NG GAN ZEE v. ASIAN CRUSADER LIFE ASSURANCE CORP.

G.R. NO. L-30685
Facts:
On May 12, 1962, Kwong Nam applied for a 20-year endowment insurance on his life
having his wife, Ng Gan Zeen as beneficiary. Upon recieipt of the required premium the insurer
approved the application and issued the corresponding policy. On December 6, 1963, Kwong
Nam died of cancer of the liver with metastasis.
On January 10, 1964, the wife presented a claim for the payment of the face value of the
policy. Appellant denied the claim on the ground that the answers given by the insured in his
application were untrue.
Appellant alleged that the insured was guilty of misrepresentation when he answered
“No” on the question “Has any life insurance company ever refused your application for
insurance or for reinstatement of a lapsed policy or offered you a policy different from that
applied for?”
As pointed out by the insurer, the insured had in January 1962 applied for reinstatement
of his lapsed insurance policy with Insular Life Insurance Co.
Appellant further maintains that when the insured was examined in connection with his
application, he gave false and misleading information as to his ailment and previous operation,
because he was operated for a tumor of the stomach. The tumor was associated with ulcer of the
stomach. The tumor taken out was hard and of a hen’s egg size.
Issue:
Whether or not the insurer is committed concealment to warrant the disapproval of the
claims over the insurance policy?
Held:
Concealment exists where the assured had knowledge of a fact material to the risk, and
honesty, good faith, and fair dealing requires that he should communicate it to the insurer, but he
designedly and intentionally withholds the same.
Assuming that the aforesaid answer given by the insured was false, the law nevertheless
requires that fraudulent intent on the part of the insured be established to entitle the insurer to
rescind the contract.
It bears emphasis that Kwong Nam had informed appellant that the tumor for which he
was operated on was associated with peptic ulcer of the stomach. In the absence of evidence that
the insured had sufficient medical knowledge as to enable him to distinguish between peptic
ulcer and a tumor, his statement should be construed as an expression made in good faith of his

.belief as to the nature of his ailment and operation. Such statement must be presumed to have been made by him without knowledge of its incorrectness and without any deliberate intent on his part to mislead the applellant.

the binding deposit receipt in question had never become in force at any time. and the company disapproves the application. (2) that if the company does not accept the application and offers to issue a policy for a different plan. on behalf of the company. but having failed on his efforts. On May 28. Ngo Hing paid the annual premium but retained his commission for being a duly authorized agent of Pacific Life. Instead. otherwise. and that the latter will either approve or reject the same on the basis of whether or not the applicant is "insurable on standard rates. and the premium paid shall be returned to the applicant. CA G. the insurance applied for shall not be in force at any time.R. The letter stated that the said life insurance application is not available for minors below seven years old. Clearly implied from the aforesaid conditions is that the binding deposit receipt in question is merely an acknowledgment. Respondent sought the payment of the proceeds of the insurance. ." Since petitioner Pacific Life disapproved the insurance application of respondent Ngo Hing.GREAT PACIFIC LIFE ASSURANCE CO. that the latter's branch office had received from the applicant the insurance premium and had accepted the application subject for processing by the insurance company. The non-acceptance of the the application was not communicated by Mondragon to Ngo Hing. v. 1957. but Pacific Life can consider the same under the Juvenile Triple Action. Respondent supplied the essential data which Lapulapu D. were asking for uch coverage. and (3) that if the applicant is not able according to the standard rates. Mondragon received a letter from Pacific Life disapproving the insurance application. Mondragon wrote back Pacific Life strongly recommending the approval of the 20 year endowment insurance plan pointing out that since 1954 the customers. for a 20 year endowment on the life of his 1 year old daughter Helen Go. the insurance contract shall not be binding until the applicant accepts the policy offered. he filed an action before the Court of First Instance in Cebu. Mondragon. NO. On April 30. Ngo Hing filed an application with Great Pacific Life Insurance Co. Branch Manager of the Pacific Life in Cebu City wrote on the corresponding form in his own handwriting. Issue: Whether or not the binding receipt constituted a temporary contract of the life insurance? And whether or not Ngo Hing concealed the state of health and physical condition of Helen Go? Held: The binding deposit receipts is intended to be merely a provisional or temporary insurance contract and only upon compliance of the following condition: (1) that the company shall be satisfied that the applicant was insurable on standard rates. 1957 Helen Go died of influenza with complication of bronchopneumonia. 1957. L-31845 Facts: On March 14. the deposit shall be returned.

Nonetheless. Where private respondent supplied the required essential data for the insurance application form.00 in favor of the latter's one-year old daughter. the Court is of the firm belief that private respondent had deliberately concealed the state of health and physical condition of his daughter Helen Go.000. as he surely must have known his duty and responsibility to such a material fact. Pacific Life would have verified the same and would have had no choice but to disapprove the application outright. What it offered instead is another plan known as the Juvenile Triple Action. Had he mentioned said significant fact in the insurance application form. he ought to know. In the absence of a meeting of the minds between petitioner Pacific Life and private respondent Ngo Hing over the 20-year endowment life insurance in the amount of P50. private respondent. which private respondent failed to accept. withheld the fact material to the risk to be assumed by the insurance company.Pacific Life disapproved the insurance application in question on the ground that it is not offering the twenty-year endowment insurance policy to children less than seven years of age. he was fully aware that his one-year old daughter is typically a mongoloid child. in apparent bad faith. As an insurance agent of Pacific Life. . Relative to the second issue of alleged concealment. Accordingly. and with the non-compliance of the above quoted conditions stated in the disputed binding deposit receipt. the deposit paid by private respondent shall have to be refunded by Pacific Life. there could have been no insurance contract duly perfected between them. Such a congenital physical defect could never be ensconced nor disguised.

