The Supreme Court overturned twelve clauses in contracts of Merkur Versicherung, including discounts for older people.
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The Supreme Court (OGH) has found a total of 12 clauses in contracts of Merkur Versicherung to be illegal – the majority of them related to private accident insurance. The Supreme Court disagreed, for example, with the fact that the sums insured for accident products should decrease by 30 percent after the age of 70 or that over 75, in the event of permanent disability caused by an accident, a low current pension should be paid out instead of a one-off lump sum.
The 30 percent lowering clause from 70 onwards led to a 77-year-old pensioner from Linz reducing the disability benefit after an accident from EUR 7,664 to EUR 5,365, announced the Upper Austrian Chamber of Labor (AK OÖ) on Wednesday, which is responsible for the Association for Consumer Information ( VKI) with an injunction against 13 clauses. The Supreme Court declared the introduction of an arbitrary age limit in insurance conditions with the consequence of a considerable reduction in the sum insured as ineffective. Consumers would not have to expect such a surprising and obviously disadvantageous clause.
Industry-standard clauses
The Supreme Court also recognized a clause customary in the industry according to the AK as inadmissible, which provides that in the event of accidents from the age of 75, a pension will be paid out instead of a lump sum for permanent disability caused by an accident. According to the Supreme Court, this provision deviates considerably from the expectations of the average policyholder: “The latter does not expect that a lump-sum payment specifically agreed in the policy will be waived in the General Conditions – solely because a certain age limit has been reached.”
The policyholder, who had paid premiums for years, would now not receive the expected lump-sum payment, but only a pension until death, which surprisingly deviated from the agreed scope of benefits. In the case of the pensioner from Linz, this clause meant that she should receive the – already reduced – benefit of 5,365 euros not as a capital but as a monthly pension of 41 euros. The renovation of the apartment, which was necessary because of the accident, would have been impossible, according to the AK, which emphasizes that, according to the Supreme Court judgment, affected consumers could now demand a lump sum instead of a pension.
The Supreme Court also objected to a termination clause at Merkur Versicherung – which, according to AK OÖ, is customary in the motor vehicle division, but has often been extended to accident or legal protection insurance. In private accident insurance, the right to terminate the insurance is extremely problematic from the point of view of the consumer protectionists, because it can be difficult for insured persons to obtain insurance cover again after termination – at least on comparable terms.
The OGH has judged the customary termination clause to be grossly disadvantageous because it gives the insurer a completely unspecific termination option for the first, no matter how small an insured event, the AK refers to the OGH opinion on Clause 8. Also in legal protection (Clause 13 of Judgment), a clause to terminate a claim is judged to be inadmissible. Policies often have a term of 10 years, according to the AK. However, the law grants consumers an annual right of termination from the 3rd year onwards. The insurance company also claimed this right of termination in a further clause. According to the Supreme Court, this is not permitted (Clause 10 of the judgment). According to the AK, the insurance company may no longer invoke these and equivalent termination clauses in order to terminate a contractual relationship prematurely.
