Germany's Federal Financial Supervisory Authority expects insurers to conclude consumer claims within one month

Germany's Federal Financial Supervisory Authority has issued a supervisory notice setting out its expectation that insurers should generally complete the handling of consumer claims within one month. The notice follows numerous consumer complaints about very long processing times and links the expectation to insurers' legal duty to pay once the necessary inquiries to establish the insured event and the extent of liability have been completed. BaFin said insurers must organize their business so that claims owed to policyholders and beneficiaries can be met promptly after those inquiries are finished. It considers that, in an average insurance case, the necessary inquiries should normally be completed one month after the loss is notified, provided the policyholder has fully met cooperation obligations. Staff shortages or elevated claims volumes are not valid reasons for persistently delayed processing. Longer handling periods may be appropriate in more complex cases, including bodily injury claims that require expert opinions, medical examinations, site inspections, access to official investigations or the outcome of criminal proceedings. Where delays amount to supervisory deficiencies, BaFin said it can use its powers under the Insurance Supervision Act to take measures that are suitable and necessary to prevent or remedy those deficiencies.