First pageNewsAmendments to the financial supervisory authority’s norm no. 20/2017 regarding mtpl insurance and publication on the financial supervisory authority’s website of the proposal of a new norm regarding the insurance activity performed in romania by third country insurers

Amendments to the Financial Supervisory Authority’s Norm no. 20/2017 regarding MTPL insurance and publication on the Financial Supervisory Authority’s website of the proposal of a new norm regarding the insurance activity performed in Romania by third country insurers

On the official website of the Financial Supervisory Authority (the "FSA"), there has been published for public debate a new norm modifying the FSA’s Norm no. 20/2017 regarding motor third party liability insurance ("MTPL") in Romania ("Norm 20/2017").

According to the information uploaded on the FSA’s website, it appears that said norm aims to modify and repeal several provisions of Norm 20/2017 which are the subject of discussions with the European Commission in the infringement case no. 2018/4075.

The main amendments brought by the new norm refer to the repeal of several obligations on MTPL insurers to notify the FSA. In this regard, it is worth mentioning that it has been repealed the obligation of MTPL insurers to notify the FSA regarding the intention to change the premium rates at least 60 days prior to the application of the new premium rates, as well as the obligation to transmit to the FSA the report prepared by the actuary approved by the FSA certifying that the premium rates have been calculated in accordance with the legal provisions in force.

Moreover, the obligation of MTPL insurers to perform quarterly analyses as regards the level of sales and administrative expenses has also been repealed together with the obligation to use in the calculation of the premium rates the same segments of uniform risks that are used in the calculation of the reference rate. Also, the obligation to use other uniform risk segments only with the prior approval of the FSA shall no longer be applicable.

Furthermore, the new norm repeals the prohibition on offering, promoting and marketing MTPL insurance at insurance premiums higher than those resulting from the application of art. 11 of Norm 20/2017, as well as the obligation of the MTPL insurers to notify the FSA regarding the intention to change the direct settlement fees and to communicate such new fees to the FSA.

On the official website of the FSA, there has also been published for public debate the proposal of a new norm regulating the insurance activity performed in Romania through branches of third country insurers.

This new norm repeals the FSA’s Norm no. 26/2016 on the supervision of branches of third country insurers and aims to update the legislative framework following the United Kingdom’s exit from the European Union.

This new norm shall govern aspects related to:

a) the authorization conditions for performing insurance activity in Romania through branches;

b) the conditions for performing the activity;

c) the quantitative and qualitative requirements regarding the performance of the activity;

d) reporting and publication requirements.

Also, for the first time the new norm contains specific provisions applicable in case of the withdrawal of a Member State from the European Union. In such case, it is stipulated that the insurers may opt between the voluntary liquidation of the portfolio or the transfer of the portfolio to other insurers headquartered in one of the Member States.

The new norms mentioned above shall enter into force on the date of their publication in the Official Gazette of Romania.

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