G.R. No. L-49699, 8 August 1988, 164 SCRA 144


There was a collision between the IH Scout (in which private respondents were riding) and a Superlines bus. Private respondents sustained injuries. A complaint for damages was filed against Superlines, the bus driver and petitioner insurance company, the insurer of the bus. The vehicle in which the private respondents were riding was insured with Malayan Insurance Co. Even before summons could be served, the judge issued an order for the Insurance Company to pay immediately within 5 days the P5,000 under the “no-fault clause” as provided for in Section 378 of the Insurance Code.

Petitioner moved for the reconsideration of the order; it was denied. Petitioner contends that under Sec. 378 of the Insurance Code, the insurer liable to pay the P5,000 is the insurer of the vehicle in which private respondents were riding, not petitioner.


Whether or not petitioner is the insurer liable to indemnify the private respondents under Sec. 378 of the Insurance Code.


Supreme Court says that the provision is clear and unambiguous. Under Sec. 378, the claim shall lie against the insurer of the vehicle in which the occupant is riding and no other. The claimant is not free to choose from which insurer he will claim the “no fault indemnity” as the law uses the term “shall.” That said vehicle might not be the one that caused the accident is of no moment since the law itself provides that the party paying the claim may recover against the owner of the vehicle responsible for the accident.

Essence of “no fault indemnity” clause: to provide victims of vehicular accidents or their heir’s immediate compensation pending final determination of who is responsible for the accident. The “no fault indemnity” provision is part and parcel of the Insurance Code provisions on compulsory motor vehicle liability insurance (Secs. 373-389) and should be read together with the requirement for compulsory passenger and/or third party liability insurance (Sec. 377).

*Case digest by Mark Milan, LLB-4, Andres Bonifacio College Law School, SY 2018-2019