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L-24833, 23 September 1968 FACTS: FACTS:] Federico Songco, a man who was only able to finish grade 1, owned a private jeepney which he, through the inducement ofFieldmen s insurance agent, insured with the plaintiff company. The policy is a Common Carrier s Accident Insurance Policy. The insurance agent told Federico that whether his vehicle was an owner type or for passengers it could be insured because their company is not owned by the Government and that the Government has nothing to do with their company, hence, they could do what they please whenever they believe a vehicle is insurable. During the policy s covered period, the insured vehicle while being driven by Rodolfo, a duly licensed driver and son of Federico figured in a vehicular accident resulting in the death of both father and son as well as physical injuries to the other passengers of the jeepney. The insurance company refused payment. ISSUE: Whether or not the insurance company is liable HELD: YES. Where inequitable conduct is shown by an insurance firm, it is estopped from enforcing forfeitures in its favor, in order toforestall fraud or imposition on the insured. After petitioner Fieldmen s Insurance Co., Inc. had led the insured Federico Songco to believe that he could qualify under the common carrier liability insurance policy, and to enter into contract of insurance paying the premiums due, it could not, thereafter, in any litigation arising out of such representation, be permitted to change its stand to the detriment of the heirs of the insured. As estoppel is primarily based on the doctrine of good faith and the avoidance of harm that will befall the innocent party due to its injurious reliance, the failure to apply it in this case would result in a gross travesty of justice. That is all that needs be said insofar as the first alleged error of respondent Court of Appeals is concerned, petitioner being adamant in its far-from-reasonable plea that estoppels could not be invoked by the heirs of the insured as a bar to the alleged breach of warranty and condition in the policy. It would now rely on the fact that the insured owned a private vehicle, not a common carrier, something which it knew all along when not once but twice its agent, no doubt without any objection in its part, exerted the utmost pressure on the insured, a man of scant education, to enter into such a contract. ISSUE:
THE INSULAR LIFE ASSURANCE COMPANY, LTD. Vs. CARPONIA T. EBRADO G.R. No. L-44059, 28 October 1977 80 SCRA 181
Buenaventura Ebrado was issued by petitioner company an insurance policy wherein he designated Carponia, his common-law wife, as his revocable beneficiary. When Buenaventura died, Carponia filed with the insurer acclaim for the proceeds of the policy in the total amount ofP11,745.73. Pascuala Vda. de Ebrado, Buenaventura s legal wife, likewise filed her claim as the widow of the deceased insured. She asserts that she is the one entitled to the insurance proceeds, not the common-law wife, Carponia.
Whether or not a common-law wife named as beneficiary in the life insurance policy of a legally married man can claim the proceeds thereof in case of death of the latter HELD: NO. When not otherwise specifically provided for by the Insurance Law, the contract of life insurance is governed by the general rules of the civil law regulating contracts. And under Article 2012 of the same Code, any person who is forbidden from receiving any donation under Article 739 cannot be named beneficiary of a life insurance policy by the person who cannot make a donation to him. Common-law spouses are, definitely, barred from receiving donations from each other. In essence, a life insurance policy is no different from a civil donation insofar as the beneficiary is concerned. Both are founded upon the same consideration: liberality. A beneficiary is like a donee, because from the premiums of the policy which the insured pays out of liberality, the beneficiary will receive the proceeds or profits of said insurance. As a consequence, the proscription in Article 739 of the new Civil Code should equally operate in life insurance contracts. The mandate of Article 2012cannot be laid aside: any person who cannot receive a donation cannot be named as beneficiary in the life insurance policy of the person who cannot make the donation. Under American law,a policy of life insurance is considered as a testament and in construing it, the courts will, so far as possible treat it as a will and determine the effect of a clause designating the beneficiary by rules under which wins are interpreted. ACCORDINGLY, the appealed judgment of the lower court is hereby affirmed. Carponia T. Ebrado is hereby WHEREFORE, the decision of respondent Court of Appeals ofJuly 20, 1965, is affirmed in its entirety. Costs against petitioner Fieldmen s Insurance Co., Inc. declared disqualified to be the beneficiary of the late Buenaventura C. Ebrado in his life insurance policy. As a consequence, the proceeds of the policy are hereby held payable to the estate of the deceased insured. Costs against Carponia T. Ebrado
