Life Insurance

Sec 181. Life Insurance is insurance on human lives and insurance appertaining thereto or
connected therewith.

Life Insurance Defined: Sec 182. Life insurance may be defined as insurance payable on the death of
a person or on his surviving a specified period, or otherwise contingently on the continuance or
cessation of life.

Parties in a life insurance policy

1. The owner of the policy the person who has the power to name or change the beneficiary, to
assign the policy (under certain conditions), cash it in for its surrender value, or its use as
collateral in obtaining a loan; and the obligation to pay the premiums;

2. The person whose life is the subject of the policy, also known as the cestui que vie;

3. The beneficiary whom the proceeds are paid.

Nature of life insurance

A life policy is not a mere contract of infirmity, but more accurately characterized as a form of
investment. It is a contract to pay the beneficiary a certain sum to money to meet the financial crisis
which may be caused in the event of death of the insured or any disability resulting in loss of earning
power provided certain conditions are performed by the insured.

Kinds of life insurance

1. Ordinary Life policy one under the terms of which the insured is required to pay a certain fixed
premium annually or at more frequent intervals throughout the entire life and the beneficiary is
entitled to receive payment under the policy only after the death of the insured.

2. Limited payment life policy is one under the terms of which the premiums are payable only
during a limited period of years usually 10, 15, 20. When the specified numbers of premiums
payments have been made, the insurance us fully paid for.

3. Endowment policy is one under the terms of which the insurer binds himself to pay a fixed sum
to the insured if he survives for a specified period (maturity date stated in the policy), or if he dies
within such period, to some other person indicated.

4. Term insurance policy is one which provides coverage only if the insured dies during the
limited period. It is an insurance for a fixed or specific term, such as 2, 5, 10 years. If the insured
dies within the period specified, the policy is paid to the beneficiary. If he survives the period, the
contract terminates or expires at the end of the timed period. Also called temporary insurance.

Liability in case of Suicide

Sec. 183. The insurer in a life insurance contract shall be liable in case of suicides only when it is
committed after the policy has been in force for a period of two years from the date of its issue or of its
last reinstatement, unless the policy provides a shorter period: Provided, however, That suicide
committed in the state of insanity shall be compensable regardless of the date of commission.

By:
Jyznareth C. Tapia and Jan Mikhail J. Panerio
Liability of the insurer in case of suicide

1. When Liable In a life insurance contract, the insurer is liable in case of suicide in the following
cases:
a. The suicide is committed after the policy has been in force for a period of two years from
the date of its issue or of its last reinstatement.
b. The suicide is committed after a shorter period provided in the policy within the two year
period
c. The suicide is committed in the state of insanity regardless of the date of the commission,
unless suicide is an expected risk

2. When not liable The insurer is not liable in the following cases:
a. The suicide is not by reason of insanity and is not committed within the 2 year period.
b. The suicide is by reason of insanity but is not among the risk assumed by the insurer
regardless of the date of commission
c. The insurer can shoe that the policy was obtained with the intention to commit suicide
even in the absence of any suicide exclusion in the policy.

"Section 184. A policy of insurance upon life or health may pass by transfer, will or succession to any
person, whether he has an insurable interest or not, and such person may recover upon it whatever the
insured might have recovered.

Section 186. Unless the interest of a person insured is susceptible of exact pecuniary measurement,
the measure of indemnity under a policy of insurance upon life or health is the sum fixed in the policy.

By:
Jyznareth C. Tapia and Jan Mikhail J. Panerio