The Social Insurance Supervision Department of the FSC announced the results of the supplementary pension insurance activity for the first half of 2021. The information was obtained on the basis of the reports and references submitted by the pension insurance companies to the Financial Supervision Commission. The data on distribution of insured persons by sex and age as of 30.06.2021 have also been published.

The total number of insured persons in the four types of pension funds as of 20.06.2021 is 4,828,080 people, increasing compared to 30.06.2020 by 0.60 per cent.

In the system of the supplementary pension insurance as of 30.06.2021, BGN 18,469,223 thousand of net assets have been accumulated. Compared to the end of the first half of 2020, the net assets of pension funds increased by 16.48 percent.

The total revenues of the pension insurance companies for the first half of 2021 amount to BGN 113,512 thousand and increased by 10.87 per cent compared to the reported revenues for the first half of 2020. The net financial result of the companies as of 30.06.2021 amounts to BGN 33,629 thousand

Detailed information on the results of the supplementary pension insurance activity for the first half of 2021 and on the insured persons and the accumulated funds as of 30.06.2021 by sex and age are available in the section: Social Insurance Activity / Statistics / Statistics and analysis / 2021.

 The data presented from the reports of insurers in non-life and life insurance at the end of May 2021 are summarized and published on the FSC website – www.fsc.bg, section “Insurance Activity”, “Statistics”.

For the period from 01.07.2021 to 31.07.2021 the FSC received notifications from the competent authorities of Member States regarding the intention of 41 (forty-one) insurers and insurance intermediaries based in other EU Member States to operate (entry or termination of the notification) on the territory of the Republic of Bulgaria under the terms of the freedom to provide services.

The FSC received 5 (five) notifications regarding the intention of insurance companies based in Member States of the EU to operate in the territory of the Republic of Bulgaria under the terms of freedom to provide services (registering insurance companies in the FSC list of notifications), as well as 1 (one) notification regarding the withdrawal of intention of one insurance company established in an EU Member State, to operate on the territory of the Republic of Bulgaria under the terms of freedom to provide services.

As of the end of July 2021, the number of insurance companies based in other EU and EEA Member States which intend to operate in Bulgaria under the principle of freedom to provide services, increased to 430 (six hundred and thirty).

For the period, the FSC received 13 (thirteen) notifications regarding the intention of insurance intermediaries based in EU Member States to carry out insurance mediation activities in Bulgaria under the terms of freedom to provide services, as well as 11 (eleven) notifications for termination of such activity in the country. As of 30.07.2021, there are 2,294 (two thousand two hundred and ninety-four) insurance intermediaries based in EU Member States that have stated their intention to carry out cross-border insurance intermediation activities in Bulgaria

For the period 01.07.2021 – 31.07.2021 the FSC has not sent notifications to the national competent authorities of the EU Member States regarding the intention or withdrawal of the intention of the insurance companies and insurance intermediaries based in the territory of the Republic of Bulgaria to carry out cross-border activity.

As of the end of July 2021, the total number of local insurance companies that have stated their intention to carry out insurance activities in the territory of other EU and EEA Member States under the terms of freedom to provide services is 17 (seventeen), and the total number of insurance intermediaries based in the Republic of Bulgaria, which have stated their intention to carry out insurance intermediation activities on the territory of EU Member States under the terms of freedom to provide services or the right of establishment, remains 52 (fifty-two).

The updated lists of notifications are available on the FSC website in the section “Supervised entities” – “Notifications”.

The data presented from the reports of insurers in non-life and life insurance at the end of April 2021 are summarized and published on the FSC website – www.fsc.bg, section “Insurance activity”, “Statistics”.

On 3 and 4 August 2021, Boyko Atanasov, Chairman of the Financial Supervision Commission, launched a series of training seminars for supervised entities on topics related to the implementation of measures to prevent money laundering and terrorist financing provided for in the Law on Measures against Money Laundering, the Law on Measures against Financing of Terrorism and the acts on their implementation.

