Settlement deadline
The period within which an insurer must pay the indemnity or an interim sum, imposed by statute for certain perils and left to contract elsewhere.
The Badinter Act of July 5, 1985 requires a motor insurer to make an offer of compensation within eight months of the accident, failing which the award carries interest at double the statutory rate. That sanction deters. Elsewhere, general insurance contract law sets no universal deadline: the insurer pays within a reasonable time, which only case law gives content to. Delay costs it no more than default interest, poor compensation for blocked cash flow. So the legislature stepped in where urgency is highest and the balance of power most uneven. For natural catastrophes, Article L. 125-2 of the French Insurance Code requires an interim payment and then the balance. The periods run from the filing of the estimate or the publication of the declaration order. Outside these regimes the deadline is contractual and expressed in days after agreement on the amount. The wording looks protective. It moves the whole difficulty onto the date of that agreement.
For natural catastrophes, Article L. 125-2 of the French Insurance Code requires an interim payment within two months of the filing of the estimate or the publication of the declaration order. The balance follows within three months. The Badinter Act of July 5, 1985 separately requires an offer of compensation within eight months of a road accident, on pain of interest at double the statutory rate.
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