as between the insurer and the insured.00. could validly give consent to such amendment HELD: 1)NO. INC. consequently. otherwise known as Act No. the same is hereby affirmed. the applicable law in the instant case is the Insurance Act. arose and became binding upon it. Thereafter the obligation of the insurer to pay the insured the amount for which the policy was issued in case the conditions therefore had been complied with. WOODWORKS. As the contract had become perfected. there was not only a perfected contract of insurance but a partially performed one as far as the payment of the agreed premium was concerned. Indubitable is the fact that all the six children named as beneficiaries were minors at the time.R. L-54216. 1968. the alleged acquiescence of the six children beneficiaries of the policy (the beneficiary-wife predeceased the insured) cannot be considered an effective ratification to the change of the beneficiaries from irrevocable to revocable. Under the said law.00.09. while the obligation of the insured to pay the remainder of the total amount of the premium due became demandable. the appealed decision being in accordance with law and the evidence. . Inevitably therefore. the beneficiary designated in a life insurance contract cannot be changed without the consent of the beneficiary because he has a vested interest in the policy. the vested rights of the irrevocable beneficiaries would be rendered inconsequential. the defendant was only able to payP3.000. based on the aforequoted provision of the contract. FACTS: PHILIPPINE PHOENIX SURETY & INSURANCE.051.95 as premium of the said policy. G. premises considered. No. Despite several demands made by the plaintiff on the defendant to pay the amount of P3. L-22684. HONORABLE GREGORIO G. As it chose to demand specific performance of the insured s obligation to pay the balance of the premium. vs. abrogating the contention of the private respondent that said designation can be amended if the Court finds a just reasonable ground to do so 2) NO. one ofwhom is already deceased while the others are allminors. Both the law and the policy do not provide for any other exception.2427 as amended. The defendant was obligated to pay P6. No.THE PHILIPPINE AMERICAN INSURANCE COMPANY vs. 1980. the policy having been procured in1968. 31 August 1967 Plaintiff Philippine Phoenix Surety issued to defendant companya fire insurance policy for the amount of P300. the parties could demand from each other the performance of whatever obligations they had assumed. Neither could they act through their father insured since their interests are quite divergent from one another. the latter failed to pay. no doubt at all that.R. Dimayuga filed a petitionbefore the CFI of Rizal to amend the designation of thebeneficiaries in his life policy from irrevocable to revocable. the latter s duty to pay is indeed indubitable. However. Therefore. the parent-insured cannot exercise right sand/or privileges pertaining to the insurance contract for otherwise. it is obvious that it had the right to demand from the insured the completion of the payment of the premium due or sue for the rescission of the contract. with costs. Rodolfo Dimayuga procured an ordinarylife insurance policy from the petitioner company anddesignated his wife and children as irrevocable beneficiaries ofsaid policy. ISSUE: 1)Whether or not the designation of the irrevocablebeneficiaries could be changed or amended without theconsent of all the irrevocable beneficiaries. 19 July 1989 175 SCRA 416 FACTS: On January 15. ISSUE: Whether or not the insurance company has the right to demand the balance of the premium HELD: YES.Needless to say. for which reason. WHEREFORE. Wherefore. In the case of the insurer. not to mention the law then applicable. thus. the questioned Orders of the respondent Judge are hereby nullified and set aside. PINEDA G.522. 2) Whether or not the irrevocable beneficiaries. There is. In February 22. INC.000. they could not validly give their consent. it is only with the consent of all the beneficiaries that any change or amendment in the policy concerning the irrevocable beneficiaries may be legally and validly effected.
