During the COVID-19 pandemic, many insurers started to offer policies to their clients that cover the risk of this disease. The Bank of Russia monitored and analysed these policies. It found out that insurance terms often allowed for the possibility to refuse or delay an insurance indemnity to a sick client in force majeure cases which include an epidemic or pandemic.
At the same time, neither insurance contracts, nor insurance rules specified that force majeure conditions become void in the case a policyholder becomes infected with COVID-19.
As a part of the behavioural supervision, the Bank of Russia interacted with insurance companies. These insurers then adjusted their business processes and changed insurance terms included in their contracts and rules. However, as such policies are becoming increasingly more popular, the regulator believes it important to take preventive measures mitigating possible risks, arising as a result of conflicting terms of insurance against COVID-19.
Preview photo: Drazen Zigic / Shutterstock / Fotodom
Central Bank of the Russian Federation published this content on 23 June 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 June 2020 12:18:04 UTC