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Frequently Asked Questions and Answers (F.A.Q.)

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1. Do policy holders pay for the guarantee provided by the Private Life Insurance Guarantee Fund (the "Fund")?
The Fund raises the capital required for achieving its objective by collecting regular contributions. These contributions cannot exceed 1.5% of the total annual production of gross written life premiums. Half of this contribution is paid by the members of the Fund (life insurance companies) and the other half by life insurance policyholders. The amount of the contribution is determined by Law (Article 10 of Law 3867/2010) and decisions of the Bank of Greece (Bank of Greece Governor’s Act 2636/24.11.2010 on the calculation of the contribution).
2. What triggers the intervention of the Fund?
Once the supervisory authorities revoke the license of a life insurance company, the Fund becomes involved. Given that the objective of the Fund is primarily to ensure the transfer of the life insurance portfolio to another insurance company, action is taken immediately. The exact duration of the transfer procedure depends on various factors (e.g. size and complexity of the portfolio, number/location of branches, quality of available data) and is determined by a decision of the Bank of Greece. However, the procedure may not exceed six (6) months from the date of publication of the relevant decision of the Bank of Greece. If the life insurance portfolio is transferred, the transferee insurance company (-ies) assume the rights and obligations related to this portfolio (Bank of Greece decision on the transfer of the life insurance portfolio of an insurance company under liquidation).
If the procedure for finding a transferee fails, the Fund will compensate the assureds or beneficiaries of sums assured in accordance with Article 7 of Law 3867/2010.
3. Should policy holders continue paying their contracts after the date of withdrawal of authorisation?
Once the authorisation of an insurance undertaking has been revoked, collection of premiums is also suspended until the date the life insurance portfolio is transferred to another insurance undertaking. If the life insurance portfolio is transferred, the transferee insurance company (-ies) will undertake the collection of insurance premiums due. If the procedure for finding a transferee fails, premiums are not payable.
4. How is compensation calculated?
If no transferee is found, the Fund will calculate claims by life insurance policy in accordance with the legislation in force and the general and specific conditions of the policy. Compensation payment covers the value of life insurance policies, as well as outstanding damages and payable benefits (other than hospital coverage), subject to the compensation ceilings set forth in Article 7 of Law 3867/2010.
In case of death or permanent total disability, the Fund will pay compensation equal to the amount due under the life insurance policy, subject to a ceiling of €60,000 (euro sixty thousand). In the case of policies that have not matured by the date the authorisation of the insurance company has been revoked, the compensation payable is equal to the redemption value of the life insurance policy as of that date, subject to a ceiling of €30,000 (euro thirty thousand). Where the right of redemption of a life insurance policy has been exercised legally, the compensation payable is equal to the redemption value as of the date the right has been exercised, subject to a ceiling of €30,000 (euro thirty thousand).
(Bank of Greece decision on payment of compensation to life insurance beneficiaries of an insurance undertaking under liquidation).
5. What steps should compensation beneficiaries take after the list of beneficiaries has been posted?
The list of compensation beneficiaries is posted on the website of the Fund, and the search criteria are the assured’s policy number and date of birth. If the search result shows that the person concerned is entitled to compensation, an electronic declaration must be filled in with the particulars of the compensation beneficiary. Once completed electronically the declaration should then be printed and sent by mail to the Fund, together with the documentation described in the instructions (all documents should be properly certified). If the relevant instructions are not complied with, the Fund assumes no responsibility for any delay in the payment procedure. This procedure should be repeated for each life insurance policy.
6. Will compensation beneficiaries receive confirmation of receipt of their documentation by the Fund?
The Fund will send by email an acknowledgement of receipt of the documentation sent by the compensation beneficiary, provided that she/he has given his email to the Fund. If any supporting document is not received by the Fund or has not been filled in according to the instructions, the compensation beneficiary must send anew the missing or non-complying documents. Until the Fund receives all the required documentation of a policy, properly completed, the compensation procedure will not be initiated.
7. How is compensation paid?
Compensation is paid by crediting a bank account of the compensation beneficiary details of which she/ he has provided to the Fund. The Fund may pay the compensation in instalments, laying down the conditions and time schedule of instalment payment.
8. When will compensation be paid by the Fund?
After the Fund has completed the collection and certification of the documentation, it will announce the scheduled date of compensation payment.
9. Do policy holders have the right to object to the compensation offered by the Fund?
If a policy holder objects to the proposed compensation, his/ her claim will be treated in accordance with the provisions of law on insurance liquidation (Article 10(3) of Law Decree 400/1970).
10. Is there any representative authorised by the Fund?
The procedure whereby insurance policies are searched for and the relevant documentation is collected is described in detail in the Fund’s website. The Fund does not have and does not use representatives for communication with beneficiaries or for collection/ mailing of the documentation required. Compensation beneficiaries should be informed officially only through the Fund’s announcements and should inquire directly only with the Fund if they need any clarification about the compensation procedure, so that they avoid being misinformed.