The Legal Protection Insurance Market in Europe

By 2 diciembre, 2022 No Comments

Legal protection insurers cover costs (e.g. lawyer`s fees and lawyer`s fees) incurred in the event of unforeseen circumstances. These costs usually include lawyers` and court fees, witness fees, translation costs or experts` fees. According to national legislation, legal expenses insurers also provide legal services and represent policyholders amicably or in court. The policyholder is usually protected in disputes in various areas of law such as contract law, labor law, consumer law and family law (including divorce in rare cases). The premium is normally paid annually. The clarity and quality of the regulatory framework are key factors in ensuring consumer confidence in financial services. However, the quality of recent EU legislation has deteriorated, leading to many cases of legal uncertainty. Insurance Europe, P&C Insurance Data, March 2021 (www.insuranceeurope.eu/statistics).

What does consumer empowerment mean in practice in the insurance sector? For example, the use of promising blockchain technology in insurance companies could be compromised by possible incompatibilities with the General Data Protection Regulation (GDPR). From an insurance perspective, blockchain technology has the potential to reduce costs, increase transparency, and increase consumer trust. But how do we reconcile the GDPR`s «right to be forgotten» and «right to rectification» with the fact that blockchain technology is supposed to be an immutable and permanent record of all transactions? 4 In 2011, only 6 out of 23 countries recorded a higher growth rate than in 2010, when it was twice as high. It can therefore be concluded that the slowdown in the development of overall premium receipts is not due to a small number of countries, but to a general trend observed in most countries. 4 In 2010, only three countries recorded a decrease in premiums received compared to 2009, six in The magnitude of these decreases is also higher than in 2010 with negative growth rates of -29.2% in Poland, % in Spain or -15.3% in the United Kingdom. The highest growth rates were recorded in Estonia, Turkey, Denmark, Luxembourg and the Czech Republic, both of which recorded growth rates close to or above 10%. These double-digit growth rates reflect the fact that the legal expenses insurance market is less developed in some of these countries and continues to catch up after economic growth in some of these countries. In the specific case of Luxembourg, the development of the legal protection market also reflects the influence of the increase in contracts sold abroad. n 3 Share of legal expenses insurance in non-life insurance premiums Legal expenses insurance represents only a small fraction of the total non-life insurance market, representing less than 2% of total non-life insurance premium income and fluctuating between 1.5% and 1.8% over the period.

Between 2002 and 2010, this share increased steadily. peaked at 1.79% in 2010. For the first time in the last decade, the ratio fell slightly to 1.76%, reflecting a higher growth rate in the overall non-life market (3%) than in the legal protection market. n 4 Degree of penetration of legal expenses insurance The ratio of legal expenses insurance premiums to GDP (at market prices), also known as the penetration rate, does not represent the contribution of the legal protection branch to GDP, but is an indicator of the relative importance of legal expenses insurance. On average, legal fee premiums amounted to 0.058% of GDP in 2011, up from 0.059% in 2009, the highest level in a decade. The sharp increase in the ratio in 2009 does not reflect a sharp increase in the legal expenses insurance premium, but is rather an indicator of the economic downturn in Europe (EU-27 GDP (at market prices) fell by 5.4% in 2009). However, in 2010 and 2011, EU GDP grew faster (4.8% and 2.9% respectively at market prices) than revenues from statutory protection premiums (3.3% and 1.2% respectively), which explains the slight decline in the ratio. The country-specific data show a very different development of legal expenses insurance in Europe. The highest values are recorded in the most advanced economies, in particular Austria, Germany, the Netherlands, Belgium, Luxembourg and Switzerland. The lowest values are mainly found in Eastern countries (Croatia, Bulgaria, Estonia, Hungary and Turkey). Very low values can also be observed in more developed markets such as Denmark, Malta or Iceland. n Country penetration rate in 2010 and % 0.14% 0.12% 0.10% 0.08% 0.04% 0.02% 0.00% AT NL DE BE CH LU AVERAGE FR FI UK GR IT IT PL SI PT CZ EE TR DK HU IS HR MT BG (Source INSURANCE EUROPE) Note: Denmark is under-represented due to incomplete data 4 It should be stressed that freedom of enterprise: Cross-border sale of insurance services in Europe, not always a perfect comparison of national markets.