NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE
s. No. 1189
Senate
of the ^cevetm-p
72 AUG 16 P 2 :40
RtCEiVED BY.
Introduced by Senator Christopher Lawrence "Bong" T. Go
AN ACT
ESTABLISHING A NATIONAL FRAMEWORK FOR THE MANDATORY 
ENVIRONMENTAL INSURANCE COVERAGE OF ENVIRONMENTALLY CRITICAL 
PROJECTS
EXPLANATORY NOTE
Article II, Section 16 of the 1987 Philippines Constitution declares that "the State 
shall protect and advance the right of the people to a balanced and healthful ecology in 
accord with the rhythm and harmony of nature." Indeed, it is the duty of the State to 
uphold the quality of life of its people through the protection of the environment they live 
in.
Despite existing measures and laws that protect the environment, there have been 
various instances of man-made environmental damages in the country.
Over the years, the responsibility of man to take care of its only home seems to 
be overlooked, especially in the wake of the blinding pace of modern industrialization. 
This has led to almost recurring and irreparable damage to the environment, seriously 
jeopardizing future generations.
This bill seeks to establish a National Framework for Mandatory Environmental 
Insurance Coverage which shall guarantee sufficient funding coverage for the needed 
restoration and compensation for damages on the environment caused by owners and


operators of environmentally-critical projects which activities have the potential to harm 
the environment and everything that depends on it.
In view of the foregoing, approval of this bill Is earnestly sought.
SENATOR CHRISTOPHER LAWRENCE


NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
First Regular Session 
)
SENATE
s. No. 1189
<©ff!cp of tlje fficfrpf
■22 AUG 16 P2 :41 
received BY
■
Introduced by Senator Christopher Lawrence "Bong" T. Go
AN ACT
ESTABLISHING A NATIONAL FRAMEWORK FOR THE MANDATORY 
ENVIRONMENTAL INSURANCE COVERAGE OF ENVIRONMENTALLY CRITICAL 
PROJECTS
Be it enacted by the Senate and the House of Representatives of the Philippines 
in Congress assembled:
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Section 1. Title. — This Act shall be known as the "Mandatory Environmental
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Insurance Coverage Act of 2022."
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Sec. 2. Definition of Terms. — As used in this Act:
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a) Environmentally Critical Project refers to a project that has high potential 
for significant negative environmental impact and is listed as such under 
Presidential Proclamation (P.P.) No. 2146, series of 1981, and P.P. No. 803, 
series of 1996, as well as other projects which the President may proclaim 
as environmentally critical in accordance with Section 4 of P.D. 1586 or the 
Philippine Environmental Impact Statement System;
b) Heavy industries to non-ferrous metal industries, iron and steel mills, 
petroleum, and petrochemical industries, including oil and gas smelting 
plants;
c) Infrastructure projects refer to major dams, major power plants, major 
reclamation projects, and major roads and bridges; and.


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d) Resource Extractive Industries refer to major mining and quarrying
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projects; forestry projects involving logging, major wood processing
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projects, introduction of fauna or exotic animals in public or private
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forests, forest occupancy, extraction of mangrove products, and grazing;
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and fishery projects, specifically fishpond development projects and dikes
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for such projects.
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Sec. 3. Estabiishment of a National Framework for Mandatory Environmental
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Insurance Coverage. - Within one (1) year following the effectivity of this Act, a national
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framework for Mandatory Environmental Insurance Coverage (MEIC) shall be established.
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The framework shall consider the following:
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a) Coverage. All owners and operators of environmentally critical projects (ECPs)
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shall be required to secure MEIC for ECPs as prescribed under this Section, to
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compensate for the adverse environmental consequences which include
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damage to health and property, and costs for environmental rehabilitation,
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remediation, cleanup, and other environmental impairments arising from their
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operations. For purposes of this Act, ECPs shall include heavy industries, major
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manufacturing industries, major resource-extractive industries, major
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infrastructure projects, and other similar projects that could pose serious risks
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to people and the environment.
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b) 
Forms of MEIC. - The MEIC shall be in the form of:
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Environmental guarantee cash fund established pursuant to existing 
environmental laws; or
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Environmental insurance policy (EIP) obtained from bonding or insurance 
companies, whenever the environmental guarantee cash fund is 
insufficient to cover the said adverse environmental consequences, upon 
determination and recommendation of the Inter-Agency Technical 
Committee created pursuant to Section 5 of this Act.
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The EIP may take the form of the following:


