The impact of Covid-19 on the global insurance industry – Denmark

Denmark

General questions

Yes/

No/

N/A

Additional comments, if any.

1

Does the country that you are reporting on follow common law jurisprudence?

No

See below.

2

If the answer to the above question is no, does the country you are reporting on follow a civil code? Please describe the judicial system in short.

Yes

Denmark is part of the Scandinavian civil law system with roots in the traditional continental European civil law code. This is characterised by recognising codified sources of law issued by legislative institutions (the legislative power; in Denmark, this being the Danish Parliament, Folketinget, and the government) subject to the Constitution. Subject to the Constitution, the courts (the judicial power) do not have the authority to create new law, but only to interpret and apply the rule of law.

In certain areas, such as contract law and insurance law, the legislator has, to some extent, left it to the courts to determine doctrines of law and general principles of law, and to define legal terms if such terms have not been defined by codified law, such as negligence, intent, force majeure, the definition of an insurance contract, principles of interpretation of contracts and so on.

3

Please provide a brief description of the legal framework applicable to insurance coverage disputes in the country you are reporting on. In so doing, please consider the following questions:

The legal framework applicable to insurance coverage disputes is: (1) codified sources of law; and (2) general principles of law established by the courts (case law).

Insurance contracts are governed by the Danish Insurance Contracts Act (forsikringsaftaleloven) (Consolidated Act no 1237/2015) which is a codification of general principles of contract law applicable to insurance contracts (both life insurance and non-life insurance/property insurance), including contractual provisions on the subjects of: misrepresentation, obligations to pay the claim, payment of premium, notification and information duties, exemptions of coverage (gross negligence and intent), time-barring, the insured interest, principles of coverage, under insurance, double insurance, increase of risks, third party interests, the duty to comply with safety guards etc.

The Insurance Contracts Act is generally protective mandatory towards the policy holder and the insured (both consumers and businesses), and most provisions protecting the policy holder and the insured cannot be dispensed by the insurance contract to the detriment of the policyholder and the insured.

The Insurance Contracts Act does not apply to reinsurance contracts which are governed by general principles of contract law.

Insurance contracts are also governed by general contract law, including the Danish Contracts Act (aftaleloven) (Consolidated Act no 193/2016) which is a codification of general principles of law applicable to all contracts, including principles on the conclusion of contracts, grounds for revocation and rules on power of attorney.

Furthermore, the insurer’s regulatory duties in the contractual relation with the policy holder and towards the insured are subject to the Executive Order no 1779/2021 on good business practice for insurance distributors (which implements the (European Union) 2016/97 Insurance Distribution Directive, or the IDD).

Insurance coverage disputes are admissible to the ordinary courts, unless the parties have agreed to arbitration (see below). The Danish courts consist of 24 local city courts (the courts of first instance), the Maritime and Commercial High Court (the court of first instance for certain commercial disputes), the Western High Court and the Eastern High Court (the courts of second instance) and the Supreme Court.

As an alternative to the ordinary courts, Danish law recognises arbitration which may be commenced as institutional arbitration or as ad hoc arbitration subject to agreement between the parties, that is, according to an arbitration clause in the insurance contract.

There is also generally an option for consumers to appeal an insurance company’s decision on coverage relating to consumer insurance contracts to the privately organised Insurance Complaints Board (Ankenævnet for Forsikring). The board consists of representatives from The Consumer Council ‘Think’ (Forbrugerrådet Tænk) and Insurance & Pension (Forsikring & Pension). A complaint can be brought before the board for a fee of DKK200 (approximately US$29) and representation by counsel is not required. The case processing time is typically six-to-eight months.

The Insurance Complaints Board’s decisions are not sources of law in the traditional sense, but they contribute to the interpretation of law governing insurance contracts and are generally a reflection of general business practice. A decision issued by the Insurance Complaints Board does not exclude the commencement of legal proceeding before the courts (or by arbitration if agreed).

Consumers can also appeal decisions from tour operators to the Package Tour Complaints Board (Pakkerejse-Ankenævnet). The Package Tour Complaints Board is a privately organised complaints board handling claims against travel agencies relating to package tours. The board consists of representatives from The Consumer Council ‘Think’ (Forbrugerrådet Tænk), Tour Operators in Denmark (Rejsearrangører i Danmark (R I D)) and The Travel Bureau Association of Denmark (Danmarks Rejsebureau Forening (D R F)). A complaint can be brought before the board for DKK 275 (approximately US$40) and representation by counsel is not required. The case processing time is typically six months.

The board does not handle insurance disputes, only contractual disputes regarding the traveller’s rights for example, to cancel a trip due to Covid-19 subject to the travel contract with a travel agency and subject to the Danish Act on Package Tours (lov om pakkerejser og sammensatte rejsearrangementer) (Consolidated Act no 1666/2017). The Package Tour Complaints Board’s decisions are not sources of law in the traditional sense, but they contribute to the interpretation of law governing package tour contracts and are usually a reflection of general business practice. A decision issued by the Package Tour Complaints Board does not exclude commencing legal proceedings before the courts, or arbitration if agreed.

4

Does the insured bear the burden of establishing coverage of a claim, or does the insurer bear the burden of establishing no coverage? Please give a short description of the legal basis in your country.

Generally, the party (the policy holder/the insured) claiming coverage under the insurance contract bears the burden of proof in respect of establishing coverage subject to the terms of the insurance contracts and subject to the Insurance Contracts Act. The standard of proof is generally based on a principle of proof on a balance of probabilities.

Generally, the insurance company bears the burden of proof in respect of establishing that the claim is excluded (wholly or partly) from coverage subject to the exclusions of the insurance contract and subject to the Insurance Contracts Act. The standard of proof is generally based on a principle of proof on a balance of probabilities, but there are examples from case law according to which the insurer bears a stricter burden of proof in relation to subjective limitations under the policy, such as intent.

5

Are coverage provisions in policies interpreted broadly or is there a presumption in favour of coverage? Please give a short description of the legal basis in your country.

