SWEDEN Law and Practice Contributed by: Viveka Classon, Karin Rättzén and Sara Stålebring, Advokatfirman Vinge KB
6.5 Multiple Insured or Potential Beneficiaries Non-insured parties can be beneficiaries of an insur- ance contract under Swedish law. The ICA includes provisions granting a third party who holds a security interest in real property or a ground lease the right to receive insurance compensation under a policy covering the property’s value. Similarly, unless expressly stipulated otherwise in the insurance policy, a security interest in movable property may also confer rights to such compensation. Swedish law imposes a duty on insurance undertak- ings to inform the parties to an insurance contract on certain matters. However, there is no legal requirement to obtain the beneficiary’s consent or notify them of the contract. On the contrary, personal data showing that a policyholder has arranged future insurance pay- outs in favour of another person, which is processed in accordance with the General Data Protection Regu- lation (GDPR), must not be disclosed to the benefi- ciary. Consequently, the insurance undertaking may be prohibited by law from sharing certain information with the beneficiary. 6.6 Consumer Contracts or Reinsurance Contracts The ICA is mandatory for both consumer insurance contracts and commercial insurance contracts. How- ever, for consumer insurance contracts, the ICA stip- ulates more onerous obligations on the insurer and more lenient obligations on the insured party than in respect of commercial insurance contracts. The ICA does not govern reinsurance contracts, instead, the Swedish Contracts Act ( Lag (1915:218) om avtal och andra rättshandlingar på förmögen - hetsrättens område ) is applicable. This means that parties to reinsurance contracts have greater contrac- tual freedom, limited mainly by the general restrictions in the Swedish Contracts Act and international law. 7. Alternative Risk Transfer (ART) 7.1 ART Transactions Alternative Risk Transfers (ART) are essentially sub- stitute risk management and finance strategies to the
For non-consumer insurance, the insurance undertak- ing must fulfil information requirements to the policy- holder, unless it can be reasonably assumed that the customer does not require the information. 6.2 Failure to Comply With Obligations of an Insurance Contract Please see 6.1 Obligations of the Insured and Insurer . 6.3 Intermediary Involvement in an Insurance Contract Insurance intermediaries may be involved in the negotiation of insurance contracts on behalf of the insured or the insurer. Insurance intermediaries must comply with certain obligations in accordance with the IDA, regardless of if they represent the insured or the insurer. 6.4 Legal Requirements and Distinguishing Features of an Insurance Contract There are no legal requirements set forth in Swedish law regarding the definition of an insurance contract. However, the distinguishing features of insurance contracts have been established through preparatory works and case law. An insurance contract should essentially mean an agreement between an insurance undertaking and a policyholder that is characterised by the fact that, in return for a consideration (an insur- ance premium), the insurance undertaking agrees to pay compensation or a certain amount upon what is referred to as an “insured event”. A basic prerequisite for the payment of insurance compensation is that the payment relates to a legiti- mate interest. According to general principles of law, agreements on insurance of unlawful interests are not binding. Examples of unlawful interests include fines (due to negligent offences) and environmental penalty fees (payable due to negligent conduct). The Swedish FSA has stated in a legal position that the provision of insurance against fines and adminis- trative sanction fees is not consistent with good insur- ance standards. This applies to both Swedish insur- ance undertakings and foreign insurers conducting business in Sweden.
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