filed an action for specific performance against petitioner with the Regional Trial Court. Moreover. Respondent Bernarda Bacani and her husband. The designated beneficiary was his mother. with double indemnity in case of accidental death. On June 26. It also sustained the finding of the trial court that matters relating to the health history of the insured were irrelevant since petitioner waived the medical examination prior to the approval and issuance of the insurance policy. respondent Bernarda Bacani. He was issued a policy valued at P100. CA Facts: On April 15. and which the other has no means of ascertaining. Robert John B. The terms of the contract are clear. The trial court concluded that the facts concealed by the insured were made in good faith and under a belief that they need not be disclosed. thus rendering the contract of insurance voidable. the appellate court agreed with the trial court that the policy was "non-medical. Respondent Bernarda Bacani filed a claim with petitioner. Petitioner discovered that two weeks prior to his application for insurance. The appellate court ruled that petitioner cannot avoid its obligation by claiming concealment because the cause of death was unrelated to the facts concealed by the insured. 1987." Issue: Whether or not there was material concealment on the part of the insured? Held: The Insurance Code is explicit in requiring a party to a contract of insurance to communicate to the other. the insured died in a plane crash. The insured is specifically required to disclose to the insurer matters relating to his health. in forming his estimate of the disadvantages of the proposed contract or in making his inquiries. but solely by the probable and reasonable influence of the facts upon the party to whom communication is due. the insured was examined and confined at the Lung Center of the Philippines. seeking the benefits of the insurance policy taken by her son. that the insured did not disclose material facts relevant to the issuance of the policy. Bacani procured a life insurance contract for himself from petitioner. respondent Rolando Bacani. .00.000. all facts within his knowledge which are material to the contract and as to which he makes no warranty. Moreover. it held that the health history of the insured was immaterial since the insurance policy was "non-medical". Materiality is to be determined not by the event. where he was diagnosed for renal failure. Petitioner informed respondent Bernarda Bacani. 1986. in good faith.SUNLIFE ASSURANCE COMPANY OF CANADA v. Petitioner conducted an investigation and its findings prompted it to reject the claim.

a disclosure may have warranted a medical examination of the insured by petitioner in order for it to reasonably assess the risk involved in accepting the application. We. The insured's failure to disclose the fact that he was hospitalized for two weeks prior to filing his application for insurance. It must be emphasized that rescission was exercised within the two-year contestability period as recognized in Section 48 of The Insurance Code. The matters concealed would have definitely affected petitioner's action on his application. rule that petitioner properly exercised its right to rescind the contract of insurance by reason of the concealment employed by the insured. It appears that such concealment was deliberate on his part. . raises grave doubts about his bonafides.The information which the insured failed to disclose was material and relevant to the approval and issuance of the insurance policy. Thus. either by approving it with the corresponding adjustment for a higher premium or rejecting the same. Moreover. "goad faith" is no defense in concealment. therefore.

L-66935 Facts: On February 19. A letter was sent to respondent Pioneer claiming the full amount of P100. the Manila Bay Lighterage Corporation entered into a contract with the petitioners whereby the former would load and carry on board its barge Mable 10 about 422.00 with respondent Pioneer Insurance and Surety Corporation. 1972. As alleged by the petitioners in their complaint and as found by both the trial and appellate courts.ISABEL ROQUE v. or upon anything which is the subject of marine insurance.” Since the law provides for an implied warranty of seaworthiness in every contract of ordinary marine insurance. 86599 against Manila Bay and respondent Pioneer. It ruled that the loss is not covered by the marine insurance policy. the appellate court modified the trial court's decision and absolved Pioneer from liability after finding that there was a breach of implied warranty of seaworthiness on the part of the petitioners and that the loss of the insured cargo was caused by the "perils of the ship" and not by the "perils of the sea". Palawan for carriage and delivery to North Harbor. the ordinary splash of sea waves brought more water inside the barge. However. 811 pieces of logs at Malampaya Sound. The appellate court further found that one of the hatches was left open causing water to enter the barge and because the barge was not provided with the necessary cover or tarpaulin. a warranty is implied that the ship is seaworthy.18 cubic meters of logs from Malampaya Sound. 1972. Issue: Whether or not the insurance company is liable to pay the face value of the policy? Held: Section 113 of the Insurance Code provides: “In every marine insurance upon a ship or freight. Port of Manila. Hence.R. The trial court ruled in favor of petitioner.000. or freightage. the petitioners loaded on the barge.00 under the insurance policy but respondent refused to pay on the ground that its liability depended upon the "Total loss by Total Loss of Vessel only". the barge where the logs were loaded was not seaworthy such that it developed a leak. but the shipment never reached its destination because Mable 10 sank with the 811 pieces of logs somewhere off Cabuli Point in Palawan on its way to Manila. Manila. NO. it becomes the obligation of a cargo owner to look for a reliable common carrier which keeps its vessels in seaworthy condition. Palawan to North Harbor.000. On February 29. The petitioners insured the logs against loss for P100. petitioners commenced Civil Case No. CA G. The shipper of cargo may have no control over the vessel but he has full control in the choice of the common carrier that will .

. Or the cargo owner may enter into a contract of insurance which specifically provides that the insurer answers not only for the perils of the sea but also provides for coverage of perils of the ship.transport his goods.