The Rishon LeZion Magistrate's Court recently addressed the extent to which insurers are responsible to their policyholders and whether this responsibility is limited to matters included in a policy. The case concerned a claim filed by an insured against an insurer for damages caused as a direct result of a water leak. The court ruled that the insurer had acted negligently as its representative had misled the policyholder regarding the insurance coverage offered.
Under the Aviation Services Law (Compensation and Assistance for Flight Cancellation or Change of Conditions), passengers who are denied boarding are entitled to compensation. However, in two recent district court judgments concerning passengers that were denied boarding, the courts found that passengers must arrive at the boarding gate on time. As this duty had not been fulfilled in either case, the airlines were not obliged to pay compensation.
Israel has a no-fault system for road accident compensation under the Road Accident Victims Compensation Law. According to the law, drivers must have a valid insurance policy that covers all bodily injuries. This mandatory insurance system ensures that drivers, passengers and any third parties receive compensation when injured in a road accident. Further, it provides compensation to pedestrians who have been hit and injured by an insured motor vehicle.
The Tel Aviv District Court recently acknowledged jurisdiction over a claim filed by an Israeli insurer against a foreign reinsurer that had refused to participate in a settlement agreed by all of the other reinsurers. The court noted that there was no dispute that the reinsurers' agreement included an exclusive jurisdiction clause referring to the Israeli courts and ordered a statement of claim to be served on the reinsurer.
The Beit Shean Small Claims Court recently declined a claim for compensation under the Aviation Services Law due to a delayed flight. The plaintiff had booked a return flight from Tel Aviv to Amsterdam with Arkia Airlines, which arrived in Amsterdam late after a nine-and-a-half-hour delay due to a technical fault. The court dismissed the claim and found that Arkia had proved that the technical malfunction had been caused by a fault in the aircraft's wing shelving, which had been beyond the airline's control.
Insureds purchase insurance coverage for their potential liability according to the level of their exposure towards third parties. In a recent judgment, the organisers of a cycling competition were found liable towards a cyclist who had been injured during a competition, and their insurance coverage was well below the damages that the court imposed. Following this judgment, sporting event organisers should reconsider the scope of their insurance coverage.
The Supreme Court recently dismissed the appeal of an insurer, declining its allegation that it should be exempt from liability towards a third party as the insured had driven under the influence of alcohol. The court determined that the standard motor vehicle insurance policy is aimed at protecting the insured. Further, an insurer's liability should not be narrowed and damage caused by a driver who drives under the influence of alcohol should not be excluded from coverage.
The Tel Aviv Small Claims Court recently declined a passenger's claim for compensation against Qantas and Worldwide Travel and Tourism Ltd, concluding that as the flight in question was a domestic flight within New Zealand, Israeli law did not apply. The court stated that a 'flight operator' is defined in Clause 1 of the Aviation Services Law as an operator that operates flights to and from Israel. Therefore, the law does not apply when connecting flights to Israel are operated by a different airline.
The Jerusalem District Court recently dismissed a liquidator claim against an insurer based on a claims-made policy that had been issued 20 years previously and expired four years later. The court stated that it could not accept a claim filed 16 years after a company had stopped paying its claims-made insurance premiums as doing so could create a situation in which a policy never ends, which would be unreasonable.
The Supreme Court recently examined whether Article 25 of the Insurance Contract Law, which discharges an insurer of liability where an insured or beneficiary submits a fraudulent claim, also applies to third-party claims made in good faith. The court's decision clarifies that fraud by an insured will also affect bona fide third-party claims and that the total discharge of an insurer does not require a causal connection between the fraud and the insurer's liability to be proven.
The Tel Aviv Magistrates Court recently declined a passenger's claim that Turkish Airlines should compensate him for being denied boarding. The court concluded that the plaintiff had failed to arrive at the departure gate on time and that he had known, or should have known, the final boarding time for passengers.
An insured recently filed a claim against its insurer with the Jerusalem Magistrate Court, which dismissed the claim based on policy exclusions. The insured then appealed to the district court, which found that the insured was entitled to insurance benefits as there was no proof that it had received a copy of the policy and been aware of the exclusions. The insurer requested leave to appeal to the Supreme Court, which dismissed the appeal and ordered the insurer to bear the insured's expenses.
The plaintiff in a recent case filed a claim and a motion to certify the claim as a class action against the insurer. The insurer paid the plaintiff only 85% of the actual damage and notified her that following the examination of the parties' versions and the damaged parts of the cars involved, it had deducted the plaintiff's contributory negligence at a rate of 15%. The insurer argued, among other things, that the plaintiff had no individual cause of action.
A recent Haifa Magistrate's Court decision concerned Hachshara Insurance Company's claim that its insured must pay the deductible despite objecting to the settlement agreement signed between the insurer and a third party. The insured had claimed that she was not required to pay the deductible as the insurer had reached the settlement without informing her and she had objected to it. The court rejected both claims and ordered the insured to pay the deductible plus legal fees.
The Jerusalem Small Claims Court and the Netanya Small Claims Court both recently dismissed compensation claims for baggage delays, as the passengers did not comply with the Montreal Convention, according to which a complaint must be submitted within 21 days from the date of receipt of the baggage. However, the latter court ordered the airline to cover the plaintiffs' expenses, holding that the plaintiffs had clearly approached the court in good faith and that the airline's conduct had been inappropriate.
With the aim of increasing competition in the insurance market, the parliamentary finance committee recently approved a proposed Ministry of Finance regulation that will reduce the minimum capital required for a new insurance company, thus enabling new players to enter this confined market. The change in equity requirements is notable and increases the opportunity for new investors to consider establishing insurance activities in Israel.
In a recent Supreme Court case, the insurer argued that it had been known that groundwater existed at a construction site before work commenced. Any damage caused as a result of groundwater was therefore foreseeable and not covered. The insured denied this and claimed that the insurance policy included no exclusion for groundwater damage. The court examined the contract's language to search for the contract's purpose based on the parties' intention before the insurance event.
A recent Tel Aviv Economic District Court case examined the issue of an insured's disclosure duty versus an insurer's obligation to conduct independent investigations. The court determined that an insured has a broad disclosure obligation during the underwriting of a policy, and that an insurance contract is subject to duties of good faith and fairness. Therefore, an insurer is entitled to rely on the information provided to it by an insured and is not obliged to conduct additional independent investigations.
The Tel Aviv Magistrates Court recently declined a passenger's claim for bodily injury damages after it concluded that the event which was the subject matter of the claim was not considered to be an 'accident' as defined by the Montreal Convention. The plaintiff had filed a claim against El Al, arguing that he had been injured after eating a cake served to passengers.
The Central District Court recently declined a jewellers' block policy claim after the insurers proved that the claim had been filed with fraudulent intent. The case concerned an Israeli diamonteer who claimed that $10 million worth of diamonds had been stolen from him under the threat of violence. However, following an investigation by the insurers, it was revealed that a number of the stolen diamonds were still in the claimant's possession after the alleged robbery.