INSURANCE LAW

OUTLINE1
I.

General
A. Concept, purpose, history
B. Governing laws
1. PD 1460 as amended (Insurance Code or IC)
2. Art. 2011-2012, Civil Code (Insurance)
3. Art. 2021-2027, Civil Code (Life Annuity)
4. Art. 2186, Civil Code (Bond for 3rd party liability, motor vehicles)
5. Special laws PD 1146 (GSIS); RA 1161 (SSS); RA 656 (government
property insurance); RA 3591 (PDIC)
C. Characteristics
D. Definition of insurance contract Sec. 2, IC
E. Requisites for validity in general Civil Code on validity of contracts
See:

Articles 1318, 1319, 1353, Civil Code

Enriquez v. Sun Life Assurance, 41 Phil 209 (GR 15895; 1920)AIYU
Perez v. CA, 323 SCRA 613 (2000)DJ
De Lim v. Sun Life of Canada,GR 15774, Nov. 29, 1920EUNICE
Musngi v. West Coast Life, 61 Phil 864 (GR 41794, 1935) JEROME

F. Essential elements
See:

Gulf Resorts v. Philippine Charter Insurance, 458 SCRA 550 (2006)JON

Philamcare Health Systems v. CA, 379 SCRA 356 (2002)KIKOY

G. Applicability of Civil Code

Art. 2011, 2012, 739, Civil Code
See:

Insular Life v. Ebrado, 80 SCRA 181 (1977)KLAIRE

Zenith Insurance v. CA, 185 SCRA 398 (1990)NIKKI

H. Subrogation
1

DLSU College of Law, 1st Term 2014-2015 (Atty. Barbara Anne C. Migallos)

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Article 2027, Civil Code
See:

Firemans Fund et al v Jamila et al. 70 SCRA 23 (1976) RIKKI

Pan Malayan Insurance v CA, 184 SCRA 54 (1990)TRICIA
SverigesAnfartygs Assurance v Qua CheeGan, 21 SCRA 12 (1967)YSA
Rizal Surety v Manila Railroad, 23 SCRA 205 (1968)JEZ

National Union Fire Insurance v. Stolt Nielsen, 184 SCRA 682

(1990)AIYU
Cebu Shipyard v William Lines, 306 SCRA 762 (1999)DJ
Manila Mahogany v CA, 154 SCRA 650 (1967)EUNICE
F.F. Cruz v CA, 164 SCRA 731 (1988)JEROME
I.

Construction of insurance contracts

See:

De la Cruz v. Capital Insurance, 17 SCRA 559 JON

Sun Insurance Office Ltd v CA, 211 SCRA 554 (1992)KARLA
Ty v Filipinas Cia de Seguros, 17 SCRA 364 (1966)KIKOY
Calanoc v CA, GR 8151, 16 December 1955KLAIRE
Biagtan v Insular Life, 44 SCRA 58 (1972)NIKKI
Finman General Assurance v CA, 213 SCRA 493RIKKI
Qua CheeGan v Law Union and Rock, 98 Phil 85 (1955)TRICIA

Del Rosario v. Equitable Insurance and Casualty, 8 SCRA 343

(1963)YSA
Verendia v CA, 217 SCRA 417 (1993)JEZ
Fortune Insurance v CA, 244 SCRA 308 (1996)AIYU
Misamis Lumber v Capital Insurance, 17 SCRA 228 (1966)DJ
J. The Business of Insurance
Section 2(2), IC
See:

White Gold Marine v Pioneer Insurance, 464 SCRA 448 (2005)EUNICE

Philamlife v Ansaldo, 234 SCRA 509 JEROME

II.

Contract of insurance

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A. What may be insured against Sections 3-4, IC
B. Parties to insurance contracts
1. Who may be an insurer
Sec. 6, IC
2. Who may be insurer
Sec. 7, IC
See:
Filipinas Cia. De Seguros v ChristernHuenefeld, 89 Phil 54
(1951)JON
See also: Constantino v Asia Life, 87 Phil 248 (1950)KARLA
Fidela Sales Gonzaga v Crown Life, GR L-4197, 20 March
1957KIKOY
3. Married women, minors
Sec. 3, IC
Note: Article 234, Family Code; R.A. 6809
4. Mortgagor/mortgagee
Sec. 8 and 9, IC; see also Sec. 13 and 53, IC
See:

