The Italian Insurance Regulator ("IVASS") and the Italian Competition Authority ("AGCM") have taken coordinated actions against certain clauses contained in health and accidents insurance policies that cover permanent invalidity, because they have been presumed unfair to the insurance beneficiaries. Based on case law of the Italian Supreme Court and a recent order of the AGCM the following types of clauses have been declared unfair and thus null and void: (i) clauses with discretionary terms (usually longer than 18 months) for the insurance undertakings in order to verify the permanent invalidity consequences of an accident or of a disease of the insured; (ii) clauses that do not allow the heirs of the insured to claim the insurance benefit in case the insured dies for reasons other than those causing the permanent invalidity and before the insurance company has finalized the medical evaluations on the permanent consequences of invalidity and (iii) clauses that do not grant the heirs of the insured the right to prove that the permanent invalidity predated the death of the insured with documentary evidence not available to the insurer. In this regard, IVASS and the AGCM have taken the following actions:
— AGCM has started investigation proceedings against some Italian insurance companies in order to ascertain the unfairness of similar clauses contained in insurance contracts;
— IVASS issued a letter to the market whereby it recommended Italian and foreign insurance undertakings (acting in Italy through a branch or under freedom of services) to verify whether their health and accidents insurance policies covering permanent invalidity contain such clauses. In case the clauses contained in insurance contracts may be considered unfair or in case the policies do not expressly rule the right of the heirs of the insured to succeed in the right of the insured to claim the death benefit under the policy they are to amend the policies within 120 days from the date of the letter.
For contracts already concluded, insurance companies will have to adopt claim liquidation procedures that will allow the heirs of the insured not to lose their right to claim the insurance benefit. Please click here to download the letter to the market issued by IVASS.