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

Tuesday 12 July 2022

G C Endedijk
Lennox Litigation, The Netherlands
gerard.endedijk@lennox.nl

K Becker
Lennox Litigation, The Netherlands
katinka.becker@lennox.nl

The Netherlands

General questions

Yes/ No/ N/A

Additional comments, if any.

1

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

No

The Netherlands has a civil law system, but the court may judge based on case law when there is no law applicable or with respect to the interpretation of existing law.

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

The Dutch civil law system is based on the Dutch Civil Code. Case law applies when there is no law applicable or with respect to the interpretation of existing law.

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 Dutch legal framework applicable to insurance coverage disputes is based on the Dutch Civil Code, Article 925, Book 7. Several deviating statutory regulations also apply. The Dutch insurance legal framework is based on contracts between the insurer and the insured that includes the conditions and clauses (the insurance policies) regarding a specific insurance.

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 insured will act with respect to submitting the claim to the insurer and the insurer will assess whether the insurance policy covers the claim and what the coverage will be. On this, a dispute can arise between insured and insurer. In principle, the insured party has the burden of proving the existence of an insured incident. If the insurer invokes an exclusion from the cover, the insurer will have the burden of proof.

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.

Generally, the coverage provisions in policies are often extremely detailed and will be interpreted very strictly from a point of view of the insurer. The coverage provisions are settled in a deed issued by the insurer (insurance contract). The insurance contract could refer to applicable general terms. Each insurer has their own conditions, but in practice there are many similarities between the conditions of other insurers.

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.

Generally, and based on case law, exclusions written in the insurance policy will be interpreted narrowly.

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).

event

There is no definition of ‘event’ in the Dutch Civil Code but the Dutch government defines an event as performance, festival or party.

occurrence

There is no definition of ‘occurrence’ in the Dutch Civil Code but in general, occurrence means an unusual event.

damage

There is no definition of ‘damage’ in the Dutch Civil Code. Article 6:95 of the Civil Code states the following regarding compensation of damage according to law:

‘The damage that has to be compensated by virtue of a statutory obligation to repair damages (due by virtue of law), consists of material loss and other disadvantages, the latter as far as the law implies that there is an additional entitlement to a compensation for such damage.’

cause

There is no definition of ‘cause’ in the Dutch Civil Code.

originating cause

There is no definition of ‘originating cause’ in the Dutch Civil Code.

natural peril

There is no definition of ‘natural peril’ in the Dutch Civil Code.

force majeure

According to the Dutch Civil Code, force majeure is a legal concept that denotes a non-attributable inability to perform an obligation.

loss

There is no definition of ‘loss’ in the Dutch Civil Code but in general loss arises from a damage-causing event. The law does, however, make a distinction between financial loss (material loss) and other harm (immaterial loss).

consequential loss

There is no definition of ‘consequential loss’ in the Dutch Civil Code but in general consequential damage is damage that arises indirectly from a damage-causing event.

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

The Netherlands has issued a lockdown, stay-at-home and no-travel restrictions due to Covid-19.

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 regarding the lockdown, stay-at-home and no-travel restrictions are mostly recommendations issued nationally by the Dutch government.

10

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

Mostly recommended. The lockdown in the Netherlands consist of closing all shops, restaurants and public buildings (theatres, museums, libraries) as well as recommendations to stay at home, work from home and no-travelling. Closing of the shops, restaurants and public buildings as well as cancellation of events were restrictions issued by the Dutch government and therefore mandatory.

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.

Yes

Most restrictions are based on the advice of the Dutch Outbreak Management Team (OMT). When the infection rate falls below a certain level, the restrictions are suspended or revoked.

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.

Such restrictions were issued by the Dutch government. The Netherlands had two lockdowns. The no-travel and stay-at-home restrictions are recommendations during the pandemic.

13

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

Whether Covid-19 is a ‘cause’ of insured loss depends on the insurance policy which applies between the insurer and insured. Generally, Covid-19 is not seen as a cause of insured loss. It is more common that it will be covered under unforeseen events or force majeure.

An example of Netherlands case law regarding whether Covid-19 is a ‘cause’ of insured loss is the case: ECLI:NL:GHDHA:2021:2497. In this case the following was included in the fire insurance policy: ‘loss of business due to contagious diseases […] whereby the branch must be closed by order of a government agency’. In this case, the court followed the insurance policy with respect to the question if losses related to Covid-19 were ‘caused’ by the virus.

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

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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.

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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.

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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

Whether Covid-19 is an ‘originating cause’ of insured loss depends on the insurance policy that applies between the insurer and insured. Generally, there are no opinions or guidance issued analysing whether Covid-19 is an ‘originating cause’.

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?

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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.

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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.

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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.

Please see the response to Question 13 for our general answer as to whether Covid-19 is a ‘cause’ of insured loss.

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?

Based on our knowledge the court did not report regarding ‘originating cause’ of insured loss.

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.

Based on our knowledge the court did not report regarding ‘originating cause’ of insured loss.