Issue: WON the insured made such false representation of material facts as to avoid the policy. during the Jap occupation. 1941. 80 PHIL 54 Facts: Oct. Appellants also contend that there was no fraudulent concealment of the truth inasmuch as the insured herself did not know. in order to avoid a policy. 10. exist as to each other. it is not necessary to show actual fraud on the part of the insured. nor did she ever have any illness or disease peculiar to her sex. She also stated that she had never been treated for. after payment of the premium. namely.1942. as there could not have been any mistake about it. concealment being defined as negligence to communicate that which a party knows and ought to communicate. involving complete removal of the right breast. that she never had cancer or tumors or consulted any physician or undergone any operation within the preceding period of 5 years. 1941. whether intentional or unintentional entitled the insurer to rescind the contract of insurance. Philamlife 7 SCRA 316 Facts: 2 months prior to the insurance of the policy. She stated therein that she did not have. Saturnino was operated on for cancer. SC ruled that said corporation became an enemy corporation upon the war between the US and Germany. Filipinas denied liability on the ground that Christern was an enemy corp and cannot be insured. The application also recited that the declarations of Saturnino constituted a further basis for the issuance of the policy. Saturnino did not make a disclosure thereof in her application for insurance. including the pectoral muscles and the glands. Christern having become an enemy corporation on Dec. fire policy no. 1941. Issue: WON Filipinas is liable to Christern. and since the insured goods were burned after Dec. found in the right armpit. Held: YES. but solely by the probable and reasonable influence of the facts upon the party to whom the communication is due. 1941 should be returned by Filipinas. There can be no dispute that the information given by her in the application for insurance was false. for such information necessarily constitutes an important factor which the insurer takes into consideration in deciding whether to issue the policy or not. The basis of the rule vitiating the contract in cases of concealment is that it misleads or deceives the insurer into accepting the risk. concealment. Domestic Corp Christern. among others listed in the application. The question to determine is: Are the facts then falsely represented material? The Insurance Law provides that materiality is to be determined not by the event. in forming his estimate of the proposed contract. Secondly. 10. that the disease for which she had been operated on was cancer. All individuals who compose the belligerent powers. This being so. relying upon the belief that the insured will disclose every material fact within his actual or presumed knowledge. concealment of the fact of the operation itself was fraudulent. Christern submitted to Filipinas its claim. Christern was NOT entitled to any indemnity under said policy from Filipinas. . or that it should in such manner increase the resources of the enemy or render it aid. the building and the insured merchandise were burned. or making his inquiries. in a state of utter exclusion and are public enemies. particularly of the breast. undergone any operation or suffered any injury within the preceding 5 years. The contention of appellants is that the facts subject of the representation were not material in view of the non-medical nature of the insurance applied for. If anything. 29333 for P100T covering merchandise contained in a building located in Binondo. obtained from Filipinas. the insurance policy issued in his favor on Oct. no matter what the ailment. 1. which does away with the usual requirement of medical examination before the policy is issued. and he is thereby induced to estimate the risk upon a false basis that it does not exist. that she had not consulted any physician. 8 provides that anyone except a public enemy may be insured. since her doctor never told her. Elementary rules of justice require that the premium paid by Christern for the period covered by the policy from Dec. 10. the waiver of medical examination renders even more material the information required of the applicant concerning previous condition of health and diseases suffered. Notwithstanding the fact of her operation. and it is inconsistent that one country should destroy its enemy property and repay in insurance the value of what has been so destroyed. 1. It stands to reason that an insurance policy ceases to be allowable as soon as an insured becomes a public enemy. and during the war. 1941 by Filipinas had ceased to be valid and enforceable. Salvaged goods were sold and the total loss of Christern was P92T. Saturnino v. ovaries. cancer or other tumors. Huenfeld & Co. Majority of the stockholders of Christern were German subjects. 27. uterus and menstrual disorders. The insurer. Christern Huenfeld & Co. In his jurisdiction. The contention is without merit. is misled into a belief that the circumstances withheld does not exist. On Feb. The purpose of the war is to cripple the power ad exhaust the resources of the enemy. The Phil Insurance Law in Sec.Filipinas Cia de Seguros v. In the first place. nor had she ever had. Held: NO. or accepting it at a rate of premium agreed upon.
