Counterfeit Insurance Guarantees: How to Protect Yourself from Fraud

“ANAC urges verifying the authenticity of insurance guarantees, whether issued by Italian or foreign companies, by directly contacting the issuing company.”

Insurance guarantees are crucial tools to secure commercial and financial transactions. They provide insurance against the risk of contractual defaults and are used both in Italy and abroad.

However, the increase in counterfeit guarantees, issued both by Italian and foreign companies, has raised concerns among industry operators. 

In response, ANAC (National Anti-Corruption Authority) has issued a warning to users, emphasizing the importance of always verifying the authenticity of the guarantee by contacting the issuing company directly.

What are Insurance Guarantees?

Insurance guarantees are financial instruments issued by insurance companies to ensure the contractual obligations of one party towards another. Here’s a detailed explanation:

1. Function: An insurance guarantee protects the creditor (the guarantee beneficiary) in case of the debtor’s default. For example, if a construction company fails to meet the terms of a contract, the insurance guarantee allows the creditor to receive compensation from the insurance company that issued the guarantee.
2. Parties Involved:
   • Debtor: The party obligated to fulfill certain contractual terms.
   • Creditor: The party for whom the guarantee is intended, receiving protection offered by the guarantee.
   • Insurance Company: The entity issuing the guarantee, committing to compensate the creditor in case of debtor default.
3. Usage: Insurance guarantees are commonly used in sectors such as:
   • Public Procurement: To ensure the completion of works or services by winning companies.
   • Real Estate Transactions: To protect the buyer of a property under construction.
   • Commercial Agreements: To ensure compliance with contracts between companies.
4. Types of Insurance Guarantees:
   • Advance Payment Guarantee: Ensures the return of advances paid by a creditor to a debtor.
   • Performance Guarantee: Ensures the debtor’s compliance with contractual obligations.
   • Ten-Year Post-Completion Guarantee: Protects the buyer of a property under construction from construction defects for ten years.
5. Benefits:
   • For the Creditor: Provides security and protection against contractual defaults.
   • For the Debtor: Can help establish trust with the creditor and facilitate agreements.
   • For the Market: Increases overall trust in transactions and commercial agreements, contributing to greater economic stability.
6. Verification:
   • Authenticity: Due to the increase in counterfeit guarantees, it’s crucial to always verify the authenticity of the document by contacting the issuing insurance company.
   • Validity: Ensure the issuing company is registered with competent authorities and that the policy follows standard models where applicable.

Insurance guarantees are essential tools for ensuring the adherence to agreements and transactions, offering protection to both the creditor and the debtor, and contributing to trust in the market.

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The Problem of Counterfeit Guarantees

Recently, numerous cases of counterfeit guarantees have emerged, issued by both Italian and foreign companies. 

These false guarantees compromise the trust and security of transactions, putting both creditors and debtors at risk. Counterfeit guarantees can also cause significant legal and financial problems for all parties involved.

ANAC Recommendations

To counter the proliferation of counterfeit guarantees, ANAC has emphasized the need to always contact the issuing company to verify the authenticity of the document. This verification is essential to avoid fraud and ensure that the guarantee is valid and reliable.

How to Verify the Authenticity of an Insurance Guarantee

1. Contact the issuing company directly: Use the official communication channels of the insurance company, whether Italian or foreign, to verify the validity of the guarantee.
2. Request specific details: Ask the company for a copy of the policy and verify the details, including the reference number, issuance date, and guarantee terms.
3. Verify the company’s registration: Ensure the company is regularly registered with competent authorities and has an established reputation.
4. Consult a lawyer: In case of doubts, seek assistance from a lawyer specializing in insurance or financial law.

Insurance guarantees are essential tools for ensuring transactions and contractual agreements, but the increase in counterfeit guarantees necessitates careful attention to verify their authenticity. 

ANAC recommends always contacting the issuing company to ensure the guarantee is valid, avoiding potential fraud, and protecting all parties involved.

Do you have more questions?