CHARACTERISTICS OF INSURANCE:

- UNILATERAL

- PERSONAL

- ALEATORY

- EXECUTORY & CONDITIONAL

- CONSENSUAL

Insurer – insurance company

Insured – offerrer through application

Consent is made upon the insurer’s approval of the application; such approval should be communicated
to the insured

- UBERRIMAE FIDAE

– perfect good faith; the insured must disclose whatever information asked by the insurer; avoid
material concealment/ misrepresentations

- VOLUNTARY

The law does not prohibit the requirement of some creditors to procure an insurance policy, depending
on the transaction

- INSURANCE AS CONTRACTS OF ADHESION

there are certain contracts in which almost all the provisions of which have been drafted only by
one party, usually a corporation. Such contracts are called contracts of adhesion, because the only
participation of the other party is the signing of his signature or his 'adhesion' thereto

Rules in the construction or interpretation of insurance contracts

GR: If the terms of the contract clearly show the intention of the parties, there shall be no room for
interpretation.

XPN: If there are ambiguities in the terms of an insurance contract, they have to be resolved in favor of
the insured and strictly against the insurer because an insurance contract being a contact of adhesion,
most of its terms is not a product of mutual negotiation between the parties as they are prepared by the
insurance company in final printed forms