branch 80 and affirmed in a May 15, 2015 decision by the Court of Appeals (CA).
DO 27-06 had required insurance companies to increase the paid-up capital to P250 million by the end of 2012. DO 15-2012 further instructed the increase of the paid-up capital to P400 million in 2014, P600 million in 2016, P800 million in 2018, and P1 billion in 2020.