in the absence of inquiries. It results. Section 32 of Insurance Law [Act No. all facts within his knowledge which are material to the contract. ISSUE WON there was concealment (Was appellant. Ng Gan Zee. Tumor taken out was hard and of a hen's egg size. 1962 Kwong Nam answered `No' to the question whether any life insurance company ever refused his application for reinstatement of a lapsed policy he did not misrepresent any fact. Kwong Nam applied for a 20-year endowment insurance on his life for the sum ofP20. a question appears to be not answered at all or to be imperfectly answered. The evidence before the Court does not clearly and satisfactorily establish that defense. the same was nevertheless sufficient tohave induced appellant to make further inquiries about the ailment and operation of the insured. that when on May 12. 2427] provides: The right to information of material facts may be waived either by the terms of insurance or by neglect to make inquiries as to such facts where they are distinctly implied in other facts of which information is communicated. and as to which he makes no warranty. and the insurers issue a policy without any further inquiry." In the absence of evidence that the insured had sufficient medical knowledge as to enable him to distinguish between "peptic ulcer" and "a tumor".Such party to a contract of insurance must communicate to the other. All premiums had been paid at the time of his death. 1962 . -Appellant: The insured was guilty of misrepresentation when: 1) he answered "No" to the question (in the application) of "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?" when in fact. with his wife. 278 of the Insurance Law nevertheless requires that fraudulent intent on the part of the insured be established to entitle the insurer to rescind the contract. Medical report show that insured was operated on for "peptic ulcer". the information communicated was imperfect. . "misrepresentation as a defense of the insurer to avoid liability is an `affirmative defense. 27. It has been held that where. Claims he is completely recovered." his ailment and operation.It has also been held "that the concealment must. The duty to establish such a defense by satisfactory and convincing evidence rests upon the defendant. -"concealment exists where the assured had knowledge of a fact material to the risk.000. because of insured's aforesaid representation. they waive the imperfection of the answer and render the omission to answer more fully immaterial. Insular Life denied his application for reinstatement of his lapsed life insurance policy 2) he gave the appellant's medical examiner false and misleading information as to his ailment and previous operation when he said he was operated on for a Tumor [mayoma] of the stomach associated with ulcer of stomach.. "upon the face of the application. . Operation was two years ago in Chinese General Hospital by Dr.Ng presented a claim for payment of the face value of the policy. good faith. Ltd. be not only material." -Kwong Nam had informed the appellant's medical examiner that the tumor for which he was operated on was ''associated with ulcer of the stomach. from the viewpoint of a medical expert. Yap. Indeed. approved Kwong Nam's request for reinstatement and amendment of his lapsed insurance policy on April 24. Appellant (Asian Crusader) denied the claim on the ground that the answers given by the insured to the questions appearing in his application for life insurance were untrue.On May 12." Reasoning 1) The evidence shows that the Insular Life Assurance Co." . misled or deceived into entering the contract or in accepting the risk at the rate of premium agreed upon?) HELD NO. Sec. but fraudulent. with costs against appellant . ASIAN CRUSADER LIFE ASSURANCE CORP 122 SCRA 461 FACTS . therefore. 1962.NG v. in good faith.He died on Dec 1963 of cancer of the liver with metastasis. his statement that said tumor was "associated with ulcer of the stomach" should be construed as an expression made in good faith of his belief as to the nature of 8 "Sec. and honesty. or the fact must have been intentionally withheld. but he designedly and intentionally withholds the same. 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 appellant. involving the excision of a portion of the stomach. Disposition the judgment appealed from is hereby affirmed. and fair dealing requires that he should communicate it to the assurer. And as correctly observed by the lower court. as beneficiary. 3) Waiver: While it may be conceded that. not tumor. and which the other has not the means of ascertaining. 2) Assuming that the aforesaid answer given by the insured is false.
"Gastritis. "Cancer. Is there concealment? YES. Act No. . But if A was aware of the materiality of the ailment. the concealment entitles the insurer to rescind the contract of insurance (Section 26). "Vertigo. in his application for insurance. It can fairly be assumed that had the true facts been disclosed by the assured. the contract of insurance apparently set forth therein was never legally existent. . Grade 4. the insured died of "infiltrating medullary carcinoma. but honestly believed that it was not material. defendant would probably had never consented to the issuance of the policy in question. May 29. was aware of the ailment. we can distinguish. Fainting-spells or Unconsciousness".December 27. considering the previous illness of the insured as disclosed by the records of the Chinese General Hospital.It should be noted that the insured's confinement in the Chinese General Hospital took place from January 29. Whether intentional or unintentional. which in section 25 is defined 'A neglect to communicate that which a party knows and ought to communicate. ." Same facts as above but the ailment is material to the contract. brother and beneficiary of the insured. There is concealment. according to the death certificate. Have you ever consulted any physician riot included in any of the above answers? Give names and address or physicians list ailments or accidents and date.Had defendant been given such opportunity.September 7: he submitted part I of his application which is the declaration made by him to an agent of defendant ." . 1950: Yu Pang Eng submitted parts II and III of his application for insurance consisting of the medical declaration made by him to the medical examiner of defendant and the medical examiner s report . advanced cardiac and of lesser curvature. Have you ever had any of the following diseases or symptoms? Each question must be read and answered "Yes" or "No. We cannot agree.1950. demanded from defendant the payment of the proceeds of the insurance policy and when the demand was refused.September 5. particularly in his declarations to the examining physician. 