The insurance broker is important in the process of buying an insurance contract

The role of the insurance broker is to protect the interests of the insured by:

– giving the insured explanations and advice on all circumstances relevant to their decision on concluding an insurance contract.

– being obliged to prepare an adequate risk analysis and propose appropriate insurance coverage for the insured;

– informing the insurance company of the insured’s intention to conclude an insurance contract and acquainting the insured with the policy terms and the calculation of the premium amount;

– checking the content of the policies and assisting the insured during the term of the insurance contract, both before and after the occurrence of the insured event.

– assisting the insured during the term of the insurance contract, both before and after the occurrence of the insured event, and in particular ensuring that the insured has performed the legal actions within the prescribed deadlines, which are a prerequisite for acquiring and enjoying the rights arising from the insurance contract.

– if the insurance broker mediates in the realization of claims for compensation, they are obliged to cooperate with the competent persons and services of the client in preparing the evidence documentation for the basis and amount of the claim, as well as to gather other necessary evidence.

The insurance broker is entitled to a commission

If the contract for insurance brokerage services concluded with the insured provides that the insurance broker is entitled to a commission, the broker acquires the right to the commission on the day the insurance contract enters into force.

The insurance broker is obliged to inform the insured of the amount of the commission it collects from insurance companies under the concluded insurance brokerage contracts.

Conflict of interest

The insurance broker is obliged to present to the insured all legal and economic relationships it has with a particular insurance company that may affect the broker’s objectivity in performing its obligations toward the insured (on the basis of which the insurance broker is entitled to a special or higher commission for mediating the conclusion of insurance contracts for a particular class of insurance or for a particular insurance company).

Protection of the insured

Protection of the insured includes: providing accurate and timely information to the insured, communicating with them in a clear and understandable way, and access to resolution mechanisms when their rights have been violated.

“Financial literacy is essential for protecting consumers”

Financial education is a process that should enable a better understanding of financial products, concepts and risks, as well as the development of the population’s ability to choose appropriately, make informed financial decisions and manage personal finances. Better information and readiness to make smart and informed financial decisions will contribute to greater financial inclusion, that is, access of legal entities and individuals to various types of financial products and services.
The Insurance Supervision Agency (ISA) is an independent regulatory body that regulates the insurance market, supervises the work of insurance companies, takes care of protecting the rights of the insured and contributes to the financial education of the population.
More at www.edukacija.aso.mk

Don’t forget to follow ISA’s profiles on social media (Facebook, LinkedIn, Instagram)

Types of insurance products

Insurance products are divided into two main groups:
• life insurance and
• non-life insurance.

Life insurance
Life insurance is coverage under which the insurer undertakes, on the basis of the insurance premiums paid, to pay the insured person (the insurance beneficiary) the insured sum in the event of death, survival or the onset of serious illness. This insurance protects you, your children and parents, or members of your family. The period of coverage is usually longer than one year, and you can choose to pay the premium monthly, quarterly, semi-annually or annually, for as long as the insurance contract is in force. The main life insurance products are: insurance in the event of death (risk insurance), insurance in the event of survival, insurance in the event of death and survival (endowment insurance), whole-life insurance in the event of death, annuity insurance, insurance with investment risk (life insurance linked to units in investment funds), insurance with a return of premiums, etc.

What is important when you conclude a life insurance contract?
ꟷ If you conclude a life insurance contract in which the insured person is a third party, the written consent of that person is required for the contract to be valid.
ꟷ Several life insurance contracts can be concluded on the life of one person with different insurers, and the beneficiary is entitled to the payout of the insured sums under each of them, in accordance with the concluded insurance contracts.
ꟷ Persons with impaired health can be insured under special insurance terms.
ꟷ When concluding a life insurance contract, always be honest when completing the questionnaires you are given. Your honest answer is crucial for:
– determining the coverage that will fully meet your insurance needs;
– determining the actual premium for that coverage;
– avoiding undesirable consequences regarding the payout of the insured sum, if it is established in the future that the information given in the questionnaire was not reliable.
ꟷ Life insurance companies invest the funds that their insured persons entrust to them in the form of premiums in safe and low-risk placements. The investment of the funds is subject to special oversight by the Insurance Supervision Agency.
ꟷ In cases determined by the insurance terms, life insurance policyholders have the right to participate in the profit that insurance companies earn from the investment of the funds collected through insurance premiums.
The main products of non-life insurance are:
compulsory traffic insurance (the most widespread is motor third-party liability insurance),
motor vehicle insurance, home insurance, travel insurance, insurance of personal belongings, insurance against the consequences of an accident, health insurance, liability insurance, etc.

