Romania Might Postpone Enforcement Of Mandatory Home Insurance Law

Enforcing Law 260/2008 regarding mandatory home insurance against earthquakes, landslides or floods entails, beside the drafting of technical norms, the improvement of mechanisms authorities need to ensure a coherent and continuous flow of information which, in turn, entails changes in legislation, the insurance regulator said in a press release Thursday.

The regulator added that together with the Interior Ministry, which initiated the law, it plans to require a postponement of the law.

Early November 2008, Romanian President Traian Basescu passed the law regulating mandatory home insurance. Under the law, home owners are obliged to get insurance policies and pay premiums ranging from EUR10 to EUR20, insuring homes for EUR10,000 to EUR20,000.

The law also stipulates the creation of an insurance pool as a joint stock insurance-reinsurance company.

There are currently eight million homes in Romania, of which only 8% are insured, according to the regulator’s data.

According to an estimate of the Interior Ministry, underwritten home insurance premiums will reach EUR150 million when the law is enforced.