AUSTRIA Law and Practice Contributed by: Philipp Scheuba, BLS Rechtsanwälte GmbH
9.9 Insurers’ Rights of Subrogation According to the Austrian Insurance Contract Act, compensation claims of the policyholder against third parties are subrogated to the insurer if the insurer compensates the policyholder. The subrogation is not applicable if the compensation claim is directed against a family member of the policyholder living in the same household. However, compensation claims, even in this case, are subrogated if the family member caused the damage intentionally. If the policyholder waives its compensation claims against a third party, the insurer is relieved from its obligations to compen- sate if the insurer could have claimed compensation from such subrogated claim. In general, a significant level of insurtech business activity has been observed in the Austrian insurance market recently. Besides co-operating with insurtech start-ups, a number of Austrian insurance undertak- ings have established their own online direct dis- tribution channels, some of which use their estab- lished company brands, whilst others create their own brands for future online business. Most of these online distribution channels provide for the possibility of signing retail insurance contracts without consult- ing an insurance distributor in person. 10. Insurtech 10.1 Insurtech Developments As for the legal framework for the business conducted by insurtechs, it should be noted that insurtechs have to comply with the same legal standards applicable to “conventional” market participants. In fact, the amount of regulation of insurance law can be seen as a major challenge for insurtechs in Austria. 10.2 Regulatory Response Insurtechs can be non-licensed and licensed compa- nies. Therefore, the FMA not only supervises licensed companies in the fintech sector, but also clarifies the licence obligation. The FMA has established a fintech point of contact (“FinTechNavigator”) on its web- site, which fintech companies may contact regard- ing licensing requirements or other legal frameworks. However, with respect to insurtechs conducting busi- ness as an insurance intermediary rather than as an
in the insurance contract and determines the deci- sion authority and jurisdiction of the particular arbitral tribunal. Apart from family and tenancy law claims, arbitration clauses are enforceable. 9.6 Enforcement of Awards A domestic arbitral award usually has the effect of a legally binding court decision and is enforceable after the expiry of the payment period stated in the arbitral award. Austria has been party to the New York Convention since 1961. The Convention requires courts of con- tracting states to give effect to private agreements to arbitrate and to recognise and enforce arbitration awards made in other contracting states. Converse- ly, Austrian arbitral awards are enforceable in states that have ratified the New York Convention. However, the enforcement of a foreign arbitral award may be refused in certain cases. 9.7 Alternative Dispute Resolution Generally, alternative dispute resolution (eg, media- tion) does not play a significant role in the resolution of insurance disputes in Austria. Nevertheless, the Alternative Dispute Resolution Act (AStG) provides a further possibility for consumers to resolve insur- ance disputes. According to this Act, a consumer can initiate an alternative dispute resolution procedure in advance instead of a regular court procedure in order to achieve a cost-effective, quick and simple set- tlement of the dispute. However, such a procedure requires the consent of the insurance company. For this reason, the parties are free to terminate the pro- cedure at any stage. 9.8 Penalties for Late Payment of Claims Penalty provisions are generally uncommon in insur- ance contracts. Claims for damages that arose due to late payments can be raised if the insurer improperly delayed settling the claims and the policyholder has faced losses on this ground. Furthermore, the poli- cyholder can withdraw from the contract and, as the insured party, can reclaim paid premiums and default interest.
25 CHAMBERS.COM
Powered by FlippingBook