Insurance Case 1

8/11/2019 Insurance Case 1

1/10


2/10

of in:uries intentionally inflicted by third parties and was not covered. %he trial court ruled that there was no proof that the robbers

intended to &ill Biagtan, or :ust to scare him away by thrusting at him with their &nives. %he Supreme Court held otherwise, pointing

out that there were nine wounds in all. %he e'ception in the accidental benefit clause does not spea& of the purpose = whether

homicidal or not = of a third party in causing the in:uries, but only of the fact that such in:uries have been intentionally inflicted. 0ine

wounds inflicted with bladed weapons at close range cannot be considered innocent insofar as intent is concerned. %he manner ofe'ecution of the crime permits no other conclusion.

>issent+ %he case of Calanoc is controlling. %he thrusts seemed to be a refle' action on the part of the robbers upon being surprised by

Biagtan. %he accidental death benefit clause carries several e'ceptions, with an ambiguous fifth paragraph saying that in:uries inflicted

intentionally by a third party were among the e'ceptions. %he ambiguous clause conflicts with all the other four e'ceptions andseemingly e'cept all other in:uries, intentionally inflicted by a third party, regardless of any violation of law or provocation by theinsured, and defeat the very purpose of the policy of giving the insured double indemnity in case of accidental death by e'ternal and

violent means.

Applying the rule of noscitus a sociis, the double indemnity policy covers the insured against accidental death, whether caused by

fault, negligence or intent of a third party which is unforeseen and une'pected by the insured. All the associated words and concepts in

the policy plainly e'clude the accidental death from the coverage of the policy only where the in:uries are self


3/10

@

A3

#$NAN GNRAL A//0RANC CR&RA+$N, 4etitioner,

v.

+' 'NRABL C0R+ # A&&AL/ an* J0L$A /0R&/A, re4on*ent.

A$uino and Associates for petitioner.

Public Attorney(s 6ffice for private respondent.

Ponente+ 06C60

#AC+/"

HPetitioner filed this petition alleging grove abuse of discretion on the part of the appellate court in applying the principle ofJe'presso unius e'clusio alteriusK in a personal accident insurance policy since death resulting from murder andEor assault are

impliedly e'cluded in said insurance policy considering that the cause of death of the insured was not accidental but rather a deliberate

and intentional act of the assailant in &illing the former as indicated by the location of the lone stab wound on the insured. %herefore,

said death was committed with deliberate intent which, by the very nature of a personal accident insurance policy, cannot be

indemnified.

$//0"

1hether or not death petitioner is correct that results from assault or murder deemed are not included in the terms JaccidentK and

JaccidentalK.

'LD"06. Petition for certiorari with restraining order and preliminary in:unction was denied for lac& of merit.

RA+$"

%he terms JaccidentK and JaccidentalK as used in insurance contracts have not ac$uired any technical meaning, and are construed bythe courts in their ordinary and common acceptation. %hus, the terms have been ta&en to mean that which happen by chance or

fortuitously, without intention and design, and which is une'pected, unusual, and unforeseen. An accident is an event that ta&es place

without one(s foresight or e'pectation G an event that proceeds from an un&nown cause, or is an unusual effect of a &nown cause and,

therefore, not e'pected.

HIt is well settled that contracts of insurance are to be construed liberally in favor of the insured and strictly against the insurer. %hus

ambiguity in the words of an insurance contract should be interpreted in favor of its beneficiary.

enit $nurance Cor4oration v. CA 7G.R. No. 8596 a 1, 1992:

Post under case digests, Commercial )aw at Saturday, 2ebruary 8, !- Posted by Schi3ophrenic Mind

#act"6n 7anuary 8, -9@, private respondent )awrence 2ernande3 insured his car for ;own damage; with petitioner 5enith

Insurance Corporation. 6n 7uly , -9@, the car figured in an accident and suffered actual damages in the amount of P,?!.!!. After

allegedly being given a run around by 5enith for two D months, 2ernande3 filed a complaint with the 4egional %rial Court of Cebu

for sum of money and damages resulting from the refusal of 5enith to pay the amount claimed. Aside from actual damages andinterests, 2ernande3 also prayed for moral damages in the amount of P-!,!!!.!!, e'emplary damages of P8,!!!.!!, attorneyFs fees of

P,!!!.!! and litigation e'penses of P,!!!.!!.

