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Transparency in the Insurance Contract Law of Croatia

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Transparency in Insurance Contract Law

Part of the book series: AIDA Europe Research Series on Insurance Law and Regulation ((ERSILR,volume 2))

Abstract

In Croatian insurance contract law, transparency is achieved through three regulations: the Civil Obligations Act, the Insurance Act, and the Consumer Protection Act. The Civil Obligations Act is the fundamental regulation of law of obligations in the Republic of Croatia which, in addition to the provisions on various types of contracts, also regulates the insurance contract. Transparency under the Civil Obligations Act is, as a rule, in one way. It refers to the obligations of the policyholder to notify on the circumstances regarding risk assessment, as well as the duty to report the occurrence of the insured event. A special exception to such a one-way communication (policyholder to insurer) is the insurer’s obligation to notify the policyholder that the insurance terms and conditions are an integral part of the insurance contract and to provide him with them. Any additional duty of the insurer in terms of providing additional clarification of the terms and conditions, advice to the policyholder or the insured are not prescribed by the Civil Obligations Act. Unlike the Civil Obligations Act, transparency in the Insurance Act and the Consumer Protection Act occur in the opposite direction, i.e. from the insurer to the policyholder/consumer. The consequence of this is the adoption of EU legislation into Croatian law. The Insurance Act has taken into account the legal order of the Solvency II Directive, which stipulates, inter alia, the information which the insurer has the duty to provide to the policyholder before the conclusion of the insurance contract as well as the duration of the insurance contract and the right to terminate the contract. The Consumer Protection Act is applied to the insurance contract that is concluded by means of the distance communication. This Act contains, inter alia, provision on the information that the financial services provider (the insurer) has to provide to the policyholder when concluding an insurance contract by means of distance communication.

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Notes

  1. 1.

    Official Gazette, n. 35/2005, 41/2008, 125/2011, 78/2015, 29/18.

  2. 2.

    Official Gazette of the SFRY, n. 29/1978, Official Gazette, n. 53/1991, 73/1991, 111/1993, 2/1994, 7/1996, 112/1999 and 88/2001.

  3. 3.

    Maritime insurance is regulated by the Maritime Code (Official Gazette, br. 181/2004, 76/2007, 14/2008, 61/2011, 56/2013, 26/2015, 17/2019) and the provisions relating to the contract of maritime insurance (Art. 684-747d of the Maritime Code).

  4. 4.

    With regard to insurance contracts in air transport, provisions of the Act on Obligatory and Proprietary Rights in Air Transport are applied (Official Gazette no. 132/2008, 63/2008, 134/2009, 94/2013). This then excludes the application of the Civil Obligations Act provisions. Article 126 of the Act provides that the provisions of the Maritime Code are applied to the insurance contract in air transport for those insurance questions that are not specially regulated by this Act.

  5. 5.

    Rules of maritime security, therefore the rules of the Maritime Code (Art. 923 par. 3 of the Civil Obligations Act), are appropriately used in the insurance of goods in land transport.

  6. 6.

    Claims insurance in Croatia is not regulated by special regulations. This insurance is, by its legal nature, similar to bank guarantees; therefore, banking rules apply to such insurances.

  7. 7.

    Re-insurance is based on principles different from those underlying other types of insurance, while the content and form of re-insurance contracts is primarily developed in business practices between insurers and re-insurers. For these reasons, the Civil Obligations Act excludes the application of its provisions to the insurance contract in relations arising from re-insurance.

  8. 8.

    In accordance with the principle of lex specialis derogat legis generalis, if a special law regulates some questions with an obligations character with regard to insurance contracts, then the advantage in the application understandably lies with the provisions of the special law in relation to the Civil Obligations Act, which is expressly recognized in the Civil Obligations Act in Art. 923, sec. 3. For example, as a special regulation that would have the advantage in the application in relation to the Civil Obligations Act is the Act on Compulsory Insurance within the Transport Sector (Official Gazette no. 151/2005, 36/2009, 75/2009, 76/2013, 152/2014) regarding questions about the insurance contract against a third party that are regulated by this Act.