Palileo v Cosio, 97 Phil 919 (1955)KLAIRE

San Miguel Brewery v Law Union, 40 Phil 674NIKKI
Gonzalez LaO v Yek Tong Lin Fire, GR 33131, 13 Dec 1930RIKKI
Geagonia v. CA, 241 SCRA 152 (1995)TRICIA
Saura Import & Export v Phil Intl Surety, 8 SCRA 143 (1963)YSA
Phil. National Bank v CA, 158 SCRA 201 (1988)JEZ

C. Insurable interest
Sec. 18, 25, IC
1. Insurable interest in life insurance
Sec. 10, IC; Sec. 181, IC
See:

Lalican v. Insular Life, 597 SCRA 159 (2009)AIYU

El Oriente v Posadas, 54 Phil 147DJ

2. Beneficiaries

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Art. 2012 and 739, Civil Code
Sections 11 and12, IC
See:

Insular Life v Ebrado, 80 SCRA 181 (1977)EUNICE

Vda. De Consuegra v GSIS, 37 SCRA 316 (1971)JEROME
Southern Luzon Employees v Golpeo, 96 Phil 84 (1954)JON
Heirs of Maramag v Maramag, 588 SCRA 774 (2009)KARLA
Philamcare v CA, 379 SCRA 356 (2002)KIKOY
Nario V Phil Am Life, 20 SCRA 434 (1967)KLAIRE
Phil Am Life v Pineda, 175 SCRA 416 (1989)NIKKI
Villanueva v Oro, 81 Phil 464 (1948)RIKKI

3. Insurable interest in property insurance

Sections 13 to 18, IC; Section25, IC
See:
Gaisano v Insurance Co. of North America, 490 SCRA 286
(2006)TRICIA
Commercial Union Assurance v. Lepanto, 113 SCRA 752
(1982)YSA
Harding v Commercial Union, 38 Phil 464 (1918)JEZ
Lampano v Jose, 30 Phil 537 (1915)AIYU
Ong Lim Sing, Jr. v FEB Leasing, 524 SCRA 333 (2007)DJ
Traders Insurance v Golangco, 95 Phil 826 (1954)EUNICE
Lopez v del Rosario, 44 Phil 98 (1922)JEROME
San Miguel v Law Union Rock Insurance, 40 Phil 674 (1920)JON
Spouses Cha v Court of Appeals, 277 SCRA 690 (1997)KARLA
4. When insurable interest must exist
Sections 19, 20, 21, 22, 23, 24, 25, IC
See:
Tai Tong Chua Che v Insurance Com, 158 SCRA 366
(1988)KIKOY
San Miguel v Law Union Rock Insurance, 40 Phil 674
(1920)KLAIRE
D. Concealment

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Sections 26-35, IC
See:

Argente v West Coast Life, GR L-24899, 9 March 1928NIKKI

Great Pacific Life v CA, 89 SCRA 543 (1993)RIKKI
Saturnino v Philippine American Life, 7 SCRA 316 (1963)TRICIA
Canilang v CA and Great Pacific Life, 223 SCRA 223 (1993)YSA
Sun Life v Bacani, 245 SCRA 268 (1995)JEZ
Yu Pang Cheng v CA, 105 Phil 939 (1959)AIYU
Ng Zee v Asian Crusader Life Insurance, 122 SCRA 461 (1963)DJ
Colado v Insular Life, 51 O.G. (No. 12) 6269 (1955) EUNICE

E. Representation
Sections 37-48, IC
See:

Edillon v Manila Bankers Life, 117 SCRA 187 (1982)JEROME

Insular Life v Feliciano, 74 Phil 468 (1943)JON
Tan ChayHeng v West Coast Life, 521 Phil 80 (1927)KARLA
Tan v Court of Appeals, 174 SCRA 403 (1989)KIKOY

F. The Policy
1. Sections 49-52; See also Sec. 226, 227, 228, 230, 231, IC
See:

Pacific Banking v CA, 168 SCRA 1 (1988)KLAIRE

Oriental Assurance v Court of Appeals, 200 SCRA 459

(1991)NIKKI
Perez v CA, 323 SCRA 613 (2000)RIKKI
Enriquez v Sun Life, 41 Phil 269 (1920)TRICIA
Tang v CA, 90 SCRA 236 (1979)YSA
Rizal Commercial Banking v CA, 289 SCRA 292 (1996)JEZ
Great Pacific Life CA, 89 SCRA 543 (1979)AIYU
De Lim v Sun Life of Canada, GR 15774, 29 Nov 1920DJ
2. Sections 53-58, IC
See:

