Third-Party Claim Against the Insured: When Does the Two-Year Limitation Period Run?

Imagine: you are a property owner in Rezé, and you have entrusted the construction of your house to a contractor. The project was completed five years ago when a crack appears. You sue the contractor. But his insurer raises the two-year limitation period. When did this period start to run? From the date of the works? From the date of your writ?

This question, crucial for thousands of property owners, was decided by the Court of Cassation on 21 November 2000 (appeal no. 98-12.481). The issue is simple: if you delay, you lose all right to compensation.

The judges' answer is clear: the two-year period under Article L. 114-1 of the Insurance Code runs from the date the writ is served on the insured by the third party. It does not matter whether it is a direct action against the insurer or a claim against the insured. Analysis of a decision that changes the game.

The facts: a story that happens every day

In 1990, an agricultural land grouping (GFA) entrusted a developer with the construction of a property complex on land in Carquefou. The developer obtained a building permit, but it was withdrawn by prefectural order in 1992. The co-owners, dissatisfied, changed architect.

The developer, considering the withdrawal wrongful, sued the GFA on 11 April 1994 for compensation of €150,000 for investments made and unforeseen events. However, the GFA had taken out public liability insurance with Generali. Generali refused to cover the loss, arguing that the two-year limitation period under Article L. 114-1 of the Insurance Code had already expired.

The central question: when did this two-year period start to run for the insurer? For the GFA, the starting point was the writ of 11 April 1994. For Generali, it should date back to the withdrawal of the permit (1992), more than two years before the writ.

The Rennes Court of Appeal ruled in favour of the GFA, and the Court of Cassation confirmed. Generali's appeal was dismissed.

The court's reasoning — analysed

Article L. 114-1 of the Insurance Code provides that all actions arising from an insurance contract are time-barred after two years from the event giving rise to them. But the event varies depending on the nature of the action.

In this case, the GFA (the insured) had been sued by the developer (a third party). The insurer, Generali, raised the limitation defence, arguing that the event was the withdrawal of the permit. But the Court of Cassation recalled that the special provisions of Article L. 114-1 are not limited to claims involving liability insurance. In other words, the period may run from the writ itself, because that act constitutes the third party's claim.

The judges therefore held that the starting point of the limitation period was 11 April 1994, the date of the writ. Since Generali was joined as a party after that date, its action was not time-barred. This reasoning is essential for property owners: if you sue your builder, his insurer cannot raise the limitation period by going back to a date before your action.

The decision confirms earlier case law (Civ. 2e, 11 June 1998, appeal no. 96-17.543) which already accepted that the writ could be the triggering event. This is a protective position for injured third parties.

What this means for you — practically

For a landlord in Rezé: if a tenant sues you for water damage, your public liability insurer cannot invoke the two-year limitation period from the date of the loss. The period runs from the writ. You therefore have two years from that date to claim against your insurer.

For a tenant in Carquefou: if you suffer harm caused by the landlord (e.g., latent defect), you must sue the landlord within two years of discovering the defect. But the landlord's insurer cannot impose a shorter period on you.

Take a concrete example: a property owner in Nantes discovers water infiltration in January 2020. He sues his builder in January 2022. The builder's insurer, Generali, refuses compensation, arguing that the loss dates from 2020. Thanks to this decision, the owner can succeed: the period ran from the writ of January 2022.

If you are in this situation, you should: 1) keep proof of your writ; 2) inform your insurer within five days of the writ; 3) not wait more than two years to take action against the insurer.

Four tips to avoid this type of dispute

• Keep all your project documents: contracts, invoices, correspondence, building permits. In case of dispute, you can prove the date of events.
• Act quickly: as soon as you notice damage, do not wait. A prompt writ sets the starting point of the limitation period for the insurer.
• Inform your insurer without delay: most insurance policies require notification of a loss within five working days. Failure to do so may result in exclusion of cover.
• Consult a specialist lawyer: a professional will be able to determine the exact starting date of the limitation period and prevent you from losing your rights.

Further reading: related case law and developments

This decision is part of a protective line for third parties. Already in 1998 (Civ. 2e, 11 June 1998, no. 96-17.543), the Court of Cassation had ruled that the writ constituted the starting point of the limitation period for a third party's direct action against the insurer. The 2000 judgment extends this principle to claims by the insurer against the insured.

More recently, the Court of Cassation clarified that the two-year limitation period does not run if the insurer has acknowledged the right to cover (Civ. 2e, 10 September 2020, no. 19-18.564). Caution: a mere offer of compensation does not amount to acknowledgment.

The trend is therefore towards protection of the third party: insurers cannot hide behind an early limitation period. But note, the two-year period remains mandatory: once it expires, the action is inadmissible.

Frequently asked questions

When does the two-year limitation period run for a third-party claim against the insured? The period runs from the date the writ is served on the insured by the third party, and not from the date of the loss.

What should I do if my insurer refuses to cover me on limitation grounds? Check the date of the third party's writ against you. If it was served less than two years before your claim against the insurer, the limitation period has not expired.

Can I sue my insurer directly without first suing the insured? Yes, that is a direct action. The period then runs from the date the insurer is served with the writ.

What are the risks if I delay? You lose all right to compensation. The two-year limitation period is a matter of public policy: the judge may raise it of his own motion.

Does this case law apply to all insurance contracts? Yes, Article L. 114-1 is general. Only a few types of insurance (e.g., construction) have special rules.

Are you in a similar situation? A first 30-minute consultation with Maître Zakine (€45) can save you months of litigation — and often much more. Book an appointment →