The Office of Competition and Consumer Protection (UOKiK) imposed a fine of over PLN 5.2 million on MetLife for the use of prohibited contractual provisions. MetLife’s method of charging allocation fees in the first two years of UFK life insurance contracts was illegal – it was intended to discourage consumers from terminating contracts in the first years after they were concluded, the Office announced.
In 2016-2017, MetLife Towarzystwo Ubezpieczeń na Życie i Reasekuracji was offering individual life insurance with insurance capital funds (UFK) called MetLife Projekt Jutro. Doubts of the President of UOKiK were raised by contractual provisions specifying the so-called allocation fees. Under them, in the first year of the contract, the company deducted 75% of the invested premium, and in the second year – 45%. The consumer gradually recovered this money in the following years in the form of the so-called investment premium, with the full return only around the 14th year of the contract. Regardless of this, the company charged several other fees, such as administrative fees, for life insurance, it was stated.
“The challenged clauses were intended to make it unprofitable for the consumer to withdraw from the UFK life insurance contract. Meanwhile, under the law, the consumer has the right to terminate such a contract at any time, with a notice period, without any additional conditions. Maybe, for example, after one year. or two, say that the results achieved by the funds do not guarantee profit or even indicate the possibility of loss. In such a situation, the consumer should be able to terminate the contract without incurring excessive costs “- said the President of UOKiK Tomasz Chróstny, it was announced.
UOKiK points out that a few years ago it was loud about the so-called liquidation fees charged by insurers when consumers wished to terminate their UFK policies ahead of schedule. In some cases, this meant the loss of all customer savings.
“MetLife’s allocation fees had the same purpose as the liquidation fees. The Company, by charging them in the first two years of the contract, de facto discouraged consumers from terminating it within that period, which is unacceptable. the company has a fine of over PLN 5 million,” added the President of UOKiK.
The fine for Metlife is PLN 5,231,684. In addition, the company must inform consumers about the decision of the President of the Office of Competition and Consumer Protection and its consequences, i.e. that the challenged clauses should be treated as if they were not included in the contract. After the decision becomes final, injured parties will be able to rely on it in court to pursue their claims.
MetLife has been operating on the Polish market since 1990. It offers life insurance, including accident and health insurance, retirement products and investment funds.
Souce: UOKiK and ISBnews