As a main rule, there is no presumption of coverage in favour of the insured, as the insured bears the burden of proof in establishing insurance cover. The scope of coverage depends on the provisions of the insurance contracts, and therefore the interpretation of the provisions.

However, it is a general principle in Danish contract law (especially in the field of protective mandatory law in favour of the policyholder and the insured) that when the insurance provisions have been drafted by the insurance company, unclear terms must as a starting point be interpreted in favour of the insured, to the detriment of the insurer (the draftsperson). This is also known as the ambiguity rule (the contra proferentem rule).

Otherwise, insurance contracts are interpreted based on general principles of interpretation such as literal interpretation of the contract wording, interpretation of the purpose of the contract (and the disputed provisions in question) and the parties’ intentions before entering into the contract and during the contract period. Other principles that may be applied would depend on the contract and circumstances surrounding the contract, such as expanding interpretation, restrictive interpretation, analogies and inference by negative implication.

The Scandinavian legal system is often recognised for being rather pragmatic in respect of the interpretation of law, as circumstances surrounding the contract – and not strictly the contract wording itself – may be decisive for the interpretation of the contract. Moreover, in contractual disputes the courts often apply a test of reasonability by which the courts take internal and external circumstances and context into account (eg, see the response to Question 30 for the Insurance Complaints Board’s decision ANF2021.95362 on cancellation due to Covid-19).

If the insurance contract is based on a standard agreement provided by the insurer or the insurance industry, typically (but not only) consumer insurance contracts, the provisions will generally be interpreted in accordance with the ambiguity rule, according to which ambiguous provisions are interpreted in favour of the insured/to the detriment of the insurer (the draftsperson).

If the insurance contract is individual, meaning that it has been individually drafted and/or negotiated between the policy holder and the insurance company, the general principles of contract interpretation according to Danish contract law apply (see above).

If the insurance contract is regulated by law or standard agreements drafted by organisations with balanced interests, there is a presumption that the provisions are balanced, and thus the general principles of contract interpretation according to Danish contract law apply (see above).

6

Are exclusions interpreted narrowly or is there a presumption against finding that an exclusion to coverage applies? Please give a short description of the legal basis in your country.

It is a general principle in Danish contract law that exemptions and limitations are interpreted narrowly, but it would typically depend on the conclusion of the contract, the wording of the contract and the circumstances surrounding the contract (see response to questions 3-5).

In general, a distinction is made between subjective exclusions and objective exclusions.

The subjective exclusions relate to the subject-matter of the policyholder and the insured, such as negligence, intent and the duty to comply with safety guards.

The objective exclusions may relate to objective factors, such as the geographical scope, specific property etc.

7

Are there universally accepted definitions for:

• event
• occurrence
• damage
• cause
• originating cause
• natural peril
• force majeure
• loss
• consequential loss

If the answer is yes, please give a short description of each definition and the legal basis for that definition (ie, a rule of law, case law etc).

Yes

The definitions below are universal in the sense that they are used in general insurance business practice (common terms used in insurance contracts) in accordance with the Danish Insurance Contract Law and case law. The specific definition of the term may be defined in the insurance contract.

event/occurrence (forsikringsbegivenhed)

An event/occurrence is generally defined as the ‘insurance event’ that is eligible to trigger coverage under the insurance contract. The extent to which an event/occurrence is eligible to trigger coverage will depend on the insurance contract. An insurance contract may be based on a principle of occurrence where the decisive factor is: (1) when the cause occurred; or (2) when the effect(s) of the cause occurred; or (3) when the cause or effect(s) of the cause were discovered, or the principle of claims made.

damage (skade)

Damage is generally defined as the negative impact of an event/occurrence. A distinction is generally made between personal injury, property damage and financial damage. Damage is also used as a synonym for the insurance claim and the financial loss provoking the insurance claim.

cause (skadesårsag)

Cause is generally defined as a cause of damage or loss. There is a general distinction between the main cause (hovedårsag) and other possible, concurrent or later causes. It is a general principle in Danish contract law that the main cause is decisive when establishing the cause.

originating cause (oprindelig skadesårsag)

The originating cause is generally defined as the ‘original’ cause of damage, in particular if there are other possible, concurrent and later causes.

natural peril (fare/risiko)

The term ‘peril’ is translated as ‘danger’/‘hazard’ or ‘risk’ (fare/risiko) in Danish. The concept of a peril under Danish law corresponds to the international understanding of a peril as an identified risk (peril) which may be subject to coverage or excluded from coverage. The distinction between policies based on ‘named perils’ versus ‘all risks’ is accepted under Danish law.

force majeure

force majeure is generally defined in case law as events which are: (1) unforeseen; (2) beyond the control of the parties and which, at the same time; thereby (3) prevent the fulfilment of the contract. force majeure is generally exempted from coverage according to insurance contracts.

loss (tab)

The term loss is broadly understood and includes all types of financial loss, including total loss, physical or financial loss or damage, loss of income, costs, and liability.

consequential loss (følgetab)

Consequential loss is generally defined as an indirect loss as opposed to a direct loss. Consequential loss can be a financial loss which incurs due to a physical loss, that is, business interruption loss. A consequential loss may also be a physical loss due to another physical loss (typically in product liability cases). Consequential loss (indirect loss), in particular financial indirect loss, is often excluded from coverage, and would typically require extended cover.

Loss causation

Yes/

No/

N/A

Additional comments, if any.

8

Did the country that you are reporting about issue lockdown, stay-at-home or no-travel restrictions in response to Covid-19?

Yes

9

If the answer to the question above is yes, were such orders issued nationally, by state/region or by local city/town. Please give a short description of the issuing authority and the orders issued.

The orders primarily concerned lockdown of public institutions, stay-at-home restrictions (self-isolation), assembly bans and travel restrictions. The orders concerned both mandatory restrictions and guidance.

Orders were issued nationally by the government based on statutory power (legislation), primarily the Epidemics Act (epidemiloven) which was issued before the Covid-19 pandemic. As of 10 March 2020 the Epidemic Act did not contain any specific legislation appropriate for the situation. During the Covid-19 pandemic, the Danish Epidemics Act (epidemiloven) (Consolidated Act no 285/2021) was amended so that it corresponded to the current situation.

