ESICUBA sets out currency unification implications for Cuban insurance policies

Photo by tiago claro

Cuba’s state insurance company ESICUBA (Seguros Internacionales de Cuba SA) has issued an official note indicating how the process of monetary and exchange rate unification will affect its clients both individual and corporate. ESICUBA reported that following currency unification on 1 January all current policies will maintain current rates, until expiration.  It said that Current policies written in Cuban Peso (the CUP) will maintain their terms and conditions. Current policies in Cuban Convertible Pesos (the CUC) whose policyholders are Cuban citizens and foreigners will see values, insured limits and premiums revalued to the CUP at the exchange rate of CUC1 to CUP24, while all other terms and conditions will continue to apply.  

ESICUBA also said that current policies issued in CUC whose policyholders are legal entities (state companies, Cuban mercantile companies, joint ventures, Asociación Internacional Economica (AEI), foreigners, and state budgeted units) will convert their values, insured limits and premiums to CUP at the exchange rate of 1 to 1, maintaining all other terms and conditions. The company said that all current policies issued in foreign currency will keep their values, insured limits and premiums expressed in the currency in which they were written until their expiration. All operations and transactions (payment of premiums, payment of indemnities, returns of premiums, bonuses) must, ESICUBA noted, be modified to CUP at the official exchange rate against foreign currencies, as determined by the Central Bank of Cuba, while maintaining all other terms and conditions. It further noted that medical expense insurance will retain the same level of service, but values ​​and premiums must be recalculated to CUP at the exchange rate of 1 to 24, while   travel insurance will retain its same terms and conditions expressed in foreign currency. ESICUBA noted that in each case the currency modifications will be included by endorsement of the policies concerned and renewals and new policies will now be written in CUP based on the risk declaration made by each client. The company said that all legal entities local and foreign now needed to assess the sufficiency of their insurance in terms of values ​​and insured limits in the event of the occurrence of a covered claim