Insurance, risk and loss

Insurance is a service that protects against loss if something unwanted happens to you and your family or to your property (personal belongings, house, apartment, car, etc.).
In insurance terms, risk is the possibility that something bad, harmful or unexpected will happen. This may include the loss, theft or damage of valuable property and items, or it may involve someone being injured.
A loss is when something has happened that leaves you worse off than before.

What is insurance?

When you have a financial obligation, such as buying a house or an apartment with a bank loan, you “reserve” part of your future income. If an accident (disability) occurs, or an unfavorable economic situation arises for you, your ability to meet your financial obligations decreases and the possibility of losing the property you have acquired becomes real. To protect yourself from these and other kinds of losses, there is a financial instrument that you can buy, called insurance.

Insurance is a means of providing protection if something unwanted happens to you and your family, or to your movable and immovable property (personal belongings, house, apartment, car, etc.). Insurance is bought by concluding an insurance contract (a policy).

How does insurance work?

All insured persons pay their premium into a common fund at the insurance company. The more insured persons the insurance company has, the larger the common fund. Whenever a client claims a payout for damage, the payout is made from the common fund. Your property is exposed to the risk of various types of loss (fire, flood, traffic accident, theft, etc.). The price of insurance, that is, the premium, depends on the assessment of the risk in accordance with the insurance terms laid down by the insurance company.

Life insurance

Life insurance is coverage under which the insurer undertakes, on the basis of the insurance premiums paid, to pay the insured person (the insurance beneficiary) the insured sum in the event of death, survival or the onset of serious illness. This insurance protects you, your children and parents, or members of your family. The period of coverage is usually longer than one year, and you can choose to pay the premium monthly, quarterly, semi-annually or annually, for as long as the insurance contract is in force.
The main life insurance products are:

• insurance in the event of death (risk insurance)
• insurance in the event of survival, insurance in the event of death and survival (endowment insurance)
• whole-life insurance in the event of death
• annuity insurance
• insurance with investment risk (life insurance linked to units in investment funds)
• insurance with a return of premiums, etc.

What is important when you conclude a life insurance contract?

If you conclude a life insurance contract in which the insured person is a third party, the written consent of that person is required for the contract to be valid.
Several life insurance contracts can be concluded on the life of one person with different insurers, and the beneficiary is entitled to the payout of the insured sums under each of them, in accordance with the concluded insurance contracts. Persons with impaired health can be insured
under special insurance terms. When concluding a life insurance contract, always be honest when completing the questionnaires you are given. Your honest answer is crucial for:

• determining the coverage that will fully meet your insurance needs
• determining the actual premium for that coverage
• avoiding undesirable consequences regarding the payout of the insured sum, if it is established in the future that the information given in the questionnaire was not reliable.

Life insurance companies invest the funds that their insured persons entrust to them in the form of premiums in safe and low-risk placements. The investment of the funds is subject to special oversight by the Insurance Supervision Agency. In cases determined by the insurance terms, life insurance policyholders have the right to participate in the profit that insurance companies earn from the investment of the funds collected through insurance premiums.

The obligation to inform the insured who are individuals, that is, consumers, when the insurance contract is concluded, must be in written form and contain information on the following:
→ the name, legal status, registered office and address of the insurance company, as well as the branch through which the insurance contract was concluded;
→ the name, legal status, registered office, address and contact telephone number of the insurance agency company or insurance brokerage company, where the insurance contract was concluded through an insurance agency company or insurance brokerage company;
→ the general and special policy terms that apply to the insured
and the insurer, and the law that governs the insurance contract;
→ cases in which the general and special policy terms do not apply to the relationship between the insurer and the insured, the performance, the scope and the due date of the obligations of the insurance company;
→ the period of validity of the insurance contract;
→ the amount of the premium, as well as the breakdown of the premium by individual risks (if the insurance contract covers risks arising from several classes of insurance) and the amounts of taxes, fees and other costs based on the premium and the total amount to be paid;
→ the right to postpone or terminate the insurance contract;
→ a reference to the Insurance Supervision Agency, as the competent supervisory authority over the insurance company, to which a complaint can be submitted regarding insurance companies, insurance brokerage companies, insurance agency companies and insurance agents;
→ the manner of submitting a claim for compensation to the insurance company and, where the insurance contract was concluded through an insurance brokerage company, informing the insured of their option to ask the insurance brokerage company for assistance in the event of an insured event;
→ the manner of submitting an objection or complaint against the operations of the insurance company, the insurance agency company or the insurance brokerage company, and the manner of out-of-court dispute resolution between the contracting parties; and
→ the body responsible for supervising the operations of the insurance company.

