You have been contributing to your insurance policy for years by paying monthly insurance premiums to your insurer. The loss occurs and you declare it to the insurer to be compensated as soon as possible. However, in practice the compensation process is not fast. If the claim is covered (no exclusion clause applies) and your insurer has nothing to blame for the warranty conditions, which are met, the fact remains that the compensation process can take a very long time.
HOW SOON AFTER THE DECLARATION OF THE CLAIM THE INSURER MUST COMPENSATE YOU
This period is provided for in the insurance contract. Please refer to the specific terms and conditions (or, where applicable, the general terms and conditions) for further information. In some situations this period is provided for by law. Thus, in the case of traffic accidents, the insurer must make an offer of compensation to the victim of the traffic accident within three months from the request for payment of the insurance compensation made by the insured. In the case of theft, policies generally stipulate that the offer of compensation must be made within 30 days from the request of the insured. What is the penalty for non – compliance by the insurer ?
PENALTY IN CASE OF NON – COMPLIANCE WITH THE LEGAL OR CONTRACTUAL DEADLINE BY THE INSURER
In the case of traffic accidents, according to Article L. 211-13, failure to comply with the deadlines imposed by law exposes the automobile insurer to payment of damages set at twice the rate of legal interest on the amount of compensation offered or allocated to the victim by the court. In the case of theft, for example, this period is usually set in insurance policies at 30 days. The penalty that will apply to the insurer is the duty to pay the legal interest as from the formal notice (LR/AR) sent to the insurer with an express request for payment. It should be noted that it is the responsibility of the insurer subject to this obligation (issue of the offer) to demonstrate that it has submitted it in good time. On this point, the case law considers that it is not incumbent on the insured to prove the delay in submitting the offer of compensation and that his claim against the insurer cannot be refused on the grounds that he does not demonstrate the insurer’s delay.
THE INSURED MAY ALSO OBTAIN DAMAGES CORRESPONDING TO THE SEPARATE DAMAGE SUFFERED AS A RESULT OF THE DELAY
In a judgment of 29 April 2003, the Court of Cassation ruled that the insured was entitled to claim compensation for the separate damage suffered as a result of the insurer’s delay in paying the insurance compensation, provided that the insured manages to establish the causal link between that damage and the insurer’s delay. Thus, for example, if the insurer delays compensating the insured in the event of theft of the vehicle purchased under lease, the insured may claim in court a separate damage suffered as a result of the obligation to pay the rents that he must continue to pay while he is no longer in possession of the insured property. Separate damage is thus also characterized in the event of a delay by the insurer in paying compensation as a result of a fire where the insured company victim of the damage has been forced to file the balance sheet if it fails to receive compensation in due time under the operating loss guarantee.