FSC: clients of bankrupt Olympic insurance company will be compensated

The management of the Financial Supervision Commission (FSC) has no data on what is happening in the insurance services market and has not received any warning signals from the already released deputy chairperson, Ralitsa Agayn. This is said in the position of the regulator sent to the media on 22^nd of August. FSC assure that they will do their best to help pay the damages to the Bulgarian citizens who have suffered from the bankruptcy of the Cypriot insurance company "Olympic".

Meanwhile, insurance companies warn that there is a risk to the Third Party Liability insurance market because of a shortage of funds, but they also assure that the sector is continuously checked and that no panic has to be created on the market.

Bulgarian insurance companies insist on urgent changes in the insurance code due to the expected new wave of third party liability claims, which can not be covered without increasing the cost of the insurance. The increase is also not an option for companies because they expect a significant outflow of customers.

What needs to be done is to have a clear methodology for determining the indemnities in individual cases and individuals.

The reason for the sharp increase of the insurance is a decision of the Supreme Court of Cassation, which extends the circle of people entitled to compensation. Thus, in the case of a death in a car crash, the right to money has, besides close relatives, also anyone who can prove a deep emotional connection with the deceased.

It is unclear which companies can afford such an increase. That is why the sector relies on the National Assembly for new amendments. MPs undertook to present them by 7 September.

In a statement to the media, the Financial Supervision Commission today announced that a new risk analysis has been commissioned in the sector, and that the prosecutor's office has begun an investigation into the outgoing FSC deputy head, Ralitsa Agayn.

FSC also pointed out that they had never been informed of the risks associated with the bankruptcy of Olympic Insuranxce Company and that each Deputy Chairperson had own area of responsibility. In this case, Ralitsa Agayn was in charge of insurers.