Portugal: the ‘right to be forgotten’ in the insurance market

On 22 October 2021, the Portuguese Government approved a law (Law n.° 75/2021 of 18 November), establishing the ‘right to be forgotten’ for people who have overcome or mitigated serious health issues and disabilities. The legislation aims to improve their access to mortgages, consumer credit and the associated mandatory and/or optional insurance contracts.

Under this law, which is due to come into force on 1 January 2022, insurers may no longer refuse to issue policies to anyone who has suffered from illnesses that may result in reduced life expectancy such as cancer, HIV, diabetes and hepatitis C.

As a result, it will prevent people who have overcome serious illnesses from being discriminated against when applying for loans or insurance of any kind.

Similar legislation has also been introduced in France, Belgium, the Netherlands and Luxembourg. 

The law

The new law amended Law n.° 46/2006 of 28 August and amended the legal regime of the insurance contract that was approved by Decree Law n.° 72/2008 of 16 April, in order to prohibit and punish discrimination on the basis of disability and/or the existence of aggravated health risks.

More specifically, Article n.° 3 of Law 75/2021 which establishes the ‘right to be forgotten’, guarantees that:

  1. Those affected must not be subjected to an increase in insurance premiums or excluded from any insurance contract coverage.
  2. No health information regarding a medical condition that originated from, or aggravated, health risk or disability may be collected or processed by credit institutions/insurers in a pre-contractual context after an uninterrupted period of:
    • Ten years since the termination of the therapeutic protocol, in the case of aggravated health risk or overcoming disability.
    • Five years since the end of the therapeutic protocol, in the case of overcoming the pathology before the age of 21.
    • Two years of continuous and effective therapeutic protocol have lapsed, in the case of aggravated health risk or mitigated disability.

Any discriminatory act provided for in this law constitutes an administrative offence punishable by fine, with possible civil liability.

Considerations for insurers

We anticipate that insurers will have some difficulties with the adoption and practical implementation of this law, including the execution of insurance contracts, particularly in relation to pre-contractual information and insurance premiums. This is due to some legal concepts in the law that are yet to be specified.

We believe that in order to implement this law, it will be essential to define specific categories of data and information that may be required by insurers, as well as to define standard protocols for processing such data and information.

In light of this, changes to policies and procedures for the design, regulatory approval and distribution of insurance contracts will be required.

This will certainly have an effect on the current risk analysis, pre-contractual and contractual information and procedures.

With the law coming into effect on 1 January 2022, we can only wait to see how insurers will adapt to these new procedures.

References

  • Law n.º 75/2021 - DR n.º 224/2021, Series I of 18.11.2021
  • Law n.º 46/2006 - DR n.º 165/2006, Series I of 28.08.2006
  • Decree Law n.º 72/2008 - DR n.º 75/2008, Series I of 16.04.2008

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