DENMARK Law and Practice Contributed by: Josefine Movin Østergaard and Johannes Hedegaard, Bruun & Hjejle
1. Key Drivers and Resolution of Insurance Disputes
• the scope of coverage and exclusions; • definitions of key terms such as “claim”, “damage” and “fraud”; • subrogation and anti-subrogation provisions; • changes in coverage that have not been transpar- ently communicated or clearly identified; and • where more applicable policies appear to con- tradict each other, for instance excess policies compared to primary policies or local policies compared to master policies. 1.3 Dispute Resolution Strategy and Outcomes Commercial Disputes Settlement attempts before formal proceedings are common in the commercial context. Parties will often enter into a suspension agreement (tolling agreement) while settlement discussions are ongoing, preserving their rights to litigate or arbitrate if negotiations fail. Under Section 126 (1) of the Danish Administration of Justice Act, attorneys must act in accordance with good advocacy practice. A party may not disclose the opposing party’s settlement offer to the decid- ing authority without consent but may present its own client’s offer. This is commonly done at the end of proceedings as it can significantly influence cost allo- cation (cf. Section 312 (4)). The same applies in arbitration: a party may inform the tribunal that a settlement offer was made and request that it be considered “without prejudice save as for costs” before the final decision. Alternatively, the offer may be submitted in a sealed envelope to the arbitra- tion institute for forwarding to the tribunal after the merits are decided, allowing it to be considered in cost allocation. In commercial insurance disputes, arbitration is the preferred forum due to its confidentiality and the par- ties’ greater procedural autonomy compared to court proceedings. As part of the Danish Arbitration Insti- tute, it is possible to enter into mediation simultane- ously with arbitration proceedings. Consumers Special rules apply to consumer agreements. Under Section 7 (2) of the Danish Arbitration Act ( voldgift-
1.1 Common Triggers of Insurance Disputes The most frequent causes of insurance disputes in Denmark are coverage interpretation and policy word- ing ambiguity, claims handling disagreements, mis- representation and non-disclosure by policyholders under Sections 4–10 of the Danish Insurance Con- tracts Act ( forsikringsaftaleloven ), and causation and exclusion clause disputes, particularly around concur- rent causes. The most active sectors are D&O liability (driven by large group actions and litigation funding), profession- al indemnity (with growing claims against lawyers and auditors – some insurers have withdrawn PI cover for auditors), property and weather damage (storm and flood losses, including the DKK 500 million Nordic Waste landslide), construction (LEG defect exclusion clauses now being tested in court), cyber insurance (rising attack frequency), and workers’ compensation (remote-work injury coverage clarified by a landmark 2025 Supreme Court ruling). Recent shifts include emerging risks from climate/ ESG factors, PFAS contamination, geopolitical dis- ruption and AI-driven underwriting. Before the Danish Complaint Board for Insurance ( Ankenævnet for Forsikring ) handling consumer com- plaints, the most frequent complaints in 2025 con- cerned change-of-ownership insurance (422 com- plaints), accident insurance (397 complaints), and life and pension insurance (372 complaints), together accounting for approximately 54% of all complaints received. The number of complaints increased from 1,898 in 2024 to 2,193 in 2025, representing an increase of approximately 15.5%. 1.2 Role of Policy Wording and Drafting Policy wording and drafting issues are significant contributors to insurance disputes in Denmark, some- times involving substantial financial exposure. Some of the recurring clauses and areas that typically give rise to contention include:
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