  9. 9.

    Official Gazette, n. 30/2015, 112/2018.

  10. 10.

    Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (Text with EEA relevance), OJ L 335, 17.12.2009, pp. 1–155.

  11. 11.

    Official Gazette, n. 41/2014, 110/2015, 14/2019.

  12. 12.

    Art. 1 of the Consumer Protection Act.

  13. 13.

    Mišćenić (2014), p. 279.

  14. 14.

    Art. 80, sec. 2 of the Consumer Protection Act.

  15. 15.

    Art. 87 of the Consumer Protection Act.

  16. 16.

    Official Gazette, n. 111/1993, 34/1999, 121/1999, 52/2000, 118/2003, 107/2007, 146/2008, 137/2009, 125/2011, 152/2011, 111/2012, 68/2013, 110/2015.

  17. 17.

    Art. 19, sec. 1 of the Insurance Act.

  18. 18.

    Official Gazette, n. 143/2013.

  19. 19.

    Art. 402 of the Insurance Act.

  20. 20.

    Act on the Croatian Agency for Supervision of Financial Services, Official Gazette, n. 140/2005, 154/2011, 12/2012.

  21. 21.

    Keglević (2016), p. 314.

  22. 22.

    Art. 15 of the Act on the Croatian Agency for Supervision of Financial Services.

  23. 23.

    Keglević (2016), p. 335.

  24. 24.

    Keglević (2016), p. 341.

  25. 25.

    Ćurković (2005), p. 30; Matijević (2006), p. 89.

  26. 26.

    Art. 295, sec. 5 of the Civil Obligations Act.

  27. 27.

    Art. 926, sec. 3 of the Civil Obligations Act.

  28. 28.

    Belanić (2014), pp. 1455, 1490.

  29. 29.

    In particular, (1) the company name and the registered office of the insurance company entering into a contract of insurance; (2) when the insurance contract is concluded through a branch office of the insurance company, in addition to the data from the previous point, it is necessary to state the company name and the registered branch office of the insurance company through which a contract of insurance is concluded; (3) the insurance requirements applicable to the insurance contract which is intended to be concluded; (4) the deadline within which the offer obliges the offeror, the right to recall an offer to conclude an insurance contract, and the right to cancellation of the insurance contract; (5) the conditions of termination and breach of contract; (6) the duration of the insurance contract; (7) the amount of the insurance premium, the means of payment of insurance premiums, amount of contributions, taxes and other costs and fees that will be charged in addition to the insurance premium and the total amount of payments; (8) the information on the procedure for resolving complaints regarding contracts, including the address to which complaints are received, and the competent body for resolving complaints; (9) the body responsible for overseeing of the insurance company.

  30. 30.

    Art. 380, sec. 3 of the Insurance Act.

  31. 31.

    Art. 380, sec. 7 of the Insurance Act.

  32. 32.

    According to Art. 380, sec. 5 of the Insurance Act, these additional information are: (1) the exact instruction where the policyholder can find the report on the solvency and financial condition of the insurance company, which provides the policyholder with easy access to this information; (2) the determination of every benefit and each option; (3) the base, criteria, and conditions for participation in the profits and the right to payment of accrued gain in all cases payments; (4) the tables of redemption value and tables of capitalized sums per insurance years; (5) the information that the policyholder may cancel the contract of life insurance no later than 30 days from the receipt of notification of the insusrance company, whereby the policyholder does not bear the obligations arising out of that contract; (6) other specific information needed to make the policyholder properly understand the risks underlying the contract and obligations of the parties; (7) the information on agreements for the application of the standstill period containing the conditions and consequences of entering into these agreements, where applicable; (8) the relevant law applicable to the insurance contract, when the parties do not have the freedom of choice of law; (9) the freedom of choice of applicable law and the law which the insurance company proposes to select as applicable.

