Insurance policies
Concept: 1999043196-2. October 12, 1999. Delegate Superintendent for Insurance and Capitalization.
Summary: Compliance insurance policy. Cancellation due to termination of the covered contract.
[§ 0144] «Article 1045 of the Commercial Code indicates the essential elements of the insurance contract and warns that in the absence of any of them the contract will not produce any effect. Such elements are the following:
a) The insurable interest.
b) The insurable risk.
c) The premium or price of the insurance.
d) The conditional obligation of the insurer.
For its part, with respect to damage insurance, article 1086 of the same ordinance provides that “The interest must exist at all times, from the date on which the insurer assumes the risk. The disappearance of the interest will lead to the cessation or extinction of the insurance, without prejudice to the provisions of articles 1070, 1109 and 1111.”
Now, the insurable interest in this type of insurance is constituted by the contracting party’s own assets, which are threatened by the possible breach of contract that the bonded contractor may eventually incur. Which implies that once the contract that gave rise to the insurance is terminated, the interest and insured risk disappear.
Indeed, in compliance insurance the risk is constituted by the eventuality of non-compliance by the bonded contractor; His conduct, insofar as he can comply or not, is the future and uncertain fact on which the insurer’s obligation to compensate the contracting party for the damage that said non-compliance causes depends. As such, it implies execution or abstention, depending on the provision that is the object of the contract.
From the above perspective, it is pertinent to maintain that the compliance policy has an accessory nature to the extent that the definition of the insured risk will be determined by the terms of the benefit whose compliance is assured.
Taking into account the above and, since the very subsistence of the compliance insurance is subordinated to that of the contract it guarantees, this Superintendency considers that the insurance expires on the date on which the state contract is effectively terminated.
The writer J. Efrén Ossa G. expresses the same sense in his work “General Insurance Theory, The Contract”, Temis editorial, 1984, page. 38, when it states that “by exception, the insurance contract can be considered an accessory contract insofar as it is aimed at ensuring compliance with a main obligation. Such is the case of performance insurance, whose purpose is to guarantee the execution of a contract or, better , of the obligation borne by one of the parties. Here if the subsistence of the insurance is subordinated to that of the main contract.
Now, since the insurance company could eventually incur some administrative expenses in the placement and renewal of insurance and reinsurance, it is feasible that these costs be transferred to the insured, that is, the person for whose benefit the insurance was concluded. compliance insurance, holder of the insurable interest, that is, the contracting entity, in accordance with the provisions of article 1071 of the Commercial Code.”
2024-02-19 00:14:43
#Insurance #policies
