Amman, Feb. 25 (Petra) – The Lower House of Parliament on Wednesday continued deliberations on the 2026 draft Insurance Contracts Law, approving Articles 13 through 25 during a session chaired by Speaker Mazen Qadi and attended by members of the government.

The House endorsed Article 13, which regulates the consequences of non-payment of insurance premiums. The provision allows the insurer to request termination of the contract if 30 days elapse from the date of notification without payment, with compensation awarded wholly or partially, as warranted.

The article further establishes that breach of certain preventive obligations may result in forfeiture of compensation unless the insured proves that the breach did not affect the occurrence of the risk, its aggravation, or the assessment of damage.

Article 14 obliges the insured, policyholder, or beneficiary to notify the insurer of the occurrence of the insured risk and submit the required documents within the timeframe stipulated in the contract. However, failure to notify within the agreed period does not automatically result in loss of compensation rights. The insurer may claim damages proportionate to any harm suffered due to delayed notification.

Under Article 15, in cases of total loss, the insured must transfer ownership of the damaged assets to the insurer in exchange for the agreed compensation. Article 16 requires the insurer to pay the agreed financial compensation or benefit upon the occurrence of the insured risk, even if the loss results from the involuntary negligence of the insured, the beneficiary, or persons under their control.

Article 17 clarifies disclosure obligations at the time of concluding the insurance contract, stipulating that the insured is not required to disclose information that reduces the likelihood of risk, is already known to the insurer, has been waived, concerns excluded risks unless specifically inquired about, or is unknown to the insured. The article also provides that acts undertaken by an insurance practitioner on behalf of the insurer are binding on the insurer, even if the agent exceeds the limits of authority, without prejudice to the insurer’s right to seek recourse against the agent.

Article 18 prohibits the insured or beneficiary from entering into a settlement with a third party responsible for the loss without the insurer’s consent, unless the settlement serves the insurer’s interest.

Articles 19 through 24 address the concept of insurable interest across different types of insurance. Article 19 stipulates that insurance is valid only if a legitimate insurable interest exists at the time of contract conclusion or at the occurrence of the insured risk, as applicable, otherwise the contract is void.

The approved articles cover key provisions on compensation, risk, and insurable interest, aiming to clarify the rights and obligations of insurers and policyholders under the proposed legislation.

Article 13 regulates the consequences of non-payment of insurance premiums, allowing insurers to request contract termination if 30 days elapse from notification without payment, while ensuring compensation is awarded wholly or partially as warranted. The article also stipulates that breaching certain preventive obligations may lead to forfeiture of compensation, unless the insured proves the breach did not affect the risk, its aggravation, or the assessment of damage.

Under Article 14, the insured, policyholder, or beneficiary must notify the insurer of the occurrence of the insured risk and submit required documents within the contractually agreed timeframe. However, delayed notification does not automatically void compensation rights, as the insurer may only claim damages proportionate to any harm suffered.

Article 15 requires the insured to transfer ownership of damaged assets to the insurer in cases of total loss, in exchange for agreed compensation. Article 16 mandates that the insurer pay the agreed financial compensation or benefit upon the occurrence of the insured risk, even if the loss results from involuntary negligence by the insured, the beneficiary, or persons under their control.

The law also clarifies disclosure obligations in Article 17, indicating that the insured is not required to disclose information that reduces the likelihood of risk, is already known to the insurer, is waived, concerns excluded risks unless specifically inquired about, or is unknown to the insured. It further confirms that actions undertaken by an insurance practitioner on behalf of the insurer are binding, even if authority limits are exceeded, without prejudice to the insurer’s right of recourse against the agent.

Article 18 prohibits the insured or beneficiary from settling with a third party responsible for the loss without the insurer’s consent, except when the settlement serves the insurer’s interest.

Articles 19 through 24 focus on insurable interest across different types of insurance. Article 19 establishes that insurance is valid only if a legitimate insurable interest exists at the time of contract conclusion or risk occurrence, otherwise the contract is void. Article 20 defines insurable interest in personal insurance as the interest in avoiding exposure to the insured risk, which must exist at the time of contract conclusion, while Article 21 allows creditors to insure a debtor’s life up to the amount of the debt.

Property and civil liability insurance are regulated under Article 22, requiring insurable interest to exist at both contract conclusion and risk occurrence, with automatic contract termination if the interest ceases. The article also allows coverage of lost profits if stipulated and confirms that insurable interest transfers to heirs unless otherwise agreed. Articles 23 and 24 permit property insurance on behalf of anyone with a proven insurable interest and recognize that both property owners and holders of real or personal rights have an insurable interest in the insured asset.

Article 25 stipulates that insurance is permissible only if the insured risk is probable. In cases of multiple or successive risks, the risk with the greatest impact determines coverage, unless otherwise agreed.

The 101-article Insurance Contracts Bill seeks to enhance transparency and fairness between insurance companies and policyholders, establish clear contractual obligations, and provide a modern legislative framework to support the stability and development of the insurance sector.

//Petra// AJ