GSIS Monopoly

GSIS Monopoly

The Filipino-based Government Service Insurance System (GSIS) is responsible for insuring state assets in that country. They have a monopoly on that market, because according to the Republic Act 656 of 19 51, they must ?secure some P1.5 trillion of the state?s assets? (BusinessWorld). They have recently been accused of abusing this market power by overcharging these government agencies large premiums, while fattening the commissions that they pay to their ?favored brokers? (BusinessWorld). This has come to the attention of the public because National Power Corporation (Napocor) has been complaining that GSIS had sold the company an insurance contract that they felt was unjustifiably high. These high premiums would be used to wine and dine brokers and pay out huge commissions. The most prominent of these brokers being Jardine Lloyd Thompson Insurance Brokers, Inc. They have long been the number one insurance company in the Philippines, up until 2000, when according to Bus!
inessWorld; they were overtaken by Orient Pearl, which had only been in business since 1999. GSIS is a monopoly, and I believe that it needs to be regulated so as to stop it from continuing to jack up the prices only

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