As in the rest of the world, Central and Eastern Europe has had to manage the cascading effects of COVID-19 across all sectors and industries.
From March onwards public-facing activities came to an abrupt stop, while traditional manufacturing industries were forced to shut down or drastically reduce production to comply with COVID-19 restrictions. Organisations had to send their employees home and invest in fast-track digitalisation to continue in a work-from-home format where possible. Other companies laid off their employees or sent them home to wait out the pandemic. Office buildings, hotels, restaurants, malls and manufacturing sites remained empty for weeks on end. Rent payments and overhead and operational costs continued to accrue regardless. Utilisation plummeted and profits fell.
At the time of writing, our region is emerging from the lockdown. However, it is clear that a significant number of businesses have suffered losses. Now that a degree of normality is returning and losses can be quantified, many businesses are looking to their insurers to partly make good such losses.
This guide looks at the ten most frequent questions received from the insurance industry regarding the COVID-19 pandemic. It provides an overview across the CEE region, including Russia and Ukraine, on the impact of COVID-19 in each jurisdiction, the legal qualifications given to the Coronavirus outbreak and the consequences on insurance coverage. It offers a perspective on how each of jurisdiction has managed the pandemic, and what measures have been put in place to overcome it. The guide also sheds light on the conduct of court proceedings during the pandemic, including insurance claims, and the effects of COVID-19 on the lapse of contractual and statutory terms and deadlines that may ultimately affect coverage.
Finally, the guide offers some insight into the remote distribution of insurance and the particular legal constraints associated with this sales channel. While the COVID-19 pandemic has incentivised the sale of insurance through less conventional means, due consideration should be given to the fact that most of the countries covered by this guide have strict regulations for distance selling of financial services including insurance. From detailed pre-contractual disclosures to requirements of form and process, all of these legal constraints need to be carefully considered when designing and implementing processes for the remote distribution of insurance.1
We would be pleased to answer any questions you may have regarding COVID-19. Enjoy reading and please contact your CMS (and CMS-partner firm) expert directly for any further questions regarding the issues dealt with in this guide.
1The information in this guide is valid as at 15 May 2020.