On Apr. 30, FIN STM consulted on proposal to amend insurance law.
Bill proposes changes to Insurance distribution act and the Insurance companies act.
Follows EU CMSN Mar. 2024 issued Reg 2024/896 re PII rise in EU OJ, see #162813.
Key Aspects
Proposed new minimum amounts for insurance brokers' liability insurance adjusted in line with the law according to EU Insurance distribution directive (IDD Dir 2016/97).
According to the Directive, liability insurance amounts or other equivalent guarantee of liability required of insurance, reinsurance intermediaries is reviewed every 5 years.
Takes into account evolution of European consumer price index published by Eurostat.
Thus ensures minimum amounts are maintained in such a way that level of protection of the liability insurance does not weaken due to the decrease in the value of money.
Effectiveness
Written statements are requested to be received by 4:15 pm on Jun. 11, 2024.
Intention is for the amendments to come into effect as soon as possible.
Oct. 2024 Legislation Passed
On Oct. 24, 2024, FIN GVT and FIN STM announced that amendments had been made to both the Act on the provision of insurance as well as to the Insurance company act.
The purpose of the amendments to the law on the provision of insurance is to update the law to reflect the newly amended EU Directive on the provision of insurance (IDD).
An insurance broker must have liability insurance approved by Financial Supervisory Authority, which covers compensation for any damages caused by professional errors.
The minimum euro amounts of the insurance broker's liability insurance according to the Act on the provision of insurance have been revised, accordingly to meet EU rules.
In the future, the amount of the liability insurance required is at least 1,564,610 euros per damage, along with a total of 2,315,610 euros per year for all relevant damages.
Minimum amounts of liability insurance are revised every five years under IDD rules.
The euro amounts of professional liability insurance or other similar collateral required from an insurance and reinsurance agent should be checked regularly so the minimum amounts of liability insurance take account of changes in European consumer index.
Smaller technical revisions are also made to both of these Acts, to meet wider needs.
The new law setting out the various amendments will enter into force on Nov. 1, 2024.
Regulators
FIN GVT; FIN STM
Entity Types
IB; Ins
Reference
Act EV 77/2024 vp, PR 10/24/2024; CP, STM046:00/2024, 4/30/2024; Reg 2024/896; Act on the Provision of Insurance, 234/2018; IDD Dir 2016/97; Citation: IDD Dir 2016/97;
