POST-MIDTERM INSURANCE NOTES Atty. Tenebro A.

Insurance Contract is an agreement whereby one undertakes for a consideration to indemnify another against loss, damage or liability arising from an unknown or contingent event. B. Characteristics a. Aleatory contract b. Contract of Indemnity i. Subrogation: basis is unjust enrichment c. Contract of Adhesion i. Entirely prepared by the insurer ii. No opportunity to change or modify iii. Take it or leave it basis d. Contract of Utmost good faith i. Concealment ii. Misrepresentation iii. Exception: 1. Incontestability clause 2. Sec 45. Waived by the acceptance of premium payments e. Personal Contract i. Binding only against he insurer and the insured ii. Exception 1. Sec 23: a change of interest, by will or succession, on the death of the insured does not avoid an insurance, and his interest in the insurance passes to the person taking hi interest in the thing insured C. Elements of a Valid Insurance Contract a. Contest which must be freely give b. Object certain which is the subject matter of the contract c. The cause of the obligation d. The insurable interest over the object of the contract D. Who are insurers? Dully authorized, certificate of authority after the payment of fees E. Who maybe insured? Anyone except a public enemy may be insured a. There must be a formal declaration of war by congress of 2/3 of each house voting in joint session

Sept 10, 2013 1. Consent freely given a. It is a consensual contract, cognition theory - The knowledge of the acceptance of the insurer by the insured. Followed in the Philippines. b. Manifestation theory - the mere acceptance of the insured. c. The cause is the premium so if there is no payment of premium there is no cause. d. Rule on cash and carry basis: when there is no payment of payment, then there is no insurance. e. Credit is still considered payment because of the principle of estoppel. Because the insurance company already agreed. 2. Object certain which is the subject matter of the contract a. Any contingent or unknown event, wheather past or future, which may damnify a person having an insurable interest 3. Cause of the obligation a. Payment of Premium itself 4. Insurable Interest a. If there is no insurable interest then it becomes a mere wager or gambling. b. It would be contrary to public order or public policy c. A person has an insurable interest in the subject matter if he is so connected, so situated, so circumstanced, so related that BY THE PRESERVATION OF THE SAME HE SHALL DERIVE PECUNIARY BENEFIT and by its DESTRUCTION he shall suffer pecuniary loss damage or prejudice. d. LIFE AND HEALTH i. Sec 10 ii. Suicide: insurer is liable when he committed it in the state of calamity and when it is after the contestability clause (2 years). e. PROPERTY i. Sec 13 ii. Sec 14 iii. Transferring interest by ENDORSEMENT but must be approved by the insurer 1. Exemption: (!) after the occurance of an injury (2) one or more several distinct things, separately insured by one policy 2.