IVASS rules for the implementation of the Italian Insurance Arbitrator’s proceedings

With the Decree of the Minister of Enterprises and the Made in Italy no. 215 of 6 November 2024 (the "Ministerial Decree") - which entered into force on 24 January 2025 - the criteria for the conduct of out-of-court settlement procedures in the insurance sector (also known as Insurance Arbitrator) have been set out, in implementation of the Italian Insurance Code.

The Ministerial Decree, in particular:

• determines the criteria for the conduct of out-of-court settlement procedures for disputes with customers relating to insurance benefits and services arising from insurance contracts;
• defines the criteria for the composition of the panel of the insurance arbitrator;
• clarifies the nature of the disputes dealt with by such system;
• instructs IVASS to adopt detailed technical and implementing provisions.

In accordance with the above, on 6 march 2025 IVASS launched a public consultation on a scheme of technical and implementation provisions which will be open until 5 April 2025.

The Insurance Arbitrator will start its operations as soon as IVASS so declares by publishing an appropriate provision after the issuance of the implementing rules.

Characteristics of the new alternative dispute resolution system

The introduction of the Insurance Arbitrator is an essential step to ensure full compliance with Article 15 of Directive 2016/97/EU (so-called IDD) on insurance distribution and with the Italian Consumer Code, as amended by the implementation in Italy of Directive 2013/11/EU on Alternative Dispute Resolution (ADR) systems.

The Insurance Arbitrator's activity is in addition to the complaints management carried out by IVASS, expanding the range of individual protection tools available to customers and guaranteeing policyholders and insureds the same means of protection as users of banking and financial services (who may already rely on the Banking Arbitrator and Financial Arbitrator respectively).

Recourse to the Insurance Arbitrator is characterized as a system for resolving disputes with insurance companies and/or intermediaries that is agile and can be activated directly by the client, without the mandatory assistance of a lawyer or attorney, and with minimal costs. In order to digitalize the entire process of appealing to the Insurance Arbitrator, a dedicated computer system and website have been created, with benefits in terms of time and efficiency of the entire procedure.

The Insurance Arbitrator website (currently being finalized) contains detailed information on how it works and a portal for submitting appeals (which will be activated when the new out-of-court dispute resolution system is launched) according to a guided procedure aimed at guaranteeing rapid, inexpensive and effective protection.

Before appealing to the Insurance Arbitrator, it is necessary to have filed a complaint with the insurance company and/or intermediary. The appeal must have the same subject as the complaint submitted by the client to the company or intermediary and can be forwarded to the Insurance Arbitrator in the event of failure to respond or an unsatisfactory response to the preliminary complaint (a response which, according to the provisions of ISVAP Regulation no. 24/2008, must be provided within 45 days from receipt of the complaint), and in any case within twelve months from the presentation of the complaint. The proceedings before the Insurance Arbitrator are concluded quickly. Once the panel has received the complete file, it has 90 days to make a decision, which can be extended only once for a further 90 days in the case of particularly complex disputes.

The decisions made by the Insurance Arbitrator, although not binding, expose insurance companies and intermediaries which do not comply with them to reputational consequences deriving from the expected publication of the decisions on the website of the Insurance Arbitrator and on that of the market operator itself

As for the relationship between complaints to IVASS and appeals to the Insurance Arbitrator – which both require the prior submission of a complaint to the insurance company or intermediary – it should be noted that if both tools are activated by the consumer for the same dispute, IVASS will reserve to the Arbitrator the handling of the aspects of individual protection of the client and the complaint will be managed by IVASS exclusively for any supervisory and sanctioning profiles, for reasons of cost-effectiveness and efficiency of administrative action.

Under Italian law, recourse to the Insurance Arbitrator is a condition for the admissibility of legal action before Italian Courts as an alternative to ADR remedies already in place, such as mediation (for disputes concerning insurance contracts and compensation for damages deriving from medical and healthcare liability) and assisted negotiation (for disputes concerning compensation for damages deriving from the circulation of vehicles and crafts).

Companies and intermediaries adhering to the Insurance Arbitrator

Pursuant to the Ministerial Decree, Italian insurance undertakings and intermediaries, Italian branches of insurance with registered office in a third country as well as EEA insurance undertakings and intermediaries operating in Italy under the right of establishment or freedom to provide services adhere to the Insurance Arbitrator without the need for any communication, as a result of theirs enrolment in the Register of insurance companies or in the Register of insurance intermediaries (RUI) or in the relevant lists kept by IVASS.

However, only EEA insurance companies and intermediaries operating in Italy under the freedom to provide services are allowed to choose to join another system of out-of-court dispute resolution, provided that such a system exists in the home Country that is a member of the FIN-NET network and subject to notification to IVASS, specifying the FIN-NET out-of-court dispute resolution system to which the company or intermediary adheres.

Under the draft IVASS implementing provisions (i) the notification above would have to be made by 30 July 2025 and (ii) participating insurance companies and intermediaries shall identify a contact person for the management of appeals and electronic means of communication (e.g. certified email) for communication with the Insurance Arbitrator.     

Insurance companies and intermediaries are required to inform customers about the procedures for appealing to the Insurance Arbitrator.

Disputes subject to the competence of the Insurance Arbitrator

The Insurance Arbitrator is competent for disputes arising from an insurance contract, which are exclusively based on documents and have as their object the ascertainment of rights, including compensation rights, obligations and faculties inherent to insurance services and benefits, or the breach of the rules of conduct provided for by the Italian Insurance Code concerning the exercise of the activity of insurance distribution.

The Insurance Arbitrator has no competence over disputes concerning claims managed by the Italian guarantee fund for victims of hunting and road accidents and disputes which fall within the competence of CONSAP (Concessionaria Servizi Assicurativi Pubblici S.p.A. – the Italian public insurance services concessionaire), as well as those related to "large risks".

The claim may also concern the payment of a sum of money, provided that it does not exceed the following amounts:

1. for disputes relating to life insurance contracts:
1. Euro 300,000.00 if the dispute regards class I contracts (insurance on the duration of human life) and the benefits under the contract are only due in the event of death;
2. Euro 150,000.00 if the dispute concerns class I contracts, without prejudice to the above, and contracts of the other life classes;
2. for disputes relating to non-life insurance contracts:

1. Euro 2,500.00 if the dispute concerns the right to compensation for damages for civil liability and is brought by the damaged third party who has a direct action against the insurance company of the person responsible;
2. Euro 25,000.00 in all other cases.

Fulfilments subsequent to the decision of the Insurance Arbitrator and publicity of non-compliance with the same

The draft IVASS implementing rules specify that the communication of the execution of the decision – which insurance companies and intermediaries are required to transmit to the technical secretariat of the Insurance Arbitrator within 5 days from execution, which shall in turn take place within 30 days from its communication - can also be carried out through trade associations.

The most relevant decisions adopted by the Insurance Arbitrator would be published on the website of the same. This form of publicity will allow companies and intermediaries to evaluate the complaints they receive, also in light of the guidelines expressed by the arbitration decisions. At the same time, the trends that can be inferred from the outcomes of the appeals will expand the wealth of information available to IVASS.

Failure by the insurance company or intermediary to comply with the decisions taken by the Insurance Arbitrator is made public in a specific section of the latter's website for a period of five years. Within 15 days of publication on the Insurance Arbitrator's website, the insurance company or intermediary shall in turn publish it for 6 months in a specific section of the home page of its website.

Authored by Silvia Lolli and Davide Valloni.