4. which may have a direct connection with his previous illness. ." .Argente vs.: "One ground for the rescission of a contract of insurance under the Insurance Act is 'a concealment'. abdominal pains and tarry stools". However. No. deprived defendant of the opportunity to make the necessary inquiry as to the nature of his past illness so that it may form its estimate relative to the approval of his application. . 812858 . 1950 having stayed there up to February 11. Dizziness.". there is fraudulent concealment. 2427). Ulcer of the Stomach or any disease of that organ? No. the insurance would never have been granted. bleeding. particularly with regard to "Gastritis.Our law even requires the insured to communicate to the insurer all facts within his knowledge which are material to the contract and which the other party has not the means of ascertaining (Section27).Plaintiff. stomach metastases spleen. stated the following in answering the questions propounded to him: 14. anemia. the effect is the same. he concealed the ailment of which he was treated in the Chinese General Hospital which precisely has direct connection with the subject of the questions propounded. and the materiality is to be determined not by the event but solely by the probable and reasonable influence of the facts upon the party to whom the communication is due (Section 30).The insured.September 8: defendant issued to the insured Policy No. the concealment is not fraudulent or intentional.The negative answers given by the insured regarding his previous ailment.YU PANG CHENG v.It is apparent that when the insured gave his answers regarding his previous ailment.Our Insurance Law provides that "A neglect to communicate that which a party knows and ought to communicate." ISSUE WON the insured is guilty of concealment of some facts material to the risk insured against which has the effect of avoiding the policy as found by respondent court. 1951. 1950.15. It entitles the insurer to rescind the contract. 1950. or his concealment of the fact that he was hospitalized and treated for sometime of peptic ulcer and had suffered from dizziness.. 1950:the insured entered St.An X-ray picture of his stomach was taken and the diagnosis made of him by his doctors showed that his illness was "peptic ulcer. Tumors or Ulcers of any kind? No. In fact. . he died of infiltrating medullary carcinoma. Dizziness.It appears that the insured entered the Chinese General Hospital for medical treatment on January29. HELD . . . Grade. whereas his application for insurance wherein he stated his answers to the questions propounded to him by the examining physician of defendant was submitted to defendant on September 5. is called concealment" (Section 25. Ulcer of the Stomach or any disease of that organ" and "Vertigo. If A. 1959 FACTS . 1950 to February 11. In an action on a life insurance policy where the evidence conclusively shows that the answers to questions concerning diseases were untrue. stomach metastases spleen". Nevertheless. . CA 105 PHIL 930 BAUTISTA ANGELO. . he brought the present action. 'Appellant argues that the concealment was immaterial and insufficient to avoid the policy. Fainting-spells or Unconsciouness? No. West Coast Life Insurance Co. If the policy was procured by fraudulent representations. advanced cardiac and of lesser curvature. Luke's Hospital for medical treatment but he died on February 27.According to the death certificate. the truth or falsity of the answers become the determining factor.
While Mrs. Vicenta was taken to a hospital for what was first diagnosed as alcoholism and later changed to manic-depressive psychosis and then again changed to psychoneurosis. Where it appears that the proposal form. the latter induced Mrs. Vicenta died of cerebral apoplexy. will not be regarded as warranted by the insured.Thereafter. The court found that the representations made by Vicenta in his application for life insurance were false with respect to her state of health and that she knew and was aware that the representations so made by her were false. 1925. the car was damaged by fire. Issue: WON on the bais of the misrepresentations of Vicenta. Held: YES. Facts: Harding v.Argente v. Harding signed. even if incorrect. which in turn is Commercial Union s agent). in response to the question asked by the medical examiner. o What physician have you consulted or been treated by within the last 5 years and for what illness or ailment? she answered none It is however. Commercial refused to pay because the car s present value was only 2. the insurance would never have been granted. On Nov. who together with the manager of LUneta. It can be fairly assumed that had the true facts been disclosed by the insured. the truth or falsity of the answer becomes the determining factor.He then gave the car to his wife Mrs. Harding was having the car repaired at the Luneta Garage (Luneta was an agent of Smith Bell and Co. the contract of insurance apparently set forth therein was never legally existent. Commercial Union Assurance Company 38 PHIL 464 Henry Harding bought a car for 2T in 1915. Harding agreed. and Smith Bell sent an agent to Luneta Garage. West Coast Life Insurance Co. Vicenta. Issue: WON Commercial is liable. Harding to insure the care with Commercial.This amt was written in the proposal form which Mrs. Bernardo is barred from recovery. 18. the proposal is to be regarded as the act of the insurer. . spirits and other intoxicants? she answered beer only in small quantities . If the policy was procured by fraudulent misrepresentations. her replies were as follows: o How frequently do you use beer. Harding. wine. In an action on a life insurance policy where the evidence conclusively shows that the answers to questions concerning diseases were untrue. Under such circumstances. Mrs. Held: Commercial is liable. Bernardo claimed payment but was refused. It is admitted that in the Medical Examiner s report.8T and not 3T. not disputed that in 1924. in the absence of willful misstatement. appraised the car and declared that its present value was P3T. during the effectivity of the policy. 51 PHIL 725 Facts: A joint life insurance policy was issued to Bernardo Argente and his wife Vicenta upon payment of premium. by West Coast. Subsequently. while signed by the insured was made out by the person authorized to solicit the insurance (Luneta and Smith Bell) the facts stated in the proposal..
