Following an investigation carried out in 2022, the General Directorate for Competition, Consumer Affairs and Fraud Repression (DGCCRF) noted four breaches of the rules for terminating damage insurance contracts.
In 2022, the General Directorate for Competition, Consumer Affairs and Fraud Repression (DGCCRF) investigated the termination, whether by the insurer or the insured, of damage insurance contracts , which cover any damage, destruction or loss of material property. Objective: to verify that the terminations initiated by the insurers did not hide a maneuver to sell more expensive contracts, but also at the same time that the policyholders did not encounter difficulties when they exercised their right of termination.
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Termination by the insurer misunderstood by the insured
Termination by the insurer is often misunderstood by the insured, particularly when it occurs following several losses for which he is not responsible, explains the DGCCRF. If no unfair practice on information concerning termination by the insurer on the part of insurers has been revealed, the competition authority has nevertheless admitted that the reasons given in the letters sent to insurers can nevertheless remain quite vague. , which makes it difficult for the insured to contest them.
Following investigations carried out with 26 establishments, three compliance injunctions and a warning were sent to the insurers concerned who quickly corrected them according to the DGCCRF:
- At an insurer and a bank, a clause incorrectly stating that the termination request had to be sent by registered letter;
- With another insurer, the absence of a mention on the exercise deadline by the insured of the right to terminate the contract, on notices of expiry dates;
- At a broker, the absence of notice of expiry for several years. It also applied one month’s notice, whereas in the absence of notice of expiry, the termination takes effect the day after its notification date.
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As a reminder, the insured can cancel their insurance contract at any time after the first year. Since June 1, 2023, a new termination button allows consumers to more easily terminate their insurance or mutual insurance contract whether the contract was initially concluded electronically or in paper form.
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