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Page 1 Insurance Part V The Policy of Insurance Provisions Atty Reyes V. The Policy of Insurance A. Definition and form “SEC. 49. The written instrument in which a contract of insurance is set forth, is called a policy of insurance. “SEC. 50. The policy shall be in printed form which may contain blank spaces; and any word, phrase, clause, mark, sign, symbol, signature, number, or word necessary to complete the contract of insurance shall be written on the blank spaces provided therein. “Any rider, clause, warranty or endorsement purporting to be part of the contract of insurance and which is pasted or attached to said policy is not binding on the insured, unless the descriptive title or name of the rider, clause, warranty or endorsement is also mentioned and written on the blank spaces provided in the policy. “Unless applied for by the insured or owner, any rider, clause, warranty or endorsement issued after the original policy shall be countersigned by the insured or owner, which countersignature shall be taken as his agreement to the contents of such rider, clause, warranty or endorsement. “Notwithstanding the foregoing, the policy may be in electronic form subject to the pertinent provisions of Republic Act No. 8792, otherwise known as the ‘Electronic Commerce Act’ and to such rules and regulations as may be prescribed by the Commissioner. (see RA 8792) B. Fine Print Rule C. Contents of the Policy “SEC. 51. A policy of insurance must specify: “(a) The parties between whom the contract is made; “(b) The amount to be insured except in the cases of open or running policies; “(c) The premium, or if the insurance is of a character where the exact premium is only determinable upon the termination of the contract, a statement of the basis and rates upon which the final premium is to be determined; “(d) The property or life insured; “(e) The interest of the insured in property insured, if he is not the absolute owner thereof; “(f) The risks insured against; and “(g) The period during which the insurance is to continue. D. Papers Attached to the Policy and their Binding Effect (Rider, warranties, clause, endorsement) E. Kinds of Policy 1. Open “SEC. 60. An open policy is one in which the value of the thing insured is not agreed upon, and the amount of the insurance merely represents the insurer’s maximum liability. The value of such thing insured shall be ascertained at the time of the loss. 2. Valued

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Page1Insurance Part V The Policy of Insurance Provisions Atty ReyesV. The Policy of Insurance

A. Definition and form

SEC. 49. The written instrument in which a contract of insurance is set forth, is called a policy of insurance.

SEC. 50. The policy shall be in printed form which may contain blank spaces; and any word, phrase, clause, mark, sign, symbol, signature, number, or word necessary to complete the contract of insurance shall be written on the blank spaces provided therein.

Any rider, clause, warranty or endorsement purporting to be part of the contract of insurance and which is pasted or attached to said policy is not binding on the insured, unless the descriptive title or name of the rider, clause, warranty or endorsement is also mentioned and written on the blank spaces provided in the policy.

Unless applied for by the insured or owner, any rider, clause, warranty or endorsement issued after the original policy shall be countersigned by the insured or owner, which countersignature shall be taken as his agreement to the contents of such rider, clause, warranty or endorsement.

Notwithstanding the foregoing, the policy may be in electronic form subject to the pertinent provisions of Republic Act No. 8792, otherwise known as the Electronic Commerce Act and to such rules and regulations as may be prescribed by the Commissioner.

(see RA 8792)

B. Fine Print Rule

C. Contents of the PolicySEC. 51. A policy of insurance must specify:(a) The parties between whom the contract is made;(b) The amount to be insured except in the cases of open or running policies;(c) The premium, or if the insurance is of a character where the exact premium is only determinable upon the termination of the contract, a statement of the basis and rates upon which the final premium is to be determined;(d) The property or life insured;(e) The interest of the insured in property insured, if he is not the absolute owner thereof;(f) The risks insured against; and(g) The period during which the insurance is to continue.D. Papers Attached to the Policy and their Binding Effect (Rider, warranties, clause, endorsement)

E. Kinds of Policy

1. Open

SEC. 60. An open policy is one in which the value of the thing insured is not agreed upon, and the amount of the insurance merely represents the insurers maximum liability. The value of such thing insured shall be ascertained at the time of the loss.

2. ValuedSEC. 61. A valued policy is one which expresses on its face an agreement that the thing insured shall be valued at a specific sum.3. Running

SEC. 62. A running policy is one which contemplates successive insurances, and which provides that the object of the policy may be from time to time defined, especially as to the subjects of insurance, by additional statements or indorsements.

F. Cover Notes

SEC. 52. Cover notes may be issued to bind insurance temporarily pending the issuance of the policy. Within sixty (60) days after issue of a cover note, a policy shall be issued in lieu thereof, including within its terms the identical insurance bound under the cover note and the premium therefor.Cover notes may be extended or renewed beyond such sixty (60) days with the written approval of the Commissioner if he determines that such extension is not contrary to and is not for the purpose of violating any provisions of this Code. The Commissioner may promulgate rules and regulations governing such extensions for the purpose of preventing such violations and may by such rules and regulations dispense with the requirement of written approval by him in the case of extension in compliance with such rules and regulations.G. Cancellation of Policy

SEC. 65. All notices of cancellation mentioned in the preceding section shall be in writing, mailed or delivered to the named insured at the address shown in the policy, or to his broker provided the broker is authorized in writing by the policy owner to receive the notice of cancellation on his behalf, and shall state:(a) Which of the grounds set forth in Section 64 is relied upon; and(b) That, upon written request of the named insured, the insurer will furnish the facts on which the cancellation is based.SEC. 66. In case of insurance other than life, unless the insurer at least forty-five (45) days in advance of the end of the policy period mails or delivers to the named insured at the address shown in the policy notice of its intention not to renew the policy or to condition its renewal upon reduction of limits or elimination of coverages, the named insured shall be entitled to renew the policy upon payment of the premium due on the effective date of the renewal. Any policy written for a term of less than one (1) year shall be considered as if written for a term of one (1) year. Any policy written for a term longer than one (1) year or any policy with no fixed expiration date shall be considered as if written for successive policy periods or terms of one (1) year.

H. Time to Commence Action on the Policy; Effect of Stipulation SEC. 63. A condition, stipulation, or agreement in any policy of insurance, limiting the time for commencing an action thereunder to a period of less than one (1) year from the time when the cause of action accrues, is void.