Insurer refused to pay out for an apartment or other property: what to do under Georgian law

What to do

1. Check the refusal against the policy: is the risk covered, is there an exclusion; unclear standard terms are interpreted in favour of the policyholder (Civil Code of Georgia, Art. 345); damage caused by war or other insurmountable force is covered only if expressly stipulated (Civil Code, Art. 831) — look for earthquake in the list of risks.
2. “Reported too late”: the policyholder must notify the insurer of an insured event as soon as it learns of it (Civil Code, Art. 814), but the insurer cannot rely on this if its interests were not materially harmed (Civil Code, Art. 814). “Your fault”: by law, only intent or gross negligence of the policyholder releases the insurer from payment (Civil Code, Art. 829) — simple negligence is not a ground for refusal unless the policy makes a condition (e.g., an alarm system) a condition of coverage.
3. “Information was concealed”: concealment of information at conclusion of the contract does not allow the insurer to withdraw from it if the insurer knew of the information or the policyholder was not at fault (Civil Code, Art. 808); the insurer may terminate the contract for failure to provide information within 1 month from when it learned of the breach (Civil Code, Art. 811); termination after the event does not release the insurer from payment if the concealed circumstance did not affect the occurrence of the event (Civil Code, Art. 812). An increase in risk after conclusion of the contract (e.g., the alarm was switched off) must be reported immediately (Civil Code, Art. 813).
4. Payment: after the event, the policyholder must mitigate the damage and follow the insurer’s instructions (Civil Code, Art. 830); if the insured sum is below the value of the property, payment is proportional (Civil Code, Art. 827); for a mortgaged apartment, payment is made only after the bank has been notified of the damage (Civil Code, Art. 294).
5. Procedure: request the documents (on request the insurer must issue copies of the contract, policy and annexes free of charge (Instruction on the Protection of Consumer Rights in the Provision of Insurance Services, Art. 5)) and a written, reasoned refusal; complaint (the insurer must have a written complaints procedure (same Instruction, Art. 6)) → State Insurance Supervision Service (დაზღვევის სახელმწიფო ზედამხედველობის სამსახური), which examines consumer applications about violations of their rights by an insurer (Law on Insurance, Art. 21); the Competition and Consumer Protection Agency does not examine insurance disputes (Law on the Protection of Consumer Rights, Art. 29) → lawsuit in court (limitation period for contractual claims — 3 years (Civil Code, Art. 129)).
6. Where to apply: insurer (complaint) → State Insurance Supervision Service → district (city) court.
7. Evidence: the policy with its terms, the written refusal, proof of the date of notification, fire or police reports, photos, estimates.
8. Pitfalls: filing the complaint with the Competition and Consumer Protection Agency; accepting a “reported too late” refusal without checking whether the insurer was actually harmed.

Be sure to check

• check the grounds for refusal under the policy (risk/exclusion); unclear terms are interpreted in favour of the policyholder
• late notice does not release the insurer if its interests were not materially harmed; only intent or gross negligence releases it from payment
• “information concealed” — only with fault of the policyholder, within 1 month, and not if the circumstance did not affect the event
• procedure: complaint to the insurer → State Insurance Supervision Service → court; not the Competition and Consumer Protection Agency