On 10 August 2018 the Supreme Court – in response to questions from the lower instance courts – adopted three identical resolutions which stated that, in a life insurance contract with an insurance capital fund (ICF), a claim for the payment of the surrender value is time-barred according to general rules, i.e. after the period specified in Article 118 of the Civil Code. Until 9 July 2018, this period was 10 years, but on that date law reducing it to 6 years came into force.
Thus, the Supreme Court rejected the competing view that the three-year limitation period provided for in Article 819(1) of the Civil Code for claims under insurance contracts applies to such claims under life insurance contracts with an ICF.
The Supreme Court indicated that the legal nature of a life insurance contract with an ICF is of key importance to resolving the issue of the limitation period. In the Supreme Court’s opinion, such contract is of a mixed nature, i.e. both an insurance and investment nature. Although there is an insurance element in it (insurance benefit in the event of death), the dominant one is the investment and savings element. The benefit of the payment of the surrender amount resulting from this contract is not an insurance benefit – it is of a completely different nature, not covered by insurance protection.
However, when deciding on the limitation period, the Supreme Court did not decide whether the benefit of surrender constitutes the main benefit under the insurance contract. It can therefore be expected that this issue will continue to be contentious in cases between insurance companies and consumers.
Source: resolutions of the Supreme Court of 10 August 2018 (ref. III CZP 13/18, III CZP 20/18 and III CZP 22/18)