The Duty of Reporting the Loss on Time to the Insurer in Liability Insurance

Abstract

Some legal systems, specifically the ones that are subject of matter in this paper, have incorporated an obligation of prompt notice of the loss to the insurance company. That same rule states that insurance company may only deduct from the settlement an amount that correspond to the damages that late notification cause them.

This paper intends to be a critical analysis about the mentioned rule, mainly focused in the Colombian case, but also taking into account the matter in other countries, like Spain, Mexico, Bolivia, Argentina and Brazil. With this approach we will analyze different elements such as the actuarial and budget implications, the premium calculation, policy underwriting, efforts that are essentially aimed at giving the rule obligatory force and binding power, so it accomplishes its purposes.