MALAYAN INSURANCE CO., INC. (MICO), petitioner, vs. GREGORIA CRUZ ARNALDO, ARNALDO, in her capacity as the INSURANCE COMMISSIONER, an CORONACION !INCA, respondents. G.R. N". L#$%&' Oct"er *+, *&% -acts On June 7, 1981, the petitioner (hereinafter called (MICO) issued to the private respondent, P1,!!!.!! effective Jul" ##, 1981, until Jul" ##, 198#. On Octo$e Octo$err 1%,198 1%,1981, 1, MICO MICO alle&e alle&edl" dl" cancel cancelled led the polic" for non'pa" non'pa"en ent, t, of the preiu preiu and sent sent the correspondin& notice to Pinca. On ece$er #, 1981, pa"ent of the preiu for Pinca *as received $" oin&o +dora, a&ent of MICO. On Januar" 1%, 198#, +dora reitted this pa"ent to MICO,toðer *ith other pa"ents. On Januar" 18, 198#, Pincas propert" *as copletel" $urned. On -e$ruar" %, 198#, Pincas pa"ent *as returned $" MICO to +dora on the &round that her polic" had $een cancelled earlier. ut +dora refused to accept it. In due tie, Pinca ade the re/uisite deands for pa"ent, *hich MICO re0ected. he then *ent to the Insurance Coission. It is $ecause she *as ultiatel" sustained $" the pu$lic respondent that the petitioner has coe to us for relief. Iss/e "0 the Case 2hether or not petitioner lia$le, for it alle&ed that the insurance polic" *as alread" cancelled due to non'pa"ent of preiu.
Ruling: On the erits, it ust also fail. MICOs ar&uents that there *as no pa"ent of preiu and that the polic" had $een cancelled $efore the occurence of the loss are not accepta$le. Its contention that the clai *as allo*ed *ithout proof of loss is also untena$le. 3he petitioner relies heavil" on ection 77 of the Insurance Code providin& that4 5C. 77. +n insurer is entitled to pa"ent of the preiu as soon as the thin& is e6posed to the peril insured a&ainst. ot*ithstandin& an" a&reeent to the contrar", no polic" or contract of insurance issued $" an insurance copan" is valid and $indin& unless and until the preiu thereof has $een paid, e6cept in the case of a life or an industrial life polic" *henever the &race period provision applies. 3he a$ove provision is not applica$le $ecause pa"ent of the preiu *as in fact eventuall" ade in this case. ota$l", the preiu invoice issued to Pinca at the tie of the deliver" of the polic" on June 7, 1981 *as staped Pa"ent eceived of the aoun& of P9:!.;! on 1#'#'81 $" oin&o +dora. 3his is iportant $ecause it su&&ests an understandin& $et*een MICO and the insured that such pa"ent could $e ade later, as a&ent +dora had assured Pinca. In an" event, it is not denied that this pa"ent *as actuall" ade $" Pinca to +dora, *ho reitted the sae to MICO. It is not disputed that the preiu *as actuall" paid $" Pinca to +dora on ece$er #, 1981, *ho received it on $ehalf of MICO, to *hich it *as reitted on Januar" 1%, 198#. 2hat is /uestioned is the validit" of Pincas pa"ent and of +doras authorit" to receive it. MICOs ac
5C. :!;. 666 666 666 +n" insurance copan" *hich delivers to an insurance a&ant or insurance $ro ($) conviction of a crie arisin& out of acts increasin& the ha=ard insured a&ainst> (c) discover" of fraud or aterial isrepresentation> (d) discover" of *illful, or rec (e) ph"sical chan&es in the propert" insured *hich result in the propert" $ecoin& uninsura$le>or (f) a deterination $" the Coissioner that the continuation of the polic" *ould violate or *ould place the insurer in violation of this Code. +s for the ethod of cancellation, ection ;% provides as follo*s4 5C. ;%. +ll notices of cancellation entioned in the precedin& section shall $e in *ritin&, ailed or delivered to the naed insured at the address sho*n in the polic", and shall state (a) *hich of the &rounds set forth in section si6t"' four is relied upon and ($) that, upon *ritten re/uest of the naed insured, the insurer *ill furnish the facts on *hich the cancellation is $ased. + valid cancellation ust, therefore, re/uire concurrence of the follo*in& conditions4 (1) 3here ust $e prior notice of cancellation to the insured> (#) 3he notice ust $e $ased on the occurrence, after the effective date of the polic", of one or ore of the &rounds entioned> (:) 3he notice ust $e (a) in *ritin&, ($) ailed, or delivered to the naed insured, (c) at the address sho*n in the polic"> () It ust state (a) *hich of the &rounds entioned in ection ; is relied upon and ($) that upon *ritten re/uest of the insured, the insurer *ill furnish the facts on *hich the cancellation is $ased. 3here is no proof that the notice, assuin& it coplied *ith the other re/uisites entioned a$ove, *as actuall" ailed to and received $" Pinca. +ll MICOs offers to sho* that the cancellation *as counicated to the insured is its eplo"ees testion" that the said cancellation *as sent $" ail throu&h our ailin& section. *ithout ore. 3he petitioner then sa"s that its stand is enervated (sic) $" the le&al presuption of re&ularit" and due perforance of dut". (not reali=in& perhaps that enervated eans de$ilitated not stren&thened). On the other hand, there is the flat denial of Pinca, *ho sa"s she never received the claied cancellation and *ho, of course, did not have to prove such denial Considerin& the strict lan&ua&e of ection ; that no insurance polic"
shall $e cancelled e6cept upon prior notice, it $ehooved MICOs to a