During the term of the insurance contract, the insurance company, the insurance brokerage company, the insurance agency company or the insurance agent are obliged to inform the insured of:

– A change of name, legal status, registered office or address of the insurance company, or of the branch through which the insurance contract was concluded, through the means of public information.
– A change in data resulting from an amendment of certain regulations.

During the term of the insurance contract, the insurance company, the insurance brokerage company, the insurance agency company or the insurance agent are obliged to inform the insured once a year of their participation in the profit.

The text of the General and Special Policy Terms and the notification to be given to the insured must be drawn up in a clear and understandable way in the Macedonian language.
The insurance company is obliged to publish the general and special insurance terms, as well as any amendments to them, on its website within five days of their adoption.

1. events on the basis of which the insurance company becomes obliged to make payments arising from the insurance contract, as well as events due to which the insurance company’s obligation to pay ceases;
2. the manner of performance, scope and due date of the obligations of the insurance company;
3. the amount and conditions of premium payment, as well as the legal consequences in case of non-payment;
4. the period of validity of the insurance contract, in which the following in particular must be stated: 4.1. the manner of automatic renewal of the insurance contract, 4.2. the manner in which the insurance contract can be canceled, or partially or fully terminated, as well as the obligations of the company in those cases;
5. the consequences for claims arising from insurance contracts in case of missing the prescribed deadlines;
6. the name of the insurance agent, the name of the insurance agency company or insurance brokerage company, if the insurance contract was concluded through an agent, agency company or brokerage company;
7. the actions required to be taken by the insured in the event of an insured event in order to realize a claim for compensation from the insurance company;
8. with regard to life insurance, the deadlines and conditions, as well as the scope of advance payments under the insurance policies, the deadlines and conditions relating to the participation of the insured in the profit of the insurance company, as well as the criteria for calculating their participation and the conditions and methods for calculating and paying the surrender value.

1. Insurance companies,
2. Insurance brokerage companies,
3. Insurance agency companies,
4. Insurance agents,
5. Banks – through their authorized agents.

1. – whether the insurance covers costs incurred due to the need for emergency medical
   assistance (an emergency medical examination/treatment, emergency hospital treatment, emergency surgery,
   intensive care…);
   – the territorial validity of the insurance (for which countries the insurance is valid),
   – what your rights and obligations are under the insurance you bought;
   – the start and duration of the insurance (the insurance can be concluded for a period of
   no more than 365 days);
   – whether all risks are included in the insurance coverage;
   – which risks are excluded from the insurance;
   – whether, as the insured, you have a deductible, that is, a share in the amount of damage, and how much it is;
   – whether the insurance can be bought without a deductible, that is, without a share in the amount of damage;
   – what documentation is needed to report a claim;
   – what the procedure is for reporting a claim;
   – what the procedure is for submitting a complaint/appeal if you are not satisfied with the
   service;
   – always read carefully and familiarize yourself with the TERMS under which the travel
   insurance is concluded

According to the legal wording of the Law on Obligations, Article 953 expressly states that “by the insurance contract the policyholder undertakes, on the principles of reciprocity and solidarity, to pool a certain amount in the insurance company, that is, in the risk company (the insurer), and the company undertakes, if an event that constitutes an insured event occurs, to pay the insured or a third person the compensation, that is, the agreed sum, or to do something else.

The main characteristics of the insurance contract:

Formal (a precisely defined form is required for the contract to be valid)

Bilateral (the contract comes into being with the signing of the policy)

Onerous (the insurer’s obligation is to pay the sum insured, which is in turn conditional on the payment of the premium)

Aleatory (it provides protection to the insured against events whose occurrence is potential)

Adhesion (it comes into being on the concept of accepting the insured’s offer)

Indemnity function (compensation for the damage caused by the occurrence of the insured event)

The insurance terms are an integral part of the insurance contract. In fact, they are the most important part of the contract, because they regulate in detail: the conclusion, duration and termination of the insurance, the meaning of terms, the insurance coverage itself for which the insurance is concluded, the condition and manner of exercising the right under the insurance, limitations and exclusions of the insurance, limitations and exclusions of the insurer’s obligation, the processing and storage of personal data, the other rights and obligations of the contracting parties, amendments to the insurance contract, out-of-court dispute resolution, the submission of an objection or complaint against the operations of the insurance company, etc. The insurer is obliged to acquaint the policyholder/insured with the Insurance Terms and to hand them over in written form when the insurance is concluded. In addition, agreed items that are not part of the Terms are entered on the policy itself in the form of clauses.

