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Last year was an important one for the insurance industry. The earthquake and tsunami caused about $30 billion of damage, of which $8 billion was insured, and a new superintendent was appointed, bringing new regulations. More recently, the Insurance Regulator announced plans to grant greater protection for insureds under fire, earthquake and tsunami coverage associated with housing mortgage credit.

This update looks at two recent developments that are of relevance to the life and health insurance sectors. The first development was the insurance regulator's decision to delete a number of policy forms from the Register of Insurance Forms. The second was the Constitutional Court's decision in a case relating to private entities which provide healthcare coverage.

Although piracy is uncommon in Chilean waters, under Chilean law the courts have universal jurisdiction to try piracy cases. This update looks at Chilean law and a recent piracy case primarily from an insurance law standpoint. The case originated when criminal charges were filed against the prosecuted parties for their use of small boats to board fishing boats in Chilean territorial waters to appropriate the catch on board.

The strong earthquake and subsequent tsunami that recently hit Chile caused extensive and severe damage to both public and private property, including productive centres and infrastructure. Such damage had manifold legal consequences. With respect to insurance, the consequences are relevant for civil liability covers and possible subrogation actions by insurers of physical assets.

General Regulation 250, which recently entered into force, will regulate coverage exclusions or restrictions included in health, life and disability insurance policies regarding pre-existing diseases or health conditions. It is hoped that the regulation will reduce the high number of claims regarding insurers' refusals to reimburse expenses associated with undeclared pre-existing diseases.

A recent Santiago Civil Court decision confirmed the general practice of insurance subrogation. The insurance beneficiary sued the broker, arguing that the placement was not made according to the instructions given by the entity that contracted the insurance policy. Therefore, the broker should be liable for the insurance indemnity declined by the insurer.

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