Scribd
Upload
121 views1 page

106 Arce v. Capital Insurance

The Supreme Court ruled in favor of Capital Insurance, finding that the insured was not entitled to claim under the policy because the premium was not paid on time. The Court noted that time is essential for payment of insurance premiums based on both law and the policy stipulation. While an extension was granted, the premium was still not paid by the agreed upon date. An insurer is only obligated once the premium is paid, and no policy is valid unless and until the premium is paid in full. Therefore, Capital Insurance was not liable to pay the claim.

Uploaded by

Jovelan V. Escaño
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
121 views1 page

106 Arce v. Capital Insurance

The Supreme Court ruled in favor of Capital Insurance, finding that the insured was not entitled to claim under the policy because the premium was not paid on time. The Court noted that time is essential for payment of insurance premiums based on both law and the policy stipulation. While an extension was granted, the premium was still not paid by the agreed upon date. An insurer is only obligated once the premium is paid, and no policy is valid unless and until the premium is paid in full. Therefore, Capital Insurance was not liable to pay the claim.

Uploaded by

Jovelan V. Escaño
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 1

Arce vs Capital Insurance ISSUE:

G.R. No. L-28501, September 30, 1982


Whether or not the petitioners are entitled to claim from their
FACTS: policy despite non-payment of their premium. NO

1. The petitioner, the insured, was the owner of a residential RULING:


house inTondo, Manila, which had been insured with the 1. It is obvious from both the Insurance Act, as amended, and
Capital insurance since 1961under Fire Policy No. 24204. the stipulation of the parties that time is of the essence in
2. On November 27, 1965, the COMPANY sent to the petitioner respect of the payment of the insurance premium so that if it
Renewal Certificate No. 47302 to cover the period December is not paid the contract does not take effect unless there is still
5, 1965 to December 5, 1966. The respondent also requested another stipulation to the contrary. In the instant case, the
payment of the corresponding premium in the amount of petitioner was given a grace period to pay the premium but
P38.10. the period having expired with no payment made; he cannot
3. Anticipating that the premium could not be paid on time, the insist that the respondent is nonetheless obligated to him.
petitioner, thru his wife, promised to pay it on January 4,
1966. The respondent accepted the promise but the premium 2. Moreover, the parties in this case had stipulated: “[T]his
was not paid on January 4, 1966. insurance will be deemed valid and binding upon the
4. When the petitioner’s house was ravaged with fire, the respondent (Capital Assurance) only when the premium and
petitioner’s wife presented a claim for indemnity to the documentary stamps therefor have actually been paid in full
respondent. She was told that no indemnity was due because and duly acknowledged in an official receipt signed by an
the premium on the policy was not paid. authorized official/representative of the respondent (Capital
5. Nonetheless the respondent tendered a check forP300.00 as Assurance).”
financial aid which was received by the petitioner’s daughter.
The respondent reiterated that the check was given "not as an 3. An insurer is entitled to payment of premium as soon as the
obligation, but as a concession" because the renewal premium thing insured is exposed to the perils insured against, unless
had not been paid. The petitioner cashed the check but then there is clear agreement to grant credit extension for the
sued the respondent on the policy. premium due. No policy issued by an insurance company is
6. CFI: Capital Insurance and Surety Co., Inc. was ordered to valid and binding unless and until the premium thereof has
pay Pedro Arce the proceeds of a fire insurance policy. been paid.

You might also like