G.R. No. 224863 , December 02, 2020
SUSAN CO DELA FUENTE, PETITIONER, VS. FORTUNE LIFE INSURANCE CO., INC., RESPONDENT.

FACTS

Petitioner Susan Co Dela Fuente invested substantial sums in the lending business of Reuben Protacio. On March 10, 2011, Reuben applied for a P15,000,000.00 life insurance policy from respondent Fortune Life Insurance Co., Inc., naming Susan as the revocable beneficiary. The policy was issued on March 25, 2011. Reuben died on April 15, 2011, from a gunshot wound to the chest. Susan filed a claim for the insurance proceeds.
Fortune denied the claim, contending that Reuben’s death resulted from suicide, an excepted risk under the policy. It relied on a Clinical Abstract from a doctor who interviewed Reuben’s brother, Randolph, at the hospital. Randolph allegedly stated that Reuben had expressed a desire to die prior to the shooting. Fortune also argued Susan lacked an insurable interest, as her largest investment was made after the policy’s issuance. Susan filed a complaint for sum of money and damages.

ISSUE

The core issue is whether Fortune Life Insurance Co., Inc. is liable to pay the insurance proceeds to Susan Co Dela Fuente, which hinges on: (1) the validity of Fortune’s defense that the insured committed suicide, and (2) whether Susan possessed an insurable interest in the life of the insured.

RULING

The Supreme Court ruled in favor of the petitioner, ordering Fortune to pay the insurance proceeds. On the first issue, the Court held that Fortune failed to prove by clear and convincing evidence that Reuben’s death was a suicide. The evidence presented, primarily the hearsay statement relayed by Randolph to a doctor, was insufficient. The statement did not qualify as part of the res gestae due to a lack of proven spontaneity, and Fortune’s expert witness provided only a speculative opinion based on documents, not an actual examination. The burden to prove the excepted risk of suicide rests on the insurer, which Fortune did not discharge.
On the second issue, the Court found that Susan had a valid insurable interest. An insurable interest requires a factual expectation of pecuniary benefit from the insured’s continued life or a loss from their death. Susan had extended multi-million peso loans to Reuben’s business, creating a valid creditor-debtor relationship. The timing of some investments after the policy’s issuance does not negate this interest, as the law does not require the interest to exist at the time of the policy’s issuance but rather at the time of the loss. As a named beneficiary with an insurable interest, Susan was entitled to the proceeds. The Court modified the interest rate to six percent (6%) per annum from the date of judicial demand.