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The Actuary The magazine of the Institute & Faculty of Actuaries

Guy Carpenter report analyses key European legal developments for insurers

A new report released today by Guy Carpenter & Company examines key legal issues unfolding in Europe affecting the general insurance industry.

The report, which covers the period September 2010 to May 2011, was compiled with the input of Dûsseldorf-based law firm Heuking Kûhn and its network of insurance legal representatives across Continental Europe.

Guy Carpenter said that the report focuses on key legal issues affecting particular countries, rather than being an exhaustive analysis. It summarises each issue, providing background, analysis of legal decisions and implications for the insurance industry. The issues covered include:

European Free Trade Association (EFTA) Court:
Definition of "Durable Media"

On January 27, 2010, the EFTA Court handed down a judgment defining and explaining the criteria by which internet sites can qualify as "durable medium" under Directive 2002/92/EC of the European Parliament and the Council on Insurance Mediation. The Directive and EFTA Court are explained, with a discussion of the judgment and its implications.

Absolute Limitation Period for Insurance Claims

The Austrian Supreme Court recently ruled that in "timely stepped" insurance cases, the insured is at least obligated to file a declaratory lawsuit in time to avoid a limitation of the insurance claim at hand. The report discusses the case, underlying legal context, Supreme Court decision and resulting implications.

Arbitration Agreements vs. Expert Determination Clauses

The report analyses how differentiating between a proper arbitration agreement and an expert determination clause can be difficult. The difference is significant since a decision rendered as a result of arbitration proceedings is binding and subject to limited review, while a decision rendered as a result of expert determination proceedings leaves open the possibility of litigation before a court in case of disagreement on the expert’s findings.

Liability for Energy Installations

With utility supply models moving away from direct delivery to end users by producers and instead towards delivery through intermediate, smaller networks, new issues are emerging in liability law - particularly when damages are incurred between network operators. The report reviews the Federal Court of Justice of Germany’s recent ruling on such a case filed by an electric utility company.

Claims-Made Insurance Policies

In recent years, insurance companies have most commonly offered professional civil liability insurance through policies based on a claims-made system, rather than on a loss occurrence. However, this can be problematic since the claims-made system does not follow specific features of civil liability insurance as provided in the Italian Civil Code. Recent developments in Italian court rulings are discussed.

The Netherlands:
Statute of Limitation and the Obligation to Complain about Professional Legal Malpractice

The report provides an overview of legal malpractice under Dutch law, summarising the issues of statute of limitation and obligation to complain.

Poland: Changing Perspective on Insurance Law
Poland’s transition to full European Union membership has resulted in numerous changes to its legal system. The report examines legal changes impacting re/insurance activities.

Simultaneous Payment and Claims Control Clauses

In April 2010 the Spanish Supreme Court handed down a judgment regarding the simultaneous payment and claims control clauses inserted in the particular conditions of a direct insurance policy and in a reinsurance contract, respectively. The case, court decisions and implications are analysed.

Enforcement of Romanian Judgment in Sweden

In a judgment rendered in October 2006 by a Romanian court, a Swedish insurer was ordered to pay compensation to a traffic injury victim said to be nine times more than the victim could have been awarded by a Swedish court. The details of the case and court decisions are presented.

The New Swiss Product Safety Act
The Federal Convention of the Swiss Confederation enacted a new federal law covering product safety, effective July 1, 2010. The new law is intended to bring the safety requirements of products under Swiss law in line with European law and to ease the free movement of goods in the economic area of the European Union (EU) and Switzerland. The report summarises the scope of the law, responsibilities for placing products, sanctions and liability and insurance law implications.

The report Recent Legislative and Judicial Developments in Continental Europe Affecting the Casualty Insurance Industry can be downloaded here