Order on Investigations Conducted by Insurance Companies

Order on Investigations Conducted by Insurance Companies

Pursuant to Section 67, subsections 2 and 4, and Section 316, subsection 1, of Act No. 718 of 13 June 2023 on Insurance Business, it is hereby prescribed:

Chapter 1
Scope and Definitions

Section 1. This Order applies to investigations conducted by Danish insurance companies and foreign insurance companies conducting business in this country, including through branch establishment or cross-border provision of services.

Subsection 2. The Order applies solely to insurance companies' procedures and disclosure obligations when they conduct investigations.

Subsection 3. Sections 5-7 do not apply to cases decided in accordance with the Act on Work Injury Insurance.

Subsection 4. Section 6 also does not apply to insurance covered by Annex 1 to the Act on Insurance Business, when the damage concerns movable property or real estate, unless a decision to make a claim for reimbursement against the injured party is made as a result of personal surveillance, cf. Section 8.

Subsection 5. The Order does not apply when insurance companies:

1. obtain information about prices or values of objects,
2. obtain information from public registers, regardless of whether the information is obtained directly from the register or via private websites that compile or reproduce information from public registers,
3. obtain information about weather conditions,
4. obtain information about the effects and side effects of medicinal products, or
5. obtain information about objectively verifiable or factual matters that do not concern the injured person or the damaged object.

Section 2. In this Order, the following terms are understood as:

1. Investigations: When the insurance company collects information without the knowledge or consent of the injured party.
2. Personal Surveillance: Collection of information about the injured party through physical surveillance of the injured party, possibly supplemented by the use of photographic or video equipment, audio recordings, or other aids.
3. Injured Party:
   a) An insured person who is a consumer who has made or is making a claim against the insurance company with which the insurance contract was concluded, based on the insurance. b) A natural person who has made or is making a claim against a third-party insurance company.
4. Consumer: A natural person who primarily acts outside their profession.
5. Durable Medium: Any instrument that enables the injured party to store information addressed personally to them in a way that allows for future reference for a period adequate to the purpose of the information, and allows for unaltered reproduction of the stored information.

Chapter 2
General Rules on Investigations
Proportionality in the Choice of Investigation Method

Section 3. Insurance companies must choose the least intrusive investigation method, cf. Section 8.

Subsection 2. The investigation used must be in reasonable proportion to the nature of the case under investigation.

Collected Information

Section 4. An insurance company must loyally weigh and process all collected information.

Hearing of the Injured Party

Section 5. Before an insurance company makes a final decision against the injured party regarding a total or partial denial of insurance coverage, or makes a final decision to stop a continuing payment, reduce a continuing payment, or make a claim for reimbursement, based on the collected information in the investigation, the insurance company must:

1. present the collected information from the investigation on paper or another durable medium, cf. also Section 10, and inform the injured party of the insurance company's immediate assessment of the case based on the information obtained in the investigation, and
2. give the injured party the opportunity to provide their comments in writing or, if the injured party so wishes, orally, cf. however subsection 2, within a deadline of at least 4 weeks.

Subsection 2. The insurance company must record oral comments according to subsection 1, no. 2.

Subsection 3. The insurance company must not present to the injured party information that the injured party does not have the right to access or be informed about in accordance with data protection regulations.

Board Approval of Decisions

Section 6. An insurance company's decision to stop or reduce a continuing payment or make a claim for reimbursement against the injured party based on the collected information in the investigation must be made by a member of the insurance company's board of directors.

Subsection 2. Subsection 1 does not apply if the injured party has agreed to the insurance company's immediate assessment of the case, cf. Section 5, subsection 1, no. 1.

Information to the Injured Party Regarding Complaint Options, etc.

Section 7. The insurance company must, in connection with decisions covered by Section 6 and decisions regarding total or partial denial of insurance coverage, made based on the collected information in the investigation, inform the injured party on paper or another durable medium about the following:

1. The injured party's complaint options in accordance with Section 4, subsection 2, of the Act on Consumer Complaints and the possibility of bringing the case to court.
2. The rules on legal aid.
3. The rules on free legal process.

Chapter 3
Use of Personal Surveillance

Section 8. An insurance company may only use personal surveillance in connection with an investigation when there is a well-founded and documented suspicion that the injured party has provided false information or concealed information that is of decisive importance for the assessment of whether the injured party is entitled to continuing payments or full or partial insurance coverage.

Section 9. The insurance company may only initiate personal surveillance of the injured party when a member of the company's board of directors has made a decision regarding personal surveillance in the specific case.

Section 10. The insurance company must, within a reasonable time after the personal surveillance has ended, present the information collected in the investigation to the injured party on paper or another durable medium, cf. also Section 5. The insurance company must simultaneously explain why there was a well-founded and documented suspicion that the injured party had provided false information or concealed information that was significant for the assessment of whether the injured party was entitled to continuing payments or full or partial insurance coverage, cf. Section 8.

Subsection 2. The insurance company must not present to the injured party information that the injured party does not have the right to access or be informed about in accordance with data protection regulations.

Chapter 4
Supervision and Penalties

Section 11. The Danish Financial Supervisory Authority may issue orders to rectify matters that are in conflict with the provisions of this Order.

Section 12. Whoever fails to comply with an order under Section 11 shall be liable to a fine. Gross or repeated violations of Sections 5-7, Section 9, and Section 10, subsection 1, shall be punishable by a fine, unless a higher penalty is incurred under other legislation.

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

Entry into Force

Section 13. This Order enters into force on 1 January 2025.

Subsection 2. Order No. 1377 of 22 June 2021 on investigations conducted by insurance companies is repealed.

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

Morten Bødskov
/ Julie Sonne