The Romanian Financial Supervisory Authority (the “FSA”) recently announced that it submitted, to the Romanian Parliament and the Ministry of Public Finances (the institution with legislative initiative prerogative in this regulated industry), a draft legislative proposal for a new law on motor third party liability mandatory insurance (the “Draft Law”). 

The FSA prepared the Draft Law following lengthy consultation with professional associations representing insurers and transporters, as well as other agencies and institutions. The FSA commented that the Draft Law is aligned with European directives in this field and reflects validated practices in other EU Member States. 

The Draft Law seeks to regulate: the scope of motor third party mandatory insurance; exemptions from such mandatory insurance; contracts/policies for motor third party mandatory insurance; direct set off between insurers; limitations on insurer’s liability; criteria for the determination and payment of damages; and facilities and penalties applicable to insurers and the policyholders.