remainder to whomsoever. Under the Insurance Act. mortgagee. Also it is provided in the IA that the insurance shall be applied exclusively to the proper interest of the person in whose name it is made. Dunn sold the property to Harding. when he acquired the property.San Miguel Brewery v. In the application. The policies might have been worded differently so as to protect the owner. Trial court ruled against Harding. but it could NOT. 12. no change or assignment of the policies had been unerdertaken. By virtue of the Insurance Act. Brias. there is no clear and satisfactory proof that the policies failed to reflect the real agreement between the parties that would justify the reformation of these two contracts. in case of loss. Unfortunately. Mortgage contract stated that Dunn was to have the property insured at his own expense. this was not what was stated in the policies. the policies were renewed. Held: NOPE. the lower court would have been able to order that the contract be reformed to give effect to them in the sense that the parties intended to be bound. but this was not done. SMB eventually reached a settlement with the insurance companies and was paid the balance of it s mortgage credit.SMB filed an action in court to recover on the policies. the parties had agreed that even the owner s interest would be covered by the policies. Undoubtedly. SMB sought to recover the proceeds to the extent of its mortgage credit with the balance to go to Harding. Dunn likewise authorized SMB to take out the insurance policy for him. Issue:WON the insurance companies are liable to Harding for the balance of the proceeds of the 2 policies. but no assignment of the policies was made to the latter. Law Union Rock Insurance Company 40 PHIL 674 Facts: On Jan. as its interests may appear. recover upon the two policies an amount in excess of its mortgage credit. issued one for P7. In 1917. an any event. Premiums were paid by SMB and charged to Dunn. not wanting to issue a policy for the entire amount. Both policies were issued in the name of SMB only and contained no reference to any other interests in the property. neither Dunn nor Harding could have recovered from the two policies. Insurance Companies contended that they were not liable to Harding because their liability under the policies was limited to the insurable interests of SMB only. and the policies had inadvertently been written in the form in which they were eventually issued. Property was destroyed by fire. SMB s general manager. NOT merely SMB s and would have shown to whom the money. he became the owner of the property. Hence the appeal. although the policies were issued in SMB s name. Harding was made a defendant because by virtue of the sale. Both policies required assignments to be approved and noted on the policy. Brias stated that SMB s interest in the property was merely that of a mortgagee. authorizing SMB to choose the insurers and to receive the proceeds thereof and retain so much of the proceeds as would cover the mortgage debt. SMB as the mortgagee of the property. Law Union.500 and procured another policy of equal amount from Filipinas Cia de Seguros. If the wording had been: Payable to SMB. Dunn mortgaged a parcel of land to SMB to secure a debt of 10T. may become owner of the interest insured . However. 1918. approached Law Union for insurance to the extent of 15T upon the property. had an insurable interest therein. it would have proved an intention to insure the entire interest in the property. . If during the negotiation for the policies. Harding was left to fend for himself. should be paid. the measure of insurable interest in the property is the extent to which the insured might be daminified by the loss or injury thereof. With respect to Harding. during the continuance of the risk. A year later.
