As part of its central bank remit, the National Bank of Serbia (“NBS“) also is responsible for the supervision of insurance company trading practices, and accordingly, it issued several useful recommendations to insurers as to how to weather the coronavirus storm. To protect the health of insurance customers and employees in the insurance sector and to prevent the further spread of diseases caused by the coronavirus, the NBS has taken steps to protect the rights and interests of insurance customers and at the same time enable those customers to continue using those services.
Deferred payment of insurance premiums
Given the delicacy of the situation and that some customers are unable to meet premium payments for objective reasons, the NBS made a recommendation to all insurance companies to allow for deferred payments of premium installments, without diminishing the customers’ insurance contract rights. In case of deferred payment, customers would settle insurance premiums that fell due for payment during the state of emergency at a later date with no interest charged on outstanding premium installments, which are to be spread evenly over the remaining contracted i.e. insurance period. It should be noted that deferred payment of insurance premium installments by no means extends the validity of the insurance, it only and exclusively postpones payment of due installments.
Policyholders – check your insurance policy
Besides the recommendation to defer insurance premium payments, the NBS reminds all Serbian citizens –beneficiaries of life insurance, voluntary health insurance, and particularly travel insurance, who happen to be abroad and have concluded insurance contracts with national insurance companies, to double-check whether their insurance policies also cover COVID-19, how those contracts, i.e. the insurance terms and conditions define the covered risks and exclusions. The NBS notes that further action in a particular case will depend on how the insurance contract i.e. insurance terms and conditions define the risk coverage. If insurance contracts do not provide coverage for COVID-19, the NBS advises customers to communicate with their insurers electronically and attempt to obtain more information about the agreed risk coverage and exclusions and to find out whether insurers happen to offer insurance that provides such coverage, i.e. whether such additional coverage can be negotiated and whether their travel insurance policies can be extended.
Communication is the key
It is now more important than ever that insurance companies as well as other insurance market participants engaging in an insurance agency and brokerage activities, communicate (electronically) with their current and prospective clients in a clear, fair manner and to act in the best interest of insurance service beneficiaries. The NBS expects insurance undertakings and other insurance market participants to take into account the circumstances in which many insurance beneficiaries are or could find themselves. These refer above all to customers’ inability to pay a premium, submit a claim/complaint or required evidence, for various reasons.
For more information, please contact us via covid19@geciclaw.com
