ITALY Law and Practice Contributed by: Giovanna Aucone and Debora Gobbo, FIVERS Studio Legale e Tributario
or limitations of guarantees, or containing costs pay- able by the policyholder or the insured party, have to be highlighted, in order to ensure transparency and protection for the policyholder. The existence of the risk to be insured is an essential element of the insurance contract. Indeed, the insur- ance contract is null and void if the insured risk never existed or ceases to exist before the insurance con- tract has concluded. The insurance contract has to contain at least the essential elements such as the parties, a description of the covered risk, the conditions under which cover- age is granted, the premium, and the duration of the contract and – if not coinciding with the policyholder – the beneficiary of the insurance benefit. If the insurer uses standardised insurance terms and conditions that have been unilaterally predetermined and have not been individually negotiated with the sin- gle policyholder, Italian law establishes provisions for the safeguarding of the policyholder. All unfair terms have to be expressly indicated and approved in writing by the policyholder. 6.5 Multiple Insured or Potential Beneficiaries The Civil Code expressly provides for the possibility to conclude an insurance contract on behalf and in the interest of a third party. The third party does not have to be indicated nomi- nally. However, a clear identification of the beneficiary, that has not been indicated nominally but as part of a category, has to be guaranteed. Examples for this practice in the Italian insurance mar- ket are D&O (directors and officers) policies in which the insurance coverage is provided in favour of an administrator and/or corporate officers in charge at a certain point of time or policies taken out to guaran- tee loans. In the latter kind of insurance contract, the beneficiary of the contract is often the lending bank, in order to ensure repayment of the outstanding credit in the event of the debtor’s death or incapacity to make the loan payments.
Another example is a life insurance policy, in which the beneficiary usually is a third party, who may be designated not nominally but as part of a generic cat- egory, for example, the legal heirs of the policyholder or his/her spouse or children at the moment of the insured event. If the insurer allows a generic, not nominal, indication of the beneficiary of a life insurance contract, it is held to expressly inform the policyholder that in case of a generic indication the insurer might have difficulty to individuate the beneficiary. The Civil Code does not impose additional disclosure obligations on third parties. However, if a third party is aware that the policyholder’s statements or omissions about the risk are inaccurate, the insurer may seek to annul the insurance contract (see 6.2 Failure to Comply With Obligations of an Insurance Contract ). 6.6 Consumer Contracts or Reinsurance Contracts In insurance contracts concluded with consumers, the additional rules of the Consumer Code apply. How- ever, there is a very high alignment between the provi- sions on insurance contracts of the Code of Private Insurance and the Consumer Protection Rules. A special level of protection is provided if the insur- ance contract is unilaterally drafted by the insurer, for example, by offering standardised terms and condi- tions. In this case, the insurer is held to highlight so- called unfair conditions, which have to be indicated in a list and have to be expressly confirmed by the other party. In reinsurance contracts, due to the professional char- acteristics of the parties involved, there are no special enhanced protections for either party to the contract. In any case, the general principles of good faith, con- tractual transparency and fairness provided for in gen- eral by the Civil Code apply also to the execution of reinsurance contracts. Italian law does not provide for any particular formali- ties and/or requirements regarding the formation of
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