Pursuant to the Epidemics Act, orders can only be issued by the government subject to: (1) a recommendation from the Epidemic Commission (Epidemikommissionen) (a committee appointed by the Danish Parliament); and (2) provided that the parliamentary Covid-19 committee (a committee in the Danish Parliament) does not object.

The Epidemics Act provides the authority to issue the restrictions listed below in response to Covid-19, provided that Covid-19 is considered to be ‘critical to society’ at the time of issuing the order. It is the Epidemic Commission which recommends whether Covid-19 is considered ‘critical to society’.

List of restrictions:

• Order individuals to undergo isolation, medical examination, treatment and hospitalisation, cf section 12-22 (such orders require a decision by the Authority of Patient Safety (Styrelsen for Patientsikkerhed));
• Assembly bans, cf section 24-25;
• Restrict public areas, cf section 26;
• Injunctions against a majority of persons who have been in places, where infection has been observed, cf section 28;
• Restrictions on or prohibition of access to or use of treatment, nursing and care institutions, etc, cf sections 29-30;
• Restrictions on or prohibition of access to or use of indoor or outdoor public institutions, facilities, etc, cf sections 31-32;
• Restrictions on or prohibition of access to or use of public and private day care centres, schools and other educational institutions, cf sections 33-34;
• Restrictions on or prohibition of access to or use of means of transport, cf section 35; and
• Restrictions on or prohibition of access to or use of premises and premises available to natural or legal persons to which the public has access, cf section 36.

Further, the government (the Minister of Foreign Affairs (udenrigsministeren)) has a general authority based on section 28(1)(vii) and (3) of the Aliens Act (udlændingeloven) (Consolidated Act no 1910/2021) to close Danish borders to non-Danish citizens for health reasons.

10

If the answer to the above question is yes, were the lockdown, stay-at-home or no-travel restrictions mandatory or recommended?

The lockdown restrictions such as assembly bans, access to or use of public places, institutions, transport etc were mandatory (see the provisions in response to Question 9).

Certain orders regarding isolation, medical examination and treatment, as well as hospitalisation, directed at individuals were mandatory.

The stay-at-home (self-isolation) restrictions were recommended.

The travel restrictions were recommended. The recommendations followed the Danish Minister of Foreign Affair’s classification of countries according to the EU’s colour code system (green, yellow, orange, red, as set out in the Council Recommendation (EU) 2020/1475). This was in a coordinated approach to the restriction of free movement in response to the Covid-19 pandemic, adopted by the EU Member States on 13 October 2020. The Recommendation was updated on 1 February 2021, 14 June 2021 and 25 January 2022.

11

If the country that you are reporting about did issue lockdown, stay-at-home, or no-travel restrictions, were those orders suspended or revoked at any point in time? If the answer is yes, please give a short description of the timeline.

The restrictions (both mandatory and recommended) have been imposed, lifted and re-imposed several times since 10 March 2020, depending on the circumstances surrounding the development of Covid-19.

Initially, on 10 March 2020, the Danish Prime Minister announced that all of Denmark (public institutions except from institutions critical to society such as hospitals, police, firemen etc) was under lockdown as of 11 March 2020. Consequently, all public employees who did not perform critical functions were sent home, including administrative offices and the courts.

Bans on gatherings were imposed, and the government closed down service professions such as restaurants, hairdressers, shops and shopping centres. All private businesses were recommended to require that their employees worked from home to the extent possible.

On 14 March 2020, Danish borders were closed to non-Danish citizens, based on section 28(1)(vii) and (3) of the Aliens Act.

12

If the answer to the above question is yes, were subsequent lockdown, stay-at-home or no-travel restrictions issued at any point in time? Please give a short description of the timeline.

On 6 April 2020, a plan for re-opening was announced by the government and several parties of the Danish Parliament based on a framework agreement. The plan was divided into nine phases:

• Phase 1 – reopening of day-care institutions;
• Phase 2 – reopening of elementary schools;
• Phase 3 – reopening of youth educations;
• Phase 4 – reopening of the private sector;
• Phase 5 – reopening of supplementary education.

Phases 6-9 did not include reopening but merely extended the assembly bans and kept the borders closed. The phases depended on for instance, the current infection rate and the number of hospital admissions.

Phase 1 was initiated and on 15 April 2020 and widened two days layer. The courts reopened on 27 April 2020. It was later confirmed that the government did not have the authority to lockdown the courts, as the courts are independent institutions organised by the Constitution and not under directions from government.

On 18 September 2020, further restrictions such as the wearing of face masks were reintroduced.

On 4 November 2020, the Danish government decided to cull all mink herds due to a mutation of Covid-19 in Danish mink. It was later confirmed that the government did not have the legislative base to implement the cull, which has led to a commission of inquiry investigating the government’s decision.

On 16 December 2020, the Danish Prime Minister re-imposed national mandatory restrictions regarding sending home school children, locking down service professions, locking down retail shops etc. On 5 January 2021, stricter restrictions regarding assembly bans were imposed.

On 8 January 2021, stricter travel guidelines from the Danish Ministry of Foreign Affair, which recommended no outward journeys, were imposed.

On 1 March 2021, Denmark was partly re-opened.

On 9 March 2021, the Danish government and the supporting parties presented a plan for extended reopening of schools and education. The plan was carried out over the following months.

From 10 September 2021, Covid-19 was no longer classified as a critical to the society in Denmark subject to the Danish Epidemics Act and all restrictions were removed.

In November 2021, Covid-19 was again classified as critical to the society in Denmark subject to the Danish Epidemics Act and face masks in public as well as Covid-19 certificates were re-imposed, but no lockdown, stay-at-home or travel restrictions were imposed.

As of 5 February 2022, Covid-19 is no longer classified as critical to the society in Denmark subject to the Danish Epidemics Act, and all restrictions (mandatory and recommended) have been lifted.

Bech-Bruun – General comments regarding available case law in relation to the following questions on case law.

