Tax control and insurance

Friday, March 4, 2022

It corresponds to the comptroller’s offices to advance the vigilance on the fiscal management that public officials and individuals carry out with funds, resources and assets of the State. In carrying out this activity, the comptroller’s offices are empowered to link the insurance companies that covered the goods, contracts or officials linked to the process, in the capacity of civilly liable third parties, to the fiscal responsibility processes, in order to seek compensation for the damage suffered by the administration.

From the point of view of the insurance contract, within these processes it is necessary to demonstrate the occurrence of an event covered by the respective policy in the terms of the contracted insurance, since the responsibility of the insurers is not automatic. This implies carefully analyzing the conditions of the insurance linked to the process, and applying the principles and rules that govern this contract.

In this sense, in the bonding of the guarantor, among other aspects, the insured values ​​determined in the policies, the terms of validity of the insurance, the agreed exclusions, the modalities of the contracted protection, and the existence of co-insurance must be addressed and respected. , since the public nature of the fiscal responsibility process and its protective purpose of public assets does not eliminate the application of the rules of this contract.

The above statement, which might seem obvious, is not always so in practice, to the point that it is easy to find rulings with fiscal responsibility in which basic aspects of insurance law are overlooked. Thus, to mention just a few examples, we know of cases in which the insured values ​​of various periods have been added together and the insurers are condemned for that added value, when the loss necessarily occurs and is temporarily located in a single period; or, in terms of compliance, there are not a few cases in which the protections of good management of the advance, compliance and stability are mixed without discriminating the amounts that correspond to each one of them and without proving the amount of the loss facing each of the insurance covers; also, in an inexplicable way, claims made policies are inexplicably ignored and left without effect, considering that they do not provide sufficient protection to the insured public entity; or, no less striking, we have seen convictions for the value of the deductible, when precisely that value corresponds to the insured.

Although the Comptroller General of the Republic has given guidelines to its officials on this matter aimed at clarifying the relationship of the guarantors, improving the understanding of the insurance and preventing lawsuits against the entity, as it did with Circular 005 of March 16 of 2020, the truth is that these initiatives have not been enough and must, in our opinion, be reinforced, not only at a general level but also territorially, since situations such as those raised continue to recur.

Of course, we know that in the exercise of the law legal divergences can arise on a certain point related to insurance or fiscal responsibility, however, cases such as those indicated are far from that situation, since they do not know basic aspects of insurance.

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