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i. Environment performance bond (EPB) - which shall be required for all 
ongoing activities or projects issued with Environmental Compliance 
Certificate (ECC) pursuant to P.D. 1586, to guarantee adequate and 
timely compliance with the environmental standards and the terms 
and conditions set forth by the Department of Environment and 
Natural Resources (DENR) during the pre-development, 
development, and construction phases of the project. The EPB shall 
answer for all environmental damages, penalties, and legal 
obligations, which may arise from the failure of the project proponent 
to comply with its undertakings during the aforementioned phases; 
and
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ii. Environment pollution, impairment, and cleanup liability insurance
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(EPICLI) - which shall be required for all existing and future activities
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or projects issued with ECC pursuant to P.D. 1586, to cover the
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operational phases. The EPICLI shall answer for all claims arising
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from damages to the environment; bodily injury and property
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damage arising from a pollution event; and for the cost of
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environmental rehabilitation, cleanup, or remediation responses to
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address the contamination or impairment of the environment.
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Sec. 4. Pre-requisite to the Construction or Operational Phase. - Owners and
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operators of ECPs shall not be allowed to commence construction or commercial operation
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without initially obtaining the MEIC required under Section 3 of this Act.
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Sec. 5. Creation of an Inter-Agency Technical Committee. - Within one (1) year 
following the effectivity of this Act, the Secretary of the DENR shall establish and chair 
an Inter-Agency Committee (lATC), with the Commissioner of the Insurance Commission 
and representatives of the insurance industry, the mining industry, and other 
stakeholders that the DENR may deem fit, as members. Within the same period, the lATC 
shall:
a) Identify the perils or possible negative environmental impacts, activities, 
processes or undertakings that need to be mandatorily insured as provided in
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b)
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covered;
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Act.
Section 3 hereof;
Conduct risk assessment to determine the appropriate insurance coverage for 
different ECPs and activities;
Formulate guidelines for the identification of primary impact areas and 
prescription of rehabilitation or remediation measures in cases of 
environmental damages;
Formulate cleanup guidelines;
Formulate guidelines for the identification of beneficiaries of the MEIC;
Ensure that the premium rates of the EIP are commensurate to the risks
Formulate guidelines for the determination of veracity of claims;
Accredit insurance companies; and
Undertake such activities as may be necessary to fulfill the objectives of this
For purposes of paragraph (h) of this Section, the Insurance Commission, in 
coordination with the DENR, shall formulate guidelines for the accreditation of insurance 
companies, within one (1) year following the effectivity of this Act.
The beneficiaries shall be represented by the government, particularly the DENR. 
The lATC shall identify the affected areas and prescribe rehabilitation or remediation 
measures pursuant to Sec. 5 of this Act.
Sec. 6. Beneficiaries. - The beneficiaries of the MEIC include affected communities, 
stakeholders, and local government units within the projects' primary impact areas. Also 
included as beneficiaries are government departments, bureaus, and agencies which are 
tasked under the law to undertake the rehabilitation, cleanup, and monitoring of sites 
affected by the pollution or insurable event, for which no responsible private or public 
entity is specified.
The beneficiaries shall be represented by the government, particularly the DENR. 
The lATC shall identify the affected areas and prescribe rehabilitation or remediation 
measures pursuant to Sec. 5 of this Act.


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Sec. 7. Payment of Claims. - The insurance company shall place all payments of
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claims into special escrow accounts in government depository banks, which shall in turn
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disburse the corresponding payment to beneficiaries, upon advice of the DENR and with
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proper documentation.
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The DENR may create an ad-hoc body composed of representatives from business,
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labor, government, civil society, and other stakeholders to assure that claims are verified
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and rightful parties are compensated and the environment is properly rehabilitated,
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cleaned up, remediated, stabilized, and protected.
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The DENR shall not receive and handle payment of claims for environmental
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damages, penalties, and charges, except for the claims component which properly
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accrues to it as an insurance beneficiary.
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The government agency tasked with rehabilitation and assigned as the beneficiary
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of the MEIC as provided under Section 6 of this Act, shall undertake the same utilizing
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funds coming from the insurance claim upon approval of the DENR.
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Sec. 8. The failure of the owner and operator of an ECP to secure an MEIC as
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prescribed under Section 3 hereof, or of the insurance company to pay a verified claim in
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violation of the provisions of this Act and within reasonable time, shall be punished with
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a fine of Five hundred thousand pesos (P 500,000.00) but not more than Two million
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pesos (P 2,000,000.00) or imprisonment of not less than six (6) years but not more than
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twelve (12) years, or both, at the discretion of the court.
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In the case of a partnership, association, corporation, or any juridical entity, the fine
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shall be Imposed upon the president, treasurer, or any other officer or person responsible
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for the violation.
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If the offender is a foreigner, the offender shall, after the service of sentence, be
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deported immediately without further proceedings by the Bureau of Immigration.
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Government officials, employees, and agents who approve the construction or
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operation of environmentally-critical projects without the necessary MEIC, in violation of
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the provisions of this Act, shall suffer the penalty of suspension of not less than thirty


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(30) days, but not more than six (6) months after due notice and hearing in the
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appropriate administrative proceedings.
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Sec. 9. Implementing Rules and Regulations. - Within sixty (60) days from the
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approval of this Act, the DENR shall, in coordination with the Insurance Commission,
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promulgate the necessary rules and regulations for the effective implementation of this
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Act.
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Sec. 10. Repealing Clause. - All laws, decrees, orders, rules, and regulations, and
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other issuances inconsistent with the provisions of this Act are repealed, amended, or
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modified accordingly.
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Sec. 10. EffectMty. -This Act shall take effect fifteen (15) days after its publication
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in the Official Gazette or in a newspaper of general circulation.
Approved,