Insurance Digested Cases

G.R. No.
195872
FORTUNE MEDICARE, INC, Petitioner,
vs.
DAVID ROBERT U. AMORIN, Respondent
Facts:
Amorin was a cardholder/member of Fortune Medicare, INC, a
corporation engaged in providing health maintenance servive to
its members. While on a vacation in Honolulu, Hawaii, he
underwent an emergency surgery, appendectomy, at the St.
Francis Medical Center. As a result, Amorin wanted to reimburse
from Fortune Care for the full amount of his expenses amounting
to US$1,777.79 and US$7,242.35, both for professional and
hospitalization expenses. However, only 12,151.36 PHP was paid
to him by Fortune Medicareprompting him to file this petition.
Issue:
Whether Fortune Medicare is liable under the policy given to
Amorin.
Held:
Yes, Fortune Medicare is liable. In the policy, a provision stating
that a member shall be entitles to full coverage benefits whether
in the Philippines or abroad. It also provides that if the emergency
confinement occurs in a foreign country, Fortune Medicare shall
be obligated to reimburse or pay 80% of the approved standard
charges which shall cover the hospitalization and professional
fees.
Settled is the rule that ambiguities in a contract are interpreted
against the party that caused it. In this case, Fortune Medicare.
G.R. No. 200784

Malayan Insurance Company, Inc., Petitioner,
vs
PAP CO, LTD (Phil Branch), Respondent
Facts:
Malayan Insurance Company issued Fire Insurance policy to PAP
Co, LTD for the latters machineries and equipment located at
Sanyo Precision Philippines building in Rosario, Cavite. After one
year and before the expiration of the contract, PAP CO LTD
renewed the policy on as-is basis. PAP Co, LTD, without the
consent of Malayan Insurance, moved the properties from Cavite
to a different place. Fire then broke out. Malayan denied liability,
hence, this petition.
Issue:
Whether Malayan Insurance is liable to PAP Co, LTD and whether
such transfer increase the risk of loss of the insured properties.
Held:
No. Supreme Court held that the insurance company is not liable
for the reason that the transfer of properties without its consent
was a violation of the contract and that the same increased the
risk of loss of the insured properties.
G.R. No. 175773

MITSUBISHI MOTORS PHILIPPINES SALARIED EMPLOYEES
UNION
(MMPSEU),Petitioner,
vs.
MITSUBISHI
MOTORS
PHILIPPINES
CORPORATION,
Respondent.
Facts:
The Collective Bargaining Agreement (CBA) of the parties in this
case provides that the company shoulder the hospitalization
expenses of the dependents of covered employees subject to
certain limitations and restrictions.
Covered employees pay part of the hospitalization insurance
premium through monthly salary deduction while the company,
upon hospitalization of the covered employees' dependents, shall
pay the hospitalization expenses incurred for the same. Portion of
the hospitalization expenses of the covered employees'
dependents were paid/shouldered by the dependent's own health
insurance. Tthe company refused to pay the portion of the
hospital expenses already shouldered by the dependents' own
health insurance.
MMPC denied the claims contending that double insurance would
result if the said employees would receive from the company the
full amount of hospitalization expenses despite having already
received payment of portions thereof from other health insurance
providers.
MMPSE Union alleged that there is nothing in the CBA which

prohibits an employee from obtaining other insurance or declares
that medical expenses can be reimbursed only upon presentation
of original official receipts. And that the hospitalization benefits
should be computed based on the formula indicated in the CBA
without deducting the benefits derived from other insurance
providers.
Voluntary Arbitrator rendered a Decision finding MMPC liable to
pay or reimburse the amount of hospitalization expenses already
paid by other health insurance companies but was reversed by
CA. A Motion for Reconsideration was filed but was still denied.
Hence, this petition.
Issue:
Whether or not the Court of Appeals erred in reversing the
decision of the Voluntary Arbitrator ordering MMPC to pay or
reimburse the whole amount of hospitalization expenses incur by
the employee
Held:
No. The conditions in the CBA provision indicate an intention to
limit MMPCs liability only to actual expenses incurred by the
employees dependents, that is, excluding the amounts paid by
dependents other health insurance providers.
The condition that payment should be direct to the hospital and
doctor implies that MMPC is only liable to pay medical expenses
actually shouldered by the employees dependents. It follows that
MMPCs liability is limited, that is, it does not include the amounts
paid by other health insurance providers.
Since the subject CBA provision is an insurance contract, the
rights and obligations of the parties must be determined in
accordance with the general principles of insurance law. Being in
the nature of a non-life insurance contract and essentially a
contract of indemnity, the CBA provision obligates MMPC to

indemnify the covered employees medical expenses incurred by
their dependents but only up to the extent of the expenses
actually incurred.
G.R. No. 173773

