On December 13, 2024, the Civil, Agrarian, and Rural Chamber of Colombia’s Supreme Court of Justice (“CSJ”, by its acronym in Spanish) issued ruling AC6958-2024, rejecting a cassation appeal filed by an insurer involved in a liability case.
Background
The insurer argued that the court of appeals had imposed an additional requirement not established in Article 184, numeral 2, subsection c of the Financial System Statute (“EOSF” , by its acronym in Spanish). According to the insurer, this provision only mandates that policy coverages and exclusions be presented in “highlighted characters.” However, the insurer contended that the appellate court overreached by interpreting this to require bold, underlined specifically, or similarly emphasized text.
Court’s Analysis
The CSJ dismissed the insurer’s arguments, emphasizing that the insurance contract was entirely written in uppercase letters, making it challenging to effectively differentiate exclusions from other clauses. The CSJ ruled that the exclusions did not meet the statutory requirement of being “highlighted” in a way that the insured could clearly identify them in contrast to the rest of the text.
The CSJ noted that merely using uppercase letters for the entire policy text failed to provide adequate distinction. It stated that effective highlighting could involve the use of bold, underlined, italicized text, or a larger font size to ensure clarity.
The CSJ remarked:
“Although the appellant claimed that the appellate court improperly assessed the insurance contract by overlooking that the coverages and exclusions were presented in ‘highlighted characters’ (as they were written in uppercase), it failed to demonstrate any factual error or its significance. The Tribunal deemed the requirement unmet because, with the entire policy written in uppercase, the exclusion stated in subsection d) of numeral 6 in the special conditions lacked any distinguishing feature, such as bold, underlined, italicized text, or larger font size.”
Implications
This decision underscores the importance of clear and distinguishable formatting in insurance contracts to meet legal standards and ensure transparency for policyholders. Insurers must take proactive measures to differentiate key provisions, such as exclusions, to avoid disputes over compliance with statutory requirements.
