COVID-19 insurance policies shall not contain conditions that void insurance indemnities: behavioural supervision by Bank of Russia
Insurance companies offering COVID-19 insurance policies to consumers shall not include conditions which actually void or delay insurance indemnities in their insurance contracts and rules. The Bank of Russia has sent an information letter to insurers stipulating such practices as unacceptable.
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.