Ensuring your business complies with insurance requirements in the Philippines is important for smooth operations and legal protection. These mandatory coverages are designed to safeguard your company, employees, and the public. Here’s a clear guide to the key insurance lines your organization needs.
Public Liability Insurance
Public Liability Insurance protects your business if a third party—like a customer, visitor, or passerby—gets injured or suffers property damage because of your operations. This insurance is often required before your business can get a permit, depending on the rules set by your local government unit (LGU).
Where it’s required:
Retail stores and malls need this to cover accidents like a customer slipping on a wet floor
Restaurants and cafés benefit in case someone gets food poisoning or trips on-site
Construction companies need it for potential damage to nearby properties
Event venues require it to cover incidents during gatherings
If your business interacts with the public, this coverage isn’t just a legal requirement—it’s a smart safety net.
Compulsory Third-Party Liability (CTPL) Insurance
If your business uses motor vehicles, CTPL insurance is mandatory. It covers third-party injury or death caused by accidents involving your registered vehicles. Without it, you can’t register or renew your vehicle with the Land Transportation Office (LTO).
Where it’s required:
All vehicles registered or for registration to the LTO
Logistics and delivery services that use trucks, vans, or motorcycles
Taxi and bus operators to cover public transport-related incidents
Construction firms with on-site vehicles like cement mixers
Corporate fleets for company cars and employee transport
This coverage ensures that third parties have basic protection if the unexpected happens on the road.
Social Security System (SSS) Enrollment for Workmen’s Compensation
Protecting employees is non-negotiable. By enrolling them in the Social Security System (SSS), you ensure they receive compensation for work-related injuries, illnesses, or even death. This is required under the Social Security Act of 2018.
Where it’s required:
Factories and manufacturing plants where employees handle heavy machinery
Hotels and restaurants where staff may face kitchen or housekeeping hazards
Office-based companies for general workplace-related accidents
Construction firms where on-site risks are higher
It’s not just about legal compliance, it shows you care for your team’s well-being.
PhilHealth Enrollment
Healthcare is a fundamental right for employees. By enrolling them in PhilHealth, you provide support for hospitalization, medical procedures, and treatments. This is mandated by the National Health Insurance Act.
Where it’s required:
All businesses with employees—whether you run a small shop or a large corporation
Call centers and BPOs where employees often work long hours
Retail chains with frontline staff who interact with customers daily
Healthcare providers for their own medical personnel
PhilHealth coverage fosters employee security and a healthier workplace.
Maritime Insurance (for Marine-Based Businesses)
Marine insurance is mandatory for businesses involved in shipping goods or operating vessels. This ensures protection for cargo and vessels against risks like accidents, theft, or natural disasters.
Where it’s required:
Shipping companies for vessel coverage
Import/export businesses transporting goods by sea
Fishing companies for their boats and equipment
This type of insurance safeguards your maritime operations and investments.
Mandatory Insurance for Employers of Overseas Filipino Workers (OFWs)
Employers who deploy Overseas Filipino Workers (OFWs) are required to provide insurance coverage to their employees under the Migrant Workers and Overseas Filipinos Act of 1995 (Republic Act No. 8042), as amended by Republic Act No. 10022. This insurance protects OFWs from various risks during their employment abroad, ensuring their safety and welfare.
Where it’s required:
Recruitment and Placement Agencies: Agencies licensed by the Department of Migrant Workers (DMW), formerly known as the Philippine Overseas Employment Administration (POEA) to deploy OFWs for overseas jobs
Direct-Hiring Employers: Foreign employers who directly hire Filipino workers for specific roles abroad
Overseas Employment for High-Risk Jobs: Industries like construction, seafaring, domestic work, and healthcare where OFWs are often exposed to physical, environmental, or health-related risks
Government-to-Government Deployments: Under special agreements, such as DMW’s Government Placement Branch (GPB) programs.
Coverage includes:
- Accidental death, natural death, and permanent total disability insurance
- Repatriation costs due to termination, injury, or death
- Subsistence allowance for OFWs involved in legal disputes abroad
- Medical evacuation, repatriation, and compassionate visit for a family member in case of prolonged hospitalization
Mandatory OFW insurance ensures compliance with Philippine laws and provides critical protection for Filipino workers employed overseas.
Surety Bonds
Surety bonds act as guarantees that your business will meet certain obligations set by regulatory bodies. These bonds vary depending on your industry and activities.
Where it’s required:
Import/export businesses dealing with the Bureau of Customs to secure duties and taxes
Construction firms for performance bonds to ensure project completion
Mining companies needing environmental compliance bonds under the Department of Environment and Natural Resources (DENR)
Businesses with government contracts to fulfill agreements for bids or services
These bonds help build trust with regulators and clients while keeping your business compliant.
Fire Insurance (as required by LGUs and Banks)
Fire insurance is often mandated for businesses before securing permits or obtaining loans. It covers damage caused by fire, lightning, and other specified risks.
Where it’s required:
Commercial establishments like malls and retail stores
Manufacturing plants and warehouses
Businesses applying for bank loans or mortgages
This ensures protection for property investments and compliance with LGU requirements.
Navigating insurance requirements can be challenging. Reach out to Lockton Philippines at info.philippines@lockton.com to ensure your business stays compliant and protected.