PARAMOUNT INSURANCE CORPORATION, Petitioner,
vs.
SPOUSES YVES and MARIA TERESA REMONDEULAZ,
Respondents.
Facts:
Respondents insured with petitioner their Toyota Corolla sedan
under a comprehensive motor vehicle insurance policy for one
year.
Respondents car was unlawfully taken by a certain Ricardo Sales
(Sales) who took possession of the subject vehicle to add
accessories and improvements thereon, however, Sales failed to
return the subject vehicle within the agreed three-day period.
Respondents notified petitioner to claim for the reimbursement of
their lost vehicle but petitioner refused to pay.
A complaint for a sum of money against petitioner before the
Regional Trial Court of Makati City was filed but was denied as loss
of respondents vehicle is not a peril covered by the policy.
The appellate court reversed and set aside the Order issued by
the trial court as well as the motion for reconsideration.
Hence this position.
Issue:
Whether or not petitioner is liable under the insurance policy for

the loss of respondents vehicle.
Held:
Yes.
The taking of repondents vehicle by Sales is without any consent
or authority from the former. Respondents entrusted possession of
their vehicle only to the extent that Sales will introduce repairs
and improvements thereon, and not to permanently deprive them
of possession thereof. Since Theft can also be committed through
misappropriation, the fact that Sales failed to return the subject
vehicle to respondents constitutes Qualified Theft.
Sales act of depriving respondents of their motor vehicle at, or
soon after the transfer of physical possession of the movable
property, constitutes theft under the insurance policy, which is
compensable.
G.R. No. 184300

Malayan Insurance Co. Inc vs. , Petitioner
Philippine First Insurance Co. Inc and Reputable Forwarder
Services Inc., Respondent
Facts:
This case involves 2 insurance contract entered into between
Wyeth Philippines, Inc. (Wyeth) and respondent Reputable
Forwarder Services (Reputable) whereby a contract of carriage
had been entered into for the latter to transport and deliver the
formers product to its customers, dealers and salesmen. While
Wyeth procured Marine Policy from respondent Philippines First
Insurance Co., Inc (Philippines First) to secure its interest over its
own products which includes nutritional, pharmaceutical and
other products usual or incidental to Wyeths business while the
same were being transported or shipped in the Philippines. On the
first insurance policy, such required Reputable to secure an
insurance policy on Wyeths goods. Thus, Reputable signed a
Special Risk Insurance Policy (SR Policy) with petitioner Malayan
or the amount of 1M.
During the effectivity of the Marine Policy and SR Policy, the truck
containing infant formula amounting to 2,357,582.70 which was
supposedly be delivered to Mercury drug was hijacked.
Pursuant to the Marine Policy, Philippine First paid Whyeth for
indemnity. Such demanded reimbursement from Reputable but
the latter ignored its demand. Consequently Philippine First filed
an action against Reputable and impleaded Malayan as third party
defendant in an effort to collect the amount covered in the SR
Policy.
Malayan insists that their liability only covers the prorated share
of the loss based on the amount covered by Section 12 or Other
Insurance Clause.
Issue:
Whether Malayan is liable for the whole amount of the insurance
policy despite the existence of other insurance clause and over
insurance clause
Held:
Yes. Sec 5 of the policy which pertains to the additional insurance
and double insurance does not apply to this case as there was no
double insurance exist. In order for double insurance to arise, the
following requisites must be present:
1.
2.
3.
4.
5.
The person insured must be the same

Two or more insurers insuring separately
There is identity of subject matter
There is identity of interest insured
There is identity of the risk of peril insured against
In the present case both Marine and SR policy were both issued
over the same subject matter and both covered the same peril
insured against, however said policies were issued to two different
persons or entities. The interest of Wyeth over the property
subject matter of both insurance contracts is also different and
distinct from that of Reputables. The policy issued by Philippines
First was in consideration of the legal and/or equitable interest of
Wyeth over its own goods. On the other hand, what was issued by
Malayan to Reputable was over the latters insurable interest over
the safety of the goods, which may become the basis of the
latters liability in case of loss or damage to the property and falls
within the contemplation of Section 15 of the Insurance Code.
G.R No. 198588

United Merchants Corporation, Petitioner
vs
Country Bankers Insurance Corporation, Respondent
Facts:
Petitioner United Merchants Corp. (UMC) entered into a contract
of insurance with Country Bankers Insurance Corporation to
insured its stocks of Christmas lights against fire. Sometime in
1996 the warehouse of UMC was gutted by fire. UMC demanded
payment but CBIC rejected the formers claim due to breach on
one of its condition particularly No. 15 focusing on the petitioners

fraudulent claim.
Issue:
Whether UMC is entitled to claim from CBIC the full coverage of its
fire insurance policy
Held:
No. the court ruled that submission of false invoices establishes a
clear case of fraud and misrepresentation which voids the
insurers liability as per conditions policy. The Insurance Code
provides that a policy may declare that a violation of specified
provisions thereof shall avoid it. Thus, in fire insurance policies,
which contain provisions such as Condition No. 15 of the
Insurance Policy, a fraudulent discrepancy between the actual
loss and that claimed in the proof of loss voids the insurance
policy. Mere filing of such a claim will exonerate the insurer.

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What are the main issues discussed in the cases?

What factors determine an insurer's liability?

G.R. No.

G.R. No. 200784

G.R. No. 175773

MMPSE Union alleged that there is nothing in the CBA which

contract of indemnity, the CBA provision obligates MMPC to

G.R. No. 173773

Whether or not petitioner is liable under the insurance policy for

G.R. No. 184300

The person insured must be the same

G.R No. 198588

one of its condition particularly No. 15 focusing on the petitioners

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