Recently, the Public Prosecutor’s Office won a case against a large insurance company at the court. The court, in line with the prosecutor’s action, found that several clauses of the general terms and conditions applied by the insurance company were unfair and declared them invalid.
According to the ruling, the clause that specified a limitation period of 1 year for claims against the insurer instead of the general 5 years, was invalid. The court found unfair also that the insurance company required the presentation of a denunciation and a decision on termination or suspension of the criminal investigation, or information on the status of civil or criminal proceedings relating to the insured event, in order to proceed with the payment of the claim.
The insurance company specified the date of payment of the claim at 15 days from the date of receipt of the last document but without any obligation for the insurance company to acknowledge receipt of the document and this clause turned out to be also unfair. The clause that exempted the insurer from reimbursement of the depreciation of the damaged property if such depreciation did not affect normal use was declared also unfair.
Finally, the clause that exempted the insurer from paying compensation for damages caused by defects, deficiencies, deterioration, omission of maintenance or failure to comply with the rules of construction and operation that were known to the insurer at the time of concluding the contract, was also unfair.
In our view, it is worth reviewing insurance contracts from time to time, even by putting insurance companies out to tender. The decision also points out that the rejection of a claim might not be final if the reason of rejection is based on an unfair general contractual term. Therefore, if an insurance company has rejected a claim on any of the above grounds, it is worth taking action against it on the grounds of unfairness of the general terms and conditions, and if successful, the insurer may be obliged to pay the claim.