Bonifacio Brothers v Mora, 20 SCRA 261 (1967)EUNICE

Heirs of Maramag v Maramag, 588 SCRA 774 (2009)JEROME

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Coquia v Fieldmens Insurance, 26 SCRA 178 (1968)JON
3. Sections 59-62, IC
See:

Development Insurance v. IAC, 143 SCRA 62 (1986)KARLA

4. Section 63, IC
See:

ACCFA v Alpha Insurance, 24 SCRA 151 (1968)KIKOY

Ang v Fulton Fire Insurance, 2 SCRA 945 (11961)KLAIRE
Sun Insurance Office v CA, 195 SCRA 193 (1991)NIKKI
Pacific Banking v CA, 168 SCRA 1 (1988)RIKKI
Lopez v Cia de Seguros, 16 SCRA 855 (1966)TRICIA

5. Sections 64-66, IC
See:

Saura Import & Export v Phil Intl Surety, 8 SCRA 143 (1963)YSA
Malayan Insurance v Cruz-Arnaldo, 154 SCRA 672 (1987)JEZ

G. Warranties
Sections 67-76, IC
See:
Ang Giok Chip v Sprinngfield Fire & Marine, 56 Phil 375
(1931)AIYU
Young v Midland Textile, 30 Phil 617 (1915)DJ
American Home Assurance v Tantuco, 366 SCRA 740
(2011)EUNICE
Qua CheeGan v Law Union & Rock Insurance, 98 Phil 85
(1955)JEROME
Pioneer Insurance v Yap, 61 SCRA 426 (1974)JON
Prudential Guarantee v Trans Asia, 491 SCRA 411 (2006)KARLA
General Insurance v Ng Hua, 106 Phil 1117 (1960)KIKOY
H. Premium
Sections 77-82, IC
See:

Philippine Phoenix v Woodworks, 20 SCRA 1270 (1967)KLAIRE

Philippine Phoenix v Woodworks, 92 SCRA 419(1979)NIKKI
Arce v Capital Insurance, 117 SCRA 63 (1982)RIKKI
Makati Tuscany v CA, 215 SCRA 462 (1992)TRICIA

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Tibay v CA, 257 SCRA 126 (1996)YSA
UCPB General vMasaganaTelamart, 308 SCRA 259 (1999)JEZ
and UCPB General v MasaganaTelamart, 356 SCRA 307
(2001)AIYU
American Home Ins. v Chua, 309 scra 250 (1999)DJ
I.

Loss and Notice of Loss

1. Sections 83-87, IC
See:
Paris-Manila Perfume v Phoenix Assurance, 49 Phil 753
(1926)EUNICE
Prats v Phoenix Assurance, 52 Phil 807 (1929)JEROME
East Furniture v Globe & Rutgers Fire, 57 Phil 576 (1929)JON
Country Bankers v Lianga Bay Multipurpose Cooperative, 374
SCRA 653 (2002)KARLA
Heirs of Coscolluela v Rico General, 179 SCRA 511 (1989)KIKOY
FGU Insurance v CA, 454 SCRA 339 (2005)KLAIRE
2. Sections 88-92, IC
See:

Malayan Insurance v Cruz Arnaldo, 154 SCRA 683 (1987)NIKKI

Yu Ban Chan v Fieldmens Insurance, 14 SCRA 491 (1965)RIKKI
Go Lu v Yorkshire Insurance, 43 Phil 633 (1930)TRICIA
Pacific Banking v CA, 168 SCRA 1 (1988)YSA
Pacific Timber v CA, 112 SCRA 199 (1982)JEZ
Phil. Charter Ins. v ChemoilLighterage, 462 (SCRA 77 (2005)AIYU

J. Double Insurance
Sections 93-94, IC
See:

Geagonia v CA, 241 SCRA 152 (1995)DJ

Sta. Ana v Commercial Union Insurance, 55 Phil 329EUNICE
Emilio Gonzalez La O v Yek Tong Lin (1930)JEROME
General Insurance v Ng Hua, 106 Phil 1117 (1960)JON
Union Manufacturing & Republic Bank v Philippine Guaranty,

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47 SCRA 271 (1972)KARLA
K. Reinsurance
Sections 95-98, IC
See:

Pioneer Insurance v CA, 175 SCRA 668 (1989)KIKOY

Gibson v Revilla, 92 SCRA 219 (1979)KLAIRE

Artex Development v Wellington Insurance, 81 SCRA 352

(1973)NIKKI
Guingon v Del Monte, 20 SCRA 1063 (1967)RIKKI

III.

