- Compulsory third party liability insurance policies for Motor Diagnostic Centers – Law 2283 of 2023
On January 5, 2023, Law 2283 of 2023 was enacted, which amended the National Code of Transit and Transportation regarding the obligation of Motor Diagnostic Centers (“CDA” for its Spanish abbreviation) to purchase mandatory third-party liability insurance policies, to cover property damages cause to third parties. These policies must have, a minimum insured limit of 15 minimum legal monthly wages (“SMLMV”) for private service vehicles and 7 SMLMV for motorcycles and similar vehicles.
Additionally, the CDAs must guarantee that the mandatory insurance policies are offered in each of their establishments. It is expressly established that the third-party liability insurance policy must not be at the expense or with extra costs to the users. In turn, the information related to the mandatory insurance policies in force and its claims must be registered in the Registro Único Nacional de Tránsito (RUNT).
- Misrepresentation in life insurance policies – Supreme Court of Justice, Civil Chamber Ruling STC-16132-2022
The Civil Chamber of the Supreme Court of Justice (“CSJ”) decided on an appeal filed against a judgment issued by the Civil Chamber of the Superior Tribunal of the Judicial District of Bogotá on November 8, 2022, in the light of a constitutional claim brought by the insured of a life insurance policy against the decision of the Tenth Civil Court of the Circuit of Bogotá. On the Judge’s ruling an insurance company was waived to pay a claim under a life insurance policy, because the insured misrepresented the information presented to the insurer after ignoring her duty to provide accurate information in the declaration her health standing and, as a result, the claim was rejected.
In a first instance, the Superior Tribunal of Bogota, decided under the constitutional action that the insurer should pay de claim, because it had a duty to verify and confirm the information attached in the declaration of health. However, the CSJ revoked such first instance ruling, considering that there is no obligation for an insurance company to verify the medical history of life insurance policyholders, and ratified that if such a rule existed, it would be contrary to the universal principle of good faith in insurance contracts, by which the policyholder is required to sincerely declare his health condition.
Likewise, the CSJ found no evidence that points to an unfair activity of the insurance company, or that its wordings were confuse, or that the advisor who provided the form had wanted to take advantage of the insured good faith. If this were so, it was the plaintiff’s duty to prove the insurer or the intermediary’s illegal conduct.
Upon reviewing the interrogation of the plaintiff, the CSJ noted a confession, as the plaintiff mentioned that at the time of entering into the contract, she was seeking the approval of the bank loan and not purchasing an insurance policy, therefore, in her view, it was not necessary to go into the information or reveal her illness in the declaration of insurability.
Considering the above, the CSJ mentioned that it was the duty of the insured, if she did not understand the consequences of concealing the truth, even partially, to request the necessary clarifications, request additional information from the insurer, or even refrain from subscribing the declaration of insurability. Therefore, the CSJ considered that the insured concealed the existence of a congenital disease which would have implications in the insurability, such as the existence of reticence, which results in the nullity of the insurance contract pursuant to the provisions of article 1058 of the Code of Commerce.
Finally, the CSJ concluded that the appeal decision did not contain any arbitrariness susceptible to correction through an exceptional constitutional claim.
- Letter Circular 06 of 2023, Financial Superintendence of Colombia – Instructions related to the mandatory investment in Class “A” and “B” Agricultural Development Securities to be made by Credit Institutions for the quarter of January to March 2023.
On January 20, 2023, the Colombian Finance Superintendence (“SFC”) published Circular Letter 6 of 2023, which informed the list of investments that banks must make in class “A” and “B” agricultural development securities for the quarter of January to March 2023.
The SFC included a query made to the Colombian Central Bank, reminding that the SFC is not responsible for the errors in the calculations as a result of inconsistencies in the information reported by credit institutions. It also established that the SFC’s responsibility is limited to issuing instructions on the information that must be submitted for the purposes of determining the surpluses and refunds, as well as conducting and communicating the results in the required time.
Therefore, it is recommended that each credit institution makes its own calculations with reference to the number of investments to be made in Class “A” and “B” Agricultural Development Securities.