France Insurance Information
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General France Insurance Information
- Compulsory Insurance:
- Workers’ Compensation (part of Social Security Scheme);
- Third Party Automobile Liability;
- Inland Marine - Carrier’s liability;
- Professional Indemnity for some professions;
- Decennial Liability (Spinetta Law);
- Clinical Trials Liability;
- Sports Associations;
- Hunter’s Liability;
- Tenants’ Property Damage Liability.
- Non-Admitted Insurance:
Prohibited; however, non-admitted insurance has been allowed for any EC Insurer for business within the EC.
- Policy Wordings & Rates / Tariffs Controlled:
All policies must be written in French. France is not a tariff market.
- Policy Language:
French.
- Types of Insurance Restricted to Government Institutions:
Workers’ Compensation , Export Credit (COFACE), Terrorism
- Policy Currency:
euro (EUR) note: on 1 January 1999, the European Monetary Union introduced the euro as a common currency to be used by financial institutions of member countries; on 1 January 2002, the euro became the sole currency for everyday transactions within the member countries. U.S. $ insurance is available.
- Currency Restrictions / Exchange Controls:
No restrictions other than approvals are required for transfers.
- Policy Period:
Annual except for Decennial Liability (10 years).
- Cancellation Provisions:
Tacit (automatic) renewals are the norm. 30, 60, or 90 written notice prior to expiry is required - check policy conditions.
- Premium Tax, etc. paid by Insured:
Property - Fire:
7%; other perils: 9%; General / Public / Product Liability: 9%; Own Damage to vehicles: 18%; driver and passengers’ personal accident: 9%;
- Marine: yachts 19%;
Decennial Liability: 25.5%;
Automobile Liability: 34.9%;
Personal Accident: 9%
D&O: 9% Terrorism fund: FF 15 per property policy.
- Unlimited bank guarantees on Freedom of Services insurers – A number of Freedom of Services insurers have been contacted recently by the French tax authorities asking for unlimited bank guarantees to cover French IPT liabilities. It is not clear if or how this would be enforced, and we are in discussions with the local tax office. (May 21, 2009)
- Insurance Companies:
- Brokers:
Agents and Brokers are common.
- Brokerage Commissions:
Property: 12-25%; General / Public / Products Liability: 15-25%; Automobile: 16%; Accident & Health: 20-25%.
- Broker of Record Letters:
It is required for local Insured to write (in French) a Broker-of-Record Letter to the appropriate underwriter(s).
- Reinsurance:
No restrictions. There are a number of reinsurance pools in France which can be considered depending on exposure (notably, Marine, Aviation, Decennial, Personal Accident and Sickness, Atomic, Pollution)
- Local Natural Hazards:
Flood and Storm are the main exposures.
- Other Information:
Since July 1, 1994, the 3rd EU Non-Life Directive has been in force. This permits insurers registered in other EU countries to write risks in France. At the same time, French companies can write risks in other EU countries.
Property Insurance
- Fire:
Standard fire perils include - fire, lightning, aircraft, explosion, storm / tempest, burst water pipe and vehicle impact. Earthquake, flood, riot / civil commotion, malicious damage, windstorm / hurricane, weight of snow / avalanche are available in the market for an additional premium charge.
- All Risk:
Available.
- Coinsurance:
100%.
- Blanket Insurance:
Available for Real and Personal (Contents) Property.
- Business Interruption:
Available. UK Loss of Profits form more common but U.S. Gross Earnings possible.
- Replacement Cost:
Available.
- Discount for fire protection equipment / systems: Maximum credit 75%.
- Comment: EQ, Flood and Volcanic Eruption are covered by the compulsory ‘Natural Catastrophe’ Scheme created by the law of July 13, 1992. As from February 1995 part of 2.5% of the Natural Catastrophe premium was allocated to the fund for the prevention of Natural Catastrophe risks.
Boiler & Machinery / Machinery Breakdown / Engineering
- Wordings:
Local. Explosion is mostly covered under the fire policy. Separate policy is issued for Machinery Breakdown.
General / Public Liability
- Available Wordings:
Comprehensive
- Comments:
Policies are written on an occurrence basis and must insure against consequential losses covered by the policy. Product Liability and Tenants and Neighbors Liability should always be included regardless of exposure. Employer’s Liability coverage included.
Automobile / Motor
- Compulsory Limits:
Bodily Injury: Unlimited Property Damage: Unlimited
- Comments:
Coverage applies to Insured and any licensed individual driving with or without the Insured’s permission. Passengers are considered Third Parties excluding employees while on duty.
Workers’ Compensation
- Comments:
All employees (including foreign nationals) are included under France’s Social Security Scheme. Extra-Territorial Benefits are included for employees stationed abroad; however, there are some limitations [e-mail for detailed explanation]. Medical Expenses and Occupational Disease are included under the Scheme. Employees do not have the option to sue.
Marine
- Available Wordings:
French and UK forms are used. Wordings are negotiable and there are no taxes for Marinepolicies (exception is pleasure craft which is taxed at 19%). Cargo War Risks rates are set by French authorities (Caisse Centrale de Réassurance).
Crime
- Available Coverages:
Fidelity, burglary, theft, cash in transit and various surety bonds available.