Delivery of a notice demanding payment of outstanding insurance premiums to the stipulated address of the group insurance applicant by an insurance company shall be deemed as a lawful notification(Taiwan)

Ankwei Chen

The Taiwan High Court rendered the 105-Bao-Xian-Shang-15 Civil Decision of February 7, 2017 (hereinafter, the “Decision”) held that an insurance company sending a payment notice to the address stipulated by the group insurance applicant constitutes proper notice.

Individual A filed a complaint that spouse B enrolled in the group insurance policy underwritten by Company C in which B was named as the insured, A as the beneficiary, and non-party Association of Public Servants of the Ministry of Justice as the applicant. After B died in a car accident triggering an insurance event, A sought to claim the death benefit from Company C, who responded that the insurance was terminated because a notice concerning outstanding insurance premiums had been served.

According to the Decision, the premiums for the subject insurance policy was to be paid by the insured, and because B was recorded on the list of insured and entered into the insurance policy agreement with the insurer, B was the actual insured of the group insurance policy and was thus obliged to provide payment instead of the group policy applicant Association of Public Servants of the Ministry of Justice. The Association of Public Servants of the Ministry of Justice was not named as the party to pay for the policy; it was merely an agent that obtained the group insurance on behalf of the insured. In addition, the terms of insurance in Company C’s group injury insurance policy stipulate: “In the event of any change to the address of the applicant, the Company shall be promptly notified in writing. If the applicant fails to deliver such notice, all notices delivered by the Company may be delivered according to what is specified in this Contract.” Therefore, Company C’s delivery of the notice demanding payment of outstanding premiums to the address of B as stated in the contract instead of that of the Association of Public Servants of the Ministry of Justice was clearly lawful and effective. A’s assertion that the insurance contract at issue was not invalid or suspended due to Company C’s failure of service was not found to be unpersuasive, and the decision against A was upheld.