  33. 33.

    Art. 380, sec. 6 of the Insurance Act.

  34. 34.

    Art. 380. sec. 7 of the Insurance Act.

  35. 35.

    Directive 2002/65/EC of the European Parliament and of the Council of 23 September 2002 concerning the distance marketing of consumer financial services and amending Council Directive 90/619/EEC and Directives 97/7/EC and 98/27/EC OJ L 271, 9 October 2002, pp. 16–24.

  36. 36.

    Art. 83 of the Consumer Protection Act.

  37. 37.

    Art. 85 of the Consumer Protection Act.

  38. 38.

    Keglević (2016), pp. 343, 345.

  39. 39.

    Keglević (2016), p. 345.

  40. 40.

    Keglević (2016), p. 344.

  41. 41.

    Art. 381, sec. 3. of the Insurance Act.

  42. 42.

    Art. 381, sec. 4 of the Insurance Act.

  43. 43.

    Art. 931 of the Civil Obligaitons Act.

  44. 44.

    Belanić (2014), p. 1501.

  45. 45.

    Ćurković (2009), p. 100.

  46. 46.

    Belanić (2014), p. 1502.

  47. 47.

    Belanić (2014), p. 1585.

  48. 48.

    The content of any kind of insurance policy, according to Article 926, paragraph 1 of the Civil Obligations Act, includes: contracting parties, the insured person, i.e. the insured event or other subject of insurance, risk covered by the insurance, duration of the insurance and duration of the coverage, amount of the insurance or unlimited insurance amount, premium or contribution (deposit), date of policy issuance, and signature of the contracting parties.

  49. 49.

    Art. 967, sec. 1 of the Civil Obligations Act.

  50. 50.

    Art. 968 of the Civil Obligations Act.

  51. 51.

    Art. 931 of the Civil Obligations Act.

  52. 52.

    Keglević (2016), p. 351.

  53. 53.

    Art. 938, sec. 1 of the Civil Obligations Act.

  54. 54.

    Belanić (2014), p. 1519.

  55. 55.

    Art. 938, sec. 3 and 4. of the Civil Obligations Act.

  56. 56.

    Art. 938, sec. 1 of the Civil Obligations Act.

  57. 57.

    Art. 938, sec. 4 of the Civil Obligations Act.

  58. 58.

    Art. 938, sec. 4 of the Civil Obligations Act.

  59. 59.

    Art. 938, sec. 5 of the Civil Obligations Act.

  60. 60.

    Belanić (2014), p. 1520.

  61. 61.

    Art. 938, sec. 6 of the Civil Obligations Act.

  62. 62.

    Art. 939 of the Civil Obligations Act.

  63. 63.

    Belanić (2014), p. 1521.

  64. 64.

    Art. 940, sec. 1 of the Civil Obligations Act.

  65. 65.

    Art. 940, sec. 2 of the Civil Obligations Act.

  66. 66.

    Belanić (2014), p. 1522.

  67. 67.

    Art. 941, sec. 1 of the Civil Obligations Act.

  68. 68.

    Art. 930 of the Civil Obligations Act.

  69. 69.

    Pavić (2009), p. 224.

  70. 70.

    Art. 380, sec. 1 of the Insurance Act.

  71. 71.

    This is information from Article 381 of the Insurance Act.

  72. 72.

    Art. 381, sec. 1 of the Insurance Act.

  73. 73.

    Art. 86, sec. 1 of the Consumer Protection Act.

  74. 74.

    Art. 5, sec. 1, par. 25 of the Consumer Protection Act.

  75. 75.

    Keglević (2016), 353.

  76. 76.

    Art. 292, sec. 4 of the Civil Obligations Act.

  77. 77.

    Art. 382, sec. 1 of the Insurance Act.

  78. 78.

    Keglević (2016), p. 355.

  79. 79.

    Art. 382, sec. 1 of the Insurance Act.