The main topics of the online training seminars were:

– Evaluation of the Republic of Bulgaria within the Fifth Evaluation Round of the MONEYVAL Committee of the Council of Europe;

– National risk assessment of money laundering and terrorist financing in the Republic of Bulgaria;

– Preparation of own risk assessment by the obligated persons and determination of the risk profile of their clients;

– Requirements for remote identification of customers;

– Requirements of the Law on Measures against Financing of Terrorism;

– Established trends and typologies for money laundering and terrorist financing and predicate offenses at the national and international level;

– Practices and trends identified among obligated parties in the Commission’s oversight of the implementation of the Law on Measures against Money Laundering, the Regulations for the Implementation of the Law on Measures against Money Laundering, and the Law on Measures against Financing of Terrorism.

During the trainings the experts of the Financial Supervision Commission provided an opportunity to discuss certain issues related to the application of the considered regulatory acts, set by the participants.

The topics of the training seminars were the subject of increased interest among business representatives.

The training held on 3 August 2021 was attended by 190 representatives and employees of a total of 62 companies – investment firms, collective investment schemes and other collective investment undertakings, management companies and managers of alternative investment funds.

The training held on 4 August 2021 was attended by 138 representatives and employees of a total of 75 pension insurance companies, insurers and insurance intermediaries.

The purpose of the seminars is to further the understanding of the representatives of the non-banking financial sector of the importance of compliance with the requirements of preventive legislation and their key role in maintaining the stability of the financial sector and assisting the competent authorities in preventing and detecting money laundering and terrorist financing activities.

The Deputy Chairperson of the Financial Supervision Commission, Head of the Insurance Supervision Department, took part in the program Money.bg on Bulgaria On Air TV. In the interview, Vladimir Savov noted that there are positive trends in both non-life and life insurance. In his opinion, insurers have quickly managed to adapt their activities to the restrictions imposed by the pandemic. “Digitalization in insurance is something that will continue to develop in the future,” said Mr. Savov.

Today, 28 July 2021, the Financial Supervision Commission organized an online meeting with representatives of all investment firms on the occasion of new regulations on prudential supervision of investment firms becoming effective, and in order to facilitate the bringing of investment firms in line with the applicable requirements. The topic of the meeting drew great interest and was attended by over 100 business representatives.

During the meeting, the FSC experts presented the general legislative framework for the prudential supervision of investment firms and provided an opportunity for discussion on specific issues for its practical implementation.

It was clarified at the meeting that the new legislation is largely in line with the typical business model of investment firms and focused on changing the approach to implementing capital adequacy and liquidity requirements at the consolidated level compared to current legislation.

The following topics were discussed at the online meeting:

the categories of investment firms under the new prudential regime;

own capital;

capital requirements;

liquidity requirements;

disclosures by investment firms;

reporting to the competent authorities and the European Banking Authority, including new business and technical formats;

remuneration requirements.

The meeting was held in the understanding that the new legislative framework will have a serious practical effect on the activities of investment firms, respectively good knowledge of it will enable its proper implementation and will contribute to maintaining the financial stability of the sector, a higher level of protection for investors, as well as to increasing the efficiency of the securities market as a whole.

The presented final data on the value and number of paid and filed claims under Motor Third Party Liability Insurance, including by risk groups, as of 30.06.2021 are published on the FSC website – www.fsc.bg, section “Insurance Activity”, “Statistics”, “Non-life Insurance”, “2020”. The data do not include insurance contracts that are concluded by insurers under the right of establishment or under the terms of freedom to provide services.

The Official Journal of the European Union of 13.07.2021 published a decision of the European Commission (EC) 2021/1145 of 30.06.2021, stating that on 06.01.2021 an Annex to the Multilateral Agreement between The National Offices of the EU Member States, the National Offices of the Principality of Andorra, Bosnia and Herzegovina, the Principality of Liechtenstein, the Kingdom of Norway, the Republic of Serbia, the Swiss Confederation, the United Kingdom and the National Office of the Republic of Montenegro pursuant to Art. Article 8 (1), second subparagraph, of Directive 2009/103/EC of 16 September 2009 relating to insurance against civil liability in respect of the use of motor vehicles, and the enforcement of the obligation to insure against such liability (Directive 2009/103/EC).

In accordance with the agreement, the national offices of all Member States individually shall ensure (in accordance with the provisions of their national legislation in the field of compulsory insurance) the settlement of claims in connection with insurance events in their territory caused by such vehicles normally located on the territory of the Republic of Montenegro.

