Insurance Case Digest No.

37 By Valero OE

First Integrated Bonding and Insurance Company, Inc., vs. Hon. Harold Hernando
(G.R. No. L-51221, July 31, 1991)

Topic : Casualty Insurance; Compulsory motor vehicle liability; Third party suit
against insurer
Facts : Silverio Blanco was the owner of a passenger jeepney which he insured
against liabilities for death and injuries to third persons with First Integrated
Bonding and Insurance Company, Inc. for P30,000.00. The said jeepney driven by
Blanco himself bumped a five-year old child, Deogracias Advincula, causing the
latter's death. The boys parents filed a complaint for damages against Blanco and
First Insurance. Summons were served on Silverio Blanco and First Insurance.
However, only Blanco filed an answer. Upon motion of the Advincula spouses,
First Insurance was declared in default. Thereafter, a pre-trial conference was
conducted where the Advincula spouses presented their documentary evidence. On
the basis of the evidence presented by the Advincula spouses, judgment was
rendered by the trial court which adjudicates a total amount of P 30,000.00 in favor
of the palintiff which must be satisfied independently by the defendant First
Integrated Bonding and Insurance Company, Inc. The Insurance company filed a
petition for certiorari contending that the victims parents have no cause of action
against it because they are not parties to the insurance contract and that they may
only proceed against the driver based on the provisions of the New Civil Code.
Issue : Whether or not an injured party for whom the contract of insurance is
intended can sue directly the insurer.
Held : YES. The injured for whom the contract of insurance is intended can sue
directly the insurer. The general purpose of statutes enabling an injured person to
proceed directly against the insurer is to protect injured persons against the
insolvency of the insured who causes such injury, and to give such injured person a
certain beneficial interest in the proceeds of the policy, and statutes are to be
liberally construed so that their intended purpose may be accomplished. It has even
been held that such a provision creates a contractual relation which inures to the
benefit of any and every person who may be negligently injured by the named
insured as if such injured person were specifically named in the policy.