  80. 80.

    Art. 382, sec. 2 of the Insurance Act.

  81. 81.

    Art. 925, sec. 1 of the Civil Obligations Act.

  82. 82.

    Art. 925, sec. 2. of the Civil Obligations Act.

  83. 83.

    Art. 925, sec. 3 of the Civil Obligations Act.

  84. 84.

    Art. 380, sec. 1 of the Insurance Act.

  85. 85.

    Art. 381, sec. 1 of the Insurance Act.

  86. 86.

    Keglević (2016), p. 359.

  87. 87.

    Keglević (2016), p. 359.

  88. 88.

    Art. 380, sec. 1, par. 4 of the Insurance Act.

  89. 89.

    Keglević (2016), p. 361.

  90. 90.

    Art. 380, sec. 5, par. 5 of the Insurance Act.

  91. 91.

    Art. 87, sec. 1 of the Consumer Protection Act.

  92. 92.

    Art. 87, sec. 2 of the Consumer Protection Act.

  93. 93.

    Art. 90 of the Consumer Protection Act.

  94. 94.

    Keglević (2016), p. 366.

  95. 95.

    Art. 280 of the Civil Obligations Act.

  96. 96.

    Art. 284 of the Civil Obligations Act.

  97. 97.

    Art. 335 of the Civil Obligations Act.

  98. 98.

    Keglević (2016), p. 366.

  99. 99.

    Art. 366 of the Civil Obligations Act.

  100. 100.

    Art. 381 of the Insurance Act.

  101. 101.

    Art. 360 of the Civil Obligations Act.

  102. 102.

    Art. 380 of the Civil Obligations Act.

  103. 103.

    Art. 348 of the Civil Obligations Act.

  104. 104.

    Art. 342, sec. 2 of the Civil Obligations Act.

  105. 105.

    Art. 93, sec. 1 of the Civil Obligations Act.

  106. 106.

    Art. 932, sec. 3 of the Civil Obligations Act.

  107. 107.

    Art. 932, sec. 2 of the Civil Obligations Act.

  108. 108.

    Ćurković (2005), p. 35; Pavić (2009), p. 203.

  109. 109.

    Art. 933, sec. 1 of the Civil Obligations Act.

  110. 110.

    Art. 933, sec. 2 of the Civil Obligations Act.

  111. 111.

    Art. 933, sec. 3 and 4 of the Civil Obligations Act.

  112. 112.

    Ćurković (2005), p. 33.

  113. 113.

    Art. 968 of the Civil Obligations Act.

  114. 114.

    Pavić (2009), pp. 343–344.

  115. 115.

    Art. 938, sec. 2 of the Civil Obligations Act.

  116. 116.

    Keglević (2016), p. 381.

  117. 117.

    Art. 938, sec. 6 of the Civil Obligations Act.

  118. 118.

    Art. 342, sec. 2 of the Civil Obligations Act.

  119. 119.

    Art. 348 of the Civil Obligations Act.

  120. 120.

    Art. 941. sec. 2 of the Civil Obligations Act.

  121. 121.

    Art. 942 of the Civil Obligations Act.

  122. 122.

    Pavić (2009), p. 225.

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Authors and Affiliations

  1. Faculty of Law, University of Rijeka, Rijeka, Croatia

    Loris Belanić & Dionis Jurić

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  1. Loris Belanić
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Correspondence to Loris Belanić .

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  1. Department of Legal Studies, Catholic University of the Sacred Heart, Milano, Italy

    Pierpaolo Marano

  2. School of Law, University of Exeter, Exeter, UK

    Kyriaki Noussia

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Belanić, L., Jurić, D. (2019). Transparency in the Insurance Contract Law of Croatia. In: Marano, P., Noussia, K. (eds) Transparency in Insurance Contract Law. AIDA Europe Research Series on Insurance Law and Regulation, vol 2. Springer, Cham. https://doi.org/10.1007/978-3-030-31198-8_2

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