In connection with the above, the Republic of Montenegro acquires the status of an associated country to the International Agreement and pursuant to Art. 8 (2) of Directive 2009/103/EC, as of 02.08.2021, all cars registered in the Republic of Montenegro have the right to enter the territory of the EU Member States, incl. and the Republic of Bulgaria, without providing data on the available Third Party Liability Insurance and the Green Card Certificate. Therefore the border control for Third Party Liability Insurance and Green Card certificate in respect of cars from the Republic of Montenegro is waived.

The European Commission’s decision also applies to cars registered in the United Kingdom of Great Britain and Northern Ireland, as that country remains a party to the Multilateral Agreement.

Today, 22.07.2021, at its meeting, the Financial Supervision Commission (FSC) adopted at the second vote an Ordinance on the requirements for the governance system of insurers and reinsurers.

The ordinance completes the national legal framework for the governance system of insurers and reinsurers in accordance with the Insurance Code (IC) and the guidelines of the European Insurance and Occupational Pensions Authority (EIOPA). Thanks to it, conditions are created for better management of the risks faced by Bulgarian insurers and reinsurers, and the guarantees for protection of the interests of the users of insurance services in the Republic of Bulgaria are strengthened. In the course of the public discussion of the Ordinance, the FSC took into account all received opinions, incl. and numerous suggestions, comments and remarks from the Association of Bulgarian Insurers.

With the ordinance, the FSC introduces into the national insurance and reinsurance legislation the following guidelines of EIOPA, which it has stated that it intends to comply with in its supervisory practice with regard to the management system of insurers and reinsurers:

1. Guidelines on the System of Governance (EIOPA-BoS-14/253 EN) and the Technical Annex thereto

These guidelines include the basic guidelines of EIOPA on the main aspects of the governance system of insurers and reinsurers, such as the requirements for the organization and operation of their management and supervisory bodies, the qualifications and reliability of their members and other key functions, risk management, structuring and operation of key functions, policies of the insurer regulating the most important aspects of its activities, internal control, outsourcing and specific aspects of the governance system at the level of a group of insurers and reinsurers.

2. Guidelines on Own Risk and Solvency Assessment (EIOPA-BoS-14/259 EN)

These guidelines include basic guidance on carrying out the important process of self-assessment of risk and solvency within the risk management system of insurers or reinsurers.

3. Guidelines on Complaints-Handling by Insurance Undertakings (EIOPA-BoS-12/069 EN)

These guidelines set out the procedures applied by insurers to deal with complaints lodged by users of insurance services.

In addition, the Ordinance provides for the FSC to issue instructions within 2 months of the Ordinance becoming effective, so as to ensure the application in its supervisory practice and the following guidelines of EIOPA:

4. Guidelines on Outsourcing to Cloud Service Providers (EIOPA-BoS-20-002)

These guidelines provide for specific requirements for the outsourcing to cloud service providers (services provided by data processing in the cloud), which are a source of additional risks for insurers and reinsurers and therefore require higher security requirements.

5. Guidelines on Information and Communication Technology Security and Governance (EIOPA-BoS-20/600)

These guidelines set out requirements to ensure compliance with the confidentiality, integrity and availability of information and information systems, as a guarantee to limit the operational risk to which insurers and reinsurers are additionally exposed as a result of the use of high technologies for storage, processing and access to data.

The new ordinance repeals Ordinance No 5 of 15.10.2003 on carrying out activity as an insurance broker and insurance agent (promulgated, SG 96/2003) and Ordinance No. 32 of 13.09.2006 on the requirements to the organization and the activity of the service for internal control of the insurer, the reinsurer and of the persons included in insurance or reinsurance group (promulgated, SG, 81/2006, amended and supplemented, issue 4 of 2010) which are issued on the basis of the repealed Insurance Act (repealed, SG No. 103/2005) and the repealed Insurance Code (repealed, SG No. 102/2015) and do not comply with the requirements of the current national and European legislation.

The ordinance provides for a 6-month period from its becoming effective, in which insurers and reinsurers should bring their policies, procedures and internal documents in line with the new requirements.