Marine Insurance
A. Scope
1. What marine insurance includes
Section 99, IC
2. Perils of the ship v perils of the sea; All Risks insurance
See:

Roque v IAC, 139 SCRA 596 (1985)TRICIA

La Razon Social Go Tiaoco v Union Insurance, 1 Sept 1919YSA
ChoaTekSeng v CA & Filipino Merchants, 183 SCRA 223

(1990)JEZ
Filipino Merchants v CA &ChoaTekTeng, 179 SCRA 638
(1989)AIYU
B. Insurable interest in marine insurance
Sections 100-106, IC
See:

Charterer:
Caltex Phil v Sulpicio Lines, 315 SCRA 709 (1999)DJ

San Miguel v Heirs of SabinianoInguito, 384 SCRA 87

(2001)EUNICE
C. Concealment and representation in marine insurance
Sections 107-110, IC
Sections 111-112, IC
D. Implied warranties

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1. Seaworthiness
Sections 113-119, IC
See:
Philippine American General Ins. v CA, 273 SCRA 262
(1997)JEROME
Caltex Phil v Sulpicio Lines, 315 SCRA 709 (1999)JON
Delsan Transport v CA, 369 SCRA 24 (2001)KARLA
Madrigal v Hanson, 103 Phil 345 (1958)KIKOY
Roque v IAC, 139 SCRA 596 (1985)KLAIRE
2. Documents where nationality expressly warranted
Section 120, IC
3. Against deviation
Sections 121-126, IC
E. Loss in marine insurance
Sections 127-137, IC
See:

PMC v Union Insurance, 42 Phil 378 (1921)NIKKI

Malayan v CA, 210 SCRA 242 (1997)RIKKI
Pan Malayan v CA, 201 SCRA 382 (1991)TRICIA

F. Abandonment
Sections 138-155, IC
See:

Oriental Assurance v CA, 200 SCRA 459 (1991)YSA

G. Measure of indemnity in marine insurance

Sections 156-166, IC
See:

IV.

Jarque v Smith Bell, 56 Phil 758 (1930)JEZ

Fire Insurance
Sections 167-173, IC
See:

Bachrach v British American Assurance, 17 Phil 455 (1910)AIYU

Ong Guan Can v Century Insurance, 46 Phil 592 (1924)DJ
Galian v State Assurance, 29 Phil 413 (1915)EUNICE

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V.

Casualty Insurance
Section 174, IC
Review:

Pan Malayan Insurance v CA, 184 SCRA 54 (1990)JEROME

De la Cruz v. Capital Insurance, 17 SCRA 559 JON
Sun Insurance Office Ltd v CA, 211 SCRA 554 (1992)KARLA
Ty v Filipinas Cia de Seguros, 17 SCRA 364 (1966)KIKOY
Calanoc v CA, GR 8151, 16 December 1955KLAIRE
Biagtan v Insular Life, 44 SCRA 58 (1972)NIKKI
Finman General Assurance v CA, 213 SCRA 493 (1992)RIKKI
Fortune Insurance v CA, 244 SCRA 308 (1996)TRICIA
Misamis Lumber v Capital Insurance, 17 SCRA 228 (1966)YSA

See:

Villacorta v Insurance Commission, 100 SCRA 467 (1990)JEZ

PerlaCia de Seguros v CA, 208 SCRA 987 (1992)AIYU
Association of Baptists v Fieldmen124 SCRA 618 (1983)DJ
Shafer v RTC Judge, 14 November 1988EUNICE
Guingon v Del Monte, 20 SCRA 1043 (1967)JEROME
Malayan Insurance v CA and Vallejos, et al., 165 SCRA 54JON
Vda de Maglana v Consolacion, 212 SCRA 268 (1992) KARLA

VI.

Suretyship
Sections 175-178, IC
See:

Philippine Pryce Assurance v.CA, 230 SCRA 164 (1994)KIKOY

AFP General Insurance v. Molina, 556 SCRA 631 (2008)KLAIRE
Capital
(1983)NIKKI

VII.

Insurance

Life Insuramce
Sections 179-183; IC (note 180-A)
Section 227, IC

v.

Ronquillo

Trading,

123

SCRA

526

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VIII.

Other provisions

A. Claims settlement
Sections 241-246, IC
Review:

Cathay Insurance v CA, 174 SCRA 11 (1989)RIKKI

Zenith Insurance v. CA, 185 SCRA 398 (1990)TRICIA

B. Mutualization
Section 262, IC

C. Insurance agents and brokers

Sections 299 -300, IC
Section 301, IC

D. Actuary
Section 335, IC

E. Compulsory Motor Vehicle Liability Insurance

Sections 373-378, IC