6n September @, -9@, 5enith filed an answer alleging that it offered to pay the claim of 2ernande3 pursuant to the terms and

conditions of the contract which, the private respondent re:ected. 6n 7une ?, -9@, a decision was rendered by the trial court in favorof private respondent 2ernande3. 6n August -/, -9@@, the Court of Appeals rendered its decision affirming in toto the decision of the

trial court.

$ue"%he propriety of the award of moral damages, e'emplary damages and attorneyFs fees is the main issue raised herein by

petitioner.

'el*"%he award of damages in case of unreasonable delay in the payment of insurance claims is governed by the Philippine

Insurance Code, which provides+

Sec. ??. In case of any litigation for the enforcement of any policy or contract of insurance, it shall be the duty of the Commissioneror the Court, as the case may be, to ma&e a finding as to whether the payment of the claim of the insured has been unreasonably

denied or withheld# and in the affirmative case, the insurance company shall be ad:udged to pay damages which shall consist of

attorneyFs fees and other e'penses incurred by the insured person by reason of such unreasonable denial or withholding of payment

plus interest of twice the ceiling prescribed by the Monetary Board of the amount of the claim due the insured, from the date following

the time prescribed in section two hundred forty


4/10

denial or withholding of payment# D interest at twice the ceiling prescribed by the Monetary Board of the amount of the claim due the

in:ured# and ?D the amount of the claim.

/0N $N/0RANC ##$C L+D v CA"2eli' )im 7r shot himself dead and the family tried to claim on the policy. %he insurer

refused, saying that when he put a gun to his head, though thin&ing it was not loaded, he willfully e'posed himself to needless periland removed himself from the coverage of the insurance policy. %he family said that )im had removed the maga3ine before and fully

believed that the gun was not loaded. As such, it was an accident that should be covered by the policy. %he court held that while )im

was un$uestionably negligent, that should not prevent his widow from recovering from the insurance policy he obtained precisely

against accident. %here is nothing in the policy that relieves the insurer of the responsibility to pay the indemnity agreed upon if theinsured is shown to have contributed to his own accident.

0arratives Berne uerreroD

of the ;Mas&arra Annual 2estival.; %hereafter, 7ulia Surposa and the other beneficiaries of said insurancepolicy filed a written notice

of claim with 2inman which denied said claim contending that murder and assaultare not within the scope of the coverage of theinsurance policy. 6n ? 2ebruary -9@9, Surposa filed acomplaint with the Insurance Commission which subse$uently rendered a

decision, ordering 2inman liable topay Surposa the sum of P-8,!!!.!! representing the proceeds of the policy with interest from the

date of thefiling of the complaint until fully satisfied. As no evidence was submitted to prove the claim for mortuary aidin the sum of

P-,!!!.!!, the same was not entertained. 6n -- 7uly -99-, the appellate court affirmed saiddecision. 2inman filed the petition for

certiorari.Issue+

1hether the death was committed with deliberate intent which, by the very nature of a personalaccident insurance policy, cannot be

indemnified.

"eld+

06. %he terms ;accident; and ;accidental,; as used in insurance contracts have not ac$uired anytechnical meaning, and are construed

by the courts in their ordinary and common acceptation. %hus, the termshave been ta&en to mean that which happen by chance orfortuitously, without intention and design, andwhich is une'pected, unusual, and unforeseen. An accident is an event that ta&es place

without oneFs foresightor e'pectation G an event that proceeds from an un&nown cause, or is an unusual effect of a &nown causeand,

therefore, not e'pected. %he generally accepted rule is that, death or in:ury does not result from accidentor accidental means within the

terms of an accident


5/10

An accident is an event which happens without any human agency or, if happening through humanagency, an event which, under the

circumstances, is unusual to and not e'pected by the person to whom ithappens. It has also been defined as an in:ury which happens

by reason of some violence or casualty to theinsured without his design, consent, or voluntary co


6/10

O

Conse$uently, the heirs of )ope Maglana filed an action for damages and attorney(s feesagainst operator Patricio >estra:o and

A2ISC6. An information for homicide thru rec&lessimprudence was also filed against Pepito Into.

O

>uring the pendency of the civil case, Into was held to be guilty of homicide thru rec&lessimprudence and was sentenced accordingly.%rial Court+

O

%he trial court found that >estra:o had not e'ercised sufficient diligence as the operator of the :eepney.

OIn the dispositive portion of the decision, it was e'pressly stipulated by the court that thedefendant insurance company is ordered toreimburse defendant >estra:o whatever amountsthe latter shall have paid only up to the e'tent of his insurance coverage.

