Libro IV · Título II · Capítulo X Sección Tercera. Del seguro de personas

Insurance on the life of a minor who is twelve years of age or older shall require his or her personal consent and that of his or her legal representative.

Insurance for the event of the death of a third party may not be entered into without its consent, given in writing before the execution of the contract, indicating the insured sum, except when it is intended to cover labor or social benefits.

The consent of the insured third party must also appear in writing for the change in the designation of the beneficiary, for the assignment of rights or for the creation of a pledge, except when the latter transaction is entered into with the insurer.

The provision of the second paragraph of article 906 is not applicable to life insurance as regards reinstatement of an insurance, change of plan or breach of a prior contract. In these cases the parties may contract different plans and forms of insurance.

Insurance may not be taken out for the event of the death of a person declared to be in a state of interdiction.

Insurance may be taken out for minors under twelve years of age, provided the legal representative has life insurance for a sum equal to or greater than the one requested. This condition shall not apply when the legal representative is uninsurable.

The insured may designate a third party as beneficiary and modify this designation by inter vivos act or by will, even if the beneficiary has expressed its willingness to accept.

Any change of beneficiary must be communicated in writing to the insurer, which shall record it in the policy.

The waiver of the power to revoke the designation of beneficiary is valid and shall become final when it has been communicated to the beneficiary in writing; but it shall not produce effects against third parties until it is also made known in writing to the insurer and the insurer records it in the policy.

In the case of designation of an irrevocable beneficiary, the insured may not dispose of the rights derived from the insurance without the consent of the beneficiary given in writing, unless the insured has reserved such rights for itself.

When the spouse is designated as beneficiary, without expression of name, the person who has this status at the moment the insured dies shall be considered as such.

If the spouse and the descendants are designated as beneficiaries, without determination of shares, it shall be understood that half of the insured amount corresponds to the spouse and the other half shall be distributed among the descendants, in accordance with inheritance law.

If the heirs or successors are designated as beneficiaries, the insured capital shall form part of the hereditary estate; the same shall be observed when the beneficiaries are designated by their name, but rather when those who have a determined kinship with the insured are designated as such. The case is excepted where the children that the insured may have in the future with a determined person are designated as beneficiaries, who shall be considered designated by name.

If there are several beneficiaries, and the share corresponding to each has not been indicated, it shall be understood that they shall receive equal shares.

If any of the beneficiaries dies before, or at the same time as the insured, its share shall accrue to that of the remaining ones.

In the absence of other beneficiaries, the insurance shall be paid to the heirs of the insured.

The case of irrevocable beneficiaries is excepted from the provisions of this article, whose right shall be transmitted to their heirs.

Upon the death of the insured, the beneficiary registered in the policy shall acquire an own right over the insured sum, which it may demand directly from the insurer, and over which neither the heirs nor the creditors of the insured shall have any right.

Payment made by the insurer to the beneficiaries registered in the policy extinguishes all contractual obligations derived from it.

The beneficiary who attacks the person of the insured shall not acquire rights over the insured sum, and shall even lose those it had acquired through an irrevocable designation.

In this case, the insurance shall be paid to the heirs of the insured, in the absence of other beneficiaries.

The rights derived from an insurance contract entered into in good faith may not be attached, nor subject to execution in the event of insolvency proceedings, judicial moratorium or bankruptcy of the insured.

At any time the insured presents reliable proof of its age, the insurer shall be obliged to record it in the policy, without being able to require new proof in that regard.

The insurer shall be obliged to pay the stipulated sum even in the case of suicide of the insured, whatever the mental state of the suicide or the motive of the suicide, if it occurs after two years from the execution or reinstatement of the contract. If it occurs before, the insurer is only obliged to return the premiums received.

In personal insurance, the insurer may not be subrogated to the rights against third parties that the loss creates in favor of the insured or of the beneficiary.

The omissions or inaccurate declarations of the applicant for insurance, other than those referring to the age of the insured, give the insurer the right to terminate the contract; but this right lapses if the policy has been in force, during the life of the insured, for two years counting from the date of its perfection or of the last reinstatement.

If the age of the insured was declared inexactly, the insurer may terminate the contract only if the real age is outside the admission limits set by the insurer itself.

In this case, the insured shall have the right, at a minimum, to the mathematical reserve, if any, calculated as of the date on which the insurer discovered the cause of termination. If this is discovered after the death of the insured, the mathematical reserve existing at that moment shall be delivered to the beneficiary, unless otherwise agreed in a manner that increases the sum the beneficiary will receive.

If the real age of the insured is within the admission limits set by the insurer and, as a consequence of the inexact declaration of its age, a lower or higher premium was set, the insured sum to be paid shall be the one corresponding to the amount that the insurer would have insured, according to its rates in force at the time the contract was entered into, in accordance with the premium actually paid.

If the age of the insured is lower than declared and this is discovered during the life of the insured, it may choose between the provisions of the preceding paragraph or the return of the excess of the existing reserve, in which case the subsequent premiums must be adjusted to the real age, according to the rates in force at the time the contract was entered into.

These provisions are also applicable to group or collective insurance.

For the calculations mentioned in this article, the rates that were in force at the time of the execution of the contract shall be applied.

The insurer shall have no action to demand payment of life insurance premiums, except the right to an indemnity for failure to pay the premium corresponding to the first year, which shall never exceed fifteen per cent (15%) of the amount of the stipulated annual premium.

Life insurance shall lapse, without the need for any declaration, thirty days after the due date of the premium, if it has not been paid, save for any provision of the policy by which the lapse of the aforementioned effects is not produced.

The insured may terminate the contract at any time by simple written communication to the insurer. Upon terminating the contract in this form, it shall have the right to immediate payment of the surrender value determined in the table of guaranteed values that must be an integral part of the policy.

When a policy has a surrender value, the insured shall have the right to automatic loans for the payment of premiums and to personal loans, in both cases with the policy as collateral. The insurer shall charge the interest agreed in the contract, applying the rule of article 691 of this Code.

The obligation to pay interest ends upon the maturity of the insurance, when the insured has complied with its stipulations or the reserves for the automatic payment of premiums that cover such liability.

Term or temporary insurance, unless otherwise agreed, shall grant neither surrender values nor the rights established in articles 1009 and 1010 of this Code.

In insurance taken out on the life of a third party, if the contracting party attacks the life of the insured, the beneficiaries, even the irrevocable ones, shall lose their rights and the insurance shall be paid to the heirs of the insured.

Insurance against accident grants the beneficiary an own right against the insurer from the moment the accident occurs.

In popular insurance and in group insurance, the insurer has an action to collect the premiums corresponding to the first year, and may agree the automatic suspension or rescission of the insurance, in the event that payment of them is not made in a timely manner.