Legal Requirement for Insurance in Motor Vehicle Operation
- It is unlawful for any land transportation operator or motor vehicle owner to operate on public highways without a valid insurance policy, cash guaranty, or surety bond.
- Such insurance or guaranty must indemnify death, bodily injuries, and/or damage to property suffered by third-parties or passengers due to the motor vehicle's use.
Historical Context and Amendments
- Originally governed by Presidential Decree No. 612, which included coverage for property damage.
- Presidential Decree No. 1814 removed property damage from the mandatory coverage.
- Republic Act No. 10607 restored the inclusion of property damage as part of the insurance policy coverage.
Interpretation of the Restored Coverage Under RA No. 10607
- Section 386(f) defines the insurance policy, specifically including property damage.
- Section 387 makes it unlawful to operate a vehicle without insurance covering death, bodily injury, and/or property damage.
- The use of the disjunctive "or" in "and/or damage to property" indicates an alternative or choice regarding coverage.
- Consequently, property damage coverage is optional, not mandatory, for the policy owner under the compulsory motor vehicle liability insurance framework.
Practical Guidance and Legal Implications
- The amended provision clarifies insurers may offer optional property damage coverage subject to approved premiums.
- Motor vehicle operators and owners must at least secure insurance covering death and bodily injuries to comply with the law.
- Stakeholders, including insurers, vehicle owners, and regulatory bodies, should align with the interpretation that property damage coverage is not compulsory but optional under RA No. 10607.
Penal Provisions and Compliance
- Operation of motor vehicles on public highways without the required insurance or guaranty is unlawful.
- Compliance with the Insurance Commission's approved premiums and terms is mandatory for validity.
Legal Interpretative Note
- The disjunctive usage reflects legislative intent to provide choice rather than impose absolute coverage requirements for property damage.
- Legal precedent supports interpreting "or" as alternatives, thus allowing optional coverage for property damage under compulsory motor vehicle liability insurance.