O

In denying the motions for reconsideration, the Court said that since the insurance contract isin the nature of suretyship, then the

liability of the insurer is secondary only up to the e'tent of the insurance coverage.Petitioner(s contention+O

A2ISC6 should not merely be held secondarily liable because the Insurance Code provides thatthe insurer(s liability is direct and

primary andEor :ointly and severally with the operator of thevehicle, although only up to the e'tent of the insurance coverage.

&erla Com4ania *e /e!uro, $nc. v 'onorable Court o< A44eal an* ila!ro Caa

.4. 0o. /@@! May @, -99!

240A0,

C.7.+

#AC+/"Milagros Cayas was the registered owner of a Ma3da bus. Said passenger vehicle was insuredwith Perla Compania deSeguros, Inc. PCSID under a policy issued on 2ebruary , -9/@. 6n >ecember -/, -9/@, the bus figured in an accident in 0aic, Cavite

in:uring several of its passengers. 6ne of them,-9ecree

0o. - which was retained by P.>. 0o. -?!, the Insurance Code of -9/@D, which provided that the liability of land transportationvehicle operators for bodily in:uries sustained by a passenger arising out of the use of their vehicles shall not be less than P-,!!!. In

other words, under thelaw, the minimum liability is P-,!!! per passenger. PCSIFs liability under the insurance contract not being less

than P-,!!!.!!, and therefore not contrary to law, morals, good customs, public order or public policy, said stipulation must be

upheld as effective, valid and binding as between the parties.In li&e manner, we rule as valid and binding upon Cayas the condition in

the policy in re$uiringher to secure the written permission of PCSI before effecting any payment in settlement of any claim

against her. %here is nothing unreasonable, arbitrary or ob:ectionable in this stipulation as would warrantits nullification. %he same

was obviously designed to safeguard the insurerFs interest against collusion between the insured and the claimants.In her cross SN46S,I0C PCSID. %he bus figured in an accident in Cavite, in:uring several of its passengers. 6ne of them, Perea, sued Cayas for damages

in the C2I, while three others agreed to a settlement of P?,!!!.!! each with Cayas.

After trial, the court rendered a decision in favor of Perea, Cayas ordered to compensate the latter with damages. Cayas filed acomplaint with the C2I, see&ing reimbursement from PCSI for the amounts she paid to A)) victims, alleging that the latter refused toma&e such reimbursement notwithstanding the fact that her claim was within its contractual liability under the insurance policy.

%he decision of the CA affirmed in toto the decision of the 4%C of Cavite, the dispositive portion of which states+

I0 LI1 62 %" 2646I0, :udgment is hereby rendered ordering defendant PCSI to pay plaintiff Cayas the sum of P8!,!!!.!!under its ma'imum liability as provided for in the insurance policy#

In this petition for review on certiorari, petitioner see&s to limit its liability only to the payment made by private respondent to Perea

and only up to the amount of P-,!!!.!!. It altogether denies liability for the payments made by private respondents to the other

in:ured passengers totaling P-,!!!.!!.

$//0"how much should PCSI pay*

'LD"%he decision of the CA is modified, petitioner only to pay Cayas P-,!!!,!!!.!!

%he insurance policy provides+

8. 0o admission, offer, promise or payment shall be made by or on behalf of the insured without the written consent of the Company

It being specifically re$uired that petitioner(s written consent be first secured before any payment in settlement of any claim could be

made, private respondent is precluded from see&ing reimbursement of the payments made to the other victims in view of her failure

to comply with the condition contained in the insurance policy.

Also, the insurance policy involved e'plicitly limits petitioner(s liability to P-,!!!.!! per person and to P8!,!!!.!! per accident

Clearly, the fundamental principle that contracts are respected as the law between the contracting parties finds application in the

present case. %hus, it was error on the part of the trial and appellate courts to have disregarded the stipulations of the parties and to

have substituted their own interpretation of the insurance policy.

1e observe that although Cayas was able to prove a total loss of only P??,!!!.!!, petitioner was made liable for the amount of

P8!,!!!.!!, the ma'imum liability per accident stipulated in the policy. %his is patent error. An insurance indemnity, being merely an

assistance or restitution insofar as can be fairly ascertained, cannot be availed of by any accident victim or claimant as an instrument

of enrichment by reason of an accident.

