Please note that a Council of State judgment concerning Aspis Pronoia General Insurance S.A. has been handed down. We do not have a copy of the judgment yet because it has not yet undergone engrossment, but the key points we need to mention are as follows:
The Court held that:
- Supervision of insurance undertakings safeguards policyholders out of reflex, and therefore does so indirectly; generally speaking, its objective is to safeguard private insurance as an institution. Consequently, despite the provisions of Greek law to the contrary, compensation cannot be sought directly from the state, even if its officers were grossly negligent when performing their duties.
- The provisions on compensation for policyholders could be applied by analogy, but not directly so; however, the Court ruled that the legislation governing the Life Insurance Guarantee Fund, as amended and currently in force, is suitable and capable of compensating the holders of ASPIS Pronoia insurance contracts, covering up to 70% of their loss, but that this must be done after the end of the liquidation process.
What is of interest more than the legal issues raised here, are the questions of fairness and unfairness in this matter: fairness because there is no longer any doubt about the unconstitutionality of the specific legislation on the guarantee fund since the compensation procedure was found to be appropriate for compensating Aspis’ policyholders who had not contributed to the guarantee fund. As you will recall, from the outset there was a problem with the specific law, which has now been set on firmer legal foundations.
Unfairness because the procedure to secure 70% compensation for you can only commence after the liquidation process finishes; and it will finish in quite a few years from now.
We are examining the issues raised by the judgment in depth and over the days to come we will send out a letter to all of you about what our next steps in Greece and/or before the European Courts will be.