LIFE INSURANCE

• Insurance on human lives and insurance appertaining thereto or connected therewith

• Every contract or undertaking for the payment of annuities including contracts for the
payment of lump sums under a retirement program where a life insurance company manages
or acts as a trustee for such retirement program shall be considered a life insurance contract
for purposes of this Code.
Classes
1. Individual – protection is based on individual application.
2. Group – unit of selection is the group rather than the individual, blanket policy covering a
number of individuals
3. Industrial – premiums are payable either monthly or oftener if the face amount of
insurance is not more than 500 times the current statutory minimum wage in Metro Manila

Non-Life
• Property insurance or insurance whose object is other than a person’s life or where the covered
peril is something other than death
Casualty
• Covers loss or liability arising from accident or mishap, excluding certain types of loss which by
law or custom are considered as falling exclusively within the scope of other types of insurance
such as fire, marine.
• Includes but is not limited to employers’ liability insurance, workmen’s compensation insurance,
public liability insurance, motor vehicle liability insurance, plate glass insurance, burglary and
theft insurance, personal accident and health insurance written by non-life companies.
Casualty: Compulsory Motor Vehicle Liability OR Third Party Liability
• Insurance against passenger and third party liability for death or bodily injuries arising from

Compulsory Motor Vehicle Liability OR Third Party Liability

Land transportation operator, the insurance guaranty in cash or surety bond shall cover liability for
death or bodily injuries of third-parties and/or passengers arising out of the use of such vehicle in the
amount not less than Twelve thousand pesos (P12,000.00) per passenger or third -party and an amount,
for each of such categories, in any one accident of not less than that set forth in the following scale:
• (1) Motor vehicles with an authorized capacity of twenty-six (26) or more passengers: Fifty
thousand pesos; (P50,000.00);
• (2) Motor vehicles with an authorized capacity of from twelve (12) to twenty-five (25)
passengers: Forty thousand pesos; (P40,000.00);
• (3) Motor vehicles with an authorized capacity of from six (6) to eleven (11) passengers: Thirty
thousand pesos; (P30,000.00);
• (4) Motor vehicles with an authorized capacity of five (5) or less passengers: Five thousand
pesos (P5,000.00) multiplied by the authorized capacity.
Compulsory Motor Vehicle Liability OR Third Party Liability
• (1) Private Cars
• (i) Bantam: Twenty thousand pesos (P20,000.00);
• (ii) Light: Twenty thousand pesos (P20,000.00); and
• (iii) Heavy: Thirty thousand pesos (P30,000.00).
(2) Other Private Vehicles
• (i) Tricycles, motorcycles and scooters: Twelve thousand pesos (P12,000.00);
• (ii) Vehicles with an unladen weight of 2,600 kilos or less: Twenty thousand pesos (P20,000.00);
• (iii) Vehicles with an unladen weight of between 2,601 kilos and 3,930 kilos: Thirty thousand
pesos (P30,000.00); and
 • (iv) Vehicles with an unladen weight over 3,930 kilos: Fifty thousand pesos (P50,000.00).
Types: Marine
• vessels, craft, aircraft, vehicles, goods, freights, cargoes, merchandise, effects, bottomry,
respondentia interests
• person or property in connection with or appertaining to marine, inland marine, transit
or transportation insurance but excludes life insurance or surety bonds or insurance
against loss by reason of bodily injury to any person who arising out of ownership,
maintenance or use of automobiles
• precious stones, jewels, jewelry, precious metals, whether in the course of
transportation OR otherwise
• bridges, tunnels and other instrumentalities of transportation and communication
(excluding buildings, furniture and furnishings fixed contents and supplies held in
storage), piers, wharves, docks and slips other aids of navigation, dru docks, marine
railways, dams
Types: Suretyship
• An agreement whereby a party called the surety guarantees the performance of
another party called the principal or obligor of an obligation or undertaking in favor
of a third party called the obligee.
• Includes official recognizances, stipulations, bonds or undertakings issued by any
company
At a glance
• In an insurance contract, a person indemnifies another person for his loss, damage or liability
• Any contingent or unknown event which may damnify a person or create a liability against him
may be insured
• The two main kinds of insurance are life and non-life insurance
• A person can sue based on an insurance contract within 10 years from the time the right of
action accrues
• 10-year period may be longer or shorter but generally, cannot be shorter than one year and in
industrial life, cannot be shorter than 6 years
• Doubts in interpreting insurance contracts are resolved in favor of the insured
 PART TWO:
LIFE INSURANCE
  Life Insurance - insurance on human lives and insurance appertaining thereto or connected
therewith
 Every contract or undertaking for the payment of annuities including contracts for the payment
of lump sums under a retirement program where a life insurance company manages or acts as a
trustee for such retirement program shall be considered a life insurance contract for purposes of
this Code.

Classes

1. Individual – protection is based on individual application.

2. Group – unit of selection is the group rather than the individual, blanket policy covering a number of
individuals

3. Industrial – premiums are payable either monthly or oftener if the face amount of insurance is not
more than 500 times the current statutory minimum wage in Metro Manila.

What may be insured against?

• Actual death
• Cessation of life
• Best proof of death: death certificate
• Policy matures upon the death of the insured

• Living death
• When the insured suffers from disability due to disease or accident which prevents him
from engaging in any lawful occupation
• Partakes the nature of health and disability benefits
• Health, accident and disability insurance are deemed as both life and non-life insurance
and such may be issued by either life or non-life insurance companies (Sec. 193, 9 th par).
• Deemed life insurance when death is one of the risks insured against (Gallardo v.
Morales)

Accident

• An event which happens without any human agency or, if happening through human agency, an
event which under the circumstances, is unusual and not expected by the person to whom it
happens by reason of some violence or casualty to the insured without his design, consent or
voluntary cooperation (Sun Insurance v. CA)

• Retirement death