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23 may 2023, 13:48
Before a law on participatory life insurance comes into force, which is currently being considered by the Russian State Duma, protection of policyholders’ rights will have to be determined, Financial Ombudsman Svetlana Maximova said in her speech at the 18th International Insurance Conference on the 23rd of May.
“I would like to point out, considering the high degree of readiness of the draft law on participatory life insurance, the issue of who, after all, will protect policyholders under this type of insurance. On the one hand, it has been repeatedly suggested to us that the insured here are investors. And the general attitude, both theoretical and as stated by the Supreme Court, is that investors are not consumers. Therefore, we should agree from the start, so that after the law is adopted we will not have to wonder whether it is appropriate to consider disputes of these investors through the Financial Ombudsman Service (FOS) or go straight to court,” the Financial Ombudsman said.
Svetlana Maximova also cited examples of unfair practices revealed when dealing with consumer appeals under investment life insurance contracts.
For instance, insurance companies establish insurance terms and conditions stipulating a considerable “delay” in effecting insurance payouts. The insurance rules stipulate that in the event of a “death” risk occuring, the payout is not due until the expiry date of the insurance contract. This procedure prevents heirs from receiving the payment immediately after the death of the insured.
However, there is no prohibition in applicable law to impose such conditions, and therefore the consumer’s claim cannot be satisfied in consideration of the appeal. “We regard such behaviour in the marketplace as not entirely ethical. The problem can probably be solved within the regulatory framework,” Svetlana Maximova said.
