Title Industrial Personnel & Management GR No.

194126
Services vs Country Bankers Date: October 17 2018
Ponente: Caguioa J

Doctrine: All defects in the proof of loss, which the insured might remedy are waived as
grounds for objection when the insurer omits to specify to him without unnecessary delay. It is
the duty of the insurer to indicate the defects on the proof of loss given so that the deficiencies
may be supplied by the insured.
FACTS
Industrial Personnel & Management Service (IPAMS) began recruiting nurces for work
deployment. As the process requires huge amounts of money. By reason of the advances of
money made to the nurses, the latter were required to post surety bonds. Country Bankers and
IPAMS agreed to provide bonds for the nurses. Under the agreement, Country Bankers will
provide surety bonds and premiums were paid by IPAMs on behalf of the nurse applicants. A
Memorandum of agreement was executed on February 2002 which stipulated various
requirements for collecting claims. According to IPAMS starting 2004, some of its claims were
not anymore settled by Country Bankers. The claims were not denied by Country Bankers which
asked for time within to pay the claims. However the counsel of Country Bankers started to
oppose the payment of claims and insisted on the production of official receipts of IPAMS on
expenses.

ISSUE/S
W/N Country Bankers is liable to pay IPAMS’s claim despite the lack of official receipt
RATIO
Yes. Section 92 of the Insurance Code states that all defects in the proof of loss, which the
insured might remedy are waived as grounds for objection when the insurer omits to specify to
him without unnecessary delay. It is the duty of the insurer to indicate the defects on the proofs
of loss given, so that the deficiencies may be supplied by the insured. When the insurer
recognizes his liability to pay claim, there is a waiver by the insurer of any defect in the proof of
loss. In the instant case, it must be emphasized that respondent readily acknowledged the
obligation under the surety agreement. The failure to attach the official receipt evidencing the
expenses incurred by IPAMS even assuming that it can be considered a defect on the required
proof of loss, is therefore considered waived as a ground for objecting the claim of IPAMS.

Notes
(Martinez, Raphael Fernand C )