Insular Life Assurance Company, Ltd. vs Feliciano G.R. No.

47593, December 29, 1943 Insurance Law;Misrepresentation; Insurance Agents Fraud. Facts: Evaristo Feliciano was issued an insurance policy by Insular Life. In September 1935, he died. His heirs filed an insurance claim but Insular Life denied the application as it averred that Felicianos application was attended by fraud. It was later found in court that the insurance agent and the medical examiner of Insular Life who assisted Feliciano in signing the application knew that Feliciano was already suffering from tuberculosis; that they were aware of the true medical condition of Feliciano yet they still made it appear that he was healthy in the insurance application form; that Feliciano signed the application in blank and the agent filled the information for him. Issue: Whether or not Insular Life can avoid the insurance policy by reason of the fact that its agent knowingly and intentionally wrote down the answers in the application differing from those made by Feliciano. Held: Yes. When Evaristo Feliciano, the applicant for insurance, signed the application in blank and authorized the soliciting agent and/or medical examiner of the Company to write the answers for him, he made them his own agents for that purpose, and he was responsible for their acts in that connection. If they falsified the answers for him, he could not evade the responsibility for thier falsification. He was not supposed to sign the application in blank. He knew that the answers to the questions therein contained would be "the basis of the policy," and for that every reason he was required with his signature to vouch for truth thereof. Moreover, from the facts of the case we cannot escape the conclusion that the insured acted in connivance with the soliciting agent and the medical examiner of the Company in accepting the policies in question. Above the signature of the applicant is the printed statement or representation: " . . . I am a proper subject for life insurance." In another sheet of the same application and above another signature of the applicant was also printed this statement: "That the said policy shall not take effect until he first premium has been paid and the policy as been delivered to and accepted by me, while I am in good health." When the applicant signed the application he was "having difficulty in breathing, . . . with a very high fever." He had gone three times to the Santol Sanatorium and had X-ray pictures taken of his lungs. He therefore knew that he was not "a proper subject for life insurance." When he accepted the policy, he knew that he was not in good health. Nevertheless, he not only accepted the first policy of P20,000 but then and there applied for and later accepted another policy of P5,000. From all the facts and circumstances of this case, we are constrained to conclude that the insured was a coparticipant, and coresponsible with Agent David and Medical Examiner Valdez, in the fraudulent procurement of the policies in question and that by reason thereof said policies are void ab initio.

Wheretofore, the motion for reconsideration is sustained and the judgment of the Court of Appeals is hereby reversed. Let another judgment be entered in favor of the respondents and against the petitioner for the refund of the premiums amounting to P1,389, with legal interest thereon from the date of the complaint, and without any finding as to costs.

Benitez, Paolo M.