In practice we distinguish:

General terms of insurance are provisions that the insurer adopts in advance, with already defined content; they are part of the insurance contract, and the policyholder/insured can either accept them in full or reject them.

Special terms of insurance are terms that derive from the General terms, that is, they build on them to regulate a particular coverage in detail.

In case of a disagreement between a provision of the general or special terms and a provision of the policy, the provision of the policy shall apply, and in case of a disagreement between a printed provision of the policy and a handwritten provision of the policy, the handwritten one shall apply.

The insurance company is obliged to publish on its website the list of required documentation and the forms for submitting a claim for compensation.

No later than 14 days from the date the claim for compensation is submitted, the company is obliged to check whether the claim is complete in terms of the documentation submitted by the claimant and to carry out an inspection and assessment of the damage or injuries. If the claim for compensation is not complete, the insurance company is obliged to request in writing or electronically that the injured party submit the required documentation.

After processing the claim for compensation, the insurance company is obliged, no later than 60 days from receipt of the claim, to deliver to the injured party:

• a reasoned offer of compensation if the insurance company’s obligation and the amount of the damage are not disputed;
• a reasoned response on all points of the claim for compensation, if the insurance company’s obligation is disputed; or
• a reasoned response on all points of the claim for compensation, if the amount of the damage is disputed.

A dissatisfied injured party has the right to object to the Company within 30 days of receiving the explanation, and the insurance company is obliged to decide and respond within 30 days of the objection being submitted. In its response to the objection, the insurance company is obliged to inform the injured party of the right to submit an objection (complaint) to the Insurance Supervision Agency ([email protected]) or to initiate another procedure.

If the injured party requests information from the insurance company regarding their claim for compensation that is being processed, or a previously submitted claim for compensation, the insurance company is obliged to provide that information within 8 working days of receiving the request for information.

What to do in a traffic accident involving an uninsured motor vehicle

If damage occurs in the territory of the Republic of North Macedonia from an uninsured domestic motor vehicle, it must be paid by the National Insurance Bureau (NIB) from the funds of the Guarantee Fund (Article 58, paragraph (1) of the Law on Compulsory Traffic Insurance).

The funds of the Guarantee Fund do not compensate damage caused by the use of uninsured foreign motor vehicles moving in the territory of the Republic of North Macedonia, to which special international agreements to which the Republic of North Macedonia is a signatory apply.

An injured person who has suffered damage under Article 58, paragraph (1) of this Law has the right to submit a claim for compensation to the NIB or directly to an insurance company. (Article 61, paragraph 1 of the Law on Compulsory Traffic Insurance)

In more detail: https://aso.mk/zakon-za-zadolzhitelno-osiguruva-e-vo/

Insurance companies that carry out compulsory insurance business are obliged to pay funds into the Guarantee Fund, which are used to pay damage in the cases referred to in Article 58, paragraph (1) of this Law, in an amount proportional to the premium earned by individual classes of compulsory insurance in the previous quarter, for the current quarter of the current year.

The NIB may entrust the processing and payment of damage under Article 58 of this Law to any insurance company (a member of the NIB) that carries out compulsory insurance business and pays funds into the Bureau’s Guarantee Fund. (Article 60, paragraph 1 of the Law on Compulsory Traffic Insurance)

The NIB has no right to require the injured person to prove that the person who caused the damage does not want to or is not able to pay. (Article 60, paragraph 2 of the Law on Compulsory Traffic Insurance)

The injured person may initiate court proceedings against the NIB, or the insurance company, if compensation has not been paid within three months of the date the claim for compensation was submitted. (Article 61, paragraph 2 of the Law on Compulsory Traffic Insurance).

Non-life insurance

Insurance contracts that do not belong to the group of life insurance are called non-life insurance contracts. The main products of non-life insurance are:

• compulsory traffic insurance (the most widespread is motor third-party liability insurance)
• motor vehicle insurance
• home insurance
• travel insurance
• insurance of personal belongings
• insurance against the consequences of an accident
• health insurance
• liability insurance, etc.

Property insurance in brief

With property insurance you receive compensation in the event of damage to your property. The compensation cannot be greater than the damage the insured has suffered.

For insurance of crops and fruits, the compensation is determined according to the value the crops and fruits would have had at harvest time.

Note: When determining the compensation, lost profit is also taken into account, but only if this has been agreed.

If several losses occur one after another during the same insurance period, the compensation for each of them is determined and paid in full with regard to the sum insured, without reducing it by the amount of losses paid earlier in that period.

Important: When you buy a property insurance policy, be sure to ask the insurance company to give you the Insurance Terms that apply to property insurance. Read them carefully!