24

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

Yes

Whether Covid-19 is a covered ‘event’ depends on the insurance policy conditions and the reason of cancellation. Damage followed by cancellation of events due to a government restriction have been or will be settled in consultation with the parties. Insurers usually no longer offer cover for pandemic risks or government measures, such as a lockdown, for new events. In the course of 2020 almost all insurers amended policy conditions in this respect.

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.

N/A

Please see the response to Question 24 for our general answer on the question whether Covid-19 is a covered ‘event’.

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

Please see the response to Question 24 for our general answer on the question whether Covid-19 is a covered ‘event’.

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?

N/A

Please see the response to Question 24 for our general answer on the question whether Covid-19 is a covered ‘event’.

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

Please see the response to Question 24 for our general answer on the question whether Covid-19 is a covered ‘event’.

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.

N/A

Please see the response to Question 24 for our general answer on the question whether Covid-19 is a covered ‘event’.

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.

N/A

Please see the response to Question 24 for our general answer on the question whether Covid-19 is a covered ‘event’.

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

Based on the Dutch Civil Code and the Collective Settlement of Mass Claims Act it is possible that claims (arising out of a single originating cause) can be aggregated.

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

Based on the Dutch Civil Code and the Collective Settlement of Mass Claims Act it is possible that claims (arising out of a single cause) can be aggregated.

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

Based on the Dutch Civil Code Collective Settlement of Mass Claims Act it is possible that claims (arising out of a single event) can be aggregated.

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.

Yes

Claims can be aggregated by a foundation or association with full legal capacity that may institute legal proceedings aimed at protecting similar interests of other persons. The Netherlands also has a governance code (Claimcode 2019) for foundations and associations subject to a collective damage claim.

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

Please see the response to Question 34 for our general answer on the questions regarding aggregating claims. Based on our knowledge, there is no specific case law concerning whether insureds can aggregate claims arising out of Covid-19.

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

Please see the response to Question 34 for our general answer on the questions regarding aggregating claims.

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.

N/A

Please see the response to Question 34 for our general answer on the questions regarding aggregating claims.

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

Please see the response to Question 34 for our general answer on the questions regarding aggregating claims. Whether insureds can aggregate claims arising out of Covid-19 depends on the conditions and clauses settled in the insurance contracts. There is no specific legislation or case law regarding aggregating claims by the insureds due to Covid-19.

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.

N/A

Please see the response to Question 39 for our general answer on the questions regarding aggregating claims by the insured.

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.

N/A

Please see the response to Question 39 for our general answer on the questions regarding aggregating claims by the insured.

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

Based on our knowledge, there is no case law concerning whether cedents can aggregate claims due to Covid-19.

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.

No

Please see the response to Question 42 for our general answer on the questions regarding aggregating claims by cedents.

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

Please see the response to Question 42 for our general answer on the questions regarding aggregating claims by cedents.

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.

N/A

Please see the response to Question 42 for our general answer on the questions regarding aggregating claims by cedents.

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.

N/A

Generally, there is no qualification of property damage losses due to Covid-19. The government has issued certain compensation rulings regarding losses for businesses due to Covid-19, but there is no specific compensation regarding property damage losses.

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.

N/A

Please see the response to Question 46 for our general answer on the questions regarding property damage losses and Covid-19.

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

Please see the response to Question 46 for our general answer on the questions regarding property damage losses and Covid-19.

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.

N/A

Please see the response to Question 46 for our general answer on the questions regarding property damage losses and 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

Please see the response to Question 46 for our general answer on the questions regarding property damage losses and Covid-19.

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.

N/A

Please see the response to Question 46 for our general answer on the questions regarding property damage losses and Covid-19.

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.

This depends on the contractual insurance agreement between the insurer and insured. The terms and conditions of the insurance policy should be assessed therefore. Generally, Covid-19 is not deemed as a natural peril by our government or by case law.

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.

Yes

This depends on the contractual insurance agreement between the insurer and insured. Based on our knowledge, there is case law in the Netherlands regarding cases that Covid-19 has been deemed as 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

This depends on the contractual insurance agreement between the insurer and insured. Based on our knowledge, Covid-19 is not acknowledged as a notifiable disease.

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.

This depends on the contractual framework. Some insurance policies includes a pandemic exclusion.

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

Based on our knowledge, a pandemic or virus exclusion is not void because of a public policy.

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.

N/A

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.

N/A

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

The insurance regulators did not issue directives relating to coverage for claims arising out of Covid-19.

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

Based on the knowledge, grace periods were not encouraged by regulators. Generally speaking, it could be possible for insures to provide grace periods to insureds regarding payments on premiums due to Covid-19. This depends on the situation or case.

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

The government has implemented relief measures for losses sustained as a result of Covid-19.

62

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

There are certain measures for businesses applicable in the Netherlands with respect to losses due to Covid-19.

63

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

For businesses, there are arrangements regarding compensation to fixed costs, taxes, employees and rental. It is also possible to receive a small credit due to Covid-19. Special arrangements are applicable to the cultural and creative sector.