Philippine insurance head suspended over transport row

The Philippines’ insurance regulator has been suspended for six months following a dispute over a mandatory passenger insurance program covering millions of public transport users.

The Office of the Ombudsman announced the preventive suspension of Insurance Commissioner Reynaldo Regalado on August 3, taking immediate effect. The July 28 order stems from allegations tied to the accreditation of a new insurance pool under the Passenger Personal Accident Insurance Program (PPAIP), which requires no-fault coverage for passengers, drivers, and conductors of public utility vehicles.

Compulsory coverage under scrutiny

The PPAIP, established under Section 387 of the Insurance Code, requires operators to secure insurance providing up to PHP 400,000 in death benefits and PHP 100,000 for injuries. The program falls under the oversight of the Insurance Commission (IC) and applies to vehicles regulated by the Land Transportation Franchising and Regulatory Board.

For years, two accredited insurance pools handled the program. In September 2025, the IC issued Circular Letter No. 2025-17, revising the framework to allow additional pools. By December 2025, it accredited a third pool managed by Centerstar Management and Insurance Agency Inc. and led by Milestone Guaranty and Assurance Corp.

The expansion drew legal challenges from the Alliance of Concerned Transport Organizations, which argued it disrupted existing risk-sharing arrangements. A Manila Regional Trial Court ruled in May 2026 that the circular did not violate any laws but did not examine whether the accreditation process itself was conducted properly. That question now lies at the heart of the Ombudsman’s investigation.

Conflict of interest allegations

The administrative complaint against Regalado focuses on his approval of the Centerstar consortium’s accreditation. The decision came despite concerns over the consortium’s membership and whether its application met deadlines.

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The Ombudsman’s order raised doubts about his impartiality, noting he was listed as senior counsel of AAQ Law, the firm representing the accredited consortium. The firm’s website still displayed his name in that role, marked “on leave.” The order stated his involvement in cases involving AAQ Law’s clients created serious conflicts.

Regalado faces multiple complaints, including alleged violations of the Code of Conduct and Ethical Standards for Public Officials and Employees and the Anti-Graft and Corrupt Practices Act. Other allegations include withholding accreditation records needed for an appeal and excluding a complainant’s lawyers from an IC conference.

The Ombudsman cited “strong evidence showing his guilt” and the need to secure documents under his control.

The accreditation process has long been contentious. A former IC commissioner noted in 2018 that it had been “perceived as a source of corruption or controversy.” The current case may push the next commissioner to address how the program balances competition, risk-sharing, and regulatory integrity.

Brokers handling transport or motor fleet risks in the Philippines now face uncertainty. Without clear leadership, even routine approvals could stall, affecting the entire sector. The situation highlights the challenges of maintaining stability in a rapidly expanding market.