We have gathered our general comments in respect to questions 13 to 29.

As our general comments in this passage are relevant to most questions below, we have only responded to the specific questions below, where specific responses were relevant in addition to these general comments.

By country, we assume that the questions refer to public institutions, the courts, the legislator (the Danish Parliament) and other relevant bodies.

There has not been any official judicial opinions issued by any official authorities analysing whether Covid-19 may constitute a ‘cause’, ‘originating cause’ or ‘event’ (the terms which the questions 13-29 below refer to).

To our knowledge and research, neither the city courts, the high courts nor the Supreme Court have yet published decisions in which they provide opinions or guidance analysing whether Covid-19 in particular is a ‘cause’, ‘originating cause’ or ‘event’.

The case processing time for a court case in Denmark in the court of first instance is generally a minimum of one-to-two years. Due to lockdown restrictions and stay-at-home requirements, the case processing time has been suspended during the pandemic. Civil law cases have been particularly affected by this suspension, as criminal law cases (critical cases) have been prioritised.

We expect that the first principal cases on contractual matters relating to Covid-19 to be decided by the high courts and perhaps the Supreme Court in 2022-2023, at the earliest.

At this point in time, there is only one printed civil law court case from the Eastern High Court, U.2021.345 Ø, concerning a contractual relation and whether Covid-19 constituted force majeure (see response to Question 53, regarding force majeure as an exclusion of coverage).

Due to the lack of published case law, it is not yet possible to comment on whether there will be consistency between the courts’ interpretations of insurance contracts relating to Covid-19. In respect of consistency, we note that the Danish judicial system is traditionally loyal to case law, especially precedents from higher courts. Traditionally, the availability of published case law from the city courts has been limited, as mostly cases from the high courts and the Supreme Court have been published. In January 2022, the Danish courts made a new database (Domsdatabasen) official which is expected to include all case law from the Danish courts going forward.

At this point in time, only the Insurance Complaints Board has issued decisions regarding insurance coverage in case of, that is, travel cancellation due to Covid-19 or imposed restrictions, especially due to the Ministry of Foreign Affairs’ travel recommendations. All decisions are published. The complaints board has assessed whether Covid-19 or an imposed restriction(s) due to Covid-19 constitute an insurance event or cause under the travel insurance contract in question (see response to Question 30). As laid out below, it is our interpretation of the decisions from the complaints board that insurance claims due to Covid-19 have been approached as any other insurance claim, and no special interpretation of the insurance contracts have yet been applied.

Furthermore, the Package Tour Complaints Board has issued decisions on cancellation of trips due to Covid-19 subject to the contract with the travel agency and the Danish Act on Package Tours. It is our interpretation of the decisions that the Package Tour Complaints Board has interpreted the rights to cancellation in the contracts with the travel agency broader than the Insurance Complaints Board has interpreted similar provisions in insurance contracts.

We also note that in the case of occupational injury, a special practice has been applied, as personal injury from Covid-19 have been deemed an occupational injury. The Danish Working Environment Authority (Arbejdstilsynet) has issued a Guidance on the assessment of occupational injury cases due to Covid-19 illness (available at: https://at.dk/regler/at-vejledninger/vurdering-arbejdsskadesager-covid-19).

According to the guidance from the Danish Working Environment Authority, Covid-19 can be considered an occupational accident or an occupational disease if it can be rendered probable that the employee has been infected at work. This may be the case, that is, if the employee has been exposed to infection or risk of infection in connection with the work and has subsequently become ill. This practice may have implications on personal injury insurance cases going forward.

Based on the above practices so far, it is our assessment that insurance disputes concerning Covid-19 will be approached as any other insurance claim in the Danish jurisprudence. Consequently, it will be a matter of interpretation of the insurance contract in question whether Covid-19 may constitute a ‘cause’, ‘originating cause’ or ‘event’ which triggers coverage or excludes coverage.

13

Has the country that you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a ‘cause’ of insured loss?

No

See general comment above.

14

Has the highest court in the country you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a ‘cause’ of insured loss? If the answer is yes, please give a short description of the conclusions in the judicial opinions or guidance.

No

See general comment above.

15

If the answer to the question above is yes, did the highest court in the country you are reporting about determine that losses related to Covid-19 were ‘caused’ by the virus? Please give a short description of the conclusions in the judicial opinions or guidance.

N/A

16

If the answer to the above question is no, did the highest court in the country you are reporting about determine that losses related to Covid-19 were ‘caused’ by government lockdown or stay-at-home orders? Please give a short description of the conclusions in the judicial opinions or guidance.

N/A

17

Has the country that you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is an ‘originating cause’ of insured loss? If the answer is yes, please give a short description of the conclusions in the judicial opinions or guidance.

No

18

If the highest court in the country you are reporting about has not issued judicial opinions or guidance analysing whether Covid-19 is a ‘cause’ of insured loss, have other courts in the country issued such opinions?

No

19

If the answer to the above question is yes, have courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether Covid-19 is a ‘cause’ of insured loss? Please give a short description of the conclusions in the judicial opinions or guidance.

N/A

20

If the answer to the above question is yes, do courts in the country you are reporting about hold that losses related to Covid-19 were ‘caused’ by the virus? Please give a short description of the conclusions in the judicial opinions or guidance.

N/A

21

If the answer to the above question is no, do courts in the country you are reporting about determine that losses related to Covid-19 were ‘caused’ by government lockdown or stay-at-home orders? Please give a short description of the conclusions in the judicial opinions or guidance.

N/A

22

Has the highest court in the country you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is an ‘originating cause’ of insured loss?

No

23

If the highest court in the country you are reporting about has not issued judicial opinions or guidance analysing whether Covid-19 is an ‘originating cause’ of insured loss, have other courts in the country issued such opinions? If yes, please give a short description of the conclusions in such judicial opinions or guidance.

N/A

24

Has the country that you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a covered ‘event’?

Yes

25

Has the highest court in the country you are reporting about issued judicial opinions or guidance analysing whether Covid-19 is a covered ‘event’? Please give a short description of the conclusions in the judicial opinions or guidance.

