Order on Information Concerning Life Insurance Contracts

Order on Information Concerning Life Insurance Contracts 1)

Pursuant to Section 67, Paragraph 2, and Section 316, Paragraph 1, of Act No. 718 of 13 June 2023 on Insurance Undertakings, the following is enacted:

Scope of Application

Section 1. This Order applies to Danish life insurance companies and cross-border pension funds operating in the country, as well as to branches of life insurance companies authorized in a country outside the European Union with which the Community has not concluded an agreement in the financial sector, provided they operate in the country.

Section 2. For the purposes of this Order, "policyholder" refers to the person who wishes to enter into, or has entered into, an agreement with an insurance company to take out insurance.

Information in Connection with the Conclusion of the Contract

Section 3. In connection with the conclusion of a life insurance contract, the insurance company must inform the policyholder, on paper or another durable medium, of the following, subject to Sections 6 and 9:

1. The company's name and legal form.
2. The address of the company's registered office and the address of the branch, if the contract is concluded with the branch.
3. A reference to the company's solvency and financial situation report, providing the policyholder with easy access to this information.
4. The definition of the individual guarantees and options.
5. A description of the individual insurance benefits and information on any options.
6. The amount of the insurance benefits.
7. The conditions for the payment of premiums, including the period over which they are paid.
8. The duration of the insurance contract.
9. The specific terms for the calculation and allocation of bonuses.
10. A statement of the surrender value and free policy value, as well as the nature of the guarantees attached thereto.
11. Information on premiums for the individual guarantees, including for the main insurance and supplementary guarantees, where such information is appropriate.
12. A statement of the relevant reference values in insurance contracts linked to investment funds.
13. A statement of the nature of the underlying assets in unit-link contracts.
14. The costs for the administration of the scheme charged to the customer.
15. A statement of the extent to which benefits, premiums, costs, etc., are guaranteed. In the event that the benefit, premium, costs, etc., are not guaranteed, the specific terms for changes must be stated. If the benefit depends on fluctuations in the capital market, information must be provided regarding the investment assumptions for the stated benefits.
16. General information regarding the tax scheme applicable to the chosen benefits.
17. The legislation applicable to the contract, if it is agreed that legislation other than Danish law shall apply.
18. Conditions for the possible termination of the insurance.
19. Information on the policyholder's, the insured's, or the beneficiaries' right to complain, including whether a complaints authority exists.
20. Additional information necessary to ensure that the policyholder can understand the risks borne by the policyholder.

Section 4. If the insurance company, in connection with an offer for or conclusion of a life insurance contract, presents the policyholder with figures regarding the amount of potential payments that exceed and go beyond the contractually stipulated payments, the company must provide the policyholder with a standard calculation indicating the potential payment at maturity using the premium calculation basis at three different interest rates.

Paragraph 2. The insurance company must clearly and understandably inform the policyholder that the standard calculation is only a calculation model based on theoretical assumptions, and that the policyholder cannot make contractual claims based on the standard calculation.

Paragraph 3. Paragraph 1 does not apply to terminating insurance policies and contracts.

Information During the Term of the Contract and Upon Changes

Section 5. During the term of the insurance contract, significant changes to the circumstances mentioned in Section 3, Paragraph 1, to the detriment of the policyholder cannot take place without notice to the policyholder on paper or another durable medium. This does not apply, however, if the change is justified by external circumstances over which the insurance company has no influence.

Paragraph 2. If the insurance contract is established as part of an employment relationship, an organizational relationship, or a relationship of a similar nature, the information may, however, be provided in connection with the changes taking effect.

Section 6. The insurance company must annually inform the policyholder of:

1. The size of the insurance benefits and the bonus situation, as well as the extent to which the bonus is guaranteed.
2. The policyholder's total return for the year.
3. The surrender value, if the insurance provides access to this, as well as the free policy value. It will be sufficient to state the value of the relevant insurance and general statements regarding the calculation of the free policy value and surrender value.
4. Less significant changes in the circumstances mentioned in Section 3, Paragraph 1, and changes in the general and special terms and conditions.

Paragraph 2. If the insurance is being paid out, however, information must only be provided according to Paragraph 1, items 1 and 4.

Paragraph 3. For insurances with a right to bonus, the insurance company shall once a year inform the policyholder of the status of the policyholder's claims, including their right to bonus. If the insurance company has presented figures on the potential future development of the bonus, the company must additionally inform the policyholder of the differences between the actual development and the original data.

Paragraph 4. Paragraphs 1 and 2 do not apply, however, if the insurance company continuously provides the policyholder with access to information on the circumstances mentioned in Paragraph 1 on paper, another durable medium, or on a password-protected website dedicated to the individual customer.

General Provisions

Section 7. If the insurance company provides the policyholder with forecasts regarding future bonus, etc., it must be clearly stated that the forecasts are not guaranteed.

Section 8. The information provided to the policyholder must be clearly and precisely formulated and must be given in Danish.

Paragraph 2. The information may, by agreement, be drafted in another language.

Section 9. If the insurance contract takes effect immediately, the information that must be provided in connection with the conclusion of the insurance contract according to this Order may be provided when the policyholder's identity is known and the insurance contract has been established.

Section 10. If the insurance company does not know the policyholder's identity, or to the extent that there is an authorized representative in the insurance scheme, the information mentioned in Section 3, Paragraph 1, and Sections 5-7 may be issued to or made available to the natural or legal person authorized to receive this material.

Penal Provisions

Section 11. Violation of the provisions in Sections 3-8 is punishable by a fine.

Paragraph 2. Companies and other entities (legal persons) may be subject to criminal liability according to the rules in Chapter 5 of the Criminal Code.

Entry into Force

Section 12. This Order enters into force on 1 January 2025.

Paragraph 2. Order No. 1132 of 17 November 2006 on Information Concerning Life Insurance Contracts is repealed.

Ministry of Industry, Business and Financial Affairs, 6 December 2024

Morten Bødskov
/ Julie Sonne

1. The Order contains provisions implementing parts of Directive 2002/83/EC of the European Parliament and of the Council of 5 November 2002 concerning life assurance (3rd Life Assurance Directive), Official Journal of the European Communities 2002, No. L 345, page 1, and parts of Directive 2009/138/EC of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II), Official Journal of the European Union 2009, No. L 335, page 1.

Official Gazette A
2024 Published on 18 December 2024
6 December 2024. No. 1583.
Ministry of Industry, Business and Financial Affairs, Danish Financial Supervisory Authority, file no. 24-019442 CQ003041