Updated in 11-05-2020

The insurance sector is, paradigmatically, the branch of the financial system that is most likely to cope with unforeseeable events. Typically, through an insurance contract, “the insurer covers a specific risk of the policyholder or of a third party, by agreeing to provide an agreed benefit in case the aleatory event provided for in the contract occurs, and the policyholder agrees to pay the respective insurance premium”. This means that, in return for payment, the insurer undertakes to cover a risk and to provide the agreed benefit, if an event identified as a claim occurs. The central question regarding the performance of insurance contracts is knowing whether, and to what extent, events occurring due to the COVID-19 pandemic are covered by the insurance contract (i.e., under the express and implicit own risk of the insurance contract). It should be noted, however, that this does not wholly exclude the possibility of an insurer raising the argument in favour of amending or terminating the contract on the basis of a change in circumstances.


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