On 1 September 2015, the Official Gazette published the Financial Supervisory Authority (“FSA”) Norm no. 17 of 2015, which determines the level of contribution owed by insurance undertakings to the Insurance Guarantee Fund (“IGF” ). It is likely that the FSA published this norm in response to concerns that contribution amounts may increase due to the recent Astra insolvency and to explicitly cover the branches of the Romanian insurance undertakings operated in other EU member states.
The newly published norm does not modify the contributions Romanian insurance undertakings and their branches operating in other EU member states are required to contribute to the IGF. The contribution amounts remain:
- 1% of the gross cashed-in premiums for general insurance; and
- 0.4% of the gross cashed-in premiums for life insurance.
The main role of the IGF is to guarantee the payment of indemnities and damages derived from voluntary and mandatory insurance policies if an insurance undertaking becomes bankrupt. Please click here for a recent article detailing the changes brought by the FSA to the IGF’s activities.