Gea!onia v CA G.R. No. 11( #ebruar 6, 1995

#act"

eagonia, owner of a store, obtained from Country Ban&ers fire insurance policy for P-!!,!!!.!!. %he - year policy and covered

thestoc& trading of dry goods.%he policy noted the re$uirement that

;. %he insured shall give notice to the Company of any insurance or insurances already effected, or which may subse$uently be

effected, covering any of the property or properties consisting of stoc&s in trade, goods in process andEor inventories only hereby

insured, and unless notice be given and the particulars of such insurance or insurances be stated therein or endorsed in this policy

pursuant to Section 8! of the Insurance Code, by or on behalf of the Company before the occurrence of any loss or damage, allbenefits under this policy shall be deemed forfeited, provided however, that this condition shall not apply when the total insurance or

insurances in force at the time of the loss or damage is not more than P!!,!!!.!!.;

%he petitioners( stoc&s were destroyed by fire. "e then filed a claim which was subse$uently denied because the petitioner(s stoc&s

were covered by two other fire insurance policies for Php !!,!!! issued by P2IC. %he basis of the private respondentFs denial was the

petitionerFs alleged violation of Condition of the policy.eagonia then filed a complaint against the private respondent in the Insurance Commission for the recovery of P-!!,!!!.!! under

fire insurance policy and damages. "e claimed that he &new the e'istence of the other two policies. But, he said that he had no

&nowledge of the provision in the private respondentFs policy re$uiring him to inform it of the prior policies and this re$uirement was

not mentioned to him by the private respondentFs agent.

%he Insurance Commission found that the petitioner did not violate Condition as he had no &nowledge of the e'istence of the twofire insurance policies obtained from the P2IC# that it was Cebu %esing %e'tiles wEc procured the P2IC policies wEo informing him or

securing his consent# and that Cebu %esing %e'tile, as his creditor, had insurable interest on the stoc&s.

%he Insurance Commission then ordered the respondent company to pay complainant the sum of P-!!,!!!.!! with interest and

attorney(s fees.

CA reversed the decision of the Insurance Commission because it found that the petitioner &new of the e'istence of the two otherpolicies issued by the P2IC.


8/10

$ue"

-. 160 the petitioner had not disclosed the two insurance policies when he obtained the fire insurance and thereby violated Condition

of the policy.

. 160 he is prohibited from recovering

'el*"es. 0o. Petition ranted

Ratio"-. %he court agreed with the CA that the petitioner &new of the prior policies issued by the P2IC. "is letter of -@ 7anuary -99- to the

private respondent conclusively proves this &nowledge. "is testimony to the contrary before the Insurance Commissioner and which

the latter relied upon cannot prevail over a written admission made ante litem motam. It was, indeed, incredible that he did not &now

about the prior policies since these policies were not new or original.

. Stated differently, provisions, conditions or e'ceptions in policies which tend to wor& a forfeiture of insurance policies should be

construed most strictly against those for whose benefits they are inserted, and most favorably toward those against whom they areintended to operate.

1ith these principles in mind, Condition of the sub:ect policy is not totally free from ambiguity and must be meticulously analy3ed.

Such analysis leads us to conclude that aD the prohibition applies only to double insurance, and bD the nullity of the policy shall only

be to the e'tent e'ceeding P!!,!!!.!! of the total policies obtained.

2urthermore, by stating within Condition itself that such condition shall not apply if the total insurance in force at the time of lossdoes not e'ceed P!!,!!!.!!, the private respondent was amenable to assume a coivision, >avide 7r. 7D+ ? concur

#act"

Armando eagonia is the owner of 0ormanFs Mart located in the public mar&et of San 2rancisco,Agusan del Sur. 6n >ecember

-9@9, he obtained from Country Ban&ers Insurance Corporation fireinsurance policy 0o. 2ecember -9@9 to >ecember -99! and covered the following+ ;Stoc&+P-!!,!!!. G Phils. 2irst CBE2


9/10

1hether the non


10/10

agents of Producers. A ;representative; is defined as one who represents or stands in the place of another# one who represents others or

another in a special capacity, as an agent, and is interchangeable with ;agent.;

In view of the foregoing, 2ortune is e'empt from liability under the general e'ceptions clause of the insurance policy.

#R+0N $N/0RANC AND /0R+3 C., $NC. v. CA

4 0o. --8/@May , -998

2AC%S4espondent Producer(s Ban& of the Philippines( armored vehicle was robbed in transit, of seven hundredtwenty

Documents

Insurance Case 1