On The Construction Of The Insurance-Claim Prescription System

Insurance-claim prescription is a system that limits the exercising period of insurance claim,which is regulated by Section 26 of Insurance Law.However,today there are still disputes about this section.Legislation,doctrine and jurisdiction have not reached a consensus on the legal nature,period length and period starting point of insurance-claim prescription.The proper design of rules of insurance-claim prescription is of crucial importance to whether the insured’s or the beneficiary’s insurance claim can successfully exercise,and whether the proposer’s insurance purpose can truly realize.In consequence,it’s necessary to deeply examine the system of insurance-claim prescription and to optimize and rebuild it in an appropriate way.Legislative goal of the insurance-claim prescription system is aimed at encouraging the insured or the beneficiary to exercise their insurance claim rights in time,so that the investigation and payment of claims can proceed efficiently,the economic losses can be indemnified timely,and the social relationships can be stabilized quickly.However,when we keep an eye on the texts of Section 26 and compare them with the aforementioned legislative goal,unignorable defects in Section26 are revealed.Firstly,the insurance claim Section 26 refers to and the starting point of limitation period it specifies,are in contradiction with basic legal theory and civil rules of extinctive prescription in China.Secondly,compared with the extinctive prescription interests that ordinary private contract parties and the insurer are entitled to,Section 26 obviously doesn’t give the insured or the beneficiary sufficient protection,and also deviates from the modern insurance legislation concept of insurance consumer protection.What’s more,the improper provision of starting point of limitation period in Section 26 is exactly what leads to the academic disputes of legal nature of insuranceclaim prescription in China.The concept of insurance claim has double meanings: one is the primary claim,i.e.the insured’s or the beneficiary’s right to request the insurer to pay insurance money upon the occurrence of insured event.At this point,the insurer is not in default,so the claim is an optional claim for performance.The other is the claim for insurer’s liability for contract breach,i.e.the insured’s or the beneficiary’s right to request the insurer to pay insurance money when the insurer has refused to make the aforementioned due payment.At this point,the insurer has been in default,and the claim is a claim for specific performance.Scholars who deny that insurance-claim prescription is extinctive prescription mostly understand insurance claim in the former sense,and this is precisely what the wrong provision of starting point of limitation period in Section 26 misleads to.As a matter of fact,the dualistic nature of insurance claim determines that both scheduled period and extinctive prescription are possible to be used to construct the insurance-claim prescription system.The difference lies in that what the former limits is the insurance claim upon the occurrence of insured event,which is the primary claim;what the latter limits is the insurance claim when the insurer has refused to pay the primary claim,which is the claim for insurer’s liability for breach of contract.The rebuilding of the insurance-claim prescription system is to optimize the provisions in Section 26,which has two solutions: one is based on the system of scheduled period;the other is based on the system of extinctive prescription.However,from an overall perspective,Solution 1 will unnecessarily repeat the legal function of Section 21 of Insurance Law and create a value and content contradiction with Section21.Additionally,the understanding and application of insurance law will also get more complex under it.Hence,Solution 2 that bases on the extinctive prescription system is a better choice.In this sense,there is no wrong that Section 26 takes insurance-claim prescription as extinctive prescription,but its provisions of length and starting point of limitation period are badly in need to be modified.For the former,the length of limitation period of insurance claim in non-life insurance shall be extended to 3 years.For the latter,the limitation period of insurance claim shall begin at the moment when the insured or the beneficiary can claim for insurance money through litigation,i.e.,when they know or ought to know that the insurer does not perform its obligation to pay insurance money.Concrete situations of this are of three types.Insurance-claim prescription of liability insurance shall apply the general provisions of that of non-life insurance,and the special provision of Section 18 of the Fourth Judicial Interpretation of Insurance Law shall be repealed.