especially where a forfeiture is involved. Where an agreement is made between the applicant and the agent. Before the issuance of said policy. by filing and signing a printed form of the GSIS on the basis of which the policy was issued. Paragraph 7 of said application states: c. and is subordinated to the act of the company in approving or rejecting the application.900. constituted a temporary contract of life insurance. the insured had filed an application. that the latter s branch office had received from the applicant. optional additional life insurance policy no 06-136107 in the sum of P7.36 beginning the month of May 1964. the GSIS issued in favor of Flaviano Landicho a civil engineer of the bureau of public works stationed at Mamburao Mindoro occidental. GSIS denied the claim on the ground that the policy has never been in force pursuant to subdivision (e) of paragraph 7 of the policy. All the essential data regarding Helen was supplied by Ngo to Lapu-Lapu Mondragon. that this application serves as a letter of authority to the collecting officer of our office thru the GSIS to deduct from my salary the monthly premium in the amount of P33. and acting exclusively in the interest. Ngo then paid the insurance premium and a binding deposit receipt was issued to him. E of the said receipt. Mondragon wrote on the bottom of the application form his strong recommendation for the approval of the insurance application. I bind myself to pay the system.: are to be construed strictly and most strongly against the insurer and liberally in favor of the insured . was conducted if required. the language. the insurance premium and had accepted the application subject for processing by the insurance company. 1964. the binding deposit receipt had never became on force at any time. adding that Grepalife was the only insurance company NOT selling endowment plans to children. Landicho met his death in June 29. respondent Ngo Hing filed an application with Grepalife for a 20-yr endowment policy for 50T on the life of his one year old daughter Helen Go. (d) and (e) is such as to create an ambiguity that should be resolved against the party responsible therefor defendant GSIS. Ngo filed a claim with Grepalife. of subdivisions (c). pursuant to par. On Apr 30. the premium account shall be considered as indebtedness which. CA 89 SCRA 543 Facts: On March 14. of the insurance company. Thus. e. in respect of which it is settled that the terms in an insurance policy. A binding receipt is manifestly merely conditional and does NOT insure outright. Mrs Landicho. Mondragon received a letter from Grepalife Main office disapproving the insurance application of Ngo for the simple reason that the 20yr endowment plan is not available for minors below 7 yrs old. ISSUE: Whether or not the insurance policy in question has been in force. Mr. d. 1957. and every month thereafter until notice of its discontinuance shall have been received from the system. Thus in life insurance. but the latter denied liability on the ground that there was no contract between the insurer and the insured and a binding receipt is NOT evidence of such contract.Mondragon then typed the data on the application form which was later signed by Ngo. that the failure to deduct from my salary the month premiums shall not make the policy lapse. The acceptance is merely conditional.800 as the double indemnity due under the policy because of the untimely death of the insured. And the reason for this rule is the insured usually has no voice in the selection of words employed and that the language of the contract is selected with great care and deliberations by experts and legal advisers employed by. 28866 FACTS: On June 1. which are ambiguous . that the policy shall be made effective on the first day of the month next following the first premium is paid. So as to effect the dominant purpose of indemnity or payment of the insured. provided that it is more ninety (90) days before or after the date of the medical examination. Since Grepalife disapproved the insurance application of Ngo. a binding slip or binding receipt does NOT insure by itself. On may 1957. the insurance applied for shall not have been in force at any time and the sum paid shall be returned to the applicant upon the surrender of this receipt. Issue: WON the binding deposit receipt. the insured employee. Mondragon wrote back the main office again strongly recommending the approval of the endowment plan on the life of Helen.The binding receipt contained the following provision: If the applicant shall not have been insurable xxx and the Company declines to approve the application. RULING: The civil code provides: The interpretation of obscure words or stipulations in a contract shall not favor the party who caused the obscurity This is particularly true as regards insurance policies. While still under the employment of the Bureau of Public Works. equivocal or uncertain . NO liability shall attach until the principal approves the risk and a receipt is given by the agent. 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. as the party who prepared and furnished the application form and in favor of the party misled thereby. 1966 in an airplane crash in Mindoro.Grepalife v. in her own behalf and that of her co-plaintiffs and two minor children filed with the GSIS a claim of P15. The binding receipt in question was merely an acknowledgement on behalf of the company. . however. Helen died of influenza with complication of broncho pneumonia. Held: NO. LANDICHO vs GSIS GR No. 1957. the branch manager of Grepalife-Cebu.