Thursday, May 13, 2021

The Insular Life Assurance Company, Ltd. vs. Ebrado (Insurance Law)

 

The Insular Life Assurance Company, Ltd. vs. Ebrado

(Insurance Law)

80 SCRA 181 (G.R. No. L-44059)

October 28, 1977

 

Petitioners/Appellants:

Carponia T. Ebrado and Pascuala Vda. de Ebrado

Respondents/Appellee:

The Insular Life Assurance Company, Ltd.

 

J. Martin:

 

FACTS:

 

Buenaventura Ebrado was issued by the Insurance Life Assurance Co. Ltd, a whole life plan for 5,882.00 with a rider for Accidental Death Benefits for the same amount. Buenaventura Ebrado designated Carponia T. Ebrado as the revocable beneficiary in his policy. He referred to her as his wife.

 

Buenaventura C. Ebrado died when he was accidentally hit by a falling branch of a tree. As the insurance policy was in force, the insurer stands liable for 11,745.73.

 

Carponia T. Ebrado filed her claim although she admits that she and the insured were merely living as husband and wife without the benefits of marriage.

 

Pascuala Vda. de Ebrado also filed her claim as the widow of the deceased insured.

 

ISSUE:

 

Whether Carponia T. Ebrado is entitled to the benefits even she was only the common law wife of the insured.

 

HELD:

 

No. The general rules of Civil Law should be applied to resolve the void in the Insurance Law Article 2011 of the New Civil Code states that: “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 a bidder from receiving any donation under Article 739 cannot be named beneficiary of a life insurance policy by the person who cannot make a donation to him. “Common law spouses are definitely barred from receiving donations from each other.

 

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 from the premiums of the policy which the insured pays out of liberality, the beneficiary will receive the proceeds or profits of said insurance. As a consequence, the proscription in Article 739 of the New Civil Code should equally operate in life insurance contracts. The mandate of Article 2012 cannot be laid aside any person who cannot receive a donation cannot be named as beneficiary in the life insurance policy of the person who cannot a donation. Under American Law, a policy of life insurance is considered as a testament and in construing it, the courts will, so far as possible treat it as a will and determine the effect of a clause designating the beneficiary by rules under which wills are interpreted.

 

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