BEFORE
MR MARTIN DIMITROV
CHAIRMAN OF THE COMMISSION ON ECONOMIC POLICY AND INNOVATIONS
TO THE NATIONAL ASSEMBLY
ABOUT: Draft law to supplement the Insurance Code No. 48-202-01-42 submitted by the Council of Ministers on December 12, 2022, adopted by the National Assembly on the first vote on January 18, 2023.
DEAR MR DIMITROV,
The Association of Bulgarian Employers' Organizations /AOBR/ basically supports the draft law adopted in the first reading in the plenary hall. AOBR shares the motives of the petitioner regarding the need to introduce stronger guarantees for the operation of the "Green Card" system in Bulgaria, as well as the clarification of the powers of the National Bureau of Bulgarian Automobile Insurers /NBAZ/. The proposed strengthened regulatory framework is necessary in view of our country's commitments after joining ERM II and subsequently to the Eurozone.
The proposed bill is largely based on the analysis of the best practices and national legislation in the member states of the European Economic Area /EEA/ in relation to the "Green Card" system made by the FSC.
As a result of the comparative legal analysis, weaknesses were found in the activity of NBBAZ and individual Bulgarian insurers in fulfilling their obligations in the "Green Card" system.
The problems arise from individual Bulgarian insurers disputing the merits of claims for reimbursement of benefits paid by correspondents and national bureaus in other member states due to alleged inconsistencies in the documentation and thus hindering the function of the bureau to ensure payment in accordance with the requirements of the Internal Rules of the Council of Bureaux.
In this sense, the AOBR supports the improvement of the regulatory framework proposed in the draft law by providing additional material legal grounds for taking actions in the process of settling claims in the "Green Card" system.
The proposed creation of cumulatively available material legal prerequisites: 1) obligation to make a guarantee payment by NBBAZ; 2) an obligation to submit recourse claims to the insurer and 3) an express obligation to satisfy these claims at the expense of the bank guarantee established and maintained by the insurer in favor of NBBAZ - regulates a normative guarantee mechanism for the satisfaction of claims in the "Green Card" system . At the same time, the mechanism thus created guarantees the rights of all participants in this process, including NBBAZ and its member insurers, to realize their recourse rights in a judicial or extrajudicial manner against the persons who have unjustly enriched themselves as a result of the guarantee payment made.
The adoption of the proposed addition to the Insurance Code is in line with the intentions of the Republic of Bulgaria to join the Eurozone and Decision No. 656 of the Council of Ministers of 2020 approving the Action Plan with measures to address the subsequent commitments of the Republic of Bulgaria after joining the ERM II.
The AOBR considers the proposals made by the people's representatives between the first and second reading to be groundless, as they actually render meaningless the effectiveness of the guarantee mechanism proposed in the draft law.
WITH RESPECT,
Tsvetan Simeonov
Chairman of the BCCI Board of Directors
and AOBR Chair for 2023,
by order of AIKB, BSK, BTPP and KRIB
http://www.turbulence.tech