Content of an insurance contract in the Draft Common frame of reference for the European insurance contract law and laws of the EU Member States


Taking into account solutions from the relevant EU directives and Draft of the Common Frame of Reference for insurance contract which does not make difference between consumer and non-consumer contracts for regulation of the precontractual information content and policy, it seems that provision of Article 902 from the Law on Contracts and Tort on mandatory content of the cover note entirely justifies protection of ‘small’ policyholders or insured who do not pose big or severe risk for insurer. However, rules on mandatory content of an insurance policy and cover note, based on the decision of the European Court of Justice (Judgment of 4 December 1986, case 205/84 ’Commission vs. Federal Republic of Germany’, ECR 1986) and rules from the Directive on Accounting and Second Non-Life Directive (Article 5), in EU Member States do not apply in field of fire property insurance (fire and other property insurances), civil liability (excluding liability of motor vehicle owners, airlines and shipowners) and loss of profit insurance or expected income if the policyholder meets at least two of three of the following criteria: 1) balance sheet exceed EUR 6.2 milions, 2) net revenue exceeds EUR 12.8 milions and 3) average number of employees during financial year exceeds 250.

In field of Marine insurance, big risks are rolling stock, vessel hull, aviation hull, cargo, including luggage and other commodities, all types of liability from use of aircrafts, including air-carrier’s liability, all types of liability from use of vessels, including sihipowner’s liability. Beside these insurance lines, credit and surety insurance have same treatment if policyholder activity relates to industrial, commercial or any other profession connected with such risks.

Based on the above, it seems unjustified in on-shore insurances to keep such kind of protection for policyholders who are, in the sense of definitions from the EU rules, classified as big risks. Therefor it is founded, de lege ferrenda, to abandon principle of providing for mandatory content of insurance contract, policy or cover note in Serbian law for big risks, which shall bring free will of the parties to an insurance contract to the full effect and parties’ agreement will have priority in interpretation of the insurance contract content. On the other hand, mandatory content of an insurance policy and cover note, should be kept for other policyholders and insured and their protection regulated in accordance with rules from the EU directives.