PORTUGAL Law and Practice Contributed by: Leonor Futscher de Deus, Broseta Abogados, SLP
ten statement sent to the insurer after the policy’s execution, or through a Will. • Multiple beneficiaries are allowed. The beneficiary clause can be revoked or changed at any time during the life of the policy (up to the moment the beneficiary is entitled to the benefit) ‒ unless the person who is entitled to designate the beneficiary has expressly waived such right or, in the case of survival insurance, the beneficiary subscribes to the policy or accepts the benefit provided under the policy. Different rules shall apply to compulsory insurance. The insurance policy must contain enough information to allow the identification of the beneficiary (name, address and civil and tax identification numbers) when referring to a nominated beneficiary. The law also allows for generic beneficiary clauses (eg, heirs of, or the children of). In the event the policyholder and the insured are not the same person, the insurer must provide information on the consequences arising from the lack of benefi- ciary designation or inaccurate/insufficient information regarding the beneficiary’s identification. Moreover, the following rules apply to insurers. • In the event the premium is not paid within the due date and the policy establishes an irrevocable ben- efit in favour of a third party, the insurer must notify said third party within 30 days of the due date to inform them that they may pay the premium (in replacement of the policyholder), should the third party wish to do so. • In the event of the demonstrated impossibility of contacting the policyholder or insured (if they are not the same person) over the course of a year, the insurer must inform the beneficiary of such fact ‒ provided the policyholder/insured person has expressly authorised this – within 30 days of the last communication made by the insurer to the policyholder/insured, where applicable. • There is an obligation to inform the beneficiary of the existence of the insurance policy and their right to receive the benefit, within 30 days of the insurer becoming aware of the insured’s death.
In the event the policyholder or the insured person (should they not be the same person) does not con- tact the insurer to claim the benefit over the course of one year following the end of term of the policy, the insurer has an obligation to inform the beneficiary of such fact ‒ provided the policyholder/insured person has expressly authorised it ‒ within 30 days after one year from the end of the term of the policy. 6.6 Consumer Contracts or Reinsurance Contracts Mass-risk insurance is subject to stricter rules aiming to protect consumers. The Insurance Contract Law lists several rules considered mandatory with regard to mass-risk insurance, classified into: • absolutely mandatory rules, which cannot be waived by the parties (eg, format of the policy, insurable interest, rules regarding risk, means to pay the premium, and consequences in the event the premium is not paid); and • relatively mandatory rules, which allow different solutions other than those established by law ‒ provided said solutions benefit the policyholder, the insured or the beneficiary, where applicable (eg, provision of pre-contractual information, risk dis- closure obligation and consequences, and policy contents). Reinsurance contracts are, in general, governed by contractual freedom. Portuguese law establishes few rules regarding reinsurance (see 3.2 Fronting ). 7. Alternative Risk Transfer (ART) 7.1 ART Transactions Insurers may resort to reinsurance and alternative risk mitigation techniques for the purposes of risk mitiga- tion within their risk management and internal control systems. Should the insurer decide to use them, it must have a written policy in place in accordance with the ASF’s guidelines on this matter, comprising processes nec- essary to identify, monitor and manage on a con- tinuous basis the use of reinsurance or alternative risk mitigation techniques according to the insurer’s
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