GLASS INSURANCE

EMPLOYER’S LIABILITY INSURANCE

MOTOR VEHICLE LIABILITY INSURANCE
GLASS INSURANCE
GLASS INSURANCE
Normally, glass insurance
insures against breakage or
damage caused by chemicals
accidentally or maliciously
applied. There is breakage
when the break penetrates
through the entire thickness of
the glass. (Huebner, Black and Webb, p.
304.)
 GLASS INSURANCE
In addition to the cost of the glass, the policy may
likewise provide for coverage for the following:

1.) Repairing or replacing damage to the

frame,
2.) Boarding up or installing temporary plates
in opening,
3.)Removing and replacing any fixtures and
other obstructions, and
4.) Removal of debris of covered property
resulting from a covered loss.
EMPLOYER’S LIABILITY INSURANCE

Insurance against employer’s

liability covers injuries
sustained by their employees
which arise out of and in the
course of the insured
employee’s employment.
EMPLOYER’S LIABILITY INSURANCE
Usual EXCLUSIONS in Employer’s Liability Insurance
include:
1.) When there is serious or willful misconduct on the part
of the insured,
2.) When the employee was hired in violation of law,
3.) When the insured failed to comply with health and
safety regulations, and
4.) When the employer discharges, coerces, or
discriminates against an employee.
MOTOR VEHICLE
LIABILITY
INSURANCE
MOTOR VEHICLE LIABILITY INSURANCE
Under this policy, the insurer becomes
liable for the damage or injury caused in
the operation of motor vehicles. This
type of insurance may be voluntary or
compulsory and covers death, incapacity
or injury and damage to property.
However, motor vehicle liability
insurance is not limited to third party
liability. It may be comprehensive and
may cover damage or injury to the
person or property of the insured
himself or third persons.
 .1 DIRECT
LIABILITY
The third party victim may proceed
directly against the insurer for indemnity.
It is significant to point out that the right
of a third person to sue the insurer
depends on whether the contract of
insurance is intended to benefit third
persons also or only insured.
1A TEST
The test that can be applied is this: Where the contract provides for indemnity
against liability to third persons, then third persons to whom the insured is
liable can sue the insurer. Where the contract is for indemnity against actual
loss or payment, then third persons cannot proceed against the insurer, the
contract being solely to reimburse the insured for liability actually discharged
by him through payment to third persons, said third persons’ recourse being
thus limited to the insured alone.

(Malayan Insurance Co., Inc. v. CA, L-36413,September 26, 1988, 165 SCRA 536).
“The liability of the insurer to such third person is based on contract
while the liability of the insured to the third party is based on tort.”
1B NOT JOINT
TORTFEASOR

The third party liability is only up to the extent of the insurance policy
and those required by law. While it is true that where the insurance
contract provides for indemnity against liability to third persons, and
such persons can directly sue the insurer, the direct liability of the
insurer under indemnity contracts against third party liability does not
mean that the insurer can be held liable in solidum with the insured
and/or the other parties found at fault for all the damages sustained by
the insured.
1B NOT JOINT
TORTFEASOR

HOWEVER, the insurer may be held solidarily liable up to the extent

that the insured may be held liable under the contract of insurance. Thus,
if the damage is less than the face value of the policy, the insurer may be
held solidarily liable up to the full value of the damage or loss.

(William Tue, et al. v. Pedro A. Arriesgado, et al. GR No. 138060, Sept. 1, 2004)
 1C NO ACTION
CLAUSE
DISALLOWED

However, if direct liability to third party is provided for, a “no action

clause” cannot be provided for in the policy. A “no action clause” is a
clause that disallows suit against the insurer unless final judgment
is obtained by a third party against the insured. This clause cannot
prevail over the Rules of Court. It cannot override procedural rules
aimed at avoidance of multiplicity of suits.
SAMPLE PROBLEM

Mr. JA insured his jeepneys

against third party liability with
C Insurance. The insurance
policies contain the following
stipulation:
 One of the drivers of Mr. JA was negligent in operating a jeepney
covered by the insurance policy and Mr. GG was bumped as a
consequence. Thereafter, Mr. GG filed a case against Mr. JA and C
Insurance. The insurer is asking for the dismissal of the case arguing that
it cannot be included in the action because of the above-quoted action
clause. Should the case against the insurer be dismissed?
YES
No. The action against the insurer should proceed. It is true that the policy
requires that suit and final judgment be first obtained against the insured;
that only “thereafter” can the person injured recover on the policy and it
expressly disallows suing the insurer as a co-defendant of the insured in a
suit to determine the latter’s liability. However, the “no action” clause in
the policy of insurance cannot prevail over the Rules of Court
provision aimed at avoiding multiplicity of suits. A “no action”
clause in a policy of insurance cannot override procedural rules
aimed at avoidance of multiplicity of suits.

(Guingon vs. Illuminado del Monte, et al., GR No. L-22042, August 17, 1967)
.2 AUTHORIZED
DRIVER CLAUSE
The insurer will be liable only if the driver is an
“authorized driver” at the time of the accident. A
typical provision may state that the driver at the time of
the accident must be “permitted in accordance with the
licensing or other laws or regulations to drive the
Motor Vehicle and is not disqualified from driving such
motor vehicle by order of a Court of Law or by reason
of any enactment or regulation in that behalf.”
2A PURPOSE

The main purpose of the “authorized driver” clause is to make sure

that a person other than the insured owner who drives the car on
the insured’s order (such as his regular driver, or with his
permission, such as a friend or member of the family or the
employees of a car service or repair shop) is a duly licensed driver
and has no disqualification to drive a motor vehicle.
2B APPLICATION

Applies only when the driver “is driving on the insured’s order or with
his permission.” It does not apply when the person driving is the
insured himself. While the Motor Vehicle Law prohibits a person from
operating a motor vehicle on the highway without a license or with an
expired license, an infraction of the Motor Vehicle Law on the part of the
insured, is not a bar to recovery under the insurance contract. It
however, renders him subject to the penal sanctions of the Motor Vehicle
Law.
.3 THEFT
CLAUSE
The motor vehicle insurance may
contain a theft clause that makes
theft a risk insured against.
3A APPLICATION
It applies when one takes the motor vehicle of another
without the latter’s consent even if the motor vehicle is
later returned.
In Paramount Insurance v. Spouses Remondeulaz, the
insurance policy over the vehicle likewise contained a
theft clause. Possession of the vehicle was entrusted to
another to a certain person who was supposed to
introduce repairs who permanently deprived the
owners of possession thereof. Hence, there was theft of
the vehicle. Although there was turn-over of physical
possession of the vehicle, there was no transfer of
physical possession. The failure of the owner of the
repair shop to return the subject vehicle to insured
owner constitutes theft and the insurer is for the loss of
insured vehicle under the “theft clause.”
3B COVERAGE

The theft clause also applies even if the person who took the vehicle is an
employee of the insured . In Alpha Insurance and Surety Company v. Castor,
the insurance policy over a car included theft as a risk insured against. One of
the exclusions or the risks that is not covered by the insurance was “malicious
damage” caused by the insured. It was argued that taking of the vehicle by
the driver of the insured constitutes “malicious damage” and is not covered
by the theft clause. The Supreme Court rejected the argument explaining
that the exclusion for “material damage” refers to damage that is the direct
result of the deliberate or wilful acts where the deliberate plan or purpose
was to cause damage to the vehicle for purposes of defrauding the insurer.
 .4 AUTHORIZED DRIVER CLAUSE
VS. THEFT CLAUSE
Where car is unlawfully and wrongfully taken without the owner’s consent or knowledge,
such taking constitutes theft, and, therefore, it is the “THEFT” clause, and not the
“AUTHORIZED DRIVER” clause that should apply. On the other hand, accident, although
it may proceed or result from negligence, is the happening of an event without the
concurrence of the will of the person by whose property it was caused. Clearly, the risk
against accident is distinct from the risk against theft.

The “authorized driver clause” in a typical insurance policy is in contemplation or

anticipation of accident in the legal sense in which it should be understood, and not in
contemplation or anticipation of an event such as theft.

Note: There is no causal connection between the possession of a valid driver’s license
and the loss of a vehicle through theft.