Netherlands

In this chapter of our Annual Insurance Review 2023, we look at the main developments in 2022 and expected issues in 2023 for the Netherlands.

 Key developments in 2022

Class actions

In the Netherlands we have seen a flurry of new cases under the new Dutch regime for class actions (60+ since inception in 2020), including class actions against tech platforms that are related to breaches of EU privacy laws and competition law (e.g., Apple, google, TikTok). The new regime has also led to the establishment of plaintiff-side, boutique law firms that are related to foreign litigation funders. The first decisions were published regarding admissibility of claim vehicles (i.e. actual class needed) and the applicability of the new regime (regarding the cut-off date of November 2016). 

Furthermore, the first major investor’s claim against Netherlands-based Airbus and its D&O’s was initiated. The plaintiffs state investors suffered losses after buying shares in Airbus that were overpriced because the company withheld information about corruption at the company. 

As another concrete example of a class action, shareholders organization ‘VEB’ has held Philips liable for the damage caused to shareholders. In the past, certain apnea devices from Philips contained a defect which could cause severe health damage for the user. The problems with the ventilators were first reported in 2021. After Philips has reported problems with the ventilators, the market value had decreased considerable. According to the VEB more than 16 billion euros in direct damage can be traced back to inadequate provision of information about the apnea affair. The VEB has informed Philips that the VEB is prepared to go to court to obtain compensation for the shareholders.

Statute of limitations for asbestos claims

As of 21 October 2022 insurers will no longer invoke the absolute limitation period in the event of a claim from an asbestos victim against a (former) employer. In principle, an asbestos claim from a(n) (former) employee expires 30 years after the exposure to asbestos. Often, this period has already expired when the (former) employee becomes ill. Recently, the Dutch Association of Insurers, a large employer's organization and various trade unions have made new agreements about the statute of limitations for an asbestos claim. This agreement is laid down in the Covenant Institute Asbestos Victims. As a result, for an asbestos claim from an employee, it is no longer relevant when the victim was exposed. In practice, a lot of insures already ceased to invoke the absolute limitation period. 

2022 showed a relevant Supreme Court rulings regarding salvage costs:

The roofs of an agricultural business contain asbestos. When material containing asbestos was found in the drainage zones of the roof, the insured claimed compensation under his ‘environmental damage insurance’ for the costs of remediation of the soil and the costs of replacing the roof plates. On 22 April 2022 the Supreme Court ruled that a measure that is required to avert an imminent danger must be regarded as a ‘special’ measure even if would form part of normal maintenance in other circumstances. Compensation is in order if removal of the roof plates must be regarded as salvage.  

What to look out for in 2023

Climate change 

In last year’s update we included a report from the Authority for the Financial Markets (AFM) on climate change related losses that are getting more and more uninsurable in the Netherlands, and the need for insured parties to be aware of that. Flood damage is one of these risks. In the Netherlands, individual insurers have so far failed to offer comprehensive flood insurance on a large scale.

The Dutch insurers have now proposed to introduce a mixed public and private system that enables citizens and (small) businesses to protect their assets against all types of flood damage. In this system the Dutch government could enable a solidarity (compulsory) nature of an insurance solution and ideally even participate in a reinsurance pool. Time will tell if this is a realistic proposal and if the government is willing to participate and to what extent.   

Furthermore, in terms of climate change, it is worth mentioning that Shell is appealing the 2021-ruling of the Court of The Hague that Shell is obliged to reduce the CO2 emission of the group’s activities by 45% net at the end of 2030, compared to 2019. The procedure was initiated by parties including ‘Milieudefensie’ and Greenpeace Netherlands. With this ruling, the Court gave substance to the unwritten standard of care in Dutch law on the basis of the relevant facts and circumstances, the best available science on (the tackling of) dangerous climate change, and the broadly supported international consensus that human rights offer protection against the consequences of dangerous climate change and that businesses must respect human rights. Regarding the activities of the Shell group, this obligation to reduce is an obligation to achieve results. Regarding the business relations of the Shell group, including the end users, this is a serious best-efforts obligation.  

Shell has appealed against the decision. Shell states that there are aspects of the court’s judgment that are not feasible and/or reasonable, to expect Shell to achieve. Furthermore, Shell argues that customers would buy fossil fuels from other companies if – for example – Shell decided to stop selling petrol.

Pending the outcome of the appeal, Shell states it is taking steps to comply with the ruling of the Court. The first hearings in the appeal case are expected to take place in 2023/2024. 

Class actions in 2023

In 2023 more clarity is expected as to competing claim vehicles and open questions regarding the admissibility bar for class actions. We also expect more cases, in particular related to tech companies. Lastly, the new EU class-action regime for consumer cases enters into force on 25 June 2023. 

Written by Marieke Opdam.

Download our full Annual Insurance Review 2023 for more insights.