The Superior Court of Justice (“STJ”) has recently tried Special Appeal No. 1,970,111/MG, which concerns the statute of limitations for the insured’s claim against the insurer within the context of general insurance (not regarding civil liability).
The previous judgment by the Court of Justice of Minas Gerais (“TJMG”), had established that the initial term of the statute of limitation would be the date of the loss, in case of event insurance.
According to article 206, § 1, item II of the Brazilian Civil Code, the statute of limitations applicable to insurance matters is of one year and the initial term depends on the type of insurance:
For civil liability insurance, the term begins on the date of summons in the action proposed by the third party or the date on which the insured indemnifies the third party with the consent of the insurer (item “a”);
For other types of insurance, the term begins on the date on which the insured becomes aware of the “triggering event” (item “b”):
Art. 206. Statutes of limitations:
- 1 One year:
II – the insured’s claim against the insurer, or the insurer’s claim against the insured, counted:
- a) in the case of civil liability insurance, for the insured, from the date he is summoned to reply to the indemnification action proposed by the injured third party, or from the date he indemnifies the third party with the consent of the insurer;
- b) in the case of other insurances, from the knowledge of the triggering event;
In such judgement, Justice Nancy Andrighi interpreted the concept of “triggering event“, specified in item “b” of the article above. According to her, the triggering event (and, thus, the initial term of the insured’s statute of limitations against the insurer) occurs when the insured becomes aware of the insurer’s refusal to provide coverage, not on the day of the loss, as stated by the TJMG.
According to Justice Andrighi, the insured is entitled to insurance coverage at the moment of the accident, but it cannot yet be claimed. Only when insurance coverage is denied such right becomes a claim that may be filed against the insurer.
According to this perspective, the insurer’s refusal to pay the insurance indemnity is what gives rise to the insured’s claim against the insurer, as there is no opposition to the insured’s right to coverage prior to that point.
This position is consistent with the one adopted within the scope of Special Appeal No. 1,922,146/SP, which was tried in July 2021, also in the sense that the statute of limitations for general insurance begins upon denial of coverage, which demonstrates the consolidation of such position in the STJ’s Third Panel.
Currently, the STJ’s position seems to rule out the use of Precedent No. 229 of the same Court, which affirms that “the request for payment of compensation to the insurer suspends the statute of limitations until the insured is aware of the decision.“, despite such Precedent still being in force.
This is because, if the statute of limitations has not yet begun before the denial of coverage, the suspension of the term stipulated by the Precedent will have no practical effect.
Such understanding triggers an instant inquiry on the possibility of the insured’s claim never being time-barred even if they fail to notify the insurer.
If the statute of limitations begins only upon refusal of coverage, no term is initiated until the moment of the claim notice, allowing the insured to notify the insurer at any time.
Justice Andrighi has also analyzed this possibility. According to her decision, considering that the initial term of the statute of limitations is the refusal of coverage, it would not perpetuate the insured’s statute of limitation, as the insured is obligated to report the accident as soon as they become aware of it, as stipulated by article 771 of the Brazilian Civil Code:
Article 771: under penalty of losing the right to insurance coverage, the insured must notify the claim to the insurer as soon as they become aware of it and take immediate steps to extenuate the resulting damages.
However, despite this understanding, the law does not specify what would be the deadline for such a notification, and, according to the Superior Court of Justice, it is not the judiciary’s responsibility to do so. Besides, also according to the case law, the late notice of claims to the insurer only generates negative consequences if it causes damage to the insurer.
In conclusion, the issue involving the impacts of the insured’s inaction in the communication of the claim is highly relevant and controversial. Given that the examined judgment was not rendered under a repetitive appeals process, we will continue to monitor the STJ’s judgements about this subject to check whether it will be reconsidered or if a new summary position will eventually be edited.
Demarest’s Insurance and Reinsurance area has a specific insurance litigation team and is at your service to provide any additional information on the subject.