21/08/2025
RECOVERY OF STOLEN CAR DOES NOT PRECLUDE INSURANCE CLAIMโSUPREME COURT
| The Supreme Court (SC) held that the recovery of a stolen vehicle does not prevent the insured owner from receiving full payment under an insurance policy.
In a 38-page decision written by Associate Justice Henri Jean Paul Inting, the SC's Third Division reinstated the ruling of a trial court that ordered UCPB General Insurance Co. Inc. to pay at least P2.1 million in insurance to Wilfrido Wijangco, who lost his vehicle to theft even though it was eventually recovered.
Wijangco owned a 2003 Jaguar X-Type, mortgaged with the AMA Rural Bank of Mandaluyong and insured with UCPB for P1.8 million from 2006 to 2007.
In 2006, his son Andrew was forced to give up the car to two men who held him up at gunpoint in a parking lot. Andrew reported the incident to the police. Wilfrido thereafter filed an insurance claim with UCPB, submitting all required documents.
Despite persistent demands made by Wilfrido, UCPB rejected his insurance claim. The insurance company later informed Wilfrido that the car was recovered by the Traffic Management Group (TMG) Special Operations Division-Task Force Limbas. It said his claim would not proceed unless he submitted himself to a TMG investigation clearance.
Protesting the lack of action on his claim, Wijangco filed a complaint against the insurer for violation of the Civil Code and Presidential Decree No. 612, as amended by Republic Act No. 10607 (Insurance Code), and for damages.
Initially, the Regional Trial Court ruled in his favor and ordered the UCPB to pay him P1.8 million, on top of P200,000 in moral and exemplary damages, plus the cost of the lawsuit. But the Court of Appeals overturned the ruling, as it held that Wijangco failed to prove the total loss of the vehicle since it was recovered, paving the way for him to elevate the case before the Supreme Court.
In reinstating the RTC ruling, the high court held that theft is complete once the vehicle is unlawfully taken, and recovery does not erase the crime.
It cited Section 249 of the Insurance Code, which requires insurers to pay claims within specific periods after receiving proof of loss. Once that period lapses and before the insured vehicle is recovered, the insurerโs obligation becomes final, and the insured cannot be compelled to accept the recovered car.
โInsurance would lose its purpose if the insured had to wait indefinitely for recovery or was forced to buy a replacement only to have the original vehicle returned later,โ the Supreme Court said.
It explained that since Wilfrido filed his proof of loss on 10 October 2006 and UCPB only informed him of the recovery 162 days laterโwell beyond the 90-day legal limit. It makes him entitled to the claim.
The SC also takes into consideration that when Wilfredo recovered his car, it was unserviceable, missing several parts, and showing heavy damage, making the loss effectively permanent.
The high court ordered UCPB to pay Wilfrido P1.8 million in insurance proceeds, plus double interest on the amount. The insurer was also directed to pay P180,000 in attorneyโs fees and P200,000 in damages.
