INSULAR LIFE ASSURANCE COMPANY, LTD. vs. CARPONIA T.

EBRADO
G.R. No. L-44059, October 28, 1977, FIRST DIVISION (MARTIN, J.)
FACTS:
On September 1, 1968, Buenaventura Cristor Ebrado was issued by The Life Assurance Co., Ltd., on a wholelife for P5,882.00 with a rider for Accidental Death for the same amount. He designated Carponia T. Ebrado,
his common-law wife as the revocable beneficiary in his policy. He referred to her as his wife in the policy. On
October 21, 1969, He died as a result of an accident when he was hit by a failing branch of a tree. As the
policy was in force, the insurance company was liable to pay the coverage in the total amount of P11,745.73,
representing the face value of the policy in the amount of P5,882.00 plus the additional benefits for accidental
death also in the amount of P5,882.00 and the refund of P18.00 paid for the premium due November, 1969,
minus the unpaid premiums and interest thereon due for January and February, 1969, in the sum of P36.27.
Carponia T. Ebrado filed a claim for the proceeds of the Policy as the designated beneficiary therein, although
she admits that she and the insured Buenaventura C. Ebrado were merely living as husband and wife without
the benefit of marriage. Pascual T. Ebrado, also filed a claim to the insurance company, this time claiming to
be the legal wife Buenaventura. She asserts that she has a better right over the proceeds than Carponia who
is a common-law wife. As the insurance company is at a loss as to whom to give the proceeds, it commenced
an action for interpleader in court. After the issues have been joined, a pre-trial conference was held on July
8, 1972, that there is no possibility of amicable settlement. The Court proceeded to have the parties submit
their evidence for the purpose of the pre-trial and make admissions for the purpose of pretrial. On September
25, 1972, the trial court rendered judgment declaring among others, Carponia T. Ebrado disqualified from
becoming beneficiary of the insured Buenaventura Cristor Ebrado and directing the payment of the insurance
proceeds to the estate of the deceased insured. From this judgment, Carponia T. Ebrado appealed to the
Court of Appeals, but on July 11, 1976, the Appellate Court certified the case to Us as involving only
questions of law.
ISSUE:
Whether or not a common-law wife named as beneficiary in the life insurance policy of a legally married man
claim the proceeds thereof in case of death of the latter.
HELD:
The appealed judgment of the lower court is hereby affirmed.
Carponia T. Ebrado is hereby declared disqualified to be the beneficiary of the late Buenaventura C. Ebrado in
his life insurance policy. As a consequence, the proceeds of the policy are hereby held payable to the estate of
the deceased insured. Costs against Carponia T. Ebrado.
A common-law wife named as a beneficiary in the life insurance policy of a legally married man cannot claim
the proceeds thereof in case the death of the latter. The contract of insurance is govern by the provisions of
the new civil code on matters not specifically provided for in the insurance code. Rather, the general rules of
civil law should be applied to resolve this void in the Insurance Law. Article 2011 of the New Civil Code states:
The contract of insurance is governed by special laws. Matters not expressly provided for in such special laws
shall be regulated by this Code. When not otherwise specifically provided for by the Insurance Law, the
contract of life insurance is governed by the general rules of the civil law regulating contracts. And under
Article 2012 of the same Code, any person who is forbidden from receiving any donation under Article 739
cannot be named beneficiary of a fife insurance policy by the person who cannot make a donation to him.
Common-law spouses are, definitely, barred from receiving donations from each other. Also conviction for
adultery or concubinage is not required as only preponderance of evidence is necessary. In essence, a life
insurance policy is no different from a civil donation insofar as the beneficiary is concerned. Both are founded
upon the same consideration: liberality. A beneficiary is like a donee, because the premiums of the policy
which the insured pays out of liberality, the beneficiary will receive the proceeds or profits of said insurance.
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Insurance Case Digest: Del Rosario V. Equitable Ins. And Casualty Co., Inc. (1963)
G.R. No. L-16215
June 29, 1963
Lessons Applicable: Ambiguous Provisions Interpreted Against Insurer (Insurance)
FACTS:

April 13, 1957: Simeon del Rosario, father of the insured who died from drowning filed a claim for
payment with Equitable Ins. and Casualty Co., Inc. but it refused to pay more than P1,000 php so a case
was filed with the RTC for the P2,000 balance stating that under the policy they are entitled to P1,000 to
P3,000 as indemnity

RTC: entitled to recover P3,000 - policy does not positively state any definite amount, there is an
ambiguity in this respect in the policy, which ambiguity must be interpreted in favor of the insured and
strictly against the insurer so as to allow greater indemnity
ISSUE: W/N Simeon is entitled to recover P3,000

HELD: YES.

terms in an insurance policy, which are ambiguous, equivocal or uncertain are to be construed strictly
against, the insurer, and liberally in favor of the insured so as to effect the dominant purpose of indemnity
or payment to the insured, especially where a forfeiture is involved

reason for this rule is that the "insured usually has no voice in the selection or arrangement of the
words employed and that the language of the contract is selected with great care and deliberation by expert
and legal advisers employed by, and acting exclusively in the interest of, the insurance company
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ALPHA INSURANCE AND SURETY CO. vs. ARSENIA SONIA CASTOR
G.R. No. 198174, September 2, 2013 (PERALTA, J.)
FACTS:
Arsenia Sonia Castor (Castor) obtained a Motor Car Policy for her Toyota Revo DLX DSL with Alpha Insurance
and Surety Co (Alpha). The contract of insurance obligates the petitioner to pay the respondent the amount of
P630,000 in case of loss or damage to said vehicle during the period covered.
On April 16, 2007, respondent instructed her driver, Jose Joel Salazar Lanuza to bring the vehicle to nearby
auto-shop for a tune up. However, Lanuza no longer returned the motor vehicle and despite diligent efforts to
locate the same, said efforts proved futile. Resultantly, respondent promptly reported the incident to the police
and concomitantly notified petitioner of the said loss and demanded payment of the insurance proceeds.
Alpha, however, denied the demand of Castor claiming that they are not liable since the culprit who stole the
vehicle is employed with Castor. Under the Exceptions to Section III of the Policy, the Company shall not be
liable for (4) any malicious damage caused by the insured, any member of his family or by A PERSON IN THE
INSUREDS SERVICE.
Castor filed a Complaint for Sum of Money with Damages against Alpha before the Regional Trial Court of
Quezon City. The trial court rendered its decision in favor of Castor which decision is affirmed in toto by the
Court of Appeals. Hence, this Petition for Review on Certiorari.
ISSUE:
Whether or not the loss of respondents vehicle is excluded under the insurance policy
HELD:

NO. The words loss and damage mean different things in common ordinary usage. The word loss refers
to the act or fact of losing, or failure to keep possession, while the word damage means deterioration or
injury to property. Therefore, petitioner cannot exclude the loss of Castors vehicle under the insurance policy
under paragraph 4 of Exceptions to Section III, since the same refers only to malicious damage, or more
specifically, injury to the motor vehicle caused by a person under the insureds service. Paragraph 4 clearly
does not contemplate loss of property.
A contract of insurance is a contract of adhesion. So, when the terms of the insurance contract contain
limitations on liability, courts should construe them in such a way as to preclude the insurer from noncompliance with his obligation. Thus, in Eternal Gardens Memorial Park Corporation vs. Philippine American
Life Insurance Company, this Court ruled that it must be remembered that an insurance contract is a
contract of adhesion which must be construed liberally in favor of the insured and strictly against the insurer
in order to safeguard the latters interest.
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