Minors' Capacity to Contract Insurance
- Minors who are at least eighteen years old are legally permitted to enter into contracts for life, health, and accident insurance.
- This legal capacity to contract applies notwithstanding their minority status.
- The insurance contract must be taken on the minor’s own life.
Permissible Beneficiaries of the Insurance Policy
- The beneficiary appointed in the insurance policy taken out by the minor must be either:
- The minor’s estate, or
- The minor’s immediate family members, specifically the minor's father, mother, husband, wife, child, brother, or sister.
Borrowing Against the Insurance Policy
- The insured minor may borrow money from the insurance company.
- The loan amount cannot exceed the cash surrender value of the insurance policy.
- The insurance policy itself serves as the guaranty for the loan.
Scope and Effectivity
- The act applies exclusively to minors aged eighteen years or older contracting with duly licensed insurance companies operating in the Philippine Islands.
- The provisions affirm contractual capacity of certain minors in the field of insurance law.
- The law took effect immediately upon its approval on November 13, 1931.