No

26

If the answer to the question above is yes, did the highest court in the country you are reporting about determine that losses related to Covid-19 were covered ‘events’? Please give a short description of the conclusions in the judicial opinions or guidance.

N/A

27

If the highest court in the country you are reporting about has not issued judicial opinions or guidance analysing whether Covid-19 is a covered ‘event’, have other courts in the country issued such opinions?

No

28

If the answer to the above question is yes, have courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether Covid-19 is a covered ‘event’? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

29

If the answer to the above question is yes, do courts in the country you are reporting about hold that losses related to Covid-19 are covered ‘events’? Please give a short description of the conclusions in the judicial opinions or guidance.

Yes

30

If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 in the context of loss causation.

Insurance Complaints Board

To date, the Insurance Complaints Board has issued almost 100 decisions in cases regarding whether Covid-19 was an event that triggered coverage under the policy (mostly regarding travel insurance). The decisions are based on the board’s interpretation of the insurance contracts in question.

Based on the cases so far, it is our assessment that the Insurance Complaints Board has approached insurance disputes concerning Covid-19 as any other insurance claim. The cases show that it is a matter of interpretation of the insurance contract in question whether Covid-19 may constitute a ‘cause’, ‘originating cause’ or ‘event’ which may trigger coverage or excludes coverage.

We have selected a list of the Insurance Complaints Board’s decisions for illustration.

Evacuation

In respect of insurance contracts which cover loss due to ‘evacuation’, the Insurance Complaints Board has interpreted the term ‘evacuation’ literally as an actual ‘evacuation’. Therefore, the recommendation from the Danish Ministry of Foreign Affairs prescribing ‘do not travel unless it is absolutely necessary’ does not constitute an actual ‘evacuation’ triggering coverage.

In the case ANF2020.95485 (evacuation) regarding a complainant’s round-trip being interrupted by two subsequent holiday destinations closing their borders to non-citizens due to Covid-19, making entry to these countries impossible, the complainant stated that he had been evacuated and was therefore entitled to compensation in accordance with the insurance contract. The company refused coverage on the grounds that the return journey did not constitute an evacuation, as the Ministry of Foreign Affairs had not announced an actual evacuation and that the provisions of the insurance contract could not be extended to cover restrictions from authorities of other countries. The recommendation of the Ministry of Foreign Affairs prescribed: ‘do not travel unless it is absolutely necessary’. The complaints board ruled in favour of the insurance company, stating that the recommendation from the Ministry of Foreign Affairs was not an evacuation and thereby not covered by the insurance contract.

Another case no 95131 (evacuation) concerned whether the complainant was entitled to compensation for a trip to Vietnam on 11 March 2020, which was interrupted during a stopover in Turkey, as the Ministry of Foreign Affairs’ travel recommendation regarding Vietnam that evening had changed from yellow to orange now prescribing ‘do not travel unless it is absolutely necessary’. According to the insurance contract, the complainant was entitled to travel compensation in case of evacuation. The complaints board decided that the Ministry’s amendment of the travel recommendation regarding Vietnam did not constitute an evacuation but merely a recommendation, therefore the complainant was not entitled to compensation.

Self-isolation/acute disease

In respect of insurance contracts which cover loss due to ‘acute disease’ (and the like), the Insurance Complaints Board has interpreted the term ‘acute disease’ strictly. Subsequently, the authorities’ recommendations of self-isolation in case of being a close contact to an infected person are not considered as an ‘acute disease’ triggering coverage if the insured is not actually infected with Covid-19. Moreover, increasing infection rates are not considered ‘acute disease’ if the insured is not infected.

In the case ANF2021.97066 (self-isolation/acute disease), regarding a travel insurance, the complaints board assessed that isolation due to Covid-19 recommended by the authorities did not constitute an ‘acute disease’, which was a covered event according to the insurance contract, as the insured persons were not tested positive for Covid-19. The complaints board emphasised that the insured persons’ self-isolation did neither constitute ‘reasonable suspicion of a new incident of serious illness’, merely because the national Health Authority recommended people that had been in close contact with people detected with Covid-19 infection to self-isolate.

In case no 95949, a complainant was not entitled to cancel his travel due to acute illness. He was not infected with Covid-19 but suffered from a chronic disease, and for that reason he was considered to be particularly vulnerable to exposure with Covid-19. The increasing infection rates were not to be equated with acute illness even though the insured was considered to be particularly vulnerable.

Cancellation

The Insurance Complaints Board has processed several cases concerning travel cancellation due to Covid-19. Most of these cases concerned cancellation of travel earlier than required by the insurance contract, which often requires that the travel is cancelled immediately before departure or not earlier than 72 hours before departure to trigger coverage (cf case nos 95764, 95584, 95972, 95853, 95617, 95720, 95775). The board has in most of the cases interpreted the timely requirements strictly and therefore denied coverage where the insured had cancelled the trip well in advance (ie, of the 72-hour period).

In the case ANF2021.96535 (cancellation), the complaints board stated that the recommendation from the Ministry of Foreign Affairs prescribing: ‘do not travel unless it is absolutely necessary’, was not a covered cause under the insurance contract triggering a right to compensation in case of cancellation by the insured person, as none of the listed causes covered by the insurance contract comprised a ‘pandemic’. Consequently, the rejection of coverage was upheld.

In ANF2021.95362 (cancellation), the complainant cancelled his trip to Spain on 10 March 2020, three days before the Ministry of Foreign Affairs changed its recommendation to ‘do not travel unless it is absolutely necessary’. The insurance contract stated: ‘the trip can be cancelled, even if the Danish Ministry of Foreign Affairs does not directly advise against entry or has taken the initiative for evacuation’. The Insurance Complaints Board found that the cancellation was covered because the cancellation on 10 March 2020 – which was the planned departure day – met the criterion that the cancellation was made immediately before departure. The decision was however dissenting. The majority of the board emphasised that Covid-19 was a completely new disease, where at the time of cancellation there was uncertainty about the risk of infection with Covid-19 and the consequences that was associated with departure at a time when the whole world was about to shut down. Furthermore, the majority of the board emphasised that the Ministry of Foreign Affairs on 13 March 2020 – that is, a few days after the cancellation date – changed the travel recommendation for all countries in the world to: ‘do not travel unless it is absolutely necessary’.

Gross negligence

In case no 95998 (gross negligence) the complaints board decided that it was grossly negligent to travel to a country where the Ministry of Foreign Affairs’ recommendation prescribed: ‘do not travel unless it is absolutely necessary’, why coverage under the insurance contract was excluded. However, the minority of the members of the complaints board were not of the opinion that travel against the recommendation constituted gross negligence.

Confirmation of cover

A number of cases processed by the complaints board concern the insurance company’s confirmation of cover before the travel. The complaints board has in these cases emphasised that it requires exceptional circumstances to withdraw such a confirmation of coverage due to Covid-19, cf case nos 96024, 95958, 96341, 95275, 96037.

Package Tour Complaints Board

The Package Tour Complaints Board has issued decisions on contracts with travel agencies and has interpreted under which circumstances Covid-19 constituted an event triggering the right to cancellation in accordance with the provisions of the contract with the travel agency.

Based on the cases so far, it is our assessment that the Package Tour Complaints Board has approached disputes concerning Covid-19 as any other complaints concerning rights to cancellation and compensation in accordance with contracts with travel agencies. The cases show that it is a matter of interpretation of the contract in question whether Covid-19 may trigger the right to cancellation and compensation from the travel agency.

We have selected a list of the Package Tour Complaints Board’s decisions for illustration.

Cancellation

The Package Tour Complaints Board has processed several cases concerning travel cancellations due to Covid-19. Most of the cases concern cancellation of travel earlier than required by the provisions of the contract with the travel agency, which often requires that the travel is cancelled immediately before departure or no earlier than 72 hours before departure to trigger coverage, cf case nos 95764, 95584, 95972, 95853, 95617, 95720, 95775 and more. The Package Tour Complaints Board has in most of the cases interpreted the timely requirements strictly denying compensation in many cases, however, (see decision no 20-1414) regarding cancellation in case of ‘unavoidable and extraordinary circumstances’, below.

The Package Tour Complaints Board’s decision no 20-1414 (unavoidable and extraordinary circumstances) concerned a complainant cancelling his ski trip on 13 March 2020 at 0914, just seven hours before the Ministry of Foreign Affairs’ travel recommendation was changed due to Covid-19.

The majority of the Package Tour Complaints Board found that the conditions in section 15, paragraph 2 of the Package Tour Act (according to which the consumer can cancel a package tour if ‘unavoidable and extraordinary circumstances occur significantly at the travel destination or in the immediate vicinity thereof that significantly affect the delivery of the package tour’) were met. Even though the Ministry’s travel recommendation was changed after the complainant’s cancellation, the majority of the board found that because ‘the situation at the destination at the time of departure was with a certain probability considered to be no different than earlier in the day before the issuance of Ministry’s travel recommendation’ the complainant was entitled to cancel the package tour pursuant to section 15 (1) of the Act.

Evacuation

The Package Tour Complaints Board has interpreted the term ‘evacuation’ in relation to the recommendation from the Danish Ministry of Foreign Affairs prescribing ‘do not travel unless it is absolutely necessary’. The Package Tour Complaints Board has therefore in some cases interpreted the recommendation as actual ‘evacuation’, triggering compensation, see decision no 20-898.

In the Package Tour Complaints Board’s decision no 20-748 (evacuation), the complainant had been on a month-long trip to Spain (scheduled from 25 February to 24 March 2020), but chose to cancel the trip on 17 March 2020 and demanded the additional cost of purchasing a new return ticket compensated by the travel agency.

The crucial question was whether the Ministry of Foreign Affairs’ amended travel recommendation on 13 March 2020 constituted an ‘evacuation’. The recommendation from the Ministry of Foreign Affairs prescribed ‘do not travel unless it is absolutely necessary’. However, in a press conference in the evening of 13 March 2020 the Foreign Minister called for all travellers to return home. The majority of the board therefore found that the call from the Foreign Minister ‘must be equated with a requirement to evacuate travellers from the destination’.

The Insurance Complaints Board and Package Tour Complaints Board cases cited above illustrate that the travel recommendations issued by the Danish Ministry of Foreign Affairs have been approached differently by the Package Tour Complaints Board and the Insurance Complaints Board.

Aggregation of claims

Yes/

No/

N/A

Additional comments, if any.

31

Does the country you are reporting on permit aggregation of claims arising out of a single originating cause? Please give a short description of the legal basis.

Yes

See below.

32

Does the country you are reporting on permit aggregation of claims arising out of a single cause? Please give a short description of the legal basis.

Yes

See below.

33

Does the country you are reporting on permit aggregation of claims arising out of a single event? Please give a short description of the legal basis.

Yes

Danish insurance contract law acknowledges aggregation of claims in case of a ‘single originating cause’, ‘single cause’ and ‘single event’, depending on the provisions of the insurance contract. In Danish, the term for ‘aggregation of claims’ is typically known as ‘serial damage clause’ corresponding to the case where several claims arise out of one or several insurance event(s).

The legal basis is the insurance contract. Danish courts recognise provisions regulating that several claims arising out of one event or cause may be considered as one insurance event, (U.1996.906 H, FED1992.42 and U.2006.1679 H).

34

Does the country you are reporting on use an accepted test for determining whether claims can be aggregated? For example, does the country you are reporting on apply to four unities test to determine whether aggregation is appropriate? Please give a short description of the legal basis.

There is no Danish regulation or case law prescribing a ‘test’ such as the four unities test, but certain criteria seem to be accepted by the Danish courts – a ‘single cause’ (or the same wrongful act) being the central criteriom.

In a precedent Supreme Court case often referred to as the asbestos case (U.2006.1679 H), the High Court in the court of first instance stated that:

‘Series damage claims (aggregated claims) are in the general insurance conditions no 54-92 section 11, paragraph 1 (SKAFOR terms), defined as claims for damages made against the insured in connection with damage or loss caused by the same wrongful act. […] In these circumstances, the High Court finds that the asbestos cases in the United States must be considered as a series of damages, as they are claims for alleged damages which were allegedly inflicted on several persons and caused by asbestos in asbestos-containing products.’

The Supreme Court upheld the High Court’s decision.

35

Have courts in the country you are reporting on issued jurisprudence concerning whether insureds can aggregate claims arising out of Covid-19? Please give a short description of the legal basis.

No

No, there has not yet been case law issued regarding the aggregation of claims in case of Covid-19. See above regarding applicable law.

36

Has the highest court in the country you are reporting about issued judicial opinions or guidance concerning whether insureds can aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

No

37

If the answer to the question above is yes, did the highest court in the country you are reporting about determine whether insureds can aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

38

If the highest court in the country you are reporting on has not issued such jurisprudence, have other courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether insureds may aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

No

39

If the answer to the above question is yes, do courts in the country you are reporting about permit insureds to aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

40

Do the courts in the country you are reporting on permit an insured to aggregate claims related to multiple properties or business locations arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

No

There has not yet been case law issued regarding the aggregation of claims related to multiple properties or business locations arising from Covid-19.

Whether claims due to Covid-19 can be aggregated depends on the insurance contract and its provisions.

However, according to general Danish insurance law it is permitted to aggregate claims related to multiple properties or business locations arising out of a single event, (see above). There is currently no basis for approaching claims arising from Covid-19 differently.

41

Do the courts in the country you are reporting on permit an insured to aggregate claims related to multiple lockdown or stay-at-home orders arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

No

There has not yet been case law issued regarding whether an insured may aggregate claims related to multiple lockdowns or stay-at-home restrictions arising from Covid-19.

Whether claims due to Covid-19 can be aggregated depends on the insurance contract and its provisions.

42

Have courts in the country you are reporting on issued jurisprudence concerning whether cedents can aggregate claims arising out of Covid-19? Please give a short description of the legal basis.

No

There has not yet been case law issued regarding aggregation of claims by cedents.

The same principles as stated above regarding aggregation of claims in general would also apply in cases of reinsurance contracts. Accordingly, it is the provisions of the reinsurance contract that would be decisive for the possibility of aggregating claims under the reinsurance contract.

43

If the answer to the above question is yes, have courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether cedents may aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

44

If the answer to the above question is yes, do courts in the country you are reporting about permit cedents to aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

45

If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 and aggregating claims.

No official sources or authorities that have issued contributions to the interpretation of Covid-19 and aggregating claims.

Nevertheless, we assume that claims arising from Covid-19 will not be treated differently from other insurance claims, so that claims arising from a single event caused by Covid-19 are likely to be treated as only one event, which is why such claims are likely to be aggregated. The open question is how a ‘single event’ will be interpreted in respect of Covid-19.

The Insurance Complaints Board has not published any decisions on aggregation of claims due to Covid-19.

Property damage

Yes/

No/

N/A

Additional comments, if any.

46

Have courts in the country you are reporting on issued jurisprudence concerning whether losses arising from Covid-19 qualify as property damage losses? Please give a short description of the legal basis.

No

To our knowledge and research, neither the city courts, the High Courts nor the Supreme Court have yet published decisions in which they provide opinions or guidance analysing whether Covid-19 in particular can constitute property damage.

It is our assessment that Covid-19 as an event is treated like any other insurance event, why losses arising from an event that can be attributed to Covid-19 are consequently treated like any other loss in Danish insurance law. Whether losses arising from Covid-19 will constitute property damage will depend on the provisions of the insurance contract.

47

Has the highest court in the country you are reporting about issued judicial opinions or guidance concerning whether losses arising from Covid-19 qualify as property damage losses? Please give a short description of the conclusions in such judicial opinions or guidance.

No

See above.

48

If the answer to the question above is yes, did the highest court in the country you are reporting about determine whether losses arising from Covid-19 qualify as property damage losses? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

See above.

49

If the highest court in the country you are reporting on has not issued such jurisprudence, have other courts in the country you are reporting on interpreted this issue consistently? In other words, is there uniformity in jurisprudence as to whether losses arising from Covid-19 constitute property damage? Please give a short description of the conclusions in such judicial opinions or guidance.

No

No, but see above regarding the treatment of losses arising from Covid-19.

50

If the answer to the above question is yes, do courts in the country you are reporting about permit insureds to aggregate claims arising out of Covid-19? Please give a short description of the conclusions in such judicial opinions or guidance.

N/A

51

If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 and property damage.

No

No other official sources or authorities have issued contributions to the interpretation of Covid-19 and property damage.

Exclusions

Yes/ No/

N/A

Additional comments, if any.

52

Has Covid-19 been deemed a ‘natural peril’ in the country you are reporting on? Please give a short description of the legal basis and relevant jurisprudence.

No

Not as of yet. It will be a matter of interpretation whether Covid-19 constitutes a ‘natural peril’ which may trigger coverage or exclude coverage under a particular insurance contract.

53

Has Covid-19 been deemed force majeure in the country you are reporting on? Please give a short description of the legal basis and relevant jurisprudence.

No

There are no published insurance cases from the courts relating to Covid-19 and force majeure.

Danish law has no actual provision defining force majeure in general, but the legal principle of force majeure is developed in case law. Therefore, whether Covid-19 constitutes force majeure which may exclude coverage depends on the interpretation of the insurance contract and whether the event meets the criteria of force majeure established in Danish case law.

We refer to the definition of force majeure in the response to Question 7. To invoke force majeure it must: (1) be impossible to fulfil the contractual obligation; and (2) the event and the consequences thereof must be unforeseen. Whether or not an event causing non-performance may constitute force majeure will depend on an individual assessment of the event based on the specific contractual provisions governing the obligation.

In one case regarding general contract law, a Covid-19 assembly ban issued by the Danish government was deemed force majeure, cf U.2021.3485 Ø (the cancellation of a wedding).

The case concerned in particular whether, due to Covid-19 restrictions, the defendant was entitled to refrain from paying the second instalment for the event and, if so, whether she was entitled to a refund of the reservation fee paid. The High Court found that the agreed arrangement was covered by the assembly ban that was in force at the time of payment of the second instalment until and including 10 May 2020. The High Court also found that at that time there was no force majeure which exempted the defendant from liability by failing to pay the second instalment, as the assembly ban did not cover the day of the agreed arrangement.

However, given the general Covid-19 situation in Denmark in April 2020 and the extension of the first assembly ban, the High Court found that when the second instalment fell due for payment, there was such a certain presumption that the plaintiff would not be able to fulfil his part of the agreement that the defendant, on the basis of general contract law principles on anticipated default, was entitled to withhold his payment until there was a clarification of whether the assembly ban would be extended to the date of the agreed arrangement.

Hereby, and as the extension of the assembly ban by executive order no 445 of 19 April 2020, constituted force majeure with regard to the fulfilment of the parties’ agreement, the High Court agreed that the defendant was acquitted of the claim for payment of the second instalment.

No particular test was applied by the High Court regarding whether the extension of the assembly ban constituted force majeure in relation to payment of the second instalment. The High Court merely based its decision on the fact that the extension of the assembly ban constituted such. The City Court however emphasised in its judgment that it had been impossible for the plaintiff to fulfil the contractual obligation and that the event and the consequences thereof was unforeseen by both parties.

The judgment demonstrates that Covid-19 related measures can constitute force majeure under Danish law a thereby exempt the fulfilment of a contract. For coverage under an insurance contract to be excluded due to force majeure the Danish interpretation of force majeure will presuppose that the event in question is making it impossible for the insured to fulfil their obligations according to a contract, which is covered by the insurance contract. It is therefore unlikely that Covid-19 or an event due to Covid-19 will exclude coverage as a result of a provision in the insurance contract excluding coverage in cases of force majeure.

54

Is Covid-19 acknowledged as a notifiable disease in the country you are reporting on? Please give a short description of the legal basis and relevant jurisprudence.

No

No, the Danish Health Authority holds a list of notifiable diseases and Covid-19 has not been added to the list, cf the Executive Order no 277 of 14 April 2000 (latest revised by Executive Order no 845 of 8 September 2009).

55

Is it common for insurance policies issued in the country you are reporting on to include a pandemic or virus exclusion? Please give a short description of the legal basis and common insurance practice.

No/ Yes

Most travel insurance policies cover evacuation in cases of epidemics or evacuation announcements from the Ministry of Foreign Affairs (see response to Question 30 regarding cases from the Insurance Complaints Board).

The general business and product liability insurance (SKAFOR) has no exclusions for infection with viruses or epidemics. Moreover, there are no exclusions for viruses in executive and board liability insurances, EPL insurances or crime- and cyber insurances.

There may obviously be differences between the insurance companies’ list of exclusions, so it will depend on an assessment of the specific provisions of the insurance contract.

It is our experience that an increasing number of insurance companies have implemented certain exclusions regarding pandemics/epidemics in their contracts due to Covid-19.

56

Have any courts in the country you are reporting on determined that a pandemic or virus exclusion is void as against public policy in the context of Covid-19? Please give a short description of the legal basis and relevant jurisprudence.

No

Neither the courts, the complaints boards, nor any other official sources have had the opportunity to assess the validity of such exclusions.

The assessment of whether an exclusion based on Covid-19 could be deemed void would depend on whether the criteria of invalidity under Danish law has been met in the specific case. The insurer may argue that Covid-19 constitutes a breach of an implied condition, as Covid-19 and the extent of the pandemic was not existing or foreseeable at the time of the conclusion of the contract. Consequently, such dispute is likely to be a matter of whether or not the insurer had taken over the risk of Covid-19, when the insurance contract was concluded.

57

Have any courts in the country you are reporting on otherwise determined that a pandemic or virus exclusion is unenforceable in response to Covid-19? Please give a short description of the legal basis and relevant jurisprudence.

No

58

If the answer to any of the above questions regarding your country’s jurisprudence was no, please comment on whether there are any other official sources or authorities that have issued contributions to the interpretation of Covid-19 in the context of exclusions.

No

As mentioned in the response to Question 30, the Insurance Complaints Board stated in the case ANF2021.95998 that it constituted gross negligence to travel to a country where the recommendation of the Ministry of Foreign Affairs prescribed: ‘do not travel unless it is absolutely necessary’, and based on this assessment, coverage under the policy in question was excluded. It was a dissenting judgment, cf above.

In regard of the objective exclusions there are however no other official sources or authorities that have issued contributions to the interpretation of Covid-19 in the context of exclusions. However, as stated above, we do not expect Covid-19 to affect the existing interpretations of the exclusions.

Regulatory oversight

Yes/ No/ N/A

Additional comments, if any.

59

Have insurance regulators in the country you are reporting on issued directives concerning coverage for claims arising out of Covid-19? Please describe the regulations that have been implemented.

No

60

Are regulators requiring or encouraging insurers to provide grace periods to insureds to make payments on premiums? If yes, please give a short description of the legal basis and relevant guidance.

No

Government action

Yes/

No/

N/A

Additional comments, if any.

61

Has the government in the country you are reporting on implemented relief measures for losses sustained as a result of Covid-19?

Yes

See the responses to questions 62 and 63.

62

If the answer to the above question is yes, are the relief measures available to both individuals and businesses?

The Danish government has implemented various relief measures in the form of compensation schemes for businesses affected by Covid-19 restrictions.

63

Briefly describe the types of relief measures available to individuals and businesses.

Compensation schemes include the wage compensation schemes, compensation for turnover loss, compensation for fixed costs, compensation to the self-employed including artists, compensation for freelancers, compensation for cancelled events and compensation for seasonal self-employed and freelancers.

Further information can be found at: https://virksomhedsguiden.dk/content/ydelser/oversigt-over-kompensationsordninger/40506f85-e4cb-452e-8132-6ce0253fdd56/