Soliman v. US Life- Rescind Contract of Insurance

104 PHIL 1046

Facts:

>  US Life issued a 20 yr endowment life policy on the joint lives of Patricio Soliman and his wife Rosario, each of them being the beneficiary of the other.

>  In Mar. 1949, the spouses were informed that the premium for Jan 1949 was still unpaid notwithstanding that the 31-day grace period has already expired, and they were furnished at the same time long-form health certificates for the reinstatement of the policies.

>  In Apr 1949, they submitted the certificates and paid the premiums.

>  In Jan. 1950, Rosario died of acute dilation of the heart, and thereafter, Patricio filed a claim for the proceeds of the insurance.

>  US life denied the claim and filed for the rescission of the contract on the ground that the certificates failed to disclose that Rosario had been suffering from bronchial asthma for 3 years prior to their submission.

Issue:

Whether or not the contract can still be rescinded.

Held:

Yes.

The insurer is once again given two years from the date of reinstatement to investigate into the veracity of the facts represented by the insured in the application for reinstatement.  When US life sought to rescind the contract on the ground of concealment/misrepresentation, two years had not yet